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The global chip shortage reminds me of the "just in time" training that corporate mandated for all engineers at my large cap aerospace company about ten years a

The global chip shortage reminds me of the "just in time" training that corporate mandated for all engineers at my large cap aerospace company about ten years ago. "Is it always better to avoid having spare parts? Maybe in some cases..." "No," the older engineer a few seats away from me interrupted. "Keeping extra inventory is a waste of money." He actually thought that redundancy is a waste and selecting parts doesn't involve any consideration of uncertainty...

prometheus76 4y ago
That's one of the main presuppositions in Lean Manufacturing that is so entrenched and so insidious. What's even more annoying is when managers who have worked in a Lean environment come over into our industry of steel fabrication (high-mix low-volume, where lean is low-mix high-volume), and they assume that 1) we're screwing up because nothing is consistent in our charts and graphs and 2) that if they just make us do Lean stuff, it will magically improve. It leads to disaster every time.
- ngrilly 4y ago
  Lean manufacturing is a lot about avoiding waste, but it doesn't necessarily mean removing all buffers and stocks, which is a type of waste, if this is causing a much worse type of waste, which is making the entire production line useless because it is missing input material. I really think "lean manufacturing" = 100% JIT is a misconception and an over-simplification.
  - actionfromafar 4y ago
    And wasn't it notably Toyota, inventors of lean which had a decent stock of components? (Not huge perhaps, but better than a lot of competitors.)
  - prometheus76 4y ago
    The argument becomes how much buffer and stock do you need? How long can you fade a falloff in supply? One hour? One day? One week? What is "wasteful" vs. what is wise?
    - ngrilly 4y ago
      Exactly, which is a much more sane and useful discussions to have, and something any serious process engineer will do using for example a simulation.
pif 4y ago
> "Keeping extra inventory is a waste of money." But he is right! Extra inventory has a cost. Each cost increases the final price. And the customers, they don't buy from you because you have extra inventory in case of a global pandemic (as well as they don't buy from you because you employ local staff or because you pay them well or because you make an actual effort to reduce your carbon footprint): no, customers buy cheap. Whenever you are tempted to criticize a corporation about some decision they took, do consider those pesky, cheap customers first.
TeMPOraL 4y ago
So perhaps a good counter would be: "No, keeping spares is insurance." This way, the costs of keeping extra inventory is acknowledged, while underscoring it also buys you something. Whether or not you need it, or how much, is for discussion, but treating spares as pure waste by definition doesn't feel responsible, and is how you end up in trouble if there are supply chain disruptions - whether global or local. And in more general sense: money is indeed cheaper to store than physical items, but can only substitute for them if, at the time you need those items, you can actually buy and get them.

prometheus76 4y ago

That's one of the main presuppositions in Lean Manufacturing that is so entrenched and so insidious. What's even more annoying is when managers who have worked in a Lean environment come over into our industry of steel fabrication (high-mix low-volume, where lean is low-mix high-volume), and they assume that 1) we're screwing up because nothing is consistent in our charts and graphs and 2) that if they just make us do Lean stuff, it will magically improve. It leads to disaster every time.

ngrilly 4y ago
Lean manufacturing is a lot about avoiding waste, but it doesn't necessarily mean removing all buffers and stocks, which is a type of waste, if this is causing a much worse type of waste, which is making the entire production line useless because it is missing input material. I really think "lean manufacturing" = 100% JIT is a misconception and an over-simplification.
- actionfromafar 4y ago
  And wasn't it notably Toyota, inventors of lean which had a decent stock of components? (Not huge perhaps, but better than a lot of competitors.)
- prometheus76 4y ago
  The argument becomes how much buffer and stock do you need? How long can you fade a falloff in supply? One hour? One day? One week? What is "wasteful" vs. what is wise?
  - ngrilly 4y ago
    Exactly, which is a much more sane and useful discussions to have, and something any serious process engineer will do using for example a simulation.

pif 4y ago

> "Keeping extra inventory is a waste of money." But he is right! Extra inventory has a cost. Each cost increases the final price. And the customers, they don't buy from you because you have extra inventory in case of a global pandemic (as well as they don't buy from you because you employ local staff or because you pay them well or because you make an actual effort to reduce your carbon footprint): no, customers buy cheap. Whenever you are tempted to criticize a corporation about some decision they took, do consider those pesky, cheap customers first.

TeMPOraL 4y ago

So perhaps a good counter would be: "No, keeping spares is insurance." This way, the costs of keeping extra inventory is acknowledged, while underscoring it also buys you something. Whether or not you need it, or how much, is for discussion, but treating spares as pure waste by definition doesn't feel responsible, and is how you end up in trouble if there are supply chain disruptions - whether global or local. And in more general sense: money is indeed cheaper to store than physical items, but can only substitute for them if, at the time you need those items, you can actually buy and get them.