tag:blogger.com,1999:blog-12248127048392614152024-02-08T12:10:15.298-08:00High-Variety Manufacturing - Issues and IdeasHigh-variety manufacturing presents a set of unique challenges for a company, whether a mass customizer, job shop, build-to-order, high-mix low-volume, or other type. These manufacturers must approach manufacturing throughput, lean, product management, sales, order processing and other functions differently than a mass producer. In this blog I hope to bring to light some of the unique issues and discuss ideas as to how to become more competitive, productive, and profitable.SNG - Valent Grouphttp://www.blogger.com/profile/15518673171412078909noreply@blogger.comBlogger21125tag:blogger.com,1999:blog-1224812704839261415.post-28260219985827282082008-11-09T07:06:00.000-08:002008-11-09T07:14:19.106-08:007 Myths of ConfiguratorsI have just published a white paper, "7 Myths of Configurators," that is available at <a href="http://www.valent-group.com/Resources.html">www.valent-group.com/Resources.html</a> . This paper focuses on the misconceptions associated with customer-facing configurators that lead to less-than successful deployments. It also discusses some of the methods to avoid these mistakes.<br /><br />The 7 Myths are:<br />1. A Configurator Is a Strategy<br />2. The Primary Justification of a Configurator is Increased Sales<br />3. Who the Sales Force Is Doesn't Matter<br />4. Customers Want to Choose From Every Possible Option the Company Offers<br />5. Engineering or Configuring - Who Cares?<br />6. If It's Technically Possible, Build It Into the Configurator<br />7. A Configurator Is an End-to-End Business System<br /><br />I invite you to review this paper and offer your comments, criticisms, and own experiences.SNG - Valent Grouphttp://www.blogger.com/profile/15518673171412078909noreply@blogger.com3tag:blogger.com,1999:blog-1224812704839261415.post-26433149045283654662008-11-08T06:17:00.000-08:002008-11-08T06:20:03.558-08:00SurvivingMuch is being and will continue to be written as to how companies should survive the recession. I need to add my own brief comments to this topic.<br /><br />1. Focus on margins, not market share or gross revenue. Too many companies will take any job no matter the profitability (if any). If you do this, and unless you are sitting on a huge cash reserve, you will end up spending your way out of business just to perform those jobs. A focus on financial health, now more than ever, is critical, and underperforming lines of business are not worth maintaining. Rationalize products and parts and drop what is not worth carrying. What good is market share if the business goes under?<br />2. Get as close to your customers are possible. This has been trumpeted many times as a response to globalization, but it's just as important in this recession. Analyze the principles of mass customization and see if there are any you can adopt - even if the whole paradigm is not a match for your business. <br />3. Grasp competitive advantage. The recession will end at some point. Be prepared to leverage every bit of competitive advantage you have now and for the future. Use this time to exploit your value chain (Porter's tool for analysis of competitive advantage) for every bit of competitive advantage you can find. Build a strategic plan (see Align/Excel, <a href="http://www.AlignExcel.com">www.AlignExcel.com</a>) based on competitive advantage and focus on internal capabilities.SNG - Valent Grouphttp://www.blogger.com/profile/15518673171412078909noreply@blogger.com2tag:blogger.com,1999:blog-1224812704839261415.post-81989991672097844912008-10-24T13:54:00.000-07:002008-10-24T14:00:16.358-07:00NudgeI'd like to recommend the book <a href="http://search.barnesandnoble.com/Nudge/Richard-H-Thaler/e/9780300122237/?itm=1"><span style="font-style: italic;">Nudge </span></a>by Richard H. Thaler and Cass R. Sunstein. The foundation of the book is how and why people make the decisions they do - and why people are rarely the completely "rational" beings that underlie so much economic theory (a very timely topic given the current financial travails).<br /><br />Besides being a very interesting and engaging read, this book does have a lot of applicability to the challenges of high-variety manufacturing. So much of customer interaction for HVM companies is about managing choices, and <span style="font-style: italic;">Nudge</span> offers an excellent guide to "choice architecture." It underscores the importance of understanding the motivation of your customer. It also provides insight into product management and sales strategies - and why making all options available during the configuration process is not a good idea.SNG - Valent Grouphttp://www.blogger.com/profile/15518673171412078909noreply@blogger.com0tag:blogger.com,1999:blog-1224812704839261415.post-66402159374935987032008-09-18T06:05:00.000-07:002008-09-18T06:07:54.999-07:00What is your Economic Profile?There is a very interesting self-test at <a href="http://www.innovationeconomics.org/type/">Learn Your Economic Type</a> on the <a href="http://www.innovationeconomics.org">Information Technology & Innovation Foundation</a> website. ITIF is an economics think tank with a focus on Innovation Economics.<br /><br />The Economic Profile lets you know whether you are a strong, moderate, or weak adherent of:<br />Innovation Economics<br />Supply Side Economics<br />LIberal Neo-Classical Economics<br />or<br />Neo-Keynesian Economics<br /><br />I think this is a very interesting and informative profile test - especially given the current economic and political climate. I encourage everyone to take the test. It provides excellent insights into one's perspective of business and policy.<br /><br />By the way, I'm a strong Innovation Economics type.<br /><br />(BusinessWeek has an excellent article on Innovation Economics: <a href="http://www.businessweek.com/magazine/content/08_38/b4100052741280.htm?chan=magazine+channel_special+report">BusinessWeek: Can America Invent Its Way Back?