Six Sigma is a methodology that provides businesses with the tools to improve the capability of their business processes. This increase in performance and decrease in process variation leads to defect reduction and vast improvement in profits, employee morale and quality of product “It’s the only program I’ve ever seen where customers win, employees are engaged and satisfied, and shareholders are rewarded.” – Jack Welch Historical Background of Six Sigma Around 1980 Robert Galvin, at that time CEO at Motorola, realized the importance of working systematically with variance reduction as the Japanese had done for a prolonged period. Together with Bill Smith, Mikel Harry and Richard Schroeder, he created an improvement program that was given the name Six Sigma. Bill Smith came up with the idea of “inserting hard-nosed statistics into the blurred philosophy of quality”. The program was inspired by Japanese work, but also strongly influenced by Juran’s thoughts. Continue reading
Operations Management
Energy Value-Stream Mapping (EVSM)
A typical Value Stream Mapping (VSM) tool classifies the various industrial processes into value adding and non-value adding with a goal to identify and eliminate the non-value added (waste) activities. Based on the concept of Value-Stream Methodology, Energy Value-Stream mapping (EVSM) is being developed where energy components along with cost are added to evaluate with respect to time. Energy Value-Stream mapping (EVSM) identifies the level of energy utilization and wastage in each step and hence determines the opportunities for energy conservations. Implementing this tool by incorporating electrical energy and fuel consumption provides with an ability to view the impact that process improvements have on reducing energy consumption and vice versa. Additionally, it can also deliver tangible and sustained results when used as a part of company’s improvement strategy and a structured analysis with a balanced set of data can reveal areas of energy improvements and optimization. In order to generate Continue reading
Concept of Agile Manufacturing
The Agile Manufacturing was presented in the first time at the publication in the USA of a report entitled 21st Century Manufacturing Enterprise Strategy. So, it has been introduced as a method of increasing competitive advantage in response to increasingly competitive global markets. Agile concept focuses on the fast response to changeable of customer demand. The key component in agile manufacturing is flexibility. The agile manufacturing methods can be adjusted and consolidated into companies of any size to ensure the growth and success. The changeable of customer and technological requirements that make the manufacturers develop agile supply chain capabilities in order to be competitive. So, many companies use the flexibility and agility to respond the customers’ requirement and markets demand in real time. The new concept of agility manufacturing need to secure competitive advantage from the production process that can be both efficient and responsive. Agility can be defined as Continue reading
Postponement Strategy in Supply Chain Management
Postponement is first implemented in manufacturing processes to reduce cost of inventory and improve service level within the company while the product variety increases. The concept of postponement is to delay the change in form, identity and place to the latest possible point until customer commitments have been obtained. It is by exploiting the commonality between items and by designing the production and distribution process so as to delay the point of differentiation. Postponement is closely intertwined with modularization where products in a certain product family are designed where all of them consist of different standardized units. With modularization, combination of different standardized sub-components allows the producing of different end products. The form, function and place of the product are altered and is in contra with the push systems in which goods are manufactured entirely in anticipation of future customer orders and stored downstream without customer’s formulated specifications. Postponement is Continue reading
Total Quality Management (TQM) Summary
Definition of Total Quality Management (TQM) Total Quality Management (TQM) is defined by International Organization for Standardization (ISO): “TQM is a management approach for an organization, centered on quality, based on the participation of all its members and aiming at long-term success through customer satisfaction, and benefits to all members of the organization and to society.” In Japanese, Total Quality Management (TQM) comprises four process steps, namely: Kaizen — Focuses on Continuous Process Improvement, to make processes visible, repeatable and measurable. Atarimae Hinshitsu — The idea that things will work as they are supposed to (e.g. a pen will write.). KanseiKansei — Examining the way the user applies the product leads to improvement in the product itself. Miryokuteki Hinshitsu — The idea that things should have an aesthetic quality which is different from “atarimae hinshitsu” (e.g. a pen will write in a way that is pleasing to the writer.) Total Continue reading
Types of Plant Layouts
Moore defined plant layout as, “The plan of or the act of planning, an optimum arrangement of facilities, including personnel, operating equipment, storage space, materials handling equipment and all other supporting services along with the design of the best structure to accommodate these facilities”. There are three basic types of plant layouts and these correspond to the three types of processing systems. Product layouts are most conducive to continuous processing, process layouts are used for intermittent processing and fixed position layouts are used when projects require layouts. 1. Product Layout Product layout is used to achieve a smooth and rapid flow of large volumes of products or customers through a system. This is made possible by highly standardized products or services which require highly standardized, repetitive processing operations. A job is divided into a series of standardized tasks, permitting specialization of both labor and equipment. The large volumes handled by Continue reading