Manuafcturing Excellence L2345678 1630128665770

Manufacturing
Excellence
Dr. Naga Vamsi Krishna Jasti
BITS Pilani Asst. Professor
Department of Mechanical Engineering
Hyderabad Campus
BITS Pilani
Hyderabad Campus
Introduction
Contents
 Introduction
 The emergence of the Information age
 History of Manufacturing Excellence/WCM
 Core Principles
 Researchers Views on ME
 Evolve ME over 90 Years
 Indian Prospects
 How to practice
 ME Case study
3 ET ZC417 – Manufacturing Excellence BITS Pilani, Hyderabad Campus

ME Course Goals
To enable you to
 Appreciate the importance of Manufacturing Excellence
(ME) and understand its historical evolution.
 Understand the basic principles & practices of ME. The
main elements / practices required for any company
wanting to achieve excellence.
 Apply quantitative and qualitative tools and techniques
in appropriate ways to investigate and ultimately resolve
product or service operations and quality concerns; and
 Evaluate the use of ME initiatives, tools, and techniques
in an organization
Introduction
 Realization of Japanese Manufacturing systems.
 How these systems changed the world.
 What is difference between before world war-II and
after world war –II
 Finally, what is the important factors to expand our
product sales in the market.

The emergence of the information age
 Agricultural age
– It was driven physical labour, land and
natural resources.
 Industrial age
– It was driven by machines and Blue collar
workers.
 Information age
– It is driven by information Technology and
knowledge workers.
Emerging business trends in the information age.

History
 The term ‘World-Class Manufacturing (WCM)/ME’ was first used by Hayes and
Wheelwright in 1984.
 It was made popular by Schonberger (1986).
 The foundation for the same was laid by Skinner (1974), when he proposed the
concept of manufacturing strategy.
 The concept has been embraced, expanded and enhanced by a number of researchers
and practitioners, who have reinforced some of Hayes and Wheelwright’s ideas,
added some new practices and ignored others.
 Hayes and Wheelwright (1984) described WCM/ME as a set of practices, implying
that the use of best practices would lead to superior performance.
 Hall (1984) stressed that WCM is a fundamentally different way of operating an
organization, rather than a set of techniques.
 Schonberger (1986) believed that WCM essentially represents the techniques and
technologies which are designed to enable a company to match its best competitors.
What is ME?
 Manufacturing Excellence is a philosophy of
organizational leadership that stresses the application of
a variety of principles, systems, and tools toward the
sustainable improvement of key performance metrics.
 Much of this philosophy is based on earlier continuous
improvement methodologies, such as Lean
Manufacturing, Six Sigma, and Scientific Management.
The focus of Operational Excellence goes beyond the
traditional event-based model of improvement toward a
long-term change in organizational culture

Definition
How each of these initiatives deferred?
 IE : Zero Waste
 TQM : Zero Defect
 TPM : Zero Default
 JIT : Zero Stock
 TEI : Zero Injury
WCM : Integrates IE,TQM, TPM, JIT, TEI, Six Sigma,

Lean & Kaizen
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Core Principles
 Respect every individual
 Lead with humility
 Seek perfection
 Assure quality at the source
 Flow and pull value
 Embrace Scientific Thinking
 Focus on process
 Think systemically
 Create constancy of purpose
 Create value for the customer
Researchers views on ME/WCM
Womack et al. (1990), Greene (1991) and others has highlighted that there
are many different viewpoints on the ways companies can improve their
manufacturing function in order to enhance their competitive advantage.
Womack et al. (1990) propagated the concept of world-class in terms of
Lean Production (LP) stating that a world-class manufacturers uses less of
everything: half the human effort in the factory, half the manufacturing
space, half the investment in tools, half the engineering hours to develop a
new product. Also, it requires keeping far less than half the inventory on site,
results in many fewer defects, and produces a greater and ever growing
variety of products.
The authors argued that the principles of LP “can be applied equally in
every industry across the globe”
LP will supplant both mass production and the remaining outposts of craft
production in all areas of industrial endeavor to become the standard global
production system of the 21st century.
Greene (1991) considered the world-class
manufacturers as those companies which continuously
outperform the industry’s global best practices and
which know intimately their customers and suppliers;
know their competitor’s performance capabilities and
know their own strengths and weakness - all of which
form the basis of continually changing competitive
strategies and performance objectives.
Voss (1995) described WCM as a subset of the ‘best
practices’ paradigm of operations strategy.
 Turney (1989) discussed ME as continuous small
improvements of all activities of the manufacturing
firm in an attempt to win the competitive edge.
 Huge and Anderson (1989) considered ‘continuous
improvement’ and the ‘elimination of waste’ as the
two principles underlying manufacturing
excellence, in addition to lower cost, higher
quality, better service and more flexibility than
competitors.

 Elliot (2001) defined the concept of ME as a
combination of doing the right thing and doing it in an
extraordinary manner, leading to the result of
achieving a set of quantifiable performance criteria.
 The inputs for the above results are the people & the
processes and the output as the measures of
manufacturing excellence which include; process
capability and control; equipment reliability; 100
percent on-time delivery to customer request; priority
focus on safety and year-over-year actual per unit cost
reduction.
Manufacturing Excellence Initiatives Over Last 90 years
1922 1927 1938 1941 1947 1949 1951

Factories Industrial Growth US Industrial World War II Search for Low Cost R&D Departments
Redesigned for with Mechanization, Production Develops Manufacturing Widespread
better use of Electric Productivity Areas Exploiting Wartim
Motors Increases Innovations
Substantially
1982 1981 1979 1971 / 72 1961 / 62 1959 1955 1954

Computer Assisted Six Sigma – Motorola Robotics and Focused Factory Critical Path Method Project Evaluation SQC for Acceptable
Design Numerical Control (CPM) and Review Defect Level
Technique
1983 / 84 1986 1989 / 90 1992 1994 1995 1996

Statistical Process Lean Manufacturing Benchmarking ISO Process Re- Supply Chain Six Sigma Central in World Class
Control for Quality Standard Engineering and Management Strategy Manufacturing
Outsourcing
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How to practice ME
Nandi (2000) implied that the Japanese
manufacturing techniques like Total Quality Control
(TQC), JIT, Total Productive Maintenance (TPM) etc.
are regarded as advanced manufacturing techniques,
and an application of these leads to WCM.
Subsequently, different techniques like Computer
Aided Design (CAD), Computer Aided Manufacturing
(CAM) etc. were also added by the authors to the
above set of techniques to be regarded as WCM
practices.
Need of involvement of through out
Organization
Knuckey et. al. (1999) conducted a survey for identifying
best practices for a world-class firm. They defined the best
practices as the cooperative way in which firms and their
employees undertake business activities in all key processes:
leadership, planning, people, customers, suppliers,
community relations, production and supply of products and
services, and the use of benchmarking.
These practices, when effectively linked together can be

expected to lead to sustainable world class outcomes in
quality, customer service, flexibility, timeliness, innovation,
cost and competitiveness.
Basic differences between traditional
manufacturing and ME/WCM
Traditional ME/WCM
Focus Internal focus Customer focus
Operational
Inflexible operations Flexibility
Flexibility
Constraints Constraints accepted Constraints removed
Control Management control operations Worker empowerment
Information Information prerogative of

Information available to everyone
flow management
Relationship Weak external relationships Strong external relationships
Performance Performance measured in Financial measures supplemented by
measurement financial terms non-financial measures
Level of
Low levels of automation High level of automation
automation
Manufacturing excellence has contributed to
India’s economic growth
 India’s GDP of USD 691 bn makes it the 5th largest economy in the world and 3rd largest in terms of
purchasing power parity .
 One of the fastest growing economies in the world - growing at over 8 % p.a for the last 10 years.
 World's second largest small car market

 One of only three countries that makes its own
Manufacturing contributes to
supercomputers
 79% of FDI investment  World's largest producer of milk, tea and pulses and
 27% of India GDP
the world’s largest livestock population
 Second largest producer of food including fruits and
 53% of Indian exports
vegetables
 World’s largest diamond cutting and polishing
center and the second largest jewelry market
Source: GoI website

