As lean production is dependent upon small lot sizes, small lot sizes are dependent upon quick changeovers. If set-ups or changeovers are lengthy, it is mathematically impossible to run small lots of parts with low inventory because large in-process inventories must be maintained to feed production during changeovers.
For example, large stamping dies commonly took hours to change until the development of quick die change methods (Single Minute Exchange of Die, or SMED). Long changeovers necessitate cycle times well below the Takt time, and hence a buildup of inventory to supply production while the die is being changed (see Pull Scheduling for a discussion of Takt time).
MoreSteam Note:
The editors are familiar with an appliance plant that is a good example of changeover problems. In order to minimize capital investment when the plant was launched, many dies were designed to make multiple parts. Not a bad idea in and of itself, but to accomplish this mission the dies had to be reconfigured in the tool room by adding or removing bolt-on modules.
As a result, changeovers between parts took as long as eight hours. Massive in-process inventories were required to maintain production levels while the dies were reconfigured. The short-term decision to reduce investment through common dies was more than offset by the increase in inventory and tool-room costs! The System Dynamics were clearly not considered when the initial investment decision was made.
Single Minute Exchange of Die (SMED)
SMED was developed by Shigeo Shingo in Japan in the sixties and early seventies at Toyota and other Japanese firms. The impetus was to reduce costly inventories and improve efficiency.
An important foundation to the SMED system is the distinction between changeover work that occurs while the machine is not running, called Internal Setup, and preparatory work that occurs while the machine is running, called External Setup. At the point in time when SMED was