Tài liệu tiếng Anh thương mại Chap005 Manufacturing

Tài liệu tiếng Anh thương mại Chap005 Manufacturing

CHAPTER 5:

Manufacturing

• The quality imperative

The 8 dimensions of product quality

– How well the product performs in

comparison to how it was

designed to perform

• Reliability

– Likelihood that the product will

perform throughout its expected

• Total quality management (TQM) is a

philosophy focused on meeting customer

expectations with respect to all needs,

across all company functions, and

recognizing all customers, both internal and

external

• TQM’s basic conceptual elements are:

– Top Management commitment and support

– Maintaining a customer focus in product, service

and process performance

– Integrated operations within and between

organizations

– A commitment to continuous improvement

Total quality management

Management standards have been established

by the ISO in both quality and environment

The International Organization for Standards

(ISO) was formed after World War II

ISO 9000—International Quality Standard

First one established in 1994

Currently transitioning to ISO 9000:2008

ISO 14000—International Environmental

Standard

First one established in 1998

Current one is ISO 14001:2004

ISO certified suppliers are frequently

preferred by procurement departments

They have to conform to an externally defined

set of standards for quality and delivery of

• They have formal processes in place for continual improvement of their

products, services, and processes

• They are easier for procurement folks to initially qualify and periodically

audit

– Certification is done by an external register agency

– Firms have to be re-certified every three years

• Brand power is the measure of customer

preference based on reputation, product

quality and supply chain capabilities

• Volume is traditionally treated according to

the principle of economy of scale

– Average cost to produce product declines as

manufacturing volume increases

– Particularly important when high fixed costs are

present

• Variety involves frequent product runs and

high repetition of small lot sizes

– Processes that can rapidly switch production

from one product to another while retaining

efficiency are said to have economy of scope

Manufacturing perspectives

• Constraints interact with volume and variety to create

realistic manufacturing plans

– Capacity is how much can you produce in a given unit of time

– Equipment considers how flexible it is

• Is one particular piece a bottleneck?

– Setup/Changeover considers how quickly can you change from

one variety of product to another

• Leadtime is the measure of elapsed time between release

of a work order to the shop floor and completion of all work

on the product to achieve ready-to-ship status

Manufacturing perspectives continued

• Job shop creates a custom product for each customer

• Batch process manufactures a small quantity of an item in

a single production run

• Line flow process has standard products with a limited

number of variations moving on an assembly line through

stages of production

• Continuous process is used to manufacture such items as

gasoline, laundry detergent and chemicals

• Modifications of the above can create new options

– Mass customization produces a unique product quickly and at a

low cost using a high volume production process

The four basic manufacturing processes

• Engineer to Order (ETO) is used when products are unique and

extensively customized for the specific needs of individual customers

• Make to Order (MTO) relies on relatively small quantities, but more

complexity

– Requires much interaction with customer to work out design and specification

– Usually shipped direct to customer

• Assemble to Order (ATO) is when base components are made,

stocked to forecast, but products are not assembled until customer

order is received

– Manufacturing postponement practiced here

• Make to Stock (MTS) features economies of scale, large volumes,

long production runs, low variety, and distribution channels

Manufacturing strategies should match

market requirements

The choice of strategy determines which performance cycles the customer experiences

Figure 5.1 Manufacturing Strategy and Performance Cycles

Product Design Procurement Cycle Manufacturing Cycle Customer Delivery

Cycle

ETO Strategy

MTO Strategy

ATO Strategy

MTP Strategy

Total Cycle Experienced by Customers.

Product

• Total cost of manufacturing (TCM) includes:

– Procurement and production activities

– Inventory and warehousing activities

– Transportation activities

• TCM generally expressed as cost per unit

• Procurement and production costs go down

as volume goes up

• Inventory and warehousing costs go up as

volume goes up

• Transportation costs go down as volume goes

up, but level off at high volumes

Total cost of manufacturing

TCM per unit ranging across strategic

• Flexibility strategy defines the role that operations

plays in the business and overall supply chain

Manufacturing capability examples

• Mass Customization

• Fast, Lean Launch

• Mix/Volume Response

• Robust Operations

What is it?

Where does it work?

What does it take to succeed?

For each strategy we’ll discuss:

Individually customized products produced at the low

cost of standardized, mass produced goods.

• Objective

– Wide product menu with reasonable cost and OTD lead time

– “On-Demand”, “To Order”, “Postponement”, “Agile Mfg”

• Examples: Dell, Cannondale, Cheesecake Factory, Knightly Tours

Market Characteristics:

• Sufficiently large customer segment that values “translatable variety”

• Turbulent, dynamic market

• Unpredictable demand - but not entirely unpredictable!

• Little impact of regulation or other constraints (designer drugs?)

Product/Process Characteristics:

• Modular or adjustable product building blocks

• Predictable components/functions interactions

• Standardized process/skill building blocks

• Reasonable lead times, steps, work content

Mass customization:

Where does it work?

• Sense

– Direct relationships with customers – demand management

– Technologies: measurement, data capture, communication, CRM, POS

– Close relationships with supply chain elements (VI?)