Indian Manufacturing : A macro perspective
Indian manufacturing sector is expected to grow at 16% to

 India is a stable
18 % over the next decade
democracy with
strong macro-
economic
fundamentals
India is ranked  The BPO

Indian manufacturing Indian economy migration to
43 in the latest
competitively expected to India is getting
GCI index (1)
positioned for a high grow at 8% to replicated in the
ahead of other manufacturing
growth rate era 10% over the
BRIC (2) sector
next decade
economies
 FDI inflow into

India has
doubled from
USD 3.4 bn in
2001 to USD 8
The quality of Indian work force is one of bn in 2005
India’s key competitive advantages
Source: National Manufacturing Competitiveness Council

Key sectors in Indian manufacturing
Auto Industry: The Indian auto industry is a USD 44 Food Processing: A USD 70 bn industry growing
bn industry (Auto motives is USD 34 at 9% to 12%
bn and Auto components is USD 10
bn) Gems & Jewelry: A USD 13 bn industry (Gold
growing at 15% p.a and
Chemicals: The size of chemical industry in India Diamond growing at 27% p.a)
(Petrochemicals to Paints) is USD 30
bn Leather: Industry size is USD 4 bn
Electronics: The electronics industry is USD 11 Machine Tools: Industry Size is USD 225 mn
bn (consumer electronics to
electronic components)
Textiles: Industry Size is USD 38 bn
Engineering: A USD 22 bn including heavy and

light engineering
These sunrise sectors of Indian manufacturing is enabling higher growth rates for the manufacturing sector
22
A handful of sectors contribute to 75% of
India’s manufacturing exports
The balance 25% exports are from sectors like

1) Automotive 2) Cement
Gems 3) Food Processing 4) Drugs/Pharmaceuticals
5) Telecom equipt 6) IT hardware/Electronics
7) Paper 8) Minerals and Metals
Leather Jewellery
Indian manufacturing is forecasted to grow at 12%-14%
over the next decade and sectors like Automotive, Food
75% of Processing and Pharmaceuticals are expected to be the
mfg growth drivers
exports
Chemicals Textiles
India is presently at the cusp of a

“Manufacturing take-off”
Engg
Goods
Source: National Manufacturing Competitiveness Council

Where does the advantage arise from.....
India’s manufacturing cost advantages
a) Production design andSavings to the extent of 80% plants in developed

Process Engineering cost markets
(due to the low cost, high quality engineering talent in India)
b) Capital Cost efficiency Savings to the extent of 30% to 60% plants in developed
markets
(due to local fabrication and labour intensiveness)
c) Higher Asset utilization Many manufacturing units in India follow a 3 shift seven day w
(unlike a 2 shift-5 day week in high cost locations)
A sustainable competitive advantage for India in Manufacturing

Attractiveness of India as a manufacturing destination
Investor’s expectations India’s manufacturing

manufacturing locations competitiveness
1. Economical labour costs and
1. Economics and Ease of operations business transactions costs
2. Favorable economic policies, flexible 2. Many manufacturing companies

manufacturing practices in terms of have emerged as centres of
India has manufacturing excellence
design, scale and delivery
compelling
advantages 3. The aspirational huge Indian middle
3. Robust domestic demand for the
class is a “readily available market”
manufactured goods
4. Competition among states/UT’s to
4. Infrastructure support, Favorable legal attract investments is addressing
systems, Policy framework, Ancillary these issues
linkages and Services support
5. Large pool of well qualified
5. Skilled and Productive labour force manpower

Case Study :
BIRLACELLULOSIC KHARACH
 Incorporated in August 25, 1947, Grasim Industries

commenced operations at Gwalior in central India in 1948, with
a small rayon weaving unit using imported rayon.
 In 1954, GRASIM set its focus on the production of rayon, a
man-made fiber (Viscose Staple Fiber).
 Birla Cellulosic divided its implementation of WCM (World
Class Manufacturing)/TQM processes into five distinct steps.
– Team formation
– Equipping teams
– Enliven Senses
– Competition
– Recognition
Process of WCM/TQM Implementation

Identification and implementation of WCM
Leadership and Employee Participation:
 Visionary leadership showed new ways of achieving excellence to the
whole organization, providing a role model for all the initiatives being
undertaken by the organization.
Regular Improvements in Business Processes (PDCA)
 Birla Cellulosic adopted the Plan, Do, Check and Act (PDCA)Approach
for achieving continuous improvement in Business Processes.
Strength as an Organisation to Attract Overseas Attention
Technological Edge
 Company’s consistent record of achievements in the area of Quality in
products and at the workplace helped it gain recognition internationally
as a quality-oriented organisation. The company's international
recognitions, such as the Deming Prize, and its growing exports bear
testimony to this fact.
Identification and implementation of
WCM
Technological Edge
 The Birla Cellulosic VSF manufacturing facility at
Kharach is a state-of the-art manufacturing facility.
Birla Cellulosic’s primary objective was to redefine
the cellulosic fibre, in terms of quality, cost and its
applications.
29 MM ZG522 - Total Quality Management BITS Pilani, Hyderabad Campus

WCM Model implemented by organization
 The figure depicts the WCM excellence model adopted by Birla
Cellulosic. The unique features of this model are as follows:
– It is an integration of TQM and TPM
– It covers all national and international award philosophies
– It focuses on stake/share holder's value performance-oriented
model with respect to QCDIPESM
– Provides systems, which were totally aligned with the PDCA
Approach for consistent and sustainable growth
– Aligns the whole organisation towards a culture of excellence
– WCM / TQM concepts supported by a strong facilitating
structure
30 MM ZG522 - Total Quality Management BITS Pilani, Hyderabad Campus

WCM Model implemented by organization

Thank you

Manufacturing
Excellence
Naga Vamsi Krishna Jasti
BITS Pilani Asst.Professor
Hyderabad Campus Mechanical Engineering Department
BITS Pilani
Hyderabad Campus
Manufacturing Strategy
Contents
 Manufacturing and Strategy
 Definitions of Manufacturing Strategy
 Role and importance of Manufacturing Strategy
 Developing business strategy
 Developing manufacturing strategy
 Order Qualifiers and Winners
 Manufacturing Strategy: Lead times
 Competitive Priorities- The Edge
 Production Requirements
 Technology for Competitive Advantage
 Case Study
35 BITS Pilani, Hyderabad Campus

Typical Views of Manufacturing
In some companies, many managers
believe that there is no such thing as a
Manufacturing Strategy.
The quotes on the next slide illustrate the
belief that Manufacturing exists to do
whatever it takes to satisfy R&D and
Marketing/Sales.

“R&D designs the product, Marketing/Sales sells the
product, and then Manufacturing produces what it’s told
when it’s told.”
“Manufacturing is supposed to make up R&D delays and
change orders and meet whatever promises are made by
Marketing/Sales.”
“In our top management meetings, R&D and
Marketing/Sales dominate the discussion and, at the end of
the meeting, Manufacturing is told what to do.”
“Everything is going well in Manufacturing when you don’t
hear any complaints about it.”
 In this session, my goals are:
– To convince you that the quotes on the
previous slide are wrong and that there is such
a thing as a Manufacturing Strategy.
– To provide you with a broad framework for
thinking about a Manufacturing Strategy.
 During the remainder of our sessions, we will
see both good and bad elements of a
Manufacturing Strategy.
Definition of Strategy
 Webster’s Dictionary defines “strategy” as follows:
– “… the science and art of military command used to
meet the enemy in battle under advantageous
conditions.”
business management
--“… the science and art of ^ military command
competitor in competition
used to meet the ^ enemy in combat under
advantageous conditions.”
Strategy : Simplification
Device for
– Disciplined planning & thinking
– Communication
– Organization building

