Highlights of our full range of training courses / Workshops:
Lean & Agile Supply Chain / Inventory Modelling
Lean & Agile Manufacturing Planning & Control
Operations Management / Team Leader Training
Step Change Management / Business Process Reengineering
Continuous Improvement
Procurement (Purchasing & Supplier Management)
IS / IT / e-commerce
Product Management / New Product Introduction / Quality Management
Bookmarks for this topic below:
Our full range of training
Relevant Training / Workshops
Expert Systems / Tools
Relevant Further Reading
Relevant Training Course / In-house Workshop Highlights:
M15 Agile Manufacturing
SSC07 Strategic Supply Chain Management
S02 Business Process Reengineering
S03 Vision of a World Class Organisation
S04 Strategic Capacity Management
Expert Systems / Tools:
Agile Manufacturing Self Diagnosis
Relevant Further Reading:
The following further articles were mentioned in this paper:
a. Permanently Maintained Website Articles:
Lean Manufacturing
Lean Supply Chains
Just in Time
Materials Management and Stock Control
Business Process Re-engineering
Kanban
New Product Development & Introduction
Demand management
MRP
Capacity Management
b. Previously Featured Articles from our Archives
(Up to 2 per organisation available on request):
Previous Techniques:
T007: "CARAP" (Process effectiveness measurement, or why OEE / OME is for the birds)
Previous Malpractices:
M005: Economic Batch Quantity EBQ / EOQ: The worst way to set batch sizes
M007: The Cost of the Costing System (Or why you do not understand your
product costs, however sophisticated your costing system is, without
firstly simplifying the process.)
|
Agile Manufacturing
This article describes key attributes required for you to become "Agile".
(The phrases "Efficient Consumer Response"
in the food industry and "Quick Response" in
the clothing industry have been used to describe similar features).
- Do you think your customers make unreasonable demands on you?
- Have you tried "Lean manufacturing" and find
you now have shortages?
- Do you need a well stocked finished goods warehouse or distribution centre to match
customer required lead-times?
- Do you have obsolescence, or obsolete stock?
- Are you carrying too much spare capacity?
- Are plan changes and expediting significant features of your business?
If you are seeking the keys to agility and the solutions to the above
problems, read this article. (Because it could mean that
your Agility is inadequate!)
Links to
related training and further reading on
left
Agile manufacturing is a concept designed to make your
business more flexible, with many themes. It attempts to satisfy
customer needs, however unreasonable these may at first seem in
relation to your ability to achieve them, based on the three
principles:
- "Customers do not want choice. They want what they
want" (& generally now) ("Agile Product
Development for Mass Customisation"; David M
Anderson & Joseph B Pine II).
- "EOQ should be what the customer wants" (See
Previous Malpractice 005: "Economic Batch
Quantity EBQ / EOQ: The worst way to set batch sizes"
- "Enriching the customer" (solving their unique
problem by (if necessary) modifying your product or service)
("Agile Competitors and Virtual Organisations: Strategies
for enriching customers", Goldman Nagel & Preiss)
"Agility" includes "leanness"
because a high stock or
spare capacity method of providing
flexibility to changing customer demands or adversity is not a
viable financial option. In the UK at the moment we are witnessing an
unprecedented growth in warehousing to store the off-shore manufactured goods,
(which have been manufactured "Just In Time").
Agile Manufacturing demands the near elimination of
finished goods by increased
flexibility in terms of the ability:
- To determine customer needs quickly and continuously
reposition the company against it's competitors
- To design things quickly based on those individual needs
- To put them into full scale, quality, production quickly
- To respond to changing volumes and mix quickly
- To respond to a crisis quickly
This overcomes an opposite problem of lean manufacturing,
namely shortages. I.e. if there is little
stock in the system and demand grows in volume or mix, above the
design parameters of the system, shortages will occur. Integrated
MRP / JIT systems (see Materials
Management and Stock Control) partially solved this
problem by adding back a forecast, but did not really tackle the
need to forecast by specifically targeting lead-time. Leanness should not be viewed as a
prerequisite to agility since this would miss the opportunity to
start work on the additional agile requirements. But agility has
major implications for:
- Organisation
- Business processes
- Operations processes and equipment
- People versatility and mobility
- Recruitment and training
This level of flexibility cannot be achieved without:
- Some degree of Leanness.
- Specific individual customer focus.
- Regular Business Process
Re-engineering re-segmenting the business
processes including the operations processes into
"virtual" transient organisations or teams with
individual or small customer group aligned objectives.
- Partnering with other organisations to enable this, from
a pre-qualified group of potential partners (so that
start-up issues are minimal). This is a logical extension
of "lean"
supplier relationships, which in practice generally last
for the life of the product. The difference here is that
the product life cycles are shorter.
- Selective, flexible use of performance management.
- Flexible business processes, particularly sales,
production planning, purchasing & manufacturing.