</a> (<i>9/11/2008</i>).SNG - Valent Grouphttp://www.blogger.com/profile/15518673171412078909noreply@blogger.com1tag:blogger.com,1999:blog-1224812704839261415.post-9231854886575519372008-06-06T08:30:00.000-07:002008-06-06T08:36:41.529-07:00What is High Variety Manufacturing (HVM)<p style="margin: 0in; font-family: georgia;font-family:Verdana;font-size:10pt;"><span style="font-size:100%;">What is High Variety Manufacturing (HVM)?</span><span style=";font-size:100%;" > </span><span style="font-size:100%;">Why is it important to define it?</span><span style=";font-size:100%;" > </span><span style="font-size:100%;">High-variety manufacturing is more than just a description of manufacturing processes; HVM is a </span><span style="font-weight: bold;font-size:100%;" >business model</span><span style="font-size:100%;"> that offers significant opportunities, but it also presents significant challenges.</span><span style=";font-size:100%;" > </span><span style="font-size:100%;">In order to take advantage of the opportunities </span><span style="text-decoration: underline;font-size:100%;" >and</span><span style="font-size:100%;"> solve the challenges, it is necessary to recognize what HVM is and how it is reflected in your company.</span></p><p style="margin: 0in; font-family: georgia;font-family:Verdana;font-size:10pt;"><span style="font-size:100%;"><br /></span> </p> <p style="margin: 0in; font-family: georgia;font-family:Verdana;font-size:10pt;"><span style=";font-size:100%;" > </span></p> <p style="margin: 0in; font-family: georgia;font-family:Verdana;font-size:10pt;"><span style="font-size:100%;">A potentially bewildering range of acronyms and descriptors are variously used to describe marketing and manufacturing models that have a high degree of variability, variation, and variety:</span></p> <ul style="margin-left: 0.5in; direction: ltr; unicode-bidi: embed; margin-top: 0in; margin-bottom: 0in; font-family: georgia;" type="disc"><li style="margin-top: 0pt; margin-bottom: 0pt; vertical-align: middle;font-size:10pt;"><span style="font-size:100%;">Mass customization</span></li><li style="margin-top: 0pt; margin-bottom: 0pt; vertical-align: middle;font-size:10pt;"><span style="font-size:100%;">BTO, build-to-order</span></li><li style="margin-top: 0pt; margin-bottom: 0pt; vertical-align: middle;font-size:10pt;"><span style="font-size:100%;">CTO, configure-to-order</span></li><li style="margin-top: 0pt; margin-bottom: 0pt; vertical-align: middle;font-size:10pt;"><span style="font-size:100%;">ETO, engineer-to-order</span></li><li style="margin-top: 0pt; margin-bottom: 0pt; vertical-align: middle;font-size:10pt;"><span style="font-size:100%;">ATO, assemble-to-order,</span></li><li style="margin-top: 0pt; margin-bottom: 0pt; vertical-align: middle;font-size:10pt;"><span style="font-size:100%;">HMLV, high-mix low-volume,</span></li><li style="margin-top: 0pt; margin-bottom: 0pt; vertical-align: middle;font-size:10pt;"><span style="font-size:100%;">Job shop</span></li><li style="margin-top: 0pt; margin-bottom: 0pt; vertical-align: middle;font-size:10pt;"><span style="font-size:100%;">Etc.</span></li></ul> <p style="margin: 0in; font-family: georgia;font-family:Verdana;font-size:10pt;"><span style="font-size:100%;">There is a problem, however, with lack of precision and definition with these terms and a limitation to the extent of a company's value chains that are described by them.</span><span style=";font-size:100%;" > </span><span style="font-size:100%;">I use the term high-variety manufacturing as an umbrella concept to cover all of these marketing and manufacturing models, framed by the critical idea that </span><span style="text-decoration: underline;font-size:100%;" >HVM is a business model that encompasses all of a company's value chains</span><span style="font-size:100%;">.</span></p><p style="margin: 0in; font-family: georgia;font-family:Verdana;font-size:10pt;"><span style="font-size:100%;"><br /></span> </p> <p face="Verdana" size="10pt" style="margin: 0in; font-family: georgia;"> </p> <p style="margin: 0in; font-family: georgia; font-size: 10pt;"><span style="font-size:100%;">HVM is best-defined as a set of characteristics of which a manufacturer may exhibit any one or all.</span><span style=";font-size:100%;" > </span></p> <ul style="margin-left: 0.5in; direction: ltr; unicode-bidi: embed; margin-top: 0in; margin-bottom: 0in; font-family: georgia;" type="disc"><li style="margin-top: 0pt; margin-bottom: 0pt; vertical-align: middle;font-size:10pt;"><span style="font-size:100%;">The sales process is complex and includes customer-driven design and configuration decisions.</span></li><li style="margin-top: 0pt; margin-bottom: 0pt; vertical-align: middle;font-size:10pt;"><span style="font-size:100%;">The products are highly configurable and the number of options and the configuration combinations are such that the demands for specific manufacturing routings, tasks, and materials can not be forecasted.<span style=""> </span>The specific product and its manufacturing demands are not known until the order is received.</span></li><li style="margin-top: 0pt; margin-bottom: 0pt; vertical-align: middle;font-size:10pt;"><span style="font-size:100%;">The production value chain includes non-manufacturing activities such as project engineering; unique manufacturing documentation, such as drawings, generation; unique BOM determination; etc.</span></li><li style="margin-top: 0pt; margin-bottom: 0pt; vertical-align: middle;font-size:10pt;"><span style="font-size:100%;">The company's "product" is competencies rather than specific products.<span style=""> </span>Examples are job shops and short-run or low-volume suppliers to OEMs.</span></li><li style="margin-top: 0pt; margin-bottom: 0pt; vertical-align: middle;font-size:10pt;"><span style="font-size:100%;">The company is a pure custom or project-based manufacturer.