Manufacturing Strategy: Definitions
 It is exploiting certain properties of the manufacturing function as
a competitive weapon (Skinner, 1969).
 Hayes and Wheelwright (1985)have defined it is a consistent
pattern of decision making in the manufacturing function which is
linked to business strategy.
 MS as a tool for effective use of manufacturing strength as a
competitive weapon for achievement of business and corporate
goals (Swamidass and Newell, 1987).
 A collective pattern of decision that acts upon that formulation
and deployment of manufacturing resources. To be most
effective, it should act in support of the strategic directions of the
business and provide for competitive advantages (Cox and
Blackstone, 1998)
Skinner on Manufacturing Strategy(1969)
 different companies within the same industry have

different strengths and weaknesses and choose to
compete in different ways
 different production "systems" have different
operating characteristics and each involves a
different set of trade-offs
 a production system must have a customized design
that reflects the priorities and trade-offs inherent in
the firm’s own competitive situation and strategy
Skinner on Manufacturing Strategy
 Therefore, no one operating system is
universally superior under all competitive
situations and for all companies.
 Every operating system embodies a set of trade-
offs.
 Some will be particularly good at producing
standardized products in high volume at low
cost;
 others will excel at responding quickly to
shifting demand for more customized products.
Role of Manufacturing Strategy
Provide a plan that makes best use of
resources which;
– Specifies the policies and plans for using
organizational resources
– Supports Business Strategy

Importance of MS
Companies often do not understand the
differences between operational efficiency
and strategy
– Operational efficiency is performing tasks
well, even better than competitors
– Strategy is a plan for competing in the
marketplace
Operations strategy is to ensure all tasks
performed are the right tasks

Developing a Business Strategy
 A business strategy is developed after taking
into many factors and following some strategic
decisions such as;
– What business is the company in (mission)
– Analyzing and understanding the market
(environmental scanning)
– Identifying the companies strengths (core
competencies)

Three Inputs to a Business Strategy

Mission
Relating the Organization’s Efforts to its Long
Term Future.
– What Business are we in?
– Who are Our Customers?
– What are our Concepts and Beliefs?
– How Do We Measure Performance
–Growth?
–Profits?
–Market Share?
–Innovation?
Environment:
Scanning the Environment for Opportunities and
Threats:
• Competition
• Market
• Economic Trends
• Social and Political Changes
Distinct Competencies
Organization’s Unique Strengths-- those that are
difficult for others to duplicate
Examples:
 Competent Workforce
 Advantageous Location
 Innovative Capability
 Technology

Examples from Strategies
 Mission: Dell Computer- “to be the most
successful computer company in the world”
 Environmental Scanning: political trends,
social trends, economic trends, market place
trends, global trends
 Core Competencies: strength of workers,
modern facilities, market understanding, best
technologies, financial know-how, logistics

Business Strategy
BUSINESS B
STRATEGY
`
Vertical Coordination
ACCTING &
R&D MFG MKT & SALES
FINANCIAL
STRATEGY STRATEGY STRATEGY
STRATEGY
Horizontal Coordination
Vertical Coordination. Management of the Business Unit must clearly

communicate the business strategy to the managers of Functional Areas.
Horizontal Coordination. Through a specific and consistent pattern of

decisions, all functional strategies must support the competitive priorities of the
business strategy.
A “Nightmare” of Functional Strategies
 Management of the Business Unit never communicates the
business strategy to the managers of the Functional Areas
and is ignorant of the fact that
 R&D thinks that the competitive priority is Flexibility and
thinks that it can demand as many change orders as it wants.
 Manufacturing thinks that the competitive priority is Cost
and bases all its decisions on what is the cheapest thing to
do.
 Marketing/Sales thinks that the competitive priority is
Dependability and feels it can promise delivery as soon as a
customer wants its.
ACCTING &
R&D MFG MKT & SALES
FINANCIAL
STRATEGY STRATEGY STRATEGY
STRATEGY
VERTICAL
CAPACITY FACILITIES TECHNOLOGY
INTEGRATION
Amount Size Equipment Direction
Timing (lead/lag) Location Automation Extent
Type Specialization
PRODUCTION &
QUALITY INVENTORY ORGANIZATION WORK FORCE
PLANNING
Methods Sourcing Structure Skill Levels
Metrics Decision Rules Control Wages
Distribution Reward Training

The purpose of the Manufacturing Strategy is to:
– Support the Business Strategy.
– Complement the other Functional Strategies
For example, in many companies, there is frequently a tension
between R&D and Manufacturing.
R&D views itself as a collection of creative people with the
role of designing the most innovative product possible, even if
it means submitting to Manufacturing a continual stream of
change-orders.
On the other hand, Manufacturing views itself as a collection of
practical people with the role of minimizing the manufacturing
cost per unit.
55
Who is right – R&D or Manufacturing?
BITS Pilani, Hyderabad Campus
Developing an Operations Strategy
Operations Strategy is a plan for the design
and management of operations functions.
Operation Strategy developed after the

business strategy.
Operations Strategy focuses on specific

capabilities which give it a competitive edge
– competitive priorities
Operations Strategy – Designing the
Operations Function

Order Qualifiers and Winners Defined
Order qualifiers are the basic criteria that

permit the firms products to be considered
as candidates for purchase by customers
Order winners are the criteria that

differentiates the products and services of
one firm from another

Service Breakthroughs
A brand name car can

be an “order qualifier”
Repair services can be “order winners”

Examples: Warranty, Roadside Assistance,
Leases, etc.

Manufacturing strategy based on lead time

Engineer-to-Order
 Manufacturer does not start until the order is

received
 Custom designs
 Unique products
 Long lead time

 Inventory purchased after order is received

Make-to-Order
 Manufacturer does not start until the order is

received
 Often uses standard components
 Little design time
 Lead time is reduced

 Inventory held as raw materials

Assemble-to-Order
 Manufacturer inventories standard components

 No design time required
 Assembly only required
 Shorter lead time

 Inventory held as standard components

Make-to-Stock
 Manufacturer produces the goods in

anticipation of customer demand
 Little customer involvement with design
 Shortest lead time

 Inventory held as finished goods

Competitive Priorities- The Edge
 Four Important Operations Questions: Will
you compete on –
Cost?
Quality?
Time?
Flexibility?
 All of the above? Some? Tradeoffs?

Competing on Cost?
 Offering product at a low price relative to

competition
– Typically high volume products
– Often limit product range & offer little customization
– May invest in automation to reduce unit costs
– Can use lower skill labor
– Probably use product focused layouts
– Low cost does not mean low quality

Competing on Quality?
 Quality is often subjective
 Quality is defined differently depending on who is defining
it
 Two major quality dimensions include
– High performance design:
• Superior features, high durability, & excellent customer
service
– Product & service consistency:
• Meets design specifications
• Close tolerances
• Error free delivery
 Quality needs to address
– Product design quality – product/service meets
requirements
67
– Process quality – error free products
Competing on Time?
 Time/speed one of most important competition priorities
 First that can deliver often wins the race
 Time related issues involve
– Rapid delivery:
• Focused on shorter time between order placement and
delivery
– On-time delivery:
• Deliver product exactly when needed every time

Competing on Flexibility?
 Company environment changes rapidly
 Company must accommodate change by being
flexible
– Product flexibility:
• Easily switch production from one item to another
• Easily customize product/service to meet specific
requirements of a customer
– Volume flexibility:
• Ability to ramp production up and down to match
market demands
Production Requirements
 Specific Operation requirements include two
general categories
– Structure – decisions related to the production
process, such as characteristics of facilities
used, selection of appropriate technology, and
the flow of goods and services
– Infrastructure – decisions related to planning
and control systems of operations

Production Requirements
 Dell Computer example – structure &
infrastructure
– They focus on customer service, cost, and speed
– ERP system developed to allow customers to order
directly from Dell
– Product design and assembly line allow a “make to
order” strategy – lowers costs, increases turns
– Suppliers ship components to a warehouse within
15 minutes of the assembly plant - VMI
– Dell set up a shipping arrangement with UPS
71 © Wiley 2010 BITS Pilani, Hyderabad Campus
Strategic Role of Technology
 Technology should support competitive

priorities
 Three Applications: product technology,
process technology, and information technology
– Products - Teflon, CD’s, fiber optic cable
– Processes – flexible automation, CAD
– Information Technology – POS, EDI, ERP, B2B

Technology for Competitive Advantage
 Technology has positive and negative potentials
– Positive
• Improve processes
• Maintain up-to-date standards
• Obtain competitive advantage
– Negative
• Costly
• Promotes dependency
• Risks such as overstating benefits
Technology for Competitive Advantage
Technology should
– Support competitive priorities
– Can require change to strategic plans
– Can require change to operations
strategy
Technology is an important strategic

decision
Case Study: Automotive Industry
 Company A is a india’s one of the oldest two
wheeler automobile manufacturing company
(established in 1945).
 The company produces 9 models two wheelers
and 3 models three wheelers.
 It has 11,000 employees and 40% of market
share in wheeler segment.
 It has 15% exports of total sales.