- Almost no work in process.
- Standardisation of products processes and tools.
- Skill management processes.
- Empowered, innovative, flexible multi-skilled, well
trained, mobile people, and / or the ability to sub-contract or
hire temporary labour quickly for less demanding jobs and
to train all people quickly at all skill levels.
- Low absenteeism levels.
- Low equipment breakdown levels.
- Simultaneous engineering of product and process including
customer and supplier involvement in the product
development process. (See New Product Development
& Introduction.)
- Capable, reliable processes. (See Previous
Technique T007: "CARAP" (Process effectiveness measurement, or
why OEE / OME is for the birds)")
- Rapid response, supply chain which may include key
supplier systems integration. I.e. direct links between
the customer’s customer demand and the production
planning process of the supplier.
- Pull systems based on this demand. (See Materials
Management and Stock Control)
- Regular customer feedback into the design process.
- Rethinking the management accounting systems and making
them appropriate, accurate, but not necessarily precise. (See
M007: The Cost of the Costing System (Accounting
Malpractice) (Or why you do not understand your product costs, however
sophisticated your costing system is, without firstly simplifying the
process.))
- Excellent communications channels and maintenance of
flexible communications network.
- Resolution of legal, ethical and confidentiality issues
involved in partnering.
- Simulation and modelling.
- Comprehensive lot traceability.
- IS / IT used with the specific aim of reducing response times, or not at
all. It has been argued that the transparency of demand through the supply
chain via portals, supply chain integration tools and speed of communication
afforded by modern computer systems etc. aids this process. Our experience
of these tools is that they can be a barrier to Agility because of their
complexity and their inherent inflexibility. For example one of our clients
visited 4 differently formatted customer internet scheduling portals,
printed and analysed the contents, only to find that schedule changes were
often within their manufacturing lead-time. Computers are great at repeating
identical tasks at great speed and not thinking about it.
Agility requires doing new things quickly and thinking
about it. Not quite the same thing! Our solution in this case was
to provide an interface to each portal which imported the demand into a
spreadsheet, which then analysed the current schedule verses the previous
and highlighted short term changes within lead-time for immediate action.
- The management processes to organise these things. The
process has been likened to managing a hospital accident
and emergency department.
A more comprehensive list is contained in our 118 point "Agile
Manufacturing Self Diagnosis".
Examples of agile supply chain developments under this banner include:
- Universal product codes, which were used throughout the
supply chain and bar coded. This avoids the problem of
interpreting the sales data provided by your customer
from their item numbers to your item numbers. If for
example you are selling through several outlets it can be
extremely difficult to consolidate demand data provided
by them, because of the translation process required.
- Electronic Point of Sale (EPOS) equipment captured the
sales data and communicated that back to the next tier in
the supply chain electronically where demand is
consolidated. In effect the notification of the sale
becomes a purchase order. An alternative method of notification is returnable
packaging, which simply acts as a Kanban.
- Because the point of sale determined the destination, the
supplier was able to replenish stock at the appropriate
outlet (not via the central warehouse).
- Direct scheduling links between manufacturing and
suppliers bypassing purchasing (who have previously
arranged contracts with pre-qualified suppliers).
- "Demand management"
which is discussed in detail elsewhere. There are many
industries where agility is vital such as where genuine
seasonal or short product life demand is exhibited.
However there are more examples where uncertain demand
could be managed better to reduce artificial demand
fluctuation.
Agile materials management & stock control & capacity
management are a must. For this reason it is
unlikely that over-sophisticated computer-based approaches will succeed over
simple approaches. One of the mechanisms to achieve agility is
the ability to provide forecasts throughout the supply chain of
forthcoming demand without the buffering encountered in current
supply chains. This is a significant challenge to the
transparency of demand through the supply chain, without the
intervention of inventory planners. For example the whole ethic
of production planning is to create a stable plan for
manufacturing to produce efficiently. Agility requires, not constant
changes of plan to satisfy changing customer requirements, but very short lead-times. There is a switch of
emphasis here from factory stability, to the customer need (not
to be confused with the sales manager’s wishes). This has a
major impact also on production planning and control whereby a product is earmarked for a particular customer fairly
early on in the process so that customisation may proceed from
that point. This is opposed to the techniques of aggregation
connected with MRP systems
and is more akin to a make-to-order environment albeit that one
product may be very similar to the preceding one. An obvious
prerequisite of course is that lead-times are short.
In conclusion:
- The principle aim of lean manufacturing is to reduce waste
- The principle aim of agile manufacturing is to satisfy customers!
- These two concepts are not mutually exclusive, but they are different
and the task list to achieve them is different!
To join our research project on this subject and receive a free copy of our
118 point
"Agile Manufacturing Self Diagnosis"
Contact Us. (This service is only
available to UK manufacturing businesses.)
________________________________________________________________
|