</span></li></ul> <p style="margin: 0in; font-family: georgia; font-size: 10pt;"> </p> <p style="margin: 0in; font-family: georgia; font-size: 10pt;"><span style="font-size:100%;"><br /></span></p><p style="margin: 0in; font-family: georgia; font-size: 10pt;"><span style="font-size:100%;">So we return to the question of why it is important to define HVM.</span><span style=";font-size:100%;" > </span><span style="font-size:100%;">One of the most critical keys to success for implementation of any type business and process improvement initiative is alignment.</span><span style=";font-size:100%;" > </span><span style="font-size:100%;">That is, at a strategic and tactic level </span><span style="text-decoration: underline;font-size:100%;" >all</span><span style="font-size:100%;"> business activities, from sales and marketing to product development and management to finance to production, are aligned with the business's objectives (and that those business objectives exist, of course).</span><span style=";font-size:100%;" > </span><span style="font-size:100%;">If, for instance, an initiative such as lean manufacturing does not recognize that project engineering and BOM and manufacturing documentation generation are part of the production value chain in HVM, the degree of success for that initiative is diminished.</span><span style=";font-size:100%;" > </span></p> <p style="margin: 0in; font-family: georgia; font-size: 10pt;"> </p> <p style="margin: 0in; font-family: georgia; font-size: 10pt;"><span style="font-size:100%;"><br /></span></p><p style="margin: 0in; font-family: georgia; font-size: 10pt;"><span style="font-size:100%;">Self-knowledge of one's business model and process are necessary to "maximize variety (sales) and minimize variation (production)."</span></p> <p style="margin: 0in; font-family: Verdana; font-size: 10pt;"> </p> <p style="margin: 0in; font-family: Verdana; font-size: 10pt;"> </p> <p style="margin: 0in; font-family: Verdana; font-size: 10pt;"> </p>SNG - Valent Grouphttp://www.blogger.com/profile/15518673171412078909noreply@blogger.com2tag:blogger.com,1999:blog-1224812704839261415.post-72323028125607281792008-05-10T13:00:00.001-07:002008-05-10T13:21:18.016-07:00When Manufacturing Errors are not Manufacturing ProblemsI had a recent conversation with an Industrial Engineer from a US-based HVAC company. He said that they had just completed an analysis of manufacturing errors. The result: 40% of errors came from design or manufacturing documentation problems. Let me repeat that:<br /><br /><span style="font-weight: bold;">The root cause of 40% of manufacturing errors was design or manufacturing/design documentation.<br /></span><span><br />Many manufacturers are making significant investments in lean, continuous improvement, and quality programs to remain competitive. But what if those investments are returning only a portion of their potential because critical production activities and inputs, such as manufacturing documentation, are ignored? This situation is especially critical in high-variety manufacturing (HVM), such as build-to-order, engineer-to-order, configure-to-order, mass customization, job shop, and HMLV (high-mix low-volume).<br /><br />I discussed this situation before in my post, <span style="font-style: italic;">Inputs, Process Control and High-Variety Manufacturing,</span> from 3/31/08. This conversation brought it all to mind again, and, in truth, it is a recurring soapbox issue for me. <br /><br />To maximize investment in lean, continuous improvement, and quality programs, an HVM company <span style="font-weight: bold;">must</span> recognize and include its full operations value chain in those efforts.<br /><br /><br /></span><span style="font-weight: bold;"><span style="font-weight: bold;"></span></span>SNG - Valent Grouphttp://www.blogger.com/profile/15518673171412078909noreply@blogger.com1tag:blogger.com,1999:blog-1224812704839261415.post-73726843599867570722008-04-29T13:55:00.000-07:002008-04-29T14:20:55.912-07:00Business Success, Strategy, Lean, and Zealotry<p style="margin: 0in; font-family: verdana;font-family:Verdana;font-size:10pt;"><span style="font-size:85%;">I attended an interesting presentation last week sponsored by the Minnesota chapter of the Association for Strategic Planning (ASP), <a href="http://www.strategyplus.org/">www.strategyplus.org</a>.</span><span style=";font-size:85%;" > </span><span style="font-size:85%;">Two Professors of Management from the <a href="http://www.stthomas.edu/">University of St. Thomas</a>, Dr. Michael A. Sheppeck and Dr. Jack Militello, spoke on the "Mediating Factors in Strategy for Successful Organizations."</span><span style=";font-size:85%;" > </span><span style="font-size:85%;">The professors are doing empirical research on which strategic processes lead to positive financial outcomes.</span></p><p style="margin: 0in; font-family: verdana;font-family:Verdana;font-size:10pt;"><span style="font-size:85%;"><br /></span></p> <p style="margin: 0in; font-family: verdana;font-family:Verdana;font-size:10pt;"> </p> <p style="margin: 0in; font-family: verdana;font-family:Verdana;font-size:10pt;"><span style="font-size:85%;">While their findings are preliminary, they have strong data that show that no one single factor can be claimed as the "secret of success."</span><span style=";font-size:85%;" > </span><span style="font-size:85%;">What the data does appear to show is that a combination of factors, really a mixture of strategy and tactics, is the determinant of financial success.</span><span style=";font-size:85%;" > </span><span style="font-size:85%;">The specific set of mediating factors are correlated to market strategy, workforce competency, organization culture, and HR management practices, with company to company variation.