Case Study: Previous Approach
 The period of 1950 -1980, an era of limited supply with Govt’s
restrictive and regulative industrial policy, company production
was very less than demand.
 The company enjoyed monopoly market status in that period.
 During that period, the company did not have a marketing
department. Therefore, it had no specific strategy till 1980s.
 After economic liberalization, many new companies entered in
this sector with Japanese collaboration.
 In 1980’s the company grew explosively and its production
volume increased from 172 to 800 thousand units a year.

Case Study: Present approach
 Due to increased competition in Indian market, the
company created a marketing department in 1993.
 It has focused on increasing annual sales to 1
million units.
 The company decided to modernize plants and
increased production efficiency.
 The company has invested in advanced
manufacturing technology such as CAD, CAM,
CNC machines etc and framed a marketing strategy.

Case Study: Elements of Marketing Strategy
 Following formed the important elements of marketing strategy:
– Increased dealer network
– Dealers allowed to sell only company brand vehicles.
– Periodically introducing new product
– 50% of the components to be produced by vendors.
– Deploying 50 service engineers at dealership to upgrade the
technical skills of dealer service personnel.
– To start its own financial company to finance the vehicles.
– Sell the product at a competitive price.
– Increase in investment in advertising and describe additional
features.

Elements of Manufacturing Strategy
 Essential features of its manufacturing strategy are:
 Speed up the new product development by using AMT
like CAD and CAM.
 Mission of manufacturing is continuous improvement
with zero defects.
 Quality circles to be established to get suggestions for
improvement at shop floor.
 Matching competitor product features by constantly
improving the existing product.
 Information Technology such as ERP.

Summary
 Manufacturing and Strategy

 Definitions of Manufacturing Strategy
 Role and importance of Manufacturing Strategy
 Developing business strategy
 Developing manufacturing strategy
 Order Qualifiers and Winners
 Manufacturing Strategy: Lead times
 Competitive Priorities- The Edge
 Translating to Production Requirements
 Technology for Competitive Advantage
 Case Study

Thank You
Lean Manufacturing
BITS Pilani Assistant Professor
Hyderabad Campus
BITS Pilani
Hyderabad Campus
Lean Manufacturing
Topics to be covered
 Global Scenario
 History
 Necessity of LM
 Lean production definition
 Why Lean production
 Toyoda Family and contributions
 US scenario
 LM Elements
 3M’s
 System and System Thinking
MM ZG522 - Total Quality Management BITS Pilani, Hyderabad Campus
Global Scenario
 The current business climate is one where
manufacturing and service companies face
challenges due to increased globalization,
competition, changing consumer tastes,
technology, governmental regulations and
environmental considerations.
 The challenges make it necessary for
organizations to rethink how they have been
doing business. In the older days, demand
exceeded supply and the companies could afford
a lot of slack in their operations.
Global Scenario
 Today, the companies cannot take it for granted
that they will make money. They need to ensure
that they meet customer requirements,
governmental requirements, environmental
considerations, while keeping costs down.
 Companies have to learn to be flexible as there is
greater uncertainty with respect to the business
environment

Competitive Priorities
 Price
 Quality
 Delivery
 Service

Types of Production Systems
 Craftsman Production
 Mass Production
 Lean Production

Craft Manufacturing
 Each product unique

 Long lead times
 Inconsistent quality
 Close interaction between producer and the customer
 High cost

Mass Manufacturing
 Advent of the moving conveyor

 Establishment of standardized, interchangeable parts
 Development of standard methods of production
 Increased productivity
 Lower costs

Lean Production
 Lean manufacturing grew from craft and
mass manufacturing.
 In craft manufacturing, the artisan was in
touch with the customer and controlled all
functions.
 In mass manufacturing, while efficiency went
up, the size of the organizations, grew while
the workers were isolated from customers.
11/19/2021
Lean Production
 In lean manufacturing we have retained the
efficiency of mass manufacturing, while bringing
the operator closer to the customer, as it was
during craft manufacturing.

Necessity of LM
 At Toyota to understand that our problems today
are those Toyota faced in 1950:
– Fragmented markets demanding many
products in low volumes.
– Tough competition.
– Fixed or falling prices.
– Rapidly changing technology.
– High cost of capital.
– Capable workers demanding higher levels of
involvement.
11/19/2021
What It Means
 Focus on
– The customer
– Value and waste
– Doing more with less
– The entire purchasing experience
– Flexibility
– Partnerships
– Longer term thinking
 Move away from
– Numbers games
– Production focus alone
Lean production definition
 Adopt the new philosophy…we are in a new economic
age-----------------------------------------W. Edwards Deming
 Lean production, also known as the Toyota Production System,
means doing more with less—less time, less space, less human
effort, less machinery, less materials—while giving customers
what they want.
 Two important books popularized the term lean:
 The Machine that Changed the World, by James Womack, Daniel
Jones, and Daniel Roos and published by Simon & Schuster in
1990.
 Lean Thinking, by James Womack and Daniel Jones, published by
Simon & Schuster in 1996.
 Although lean principles are rooted in manufacturing, found that
they apply universally. Our challenge is to translate, tailor, and
apply them to our particular situation.
Why Lean Production?
The New Economics
 It used to be that companies could set their prices
according to the following formula:
Cost + Profit margin = Price
 The accounting department would determine cost based
on the principles of cost accounting and a profit margin
typical for the industry would be added. The price would
be passed on to the customer, who, more often than not,
paid it.
 This is no longer true. The profit equation is now as
follows:
Price (fixed) − Cost = Profit
Why Lean Production?
 In most industries, price is fixed (or falling).
Customers are more powerful than ever before.
They have a wealth of choices, unprecedented
access to information, and demand excellent
quality at a reasonable price.
 In such an environment, the only way to improve
profit is to reduce cost. The great challenge of the
twenty-first century is not information technology.
It is cost reduction. Can your company continually
improve quality and enlarge customer choices
while reducing cost?
The Goal is Cost Reduction

Origins of LM
 The origins of lean may be multifold, but the main
development was done by Toyota.
 As Japan went through the devastation of WW II,
the manufacturers in Japan were looking to
recreate their industry.
 Taiichi Ohno was given the task of managing the
production at Toyota and he used the problems of
shortage of space and capital, along with a threat
of foreign competition, to create the Toyota
Production System

Toyoda Family: Sakichi Toyoda
 Saw his mother and other women use manual
looms
 Developed the automatic loom to relieve the
efforts of the women weavers.
 Started the Toyoda Automatic Loom Works
 He focused on the need to solve a specific
problem
 He was obsessed with continually improving the
design to make the loom easier to use

Toyoda Family: Kiichoro Toyoda
 Sakichi’s son Kiichiro Toyoda started making

automobiles as a division of the Toyoda
Automatic Loom Works
 Kiichiro Toyoda visited the US to learn about car
manufacturing
 Most of the early ideas came from Ford and from
observing supermarkets
 When Kiichiro returned to Japan, he realized that
he had constraints of capital and land

Role of Ohno
 Kiichiro hired Taiichi Ohno and gave him the charge of
developing the manufacturing system that would
become the Toyota Production System (TPS).
 TPS was Ohno’s solution to Toyota’s problems
bringing machines close to each other and using
general purpose machines
 In order to be able to overcome the shortcoming of
less capital, Toyota invested in its people. This is
evident at Toyota even today.
 From the 1950s to the present Toyota has grown to
become the largest global producer of automobiles,
refining and evolving the Toyota Production System
US Scenarios
 Frederick Winslow Taylor –Scientific
management
 Henry Ford- Standardization work
 Walter Shewart/ W. E. Deming: Quality Gurus
and proposed PDCA
were developing methods and techniques that
would revolutionize manufacturing

US Scenarios
 Somehow the advent of mass
manufacturing saw the US industry move
away from the basics of lean, which the
Japanese adopted and perfected.