– Technologies: CAM, FMS, mixed model lines, digital tracking and control,

Fast and reliable new product launch with few

engineering changes

Capability: Fast lean launch

Structural and Infrastructural Elements

• Production engrs and plant workers involved 36 months before launch (vs 9 months before launch in old system)

standardized launch process

and processes

Lean launch example: BMW

• Manage reaction to “discipline” imposed on product design

• Shape value system to add launch quality as a priority while

preserving design flexibility

• Find manufacturing talent to make contributions in NPD

• Balance competing priorities of production vs prototyping on the

shop floor

• Manage critical functional integration: Design-Mfg

Lean launch: Key challenges

Efficient response to seasonal demands (“chase” strategy)

and response time

Capability: Mix/volume response

tc Conventional Demand-Supply Chain

Responsive Demand-Supply Chain Production Volume

Conventional Demand-Supply Chain

Responsive Demand-Supply Chain Standard Custom

Structural and Infrastructural Elements

personnel meet weekly

• Cross-trained, incentive-driven labor

• “Tunable” factory – Teams reassign operators hour-to-hour, create recovery plans as needed, Planners reassign personnel to other factories day-to-day, Mgmt transfers product build among factories season-to-season

• Flexible suppliers – Required to be able to increase shipments by 25% on 30 days notice, 50% in first 90 days of new product, VMI, production plans shared weekly, on- line consumption visibility

Mix/volume response example:

Dell servers

• Improved aggregate planning models

– Cost accuracy

– Model sophistication

– Smart uses of slack capacity; external sources of capacity (surge); temporary

labor or overtime

• Complimentary products or activities (prototyping?)

• Labor for capital substitution

• Find proper “balance” in modularity and common building blocks

• Critical functional integration: Supply-Mfg-Sales

Mix/volume response: Key challenges

Uniform performance over a wide variety of process

conditions

• Objective:

– Accommodate variations in input or resource characteristics with no

degradation in quality, yield, lead time, etc.

• Examples: Kellogg’s, Furniture Mfg, MBA School

Conventional Demand-Supply Chain

Robust Demand-Supply Chain

Supply Variability

• High variability in input material characteristics

• High variability in resource characteristics or availability

• Substitute materials or resources are possible

• Cost of materials is a high percentage of unit cost

Robust operations:

Where does it work?

• Sense and accommodate

– High level of process knowledge – understand

process physics – High level of process capability

– Process flexibility – ability to make adjustments

appropriate to incoming requirements

• Critical functional integration:

– Purchasing-Process Engrg-Mfg

Robust operations:

What does it take to succeed?

Comparative manufacturing models

Mass Customization Fast Lean Launch Mix/Volume Response OperationsRobust

• Lean is a philosophy of

manufacturing that

emphasizes the

minimization of the amount

of all resources (including

time) used in the operation

of a company

• Defining principle is the

elimination of “waste”

Lean systems

 Produce only the products that

customers want

 Produce products only as quickly as

customers want them

 Produce products with perfect quality

Primary objectives of lean systems

 Produce in the minimum possible

lead times

 Produce products with features that

customers want and no others

 Produce with no waste of labor,

materials or equipment

 Produce with methods that reinforce

the occupational development of

workers

• Six sigma approach is to

identify sources of variability

and then systematically reduce

them

• The six sigma goal is to

achieve a process standard

deviation that is six times

smaller than the range of

outputs allowed by the

product’s design specification

Six sigma quality concepts

Example of a six sigma quality level

• Produces defect free product

99.74 percent of the time

• 66,807 defects per million parts

produced

• Produces defect free product

99.99966 percent of the time

• 3.4 defects per million parts

produced

Three sigma quality level

Six sigma quality level

• Resources must be procured, positioned, and

coordinated as needed to support the

manufacturing strategy selected

• Four approaches to achieve this are:

– Just-in-time (JIT)

– Materials requirements planning (MRP)

– Design for logistics

– Performance based logistics

Logistical interfaces

• Just-in-time only produces to a customer

order (ATO, MTO)

• Purchased materials and components arrive

at the manufacturing or assembly point just

at the time they are required for the

transformation process

• Raw material and work in process

inventories are minimized

• Demand for materials depends on the

finalized production schedule

• Lot sizes are as low as one unit

• Close cooperation with suppliers is

essential!

Just-in-time (JIT) interfaces

• For more complex manufacturing

(MTO, ETO) where large numbers of

components or assemblies are used to

produce a final product

• Procurement has a key role in insuring

all the components are obtained on

time to make an end item

– Key information requirement is the bill of

materials (BOM)

• Planning sometimes spans multiple

manufacturing locations (e.g Boeing

Dreamliner)

interfaces

• Design-for-assembly – focuses on minimizing the

number of parts and on easing assembly processes.

• Design-for-product-servicability – focuses on easing

the disassembly and reuse of product components.

• Design-for-six-sigma – systematically evaluates the

consistency with which a good or service can be

produced or delivered given the capabilities of the

processes used.

Design for manufacture

• Design for logistics includes the

requirements and framework for

logistical support in the early phases of

product development

• Considers

into the process

assemblies

Design for logistics interfaces

• Initiated by US Department of

Defense to purchase performance

outcomes instead of individual

transactions defined by product

specifications

outcomes and lets suppliers

determine the best way to meet

those requirements

purchasing but business

organizations are expected to

adopt the practice

Performance based logistics interface

Table 5.2 - Strategic integration

END