</span><span style=";font-size:85%;" ><br /></span></p><p face="Verdana" size="10pt" style="margin: 0in; font-family: verdana;"><span style=";font-size:85%;" ><br /></span></p> <p face="Verdana" size="10pt" style="margin: 0in; font-family: verdana;"> </p> <p style="margin: 0in; font-family: verdana; font-size: 10pt;"><span style="font-size:85%;">I think their findings underscore the contention of Phil Rosenzweig in </span><span style="font-style: italic;font-size:85%;" >The Halo Effect</span><span style="font-size:85%;"> that:</span></p> <p style="margin: 0in;font-family:georgia;font-size:10pt;">"<span style="font-style: italic;">What leads to high performance</span>? If we set aside the usual suspects of leadership and culture and focus and so on - which are perhaps better understood as attributions based on performance rather than causes of performance - we're left with two broad categories: strategic choice and execution. The former is inherently risky since it's based on our best guesses about customers, about competitors, and technology, as well as about our internal capabilities. The latter is uncertain because practices that work well in one company may not have the same effect in another. <span style="font-weight: bold;">In spite of our desire for simple steps, the reality of management is much more uncertain than we would often like to admit - and much more so than our comforting stories would have us believe.</span>" (emphasis added)</p><p style="margin: 0in; font-family: verdana; font-size: 10pt;"><span style="font-size:85%;"><br /></span></p> <p style="margin: 0in; font-family: verdana; font-size: 10pt;"> </p> <p style="margin: 0in; font-family: verdana; font-size: 10pt;"><span style="font-size:85%;">So what does that have to do with Lean and zealotry?</span><span style=";font-size:85%;" > </span><span style="font-size:85%;">Anyone who participates in lean discussion forums sees that the level of emotion and certainty about lean does rise to the level of zealotry at times.</span><span style=";font-size:85%;" > </span><span style="font-size:85%;">It clouds that fact that lean, while without a doubt one of the most powerful methodologies a company should use and a powerful cultural construct, is, by itself, not the primary driver for a company's success.</span><span style=";font-size:85%;" > </span><span style="font-size:85%;">Marketing decisions, HR management practices, and the other mediating factors that Professors Sheppeck and Militello are studying, have just as much impact, or more or lack thereof, on a company's financial success.</span><span style=";font-size:85%;" ><br /></span></p><p style="margin: 0in; font-family: verdana; font-size: 10pt;"><span style=";font-size:85%;" ><br /></span></p> <p style="margin: 0in; font-family: verdana; font-size: 10pt;"> </p> <p style="margin: 0in; font-family: verdana; font-size: 10pt;"><span style="font-size:85%;">Zealotry about lean can also cloud one's judgment in terms (1) how lean should be implemented in specific situations, such as high-variety manufacturing, and (2) is lean the answer to the real root causes of a company's lack of financial or competitive success.</span><span style=";font-size:85%;" > </span><span style="font-size:85%;">In either case, it is likely that the reality of the benefits derived from the lean implementation will not be aligned with the expectations - a potentially devastating outcome.</span><span style=";font-size:85%;" > </span><span style="font-size:85%;">I wonder if this misalignment of expectations with reality is one of the reasons that the track record of lean implementation is spotty within American industry.</span></p>SNG - Valent Grouphttp://www.blogger.com/profile/15518673171412078909noreply@blogger.com0tag:blogger.com,1999:blog-1224812704839261415.post-49957944430546545642008-03-31T06:31:00.000-07:002008-03-31T13:25:59.037-07:00Inputs, Process Control and High-Variety ManufacturingI was reading a chapter in Lean Manufacturing for Job Shops (Tristani and Irani) that introduces the concept of process control. The following statement resonated with me:<br /><br />" . . . consistent inputs help give better internal work-center-to-work center quality, which tends to lower the amount of re-work a job requires. That means the work content is less, product cost is less, and product lead time through the shop is improved."<br /><br />I believe that many manufacturers overlook what should be one of the easiest and potentially most critical input to control: their manufacturing documentation.<br /><br />In high-variety manufacturing (HVM)*, by definition, there is variety and variation of products manufactured, and, in many cases, uniqueness of product. That means that the manufacturing documentation which details the specific requirements of the specific product or product variation to be manufactured is absolutely critical to the effectiveness (productivity and quality) of the manufacturing process.<br /><br />There is no universal standard for manufacturing documentation; in HVM, especially, it needs to mirror the variation and variety of product. It must, however, include all relevant content and present it in a way that reduces and/or clarifies complexity. (One common error is to include too much irrelevant information that ends up obscuring the most critical information.) The physical organization must match the workflow of the shop floor, as must the specific presentation match the needs of each process step. That is, a drawing may be needed for some steps, but other steps may just need a dimensional cut list. In some cases generic assembly instructions or drawings may not be needed in the packet itself, but accessible on an as needed basis. The documentation also needs to reflect the needs of the workforce in terms of language and technical literacy.<br /><br />Too many times, however, the manufacturing department just accepts what it receives as either it doesn't realize that the documentation can be improved or it's been told that that is another department's responsibility and not its concern. Both of these conditions, and the lack of control and quality in the manufacturing documentation, are symptomatic of a larger issue: the lack of understanding that in HVM "production" or "operations" encompasses more than just the manufacturing floor and that, as such, process and quality improvements, whether lean or other methodologies, need to extend beyond the factory threshold.