Lean elements
 The term Lean was first used by Womack and
Jones and includes 5 elements
– Value,
– Value Stream,
– Flow,
– Pull, and
– Perfection.

Value and Waste
 Value
– Value is what the customer sees in a product or
service
– It is what the customer is willing to pay for – It
has no relation with cost
 Waste
– Anything that does not add value, from a
customer standpoint, but adds cost, is a waste
and must be eliminated

Value and Waste

Value Adding Vs Non Value Adding

Value Addition

Importance of value addition

Value Stream
 Ideally, the time spent by the product from its
initial stages until it is in the hands of the
customer should be value adding
 It would be best if this could include requirements
generation, conceptualization, design,
procurement, manufacturing, testing,
transportation and any major activity that affects
the time spent by the part

Flow
 Elimination of discontinuities in the process
 Why do discontinuities occur?
– Batch mentality
– Focus on maximizing utilization of expensive
equipment
– Lack of flexibility in the system
– Lack of trust
 Focus on the root causes of discontinuities and
address them

Pull
 Do what is necessary,, and when it is necessary
 Let the customer “pull” production
 Have a streamlined process so that the system
responds quickly to demand and changes in
requirements
 Eliminate “inventory”
 Eliminate “batches”

Perfection
 Continuous improvement/Kaizen
 PDCA/PDSA Cycle

3M’s
 Lean focuses on aggressively attacking and
eliminating waste.
 The term for Waste in Japanese is Muda.
 Muda is created by 2 other Ms, i.e., Mura and
Muri.
 Mura is Unevenness, which leads to Muri, which
is Overburden. Overburden, in turn, leads to
waste.

3M’s : Example

Conventional Vs Lean Production
Conventional Toyota/Lean
Move the metal! Make your numbers! Stop production—so that production
never has to stop! (Jidoka concept)
Make as much as you can. Go as fast as Make only what the customer has
you can. (Push system) ordered. (Pull system)
Make big batches and move them slowly Make things one at a time and move them
through the system. (Batch and queue) quickly through the system. (Flow)
Thou shalt! (Leader = Boss) What do you think? (Leader = Teacher)
We have some standards. (Not sure where We have simple, visual standards for all
they are or of they're followed…) important things.
Engineers and other specialists create The people closest to the work develop
standards. The rest of us do what we're standards and pull in specialists as
told. required.
Don't get caught holding the bag! Make problems visible.
Only grunts go to the shop floor. Go and see for yourself.
Do-Do-Do-Do! Plan-Do-Check-Adjust (PDCA)

Idea of Lean Manufacturing
 One piece flow
 It is a myth that "Toyota received their inspiration for
the system, not from the American automotive
industry (at that time the world's largest by far), but
from visiting a supermarket."
 The idea of Just-in-time production was originated by
Kiichiro Toyoda, founder of Toyota.
 The question was how to implement the idea. In
reading descriptions of American supermarkets, Ohno
saw the supermarket as model for what he was trying
to accomplish in the factory.
Idea of Lean Manufacturing
 While low inventory levels are a key outcome of the
Toyota Production System, an important element of
the philosophy behind its system is to work
intelligently and eliminate waste so that only minimal
inventory is needed.

Need of Understanding
 Many American businesses, having observed Toyota's
factories, set out to attack high inventory levels
directly without understanding what made these
reductions possible.
 The act of imitating without understanding the
underlying concept or motivation may have led to the
failure of those projects.

Systems and Systems Thinking

Discussion
 Discussion questions
– How has globalization affected your company?
Your job?
– How has competition affected the mindset in
your organization?
– What is the way in which your organization
approaches new technology? Do you feel
technology is well understood and integrated in
your organization?
– Does your organization use aspects of lean
manufacturing? How were these introduced?
Discussion
 What does waste mean to you? Is there a culture

of waste reduction in your organization? How
effective is it?
 Do you use PDSA (or PDCA) in your
organization? Can you describe an example?
 Do you view Value from a customer perspective?
How is this reflected in what you do?
 Do you witness unevenness and overburden in
your organization? What is the result of this?
How might you tackle this problem?

Thank you

Lean Manufacturing
Hyderabad Campus
BITS Pilani
Hyderabad Campus
Lean Manufacturing
 Just In Time
 JIT Elements

Lean Production Framework

 Our core goal is to provide the highest quality, at the lowest cost, in
the shortest time by continually eliminating muda or waste.
 But today customers have broader expectations. Thus, lean companies
have added safety, environment, and morale to their core goals.
 Hence, the acronym PQCDSM:
– Productivity.
– Quality.
– Cost.
– Delivery time.
– Safety and environment.
– Morale.
 We must confirm on a daily basis that our activities are advancing
PQCDSM. Otherwise, it's pure muda.

JIT Production: Overview
 Just-in-time (JIT) production means producing the right item
at the right time in the right quantity.
 Anything else entails muda.
 Toyota introduced JIT in the 1950s in response to very
concrete problems including:
 Fragmented markets demanding many products in low
volumes.
 Tough competition.
 Fixed or falling prices.
 Rapidly changing technology.
 High cost of capital.
 Capable workers demanding higher levels of involvement.
 At Toyota, JIT must supported by the entire lean system.
Why JIT?
 Eliminate the Push Production
 Change over timings are long and large
batch sizes
 Shortage of products to meet the customer
demands.
 Tracking the production schedules are
difficult.

Basic Principles of JIT
 JIT production follows a few simple rules.
– Don't produce something unless the customer has
ordered it.
– Level demand so that work may proceed smoothly
throughout the plant.
– Link all processes to customer demand through
simple visual tools (called kanbans).
– Maximize the flexibility of people and machinery.

Continuous flow
How can we make things flow? Here is a good way to
start:
Define value from the point of view of the
customer.
Move machinery and people close together so that
they can provide value continuously.
Subordinate everything to 1 and 2.

Pull Production
Pull means that nobody upstream should produce a goods
or service until the customer downstream asks for it.
In the most common type of pull system the customer
withdraws the product and we plug the gap created
thereby. Let's look at an example.
– For example, suppose you back your blue 2000 Toyota Camry into a post. You go to your local Toyota
dealer who installs a blue 2000 Toyota Camry bumper. This creates a "hole" in the dealer's stores area.
The hole generates a signal to the local Toyota Parts Distribution Center (PDC): "Please send us a blue
2000 Toyota Camry bumper (to replace the one that we put on the customer's car).“
– PDC sends a replacement bumper to the dealer and a signal upstream to the Parts Redistribution Center
(PRC), where Toyota suppliers ship their parts. PRC sends a blue 2000 Toyota Camry bumper to the
PDC and a signal to the bumper manufacturer: "Please make us a blue 2000 Toyota Camry bumper." The
bumper manufacturer schedules a slot of production time to make the blue bumper. Figure 5.1 shows the
three "pull loops" between the bumper manufacturer and the dealer.

Pull Production

The Magic of Pull
 Pull systems control WIP. The number of kanban cards,
bins, footprints on the factory floor etc, put an upper limit
on WIP in the system.
 this in turn:
 reduces cycle time—in accord with Little's law
 reduces operating expense—we aren't ordering as much raw
material or making as much WIP and finished goods inventory
 improves quality—defects are not reproduced in large batches,
and are easier to catch quickly
 improves ergonomics—part bins aren't as big or numerous so
there is less heavy lifting,
 improves safety—there are fewer forklift trucks whizzing by

JIT Systems
At Toyota came to see the essence of JIT—make value flow
so that the customer can pull. The components of the JIT
system are:
Kanban. A system of visual tools (usually signal cards) that
synchronize and provide instruction to suppliers and
customers both inside and outside the plant.
Production leveling or heijunka. This supports standardized
work and kaizen. The goal is to produce at the same pace
every day so as to minimize the peaks and valleys in the
workload. Paradoxically, heijunka also supports quick
adaptation to fluctuating demand.

