The main objective of any business is profit making which it derives by making its products and services available to people. The business models therefore, can be described as value propositions for various stakeholders for which the management evolves strategies and methodologies to create goods and services in some particular arena and delivers the same to the desired target group or customers. It explains how the business would function, identify the goods and services that would be produced for identified customers, ensure the viability of the objectives and goals of the business to deliver values based services. In the contemporary environment of highly competitive business, innovative managerial practices become critical for increasing profitability without major capital investment. The essay would therefore focus on how the improvements in productive flow and product quality would impact on firms’ sales and profit. Productive Flow and Quality Product Productive flow broadly defines the streamlined Continue reading
Production Management Techniques
Background of Lean Manufacturing
Lean is a philosophy that spurred from the Toyota Production System (TPS). TPS was created by Toyota’s founder Sakichi Toyodo, Kiichiro Toyoda, and Taiichi Ohno. Much of TPS was also influenced by W. Edwards Deming’s statistic process control (SPC) and Henry Ford’s mass production lines. However, the Japanese were not impressed with Ford’s approach because it was filled with over-production, lots of inventory, and much waiting. Toyota identified these weaknesses in Ford’s production line and adapted the production line to create a more productive and reliable production line. TPS and lean also use just-in-time inventory where only small amounts of inventory were ordered and very little inventory was left waiting in the production line. This also was very different from Ford’s production line which usually bought high volumes of materials and had high inventory levels to lower costs. After TPS proved to be successful for Toyota, many companies adapted their Continue reading
Cellular Manufacturing – Meaning, Implementation and Benefits
A cellular manufacturing layout is in direct contradiction to the traditional production line. In the production line, numerous workers are needed to service a single production line running from receiving of raw material to shipping of finished product. A breakdown in staffing or machinery in any part of the line nearly always resulted in the entire process being idled until the specific difficulty in the line was repaired, or re-crewed. With cellular manufacturing, production is divided among groups, or cells, of workers and production machinery. Thus, the breakdown of one cell, due to equipment malfunction or staffing problems, does not radically affect the rest of the production process. Technology and cellular manufacturing have combined to streamline the production processes of numerous established and start-up manufacturing facilities worldwide. Lean systems, such as Kaizen, and Six Sigma, to name just two, though very often high in startup cost, provide both a short- Continue reading
Manufacturing Resource Planning Models
Evolution of Manufacturing Environment The field of production planning and control has undergone tremendous change in the last 50 years. Prior to the 1960s, inventory was controlled by a manual system, utilizing various techniques: stock replenishment, reorder points, EOQ (economic order quantity), and ABC classifications, to name a few. By the mid-1970s, enough experience of material requirements planning (MRP) had been gained and the importance of the master production schedule (MPS) was realized. In the 1950s, MRP was the first off-the-shelf business application to support the creation and maintenance of material master data and bill-of-materials across all products and parts in one or more plants. These early packages were able to process mass data but only with limited processing depth. From the 1940s to the early 1960s, material control consisted of basic ‘order point’ formulae used to maintain a level average inventory balance. In 1965, Joseph Orlicky of the J. Continue reading
The Seven Wastes of Lean Manufacturing
There are differing opinions on how many ‘types’ of waste an organisation might have. Current thinking suggests, seven, eight, or even nine depending on the nature of the organisation and the type of work carried out. Originally, there were said to be seven types of waste, and these were largely found in manufacturing organisations. They can be listed as: Overproduction Excess inventory Waiting (lost time) Unnecessary motion Unnecessary transportation (double handling, or moving excess stock) Re-work (poor quality) Over-processing (over-engineered) In each instance, it is recognized that even incremental improvements can help an organisation to increase its efficiency and reduce its costs. These savings and improvements are typically realized in a greater proportion of better quality output, meaning that even small improvements can have an exponentially large positive outcome. It is also noted that each one of these seven types of waste can be tied to different types Continue reading
Batch Production – Meaning and It’s Key Characteristics
Batch production is one of manufacturing methods where limited quantity of each type of product is authorized for manufacture at a time. It is characterized by the manufacture of a limited number of products produced at periodic intervals and stocked in warehouses as finished goods awaiting sales. Typical examples of such batch production are process industries such as pharmaceuticals, paints, chemicals, medium and heavy engineering industry engaged in the manufacture of electric motors, switch gear, heave motor vehicles, internal combustion engines; manufacturer of readymade garments etc. Characteristics of Batch Production Short Runs: Short production runs and frequent changes of setup also characterize batch production. The equipment and the assembly setup is used for a limited number of parts or assemblies and is then changes to make a different product. The production is generally made to stock. In project production, each project has a definite beginning and a definite end. Skilled Continue reading