<br /><br />More on this subject forthcoming.<br /><br />* High-variety manufacturing includes types such as job shop, build-to-order (BTO), configure-to-order (CTO), engineer-to-0rder (ETO), mixed model, high-mix low volume (HMLV), mass customization, modular, and so forth.SNG - Valent Grouphttp://www.blogger.com/profile/15518673171412078909noreply@blogger.com0tag:blogger.com,1999:blog-1224812704839261415.post-45957293175073358102008-03-10T06:13:00.001-07:002008-03-10T06:41:28.102-07:00"Lean Manufacturing for Job Shops" - a great new bookA great new book and resource has just been published: <em>Lean Manufacturing for Job Shops</em> by Robert J. <span class="blsp-spelling-error" id="SPELLING_ERROR_0">Tristani</span> and Dr. <span class="blsp-spelling-error" id="SPELLING_ERROR_1">Shahrukh</span> A. <span class="blsp-spelling-error" id="SPELLING_ERROR_2">Irani</span>. The information site is <a href="http://www.geocities.com/Robert_Tristani">www.geocities.com/Robert_Tristani</a> .<br /><br /><br /><br />The book has a unique format which adds to its <span class="blsp-spelling-corrected" id="SPELLING_ERROR_3">usefulness</span>. The story of Southern Foundry and Pattern Works, a fictional job shop implementing the job shop lean principles, is intertwined with the textbook portion of the book. This format really helps the reader grasp the concepts and how to apply them. It also helps the reader visualize how these critical principles can be applied to other job shop and high-variety manufacturing scenarios.<br /><br /><br /><br />The book is packaged with two additional resources: a CD about Value Network Mapping (VNM) and a CD entitled "How a <span class="blsp-spelling-error" id="SPELLING_ERROR_4">Jobshop</span> Developed their In-House Training Video on Waste <span class="blsp-spelling-corrected" id="SPELLING_ERROR_5">Elimination." Anyone who has tried to do a Value Stream Map of a non-repetitive process knows the limitations thereof. Value Network Mapping solves those problems.</span><br /><br />I strongly encourage everyone in high-variety manufacturing to get this book and its companion resources. I foresee using it as not just a resource for the shop floor but for management, as well.SNG - Valent Grouphttp://www.blogger.com/profile/15518673171412078909noreply@blogger.com0tag:blogger.com,1999:blog-1224812704839261415.post-66797804497937671862008-02-29T04:13:00.000-08:002008-02-29T04:17:55.381-08:00Implementing a Lean Manufacturing Program in a Jobshop - webminarHere is a webinar worth attending:<br /><br />Lean Manufacturing is a proven manufacturing strategy that is based<br />completely on the Toyota Production System. It helps to increase capacity<br />and to reduce lead times, setup times and inventories. But, even if the<br />principles of the Toyota Production System are universal, there are<br />significant differences in the design and operation of production systems<br />designed for low-mix high-volume manufacturing versus high-mix low-volume<br />manufacturing, especially small-to-medium sized contract manufacturers. At<br />this unique and interesting online event, the speakers will discuss<br />implementing Lean Manufacturing programs specifically for the jobshop<br />environment.<br /><br />Speakers:<br />Shahrukh A. Irani (The Ohio State University),<br />Louis Marecek (Parker-Hannifin)<br />David Lechleitner (Exact JobBOSS)<br /><br />Date: March 11, 2008<br />Time: 1:00 - 2:30 p.m. Central<br /><br />Website for Registration: <a href="http://www.exactamerica.com/jobboss/webinarform.php?date=March-11&source=website">http://www.exactamerica.com/jobboss/webinarform.php?date=March-11&source=website</a>SNG - Valent Grouphttp://www.blogger.com/profile/15518673171412078909noreply@blogger.com0tag:blogger.com,1999:blog-1224812704839261415.post-32727762364629046352008-02-26T12:34:00.000-08:002008-02-29T04:20:03.717-08:00Production information quality call to actionWith all the focus and investment in lean and Six Sigma and all the other methodologies, why do so many companies settle for ineffective, inefficient, and some times just plain incorrect order and manufacturing documentation?<br /><br />This is a special vice of high-variety manufacturing as, almost by definition, each order and manufacturing packet can be different.<br /><br />The content and format of manufacturing packets are the inputs to manufacturing value streams. Efficiency and effectiveness of that information is as important to a streamlined and productive production process as any kaizen event. Yet time and time again, I see horrifically inefficient project engineering processes; reliance on manual data management; manual drafting instead of automated, smart drawings and models; poorly constructed and confusing shop floor information packets; manual programming of CNC machines; and so forth.<br /><br />There are so many opportunities to improve the quality of this information. In many cases, its just making better use of the tools at hand whether it’s 2D CAD, solid modeling, ERP or MRP. The problem is that inertia sets in with how these tools are used, the users are not trained in the application capabilities beyond minimum functionality, and management does not demand an appropriate level of performance accountability.<br /><br />My call to action for anyone involved in high-variety manufacturing is to really start questioning whether your information foundation and content is really supporting your lean, quality and process improvement programs.SNG - Valent Grouphttp://www.blogger.com/profile/15518673171412078909noreply@blogger.com0tag:blogger.com,1999:blog-1224812704839261415.post-86832481550369141462008-02-19T05:34:00.000-08:002008-02-19T09:46:57.398-08:00Fun demo of TWI combined with videoI think the demo available at the following link, <a href="http://highvarietymfg.ning.com/forum/topic/show?id=1799974%3ATopic%3A2688">http://highvarietymfg.ning.com/forum/topic/show?id=1799974%3ATopic%3A2688</a> ,<br />shows the continuing relevance of TWI (Training Within Industry).