JIT Systems
Kanban and heijunka in turn depend on:
 Quick machine changeovers, which allow rapid
response to daily customer orders and minimize muda
of waiting.
 Visual management through the 5S system, which
makes the production condition transparent to the
entire team and coordinates action.

Kanban
– A light on a production control board.
– A space on a parts cart (useful for assembling part kits).
– A colored Ping-Pong ball that rolls down a chute when a
customer withdraws an item, telling us to "make one of
these please."
– An electronic message on a computer screen can also
serve as a kanban.
 However, such electronic kanbans do not satisfy the
visual management triangle discussed.
 This situation may change as computer technology
advances and large screens are available that everyone
can see at the same time.
Kanban Circulation

Types of Kanban
There are two kinds of kanban

 Production kanban, which specifies the kind and
quantity of product that the upstream process
(supplier) must produce.
 Withdrawal kanban, which specifies the kind and
quantity of product that the downstream process
(customer) may withdraw.

Production Kanban and Withdrawal Kanban
Storage Area _____ Part No. Process
_____
Item Name _____ Welding SB-4
Product Type _____
Quantity/container _____
Box Type _____
Delivery Area _____ Card
No. _____
Stores Shelf _____ Proceeding Process

Item No. _____
Item Name _____
Product Type

The Six Kanban Rules
 Team members and supervisors must have a deep

understanding of these rules as well as good problem
solving skills. Murphy rules during kanban
implementation.
– Rule 1: Never ship defective items
– Rule 2: The customer withdraws only what is
needed
– Rule 3: Produce only the quantity withdrawn by
the customer
– Rule 4: Level production
– Rule 5: Use kanban to fine-tune production
– Rule 6: Stabilize and strengthen the process
Production Leveling
 Most assembly departments find it easier to schedule
long runs of one product type and avoid changeovers.
 Lead times expand because it becomes difficult to
serve customers who want something different than
the batch we are making now.
 Batch production also means that we consume raw
materials and parts in batches, which swells WIP
inventories.
 Quality suffers because a single defect becomes
replicated throughout the batch.

Production Leveling
 Workers experience unevenness—that is, some lines
are busy, others idle—which also degrades efficiency.
 The unevenness in the work creates strain, which
corrodes safety and morale.
 Production leveling or heijunka means distributing the
production volume and mix evenly over time.

Production Leveling
 For example, instead of assembling all the type A
products in the morning and all the type B products in
the afternoon, we would alternate small batches of A
and B.
 It took me a while to grasp the benefits of heijunka.
But the more we level the production mix at the
pacemaker:
 The shorter our lead time.
 The smaller our finished goods and WIP inventory
required.

Production Leveling
 The less unevenness and strain experienced by our
operators.
 In fact, the kanban system is predicated on production
leveling, as is standardized work.
 Production leveling also helps us determine our
personnel, equipment, and material needs.

JIT Systems: Capable Processes
 Capable processes, which means capable methods, workers,
and machines:
 Capable methods means standardized work, which
provides a baseline for kaizen. It also means applying
jidoka to both minimize and contain defects.
 Capable workers means multiskilled problem solvers
who rotate from job to job and are involved in
improvement activities.
 Capable machinery means TPM and 5S activities that
attack the six big losses (equipment breakdowns, setup
and adjustment delays, idling and minor stoppages,
reduced speed, process defects, and reduced yield).
Conveyance
 There are two kinds of conveyance in the kanban system:
– Fixed time and variable quantity conveyance.
– Fixed quantity and variable time conveyance.
 Fixed time conveyance is preferable when processes are
disconnected and conveyance distances are long.
 Easy to follow or "milk run" routes can be readily set up.
External suppliers almost always use this form of conveyance.
 Fixed quantity conveyance is preferable when processes are
connected (e.g., an assembly line) and conveyance distances
are short, or when lot sizes are large (e.g., stamping).
 Toyota uses fixed quantity conveyance for stamped parts and
for large injection-molded parts such as instrument panels.
Muda
 Muda is the one Japanese word you must know. It is just what it sounds like.
Heavy and foul, it sticks in your mouth.
 Muda means waste, or any activity for which the customer is not willing to pay.
 Muda is the opposite of value, which is simply what a customer is willing to pay
for.
 Consider a filing cabinet manufacturer. The customer is willing to pay for sheet
metal to be cut, bent, welded, and painted. But the customer is not willing to pay
for wait time, rework, or excess inventory or any of the other forms of muda.
 Human motion can be divided into three categories.
– Actual work: refers to any motion that adds value to the product.
– Auxiliary work: motion that supports actual work; usually occurs before or
after the actual work (e.g., picking a part out of a suppliers box or setting the
part in a machine).
– Muda: motion that creates no value. Here is a good test: If you stopped doing
this, there would be no adverse effect on the product.

Muda
 Consider a spot welding operation:
 Actual work comprises those few moments of spot
welding.
 Auxiliary work might comprise setting up and removing
the work piece.
 Muda might comprise:
– Unnecessary walking or reaching to set up the work
piece.
– Making more spot welds than necessary.
– Making more pieces than the customer demands.

Muda
 The traditional approach to process improvement focuses on
identifying local efficiencies—“Go to the equipment, the value-
added processes, and improve uptime, or make it cycle faster, or
replace the person with automated equipment.”
 The result might be a significant percent improvement for that
individual process, but have little impact on the overall value
stream.
 This is especially true because in most processes there are relatively
few value-added steps, so improving those value-added steps will
not amount to much.
 Without lean thinking, most people can’t see the huge opportunities
for reducing waste by getting rid of or shrinking non-value-added
steps.
Muda
 In a lean improvement initiative, most of the progress comes
because a large number of non-value-added steps are squeezed
out. In the process, the value-added time is also reduced. We
can see this most vividly by taking a process like the nut-
making example and creating a one-piece-flow cell.
 In lean manufacturing, a cell consists of a close arrangement of

the people, machines, or workstations in a processing sequence.
You create cells to facilitate one-piece flow of a product or
service, through various operations, for example, welding,
assembly, packing, one unit at a time, at a rate determined by
the needs of the customer and with the least amount of delay
and waiting.
Waste in a value system

Motion
 Wasted motion has both a human and machine element. Wasted human
motion is related to workplace ergonomics.
 Poor ergonomic design negatively affects productivity and quality as
well as safety. Productivity suffers when there is unnecessary walking,
reaching, or twisting.
 Quality suffers when the worker has to strain to process or check the
work piece because of reaching, twisting, or poor environmental
conditions.
 Poor ergonomics has perhaps the biggest impact on safety. Ergonomic
injuries comprise more than 50 percent of all workplace injuries in
North America.
 The most important ergonomic risk factors are posture, force, and
repetition, all of which depend on workplace design. Ergonomics,
therefore, is a key to reducing the muda of human motion.
Delay
 Waiting waste occurs when a worker has to wait for material to

be delivered or for a line stoppage to be cleared, or when
employees stand around waiting for a machine to process a part.
 It also occurs when there is excessive work-in-process (WIP)
because of large batch production, equipment problems
downstream, or defects requiring rework.
 Delays increase lead time—that is, the time between the
customer placing and receiving his or her order—a critical
measure in the lean system.
 Lead time may be defined as follows:
 Lead time = Processing time + Retention time
 Delays increase retention time, which far exceeds processing
time in most manufacturing operations.
Conveyance
 Conveyance waste includes the large-scale waste caused by

inefficient workplace layout, overly large equipment, or
traditional batch production.
 Such waste occurs, for example, when large batches must be
moved from process to process.
 Making smaller batch sizes and moving processes closer
together can reduce conveyance muda.
 There is also a micro component related to work pieces being
carried within a process area either by conveyor or by workers.
 Conveyance, delay, and motion wastes are closely related.
Conveyance is necessary muda—obviously materials must be
moved through the factory, but it must be minimized.
Correction
 The muda of correction is related to making and
having to fix defective products. It comprises all
material, time, and energy involved in making and
repairing defects. There is now a large body of
literature on quality costs—that is, on the costs of
correcting this muda.

Overprocessing
 This is a subtle form of muda related to doing more than what

the customer requires. Such muda often exists in companies
driven by their engineering departments.
 For example, companies enamored with a given technology, or
committed to achieving a certain technical goal, may lose touch
with what the customer actually wants.
 Porsche suffered from this in the 1980s as the company
continually pursued engineering goals that were unrelated to the
customer's desires.
 For example, Porsche automobiles of that era achieved
incremental performance improvements at 200 km/hr or more.
But try changing the oil.
Inventory
 The muda of inventory is related to the keeping of unnecessary raw

materials, parts, and WIP.
 These conditions result when flow is constricted in a plant and when
production is not linked to the drumbeat of the market (pull).
 For example, organizations that schedule production solely on the
basis of material requirement planning (MRP) systems inevitably
have substantial muda of inventory.
 MRP is a "push" system. That is, production is scheduled at each
department—or pushed along—regardless of the needs of the
downstream process.
 These schedules are based on the inventory and WIP levels recorded
in the database, which usually vary widely from actual levels.
 Thus, workers and supervisors make extra, "just in case," and WIP
accumulates. BITS Pilani, Hyderabad Campus
Overproduction
 Taiichi Ohno saw overproduction as the root of all

manufacturing evil. Overproduction means making
things that don't sell. Here are some of the related costs:
 Building and maintenance of large warehouses.
 Extra workers and machines.
 Extra parts and materials.
 Extra energy, oil, and electricity.
 Extra forklifts, tow trucks, pallets, and skids.
 Extra interest payments on loans.
 Hidden problems and invisible kaizen points.
Overproduction is a root cause
 Motion: Workers are busy making things that nobody

ordered.
 Waiting: Related to large batch sizes.
 Conveyance: Unneeded finished goods must be moved
to storage warehouses.
 Correction: Early detection of defects is more difficult
with large batches.
 Inventory: Overproduction creates unnecessary raw
materials, parts, and WIP.
 If we prevent overproduction we will make major strides
toward our goals.
KnowledgeDisconnection
 This form of muda exists when there are disconnects within a

company, or between the company and its customers and suppliers.
 Disconnects within a company can be horizontal, vertical, or
temporal.
 These inhibit the flow of knowledge, ideas, and creativity, creating
frustration and missed opportunities.
 When a company is connected to the voice of the customer it will
create products that consistently satisfy and even delight.
 When a company and its suppliers are in tune, they will jointly
identify muda and act to their mutual benefit.
 There will be few missed opportunities. Womack and Jones have
coined the term macro value stream to highlight the opportunities that
exist both upstream and downstream in the value chain.
Thank you

Lean Manufacturing
Hyderabad Campus
BITS Pilani
Hyderabad Campus
Lean Manufacturing
 Work Flow
 Value Stream Mapping

Recap
 Evolution of lean manufacturing from the origins of
craft manufacturing and mass manufacturing
 In lean manufacturing we have retained the efficiency
of mass manufacturing, while bringing the operator
closer to the customer, as it was during craft
manufacturing.
 JIT Elements

Flow
 The way in which material moves in the plant
 Having smooth material flow is important to
organizations as it makes it easier to detect problems,
allows for efficiency in material movement, ease of
supervision, and short lead times.
 Focus on utilization of expensive machines and batch
mentality work against smooth flow of material.
 We need to focus on the root causes of flow
disruption and eliminate them.

Why is Material Flow Important?
 Shorter throughput times

 Easier to predict customer promise dates
 Problems surface faster
 Better quality
 Ease of supervision
 Ease of scheduling
 Ease of taking corrective action, when problems arise

Flow
 Elimination of discontinuities in the process
•Why do discontinuities occur?
–Batch mentality
–Focus on maximizing utilization of expensive equipment
–Lack of flexibility in the system
–Lack of trust
•Focus on the root causes of discontinuities and
address them

Flow and Muda
 Muda is usually a symptom of obstacles to flow. For
example, WIP in front of a machine means that there
may be a problem with:
– Changeover time (e.g., changeovers are so long that
the operator makes as many pieces as possible).
– Machine availability (e.g., machines are unreliable
and the operator makes extra parts just in case).
– Quality (e.g., the defect rate is high and the operator
has to make more to meet the production target).

Layouts

Layouts

Product Layouts
 Product layouts were designed to maximize flow, but
for high volume products
 The machines were special purpose and automation
was hard automation, i.e, the system was designed
for a specific part and volume
 The system was inflexible
 It was easy to supervise
 Scheduling was relatively easy
 Lead times were generally short
 WIP was low
Process Layouts
 Process layouts were used for low volume products

 Machines were general purpose and parts requiring
processing could be produced on any machine of a
particular type, e.g., lathe, etc.
 Supervision and scheduling were more difficult
 Lead times were long
 WIP was high

Group Technology
 Attributed to Mitofanov, a machinist, who was looking

for similarities in part shapes
 Group technology was the forerunner to machine cells
 Initial applications were in coding and classification of
parts for reducing redundant effort in part design
 John Burbidge devised Production Flow Analysis to
group parts that needed similar routings and the
machines into cells

Machine Cells
 A group of machines used to complete a sequence of

operations on a family of parts
 The parts in a family does not have high volumes, but
the family has sufficient volume to justify the
dedication of the machine cell
 By restricting the movement of each part to a small
area, material handling and control is easier,
inventories are low and therefore lead times short.
This gives the machine cells the efficiency of product
layouts

Machine Cells
 Unlike product layouts, group layouts/machine cells
have the ability to accommodate a family of parts
 Due to this, when product mix and volumes change,
the machine cell is able to absorb the fluctuation. This
makes the group layout/machine cell flexible like the
process layouts
 Machine cells are easy to supervise and schedule
 WIP and lead times tend to be low

Setup time reduction
 Traditional inventory models, such as EOQ, assume
that the set up cost/time is a fixed quantity.
 Some large automated lines and presses can take more
than a shift to change over from one product to
another.
 With such long set up times, the batch sizes had to be
large. Also, it was impractical to do much load
leveling.
 Toyota challenged the assumption of fixed setup times

Problems with existing method of setup
– Scheduling not done in time resulting in long
waiting times.
– Non standard procedures. Insufficient training.
– Non standard equipment and dies of different sizes
and heights. Searching time.
– Different shut heights require longer adjustment.
– Tools, nuts, bolts missing.
– Excessive adjustment.

 Steps in set up reduction (SMED)
–Determine existing setup procedure
–Divide activities into internal elements and external
elements
 Internal elements are those that require the machine to
be stopped
 External elements can be performed while the machine
is running
–Try to convert internal elements to external elements
–Try to improve external elements
Process Mapping
 Process maps are pictorial representations of an activity.
 Process maps can be drawn with different levels of detail
and for different purposes.
 A flow chart is a common type of mapping technique
 Typically flow charts are used to map detailed processes
 When processes are mapped at a detailed level, the
intent is to improve the individual activities involved in the
process
 Usually such improvements are local and relatively easily
implemented
 The local improvements may or may not result in the
overall system improvement
Process Maps

Process Map

Introduction to Value Stream Mapping
A Value Stream includes all elements (both value added

and non-value added) that occur to a given product
from its inception through delivery to the customer.
Requirements Design Raw Materials Parts Manufacturing
Assembly Plants Distribution Customer

Introduction to Value Stream Mapping
Value Stream Mapping (VSM) is a hands-on process to

create a graphical representation of the process,
material and information flows within a value stream.
Customer
X pcs / month
Steel Supplier Std Pack Qty
PC & L # Shifts
Level Box
DA1
Daily DA2
DA3
6 x / Day
Stamping Welding Assembly Finished Goods
Layout
3 Shifts 3 Shifts 3 Shifts # Material Handlers

TAKT Time TAKT Time TAKT Time Max Size
CT = CT = CT = 2 Shifts
C/O Time = C/O Time = C/O Time = 0 Overtime
DT = DT = DT =
Scrap = Scrap / Rework= Scrap / Rework =
WIP = Small Lot # Operators
WIP = WIP =
Inv .Time ? days ? days ? days ? days TPc /t = ?

Proc .Time ? days ? days ? days
Future State Material, Information and Process Flows

with total Product Cycle Time
Objectives of Value Stream Mapping
 Provide the means to see the material, process and

information flows.
 Support the prioritization of continuous improvement
activities at the value stream
 Provide the basis for facility layout
 Finally, it is helpful to eliminate waste

Value stream mapping (VSM) process symbols
Symbol Title Symbol Title
Supplier or Customer Dedicated Process
Shared Process Data Box
Work Cell

Value stream mapping (VSM) material symbols
Inventory
Shipments
Material Pull Push Arrow
Supermarket Safety Stock
FIFO Lane External Shipment

(Receiving or Shipping)

Value stream mapping (VSM) information
symbols
Verbal Information MRP/ERP
Sequenced Pull Production Control
Electronic Go See Scheduling

Information
Manual Information Load Leveling
Signal Kanban Kanban Post
Production Kanban Withdrawal Kanban

Value stream mapping (VSM) general
symbols
Kaizen Burst Human Operator
Other Information Timeline

Steps in VSM
Identification of Product Family

Current State map
Data collection and analysis
Future State map
Implementation

Current State Map
The Steps
Step 1: Select a Product Family

Step 2: Form a Team
Step 3: Understand Customer Demand
Step 4: Map the Process Flow
Step 5: Map the Material Flow
Step 6: Map the Information Flow
Step 7: Calculate Total Product Cycle Time
Step 8: Detail Off-Line Activities
Current State Map
Step 1: Select a Value Stream (Product Family)
 Define value stream (product family)

– Identify value stream from the customer end
– Product should pass through similar processes and common
equipment
– Door-to-door in scope (within plant walls)
 List part numbers

Current State
Step 2: Form a Team
 Select a cross-functional team

 Select team members Sensei
Industrial
Engineering
who are familiar with

the product
Product
Manufacturing Engineering
Cross Functional
Team
 Ensure that team Maintenance

PC & L
members are trained in the
use of VSM Leadership
 Designate a champion (typically a line manager)

THIS IS CRITICAL
Current State Map
Step 3: Understand Customer Demand
 Plan for Every Part Customer
 Production
Control
Demand/month:
Part A =
Part B =
(monthly/weekly forecasts) Part C =

# of shifts =
 Production history (day-to-day, month-to-month

variation)
 Sales (product changes, new business, etc.)
Current State Map
Customer
Demand/month:
Part A =
Part B =
Part C =
# of shifts =
Stamping Welding Assembly Shipping
Takt = Takt = Takt = Inventory

C.T. = C.T. = C.T. = Part A =
D.T. = D.T. = 20% D.T. = Part B =
FTQ = FTQ = FTQ = 90% Part C =
C/O Time = 4 hrs. C/O Time = C/O Time = # of shifts =
Lot Size = Lot Size = Lot Size =
# of Shifts # of Shifts # of Shifts
WIP = WIP = WIP =
Changeover
Downtime FTQ
Current State Map
Step 5: Map the Material Flow
Customer
Supplier
Demand/month:
Part A =
Part B =
Part C =
# of shifts =
2 x/ 2 x/
week day
Shipping
Stamping Welding Assembly
I I I I
1,200 pcs 1,500 pcs 800 pcs 500 pcs
C.T. = C.T. = C.T. = Part A =
D.T. = D.T. = 20% D.T. = Part B =
FTQ = FTQ = FTQ = 90% Part C =
WIP = WIP = WIP =
Changeover Downtime FTQ

Current State Map
Step 6: Map the Information Flow
PC & L
6 week rolling forecast
Weekly Order
6 week rolling forecast Weekly Order Customer
Supplier Daily Ship Schedule

Demand/month:
Part A = 705 pcs.
Weekly Build Schedule
Part B = 600 pcs.
Part C = 1650 pcs.
# of shifts =
2 x/
week 2 x/
day
I I I I
1,200 pcs 1,500 pcs 800 pcs 500 pcs
C.T. = C.T. = C.T. = Part A = 750 pcs
D.T. = D.T. = 20% D.T. = Part B = 600 pcs
FTQ = FTQ = FTQ = 90% Part C = 1650 pcs
WIP = 25 pcs. WIP = 60 pcs. WIP = 550 pcs.

PC & L
Weekly Order
Weekly Order Customer
Daily Ship Schedule
Supplier
Demand/month:
Part A = 705 pcs.
Weekly Build Schedule
Part B = 600 pcs.
Part C = 1650 pcs.
# of shifts =
2 x/ 2 x/
week day
I I I
800 pcs I
1,200 pcs 1,500 pcs 500 pcs
C.T. = C.T. = C.T. = Part A = 750 pcs
D.T. = D.T. = 20% D.T. = Part B = 600 pcs
FTQ = FTQ = FTQ = 90% Part C = 1650 pcs
WIP = 25 pcs. WIP = 60 pcs. WIP = 550 pcs.
.4 days .5 days .27 days .17 days

TPc/t = 2.5 days
.008 days .02 days .18 days 1.0 days
Current State Map
Step 8: Detail Off-Line Activities
 Show on the map using general icons

 Detail
on another sheet using either reference
VSM and/or process flow-charting
Press Room
Fork Truck
Die Bench
Die Room Die Room
Receiving Shipping
(Remove from
Schedule
I I Board)
Dies Dies
12 shifts 2 shifts
Schedule Board
(Forecast)
Data Collection
Data Collection
Attribute Data to Collect
 Shipping/Receiving  Work-in-process
schedules inventory
 Pack sizes at each  Overtime per week
process
 Demand rates by process  Process cycle times

(Takt Time)
 Number of product variations at
 Working hours and breaks each step
 Scrap  Batch (lot) sizes

 Inventory Points (location
& size)  Changeover times
 Rework
 How Operations are  Changeover
scheduled  Downtime
frequencies
Data Collection
Data Box
Tailor the
data box for
your plant’s
ox
needs.
a B
at The data box
D should be
open ended
to allow for
additional
attributes.
Data Collection
What is Takt Time?
Takt Time is the rate at which production

should run to meet customer demand
The idea is to synchronize the pace of
production to the pace of sales.
Your Operating Time per Shift
Customer Requirement per Shift
27,000 sec = 59 sec 59 sec.

460pieces
59 sec.
59 sec.
Data Collection
How to Calculate Takt Time?
1. Determine Total Customer Requirements for the

affected process.
2. Determine the Scheduled Runtime (S.R.) for the
affected process:
Scheduled Runtime = (Effective Minutes) - (Planned Downtime)
Effective Minutes = (minutes per shift) - (approved breaks)
Planned Downtime is the amount of time an operation is down
for scheduled reasons.
3. Calculate Takt Time:
Scheduled Runtime
Takt Time =
Total Customer Requirements
Data Collection
Identify Opportunities for Improvement
?
Design Future State - Purpose
Purpose
 Define how the plant will

operate in the future
 Serve as the blueprint

for implementation
Without it, the Current State Map is

nothing more than wallpaper !
Future State Map
The Steps
Step 1: Validate Customer Demand

Step 2: Draw the Future State Process Flow
Step 3: Map the Future State Material Flow
Step 4: Map the Future State Information Flow
Step 6:
Detail Off-Line Activities
Step 7: Outline a Plan
Future State Map
Step7: Outline a Plan
Original Condition Future Condition
Inj: 2 MSS MSS
I Molding
Change I
Over
2
Sender
Ass’y
2 I 2 Level
I Fuel Pump No Flow 2 Sender
Ass’y I Inj: ABABA. . .
Molding Ass’y
Attendance Labels Staging
by Truck
10 Tank 4 Ass’y
Stamping I Ass’y