Firms in the past have mainly focused on improving the material flow in a supply chain using various innovative methods like cross docking, Vendor Managed Inventory (VMI), Collaborative Planning, Forecasting and Replenishment (CPFR) etc. Firms have also used IT solutions to automate the material flow. Today, they have also begun to focus on improving the financial flow in the supply chain. Many firms have adopted best practices of cash flow management to improve the financial flow. One of the key elements which helps in efficient financial flow in a supply chain is the use of IT solutions in the purchase-to-pay and order-to-cash processes. By automating these processes firms can minimize inefficiencies and improve the effectiveness of the supply chain.Many firms have automated the same or all of the elements of the financial flow in a supply chain through implementing ERP systems and cash flow management solutions. However, most firms have Continue reading
Operations Management
Factors Influencing Plant Layouts
The basic objective of any plant layout is to ensure a smooth flow of work, material, and information through a system. The basic meaning of plant is the space in which a business’s activities take place. The layout and design of that space impact greatly how the work is done-the flow of work, materials, and information through the system. The key to good plant layout and design is the integration of the needs of people (personnel and customers), materials (raw, finishes, and in process), and machinery in such a way that they create a single, well-functioning system. Recommended reading: Plant layouts – Definition and Objectives The following are some important factors, which influence the planning of effective layout to a significant degree. 1. Nature of the product: The nature of the product to be manufactured will significantly affect the layout of the plant. Stationary layout will be most suitable for Continue reading
Lean Thinking – Concept and Principles
Concept of Lean Thinking Lean Thinking originated from manufacturing methods used by Japanese automotive manufacturers, especially from Toyota. Lean thinking is basically about getting the right things, to the right place, at the right time, in the right quantity while minimizing waste and waiting time and being flexible and open to change. A term coined by James P. Womack and Daniel T. Jones in their book “Lean Thinking: Banish Waste and Create Wealth in Your Corporation” to describe an exceptionally focused, efficient, agile and successful organisation. Lean thinking provides a way to specify value, sequence value-creating actions in the best way, conduct these activities without interruption whenever someone requests them, and perform them more and more effectively. Lean thinking means doing more and more with less and less resources while providing customers with exactly what they want. “Becoming ‘lean’ is a process of eliminating waste with the goal of Continue reading
How to Eliminate Waste in Manufacturing?
What is Waste in Manufacturing Term? Waste Squander disposal is a standout amongst the best approaches to expand the gainfulness of any business. Forms either add esteem or waste to the creation of a decent or administration. The seven squanders started in Japan, where waste is known as “Muda.” “The seven squanders” is an apparatus to additionally order “Muda” and was initially created by Toyota’s Chief Engineer Taiichi Ohno as the center of the Toyota Production System, otherwise called Lean Manufacturing. To wipe out waste, it is imperative to see precisely what waste is and where it exists. While items altogether contrast between industrial facilities, the regular squanders found in assembling conditions are very comparative. For each waste, there is a technique to lessen or take out its impact on an organization, consequently enhancing general execution and quality. We’ve all heard the expression, “you can’t make something out of nothing.” Continue reading
Six Sigma – A Business Process Improvement Methodology
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
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