<br /><br />Using the "2-second T-shirt fold," Vic Uzumeri, a professor at Auburn University, shows how simple video can enhance the structured training benefits that TWI offers.<br /><br />Be sure to follow the discussion thread for his remarks on why it is important to include both a full-speed demo and a step-by-step clip.<br /><br />(And you may gain some laundry tips, as well!)SNG - Valent Grouphttp://www.blogger.com/profile/15518673171412078909noreply@blogger.com0tag:blogger.com,1999:blog-1224812704839261415.post-55617947464843973292008-02-07T08:23:00.000-08:002008-02-07T08:25:21.353-08:00The Lessons of the Commoditization of Starbucks"Overhaul, Make It A Venti," an article in the Wednesdays, January 30, 2008, <a href="http://www.nytimes.com/">New York Times </a>discusses the current restructuring of Starbucks. The article references a memo written by Howard Schultz, its long-time and newly rehired CEO, entitled "The Commoditization of the Starbucks Experience." As I read the article I started wondering whether some very cogent lessons for high-variety manufacturers, can be derived from the Starbucks experience. <br /><br />The Times article quotes several analysts:<br />"…replacing mystique with relentless commerce."<br />"…the mystique that so thoroughly defined the initial experience is conspicuously absent - trampled in the stampede of proliferation."<br /><br />Starbucks tried to become everything to everybody. They loaded up their stores with absolutely everything they could sell: music, food, cutesy beverages, appliances, gifts, etc. They tried to be everywhere. And their biggest mistake: they replaced the experience of the barista-made cappuccino with automatic machines. <br /><br />So how does this relate to job shops, mass customizers, build-to-order, and the like? It is very easy, especially in a time of economic uncertainty and pressure, to accept every possible order if one has the slightest capability to deliver it. It is very easy to try to create a "product" from every possible idea a customer or an employee may have. <br /><br />What this sort of reaction can do, however, is destroy the very competencies and customer values that have contributed to the growth and success of the business to date. <br /><br />Being a job shop, a mass customizer, or other sort of high-variety manufacturer requires an exceptionally-disciplined focus on what it is that you do well and what value you deliver to your customer. If you are accepting every order that comes in the door, what impact does that have on your quality? On meeting your delivery deadlines? On managing your production schedules? On the perception of your most profitable customers as to who you are?<br /><br />Starbucks lost sight of those items, is experiencing declining customer traffic, and is closing stores. The NY Times article frames its discussion by profiling a neighborhood coffee shop that has four Starbucks stores within one mile of its location. At least one of those Starbucks is closing. The neighborhood coffee shop? It's continuing to thrive, with coffee roasted by hand, free refills, and a funky atmosphere.SNG - Valent Grouphttp://www.blogger.com/profile/15518673171412078909noreply@blogger.com0tag:blogger.com,1999:blog-1224812704839261415.post-56277088022761415752008-01-25T05:46:00.000-08:002008-01-26T06:19:53.165-08:00The importance of a New Product Development processA couple of recent conversations have re-enforced in my mind the need for a good, disciplined New Product Development (NPD) process for any company and for high-variety and mass customization manufacturers in particular. The danger of being used to variety and variability and having flexibility is that it is easy to say yes to just about anything. High-variety and mass customization do not absolve you from the need to understand what your competencies are, who your market is, and where your profitability arises.<br /><br />The statistics regarding the benefits of a structured NPD program are quite dramatic. For instance, companies that use a disciplined NPD approach:<br /><ul><li>are <strong>two and one-half times</strong> more likely to launch a successful product,</li><li>will capture <strong>two times</strong> the market share, and</li><li>will generate <strong>two times</strong> the profit. </li></ul><p>(from the Product Development and Management Association, <a href="http://www.pdma.org/">http://www.pdma.org/</a>, Best Practices Study)</p><p>A job shop may say that they don't have a "product," just capabilities or services that they sell to their customers. In reality both those services and the types of parts they produce on a regular basis are products within a NPD definition. The decision to add a new service or take an order for a new type of part should be just as carefully considered as the development and marketing of a product product by a mass-production manufacturer. </p><p>This is a link to a white paper on my website that may be useful to any manufacturer looking at implementing or improving an NPD program.</p><p><a href="http://www.valent-group.com/files/NPD_Cornerstone_CompetitiveStrategy.pdf">New Product Development - A Cornerstone of Competitive Strategy</a></p><p>Additional materials are available upon request.</p><p></p><p></p><p></p>SNG - Valent Grouphttp://www.blogger.com/profile/15518673171412078909noreply@blogger.com0tag:blogger.com,1999:blog-1224812704839261415.post-91089197010071281572008-01-06T07:34:00.000-08:002008-01-07T05:14:20.083-08:00High-Variety Manufacturing Professional CommunityI'm pleased to announce the launch of a professional community for High-Variety Manufacturing, <a href="http://highvarietymfg.ning.com/">http://highvarietymfg.ning.com/</a>. I'm also pleased to say that I'm acting as site administrator.<br /><br /><br />This site is directed at all people involved in high-variety manufacturing, whether in operations, sales & marketing, product development and management, or any other job role. It is also directed at all flavors of high-variety manufacturing: job shop, HMLV, mass customization, contract, mixed model, etc.<br /><br /><br />I would like to invite all interested parties to join this community. It will become what its members want it to be. I hope that it becomes a true resource center for sharing and support for this challenging environment.<br /><br /><br /><br />So please join, take part in discussions, join SIGs and other groups, post content, and interact with other members. If you have any questions or problems joining, feel free to contact me through this blog.SNG - Valent Grouphttp://www.blogger.com/profile/15518673171412078909noreply@blogger.com0tag:blogger.com,1999:blog-1224812704839261415.post-83975701366110428002007-12-20T09:34:00.000-08:002007-12-20T11:12:51.907-08:00Lean + lack of communication + "one size fits all" = poor outcomesI was at a gathering recently at which several health care professionals were in attendance. They were discussing the lean initiatives taking place at several large clinics and hospitals in the area. A couple of comments made me question both the quality of the implementations and the consultants.<br /><br /><br /><br />First, the perception of the staff at more than one of the respective facilities is that the lean initiative is solely to "speed up things." Not to eliminate waste, not to improve processes and quality, but just to speed up tasks. As such, there is a lot of resistance to the changes being recommended, questioning of the validity of those recommendations, and an attitude of this is just another "flavor-of-the-month" idea on which management spends money.<br /><br /><br /><br />Little time has been spent educating the staff as to the purpose and objectives of the intiatives. Little time has been spent involving operational staff in analyzing work flows, doing value stream mapping, and addressing organizational change management issues. The consultants, for the most part, are doing all the work and making all the decisions.<br /><br /><br /><br />The second set of comments concerned the recommended changes in one of the clinicial labs, microbiology to be specific. Micro is very much like a job shop or HMLV manufacturer in that it deals with a wide-variety of speciman types and tests and has multiple workcenters doing very different types of tasks. It also has its "runners," "repeaters," and "strangers." The consultants demonstrated a lack of understanding of the process requirements of Micro in two ways. First, their recommendations centered on trying to move every speciman through the same process flow. Second, and even more concerning, was a recommendation to increase the temperature of the incubators so that the "bugs would grow faster" (not a scientifically-valid recommendation). Besides making poorly-conceived process recommendations, the consultants were making totally inappropriate recommendations concerning the medical operation of the lab.<br /><br /><br /><br />I think these two situations are good examples of why lean implementations can fail to deliver all the possible benefits they promise.SNG - Valent Grouphttp://www.blogger.com/profile/15518673171412078909noreply@blogger.com0tag:blogger.com,1999:blog-1224812704839261415.post-47765506115319852642007-12-14T09:27:00.000-08:002007-12-14T09:43:14.609-08:00Rational ManufacturingMr. <span class="blsp-spelling-error" id="SPELLING_ERROR_0">Prasad</span> <span class="blsp-spelling-error" id="SPELLING_ERROR_1">Velaga</span> posted this thoughtful and insightful comment regarding rational manufacturing on the <span class="blsp-spelling-error" id="SPELLING_ERROR_2">JS</span> Lean Resource Center forum, <a href="http://finance.groups.yahoo.com/group/JSLEAN/">http://finance.groups.yahoo.com/group/JSLEAN/</a>. I hope it will inspire additional serious thought and discussion.<br /><br /><br /><br /><br /><br /><p><span style="font-family:trebuchet ms;">Rational Manufacturing, by <span class="blsp-spelling-error" id="SPELLING_ERROR_3">Prasad</span> <span class="blsp-spelling-error" id="SPELLING_ERROR_4">Velaga</span></span></p><br /><p><span style="font-family:trebuchet ms;">As everyone knows, Lean identifies and eliminates the things that add no value to the customer. What is this value (to the customer) in terms of our traditional metrics of price, delivery and quality, particularly when different customers give different weights to the metrics? For example, one customer may allow a long lead time with an emphasis on price subject to some minimum quality requirements. Another customer may say,"price is no problem but I want the product immediately." Should we not change the measurement of value based on customer preferences mainly for job shops with diverse customers? In my view, the value to the customer is the weighted sum of the three metrics, which is a composite measurement.</span></p><br /><span style="font-family:trebuchet ms;"></span><br /><br /><span style="font-family:trebuchet ms;">Ultimately, the elimination of the so called "waste" must clearly result in the improvement of at least one of the three metrics without adversely affecting the rest. How can we take advantage of the variation in the value to the customer? Human aspects (like work culture), practices, logistics, quality programs,product innovation, process technology and the management all have impact on the value delivered to the customer. For any organization, the individual impacts of these elements on the value to the customer vary with situation, that is, the marginal gains from the improvement of the elements vary with company situation. Imagine an n-variable mathematical function that maps all these elements to their net outcome. The derivative of this function with respect to any variable changes with the point (situation) and the derivatives are not the same for all variables at any point. Therefore, we need to know which variables we must change at any point (in any given situation) for significant increase in the value of the function. Some of these like better practices, worker involvement, 5S, etc can be improved without much expenditure as part of the culture transformation while some involve certain cost. The effort, time and cost that can be put on these elements are limited at any time.</span><br /><br /><span style="font-family:trebuchet ms;"></span><br /><br /><span style="font-family:trebuchet ms;">It is possible in some cases that a well-managed company fails to see big improvements in the value (composite measurement) to the customers by religiously implementing <span class="blsp-spelling-error" id="SPELLING_ERROR_5">TPS</span>. In my view, we need to progress from lean <span class="blsp-spelling-error" id="SPELLING_ERROR_6">manufactuirng</span> to rational manufacturing that <span class="blsp-spelling-error" id="SPELLING_ERROR_7">focusses</span> at any time on the most effective elements of improvement in <span class="blsp-spelling-error" id="SPELLING_ERROR_8">additon</span> to the universally beneficial drive for better work culture.</span>SNG - Valent Grouphttp://www.blogger.com/profile/15518673171412078909noreply@blogger.com0tag:blogger.com,1999:blog-1224812704839261415.post-71497389040739907942007-11-21T05:30:00.000-08:002007-11-21T06:30:38.162-08:00Mass customization and high-mix low-volume manufacturing - a few thoughtsAdopting mass customization means grappling with a high-mix low-volume (HMLV) manufacturing environment. This can be quite a change from mass production models. Routings can become more complex, lot sizes may be in units of 1, scheduling a challenge, and so forth. <br /><br />In this high-mix low-volume model, the quality of the information transmitted to the shop floor becomes even more critical. Format, content, even quantity of data supplied has a magnified impact on productivity. All too often, unfortunately, this key element of production is overlooked. ERP and other systems control the transmission of an order to manufacturing, but the content of that order may be a combination of drawing types and manufacturing instructions all of which is unique to that specific order. Absolute consistency of manufacturing order information is not possible, virtually by definition. <br /><br />One of the principles of mass customization is that internal systems should mirror the concept of providing a unique product to the customer based on standardized components. That is, internal systems should be comprised of standardized processing components that are combined uniquely to fit the needs to the order. This principle also applies to information components, such as manufacturing orders. <br /><br />I think applying this principle to internal systems is much harder than adopting mass customization as a way of creating unique product for customers. The success of being able to do so, however, is the true indication of whether a company has successfully adopted mass customization as a <strong>business model</strong>. I also think that this application of mass customization principles to internal systems is where the traditional job shop can benefit from MC. <br /><br />I intend to publish a white paper within the next several weeks that delves into these issues of mass customization, high-mix low volume manufacturing, and job shops in more depth. If you have any experiences or comments in these areas that you'd care to share, I'd be very pleased to hear them.SNG - Valent Grouphttp://www.blogger.com/profile/15518673171412078909noreply@blogger.com1tag:blogger.com,1999:blog-1224812704839261415.post-31152312961499423782007-11-09T14:02:00.000-08:002007-11-09T14:07:04.259-08:00Mass Customization resource listI have put together a list of resources that I've found very useful for Mass Customization.<br /><br /><br />You may review the list at the Valent Group website, <a href="http://www.valent-group.com/">www.valent-group.com</a>, or click here for a pdf version: <a href="http://www.valent-group.com/files/Valent%20Group%20Recommended%20Resources.pdf">Valent Group Resource List</a><br /><br /><br />If you have any suggestions for additions to the list, please let me know.SNG - Valent Grouphttp://www.blogger.com/profile/15518673171412078909noreply@blogger.com0tag:blogger.com,1999:blog-1224812704839261415.post-46807538169942813812007-11-09T05:50:00.000-08:002007-11-09T06:27:34.581-08:00JobShopLeanAs a company adopts mass customization, it will find its manufacturing process moving more to a high-variety low-volume (HVLV) production model. TPS (Toyota Production System) Lean does not adapt easily to HVLV. JobShop Lean is a response to this situation. <br /><br />A great resource is the JobShop Lean discussion group, <a href="http://finance.groups.yahoo.com/group/JSLEAN/">http://finance.groups.yahoo.com/group/JSLEAN/</a>, moderated by Dr. Shahrukh Irani of The Ohio State University. <br /><br />The JobShop Lean 2007 Conference, <a href="http://iwse.osu.edu/isefaculty/irani/jobshoplean2007.htm">http://iwse.osu.edu/isefaculty/irani/jobshoplean2007.htm</a>, will be held Dec. 11 - 13 in Columbus, Ohio.<br /><br />Finally, the results of some of Dr. Irani's research can be found with the PFAST tools, <a href="http://ceti.cse.ohio-state.edu/pfast/index.php">http://ceti.cse.ohio-state.edu/pfast/index.php</a>.SNG - Valent Grouphttp://www.blogger.com/profile/15518673171412078909noreply@blogger.com0tag:blogger.com,1999:blog-1224812704839261415.post-19891878748396274572007-11-08T14:31:00.000-08:002007-11-08T14:50:22.251-08:00Welcome!I'm very excited to start this blog about issues related to Mass Customization in industrial and construction environments. I've seen steps in this direction since the mid 80s, yet just now do I feel it is gaining traction. Based on my experience, this is an important business model for construction companies and manufacturers in a variety of industries. It is not well-understood, however, and can present significant implementation challenges.<br /><br />I hope you find these thoughts interesting and useful.SNG - Valent Grouphttp://www.blogger.com/profile/15518673171412078909noreply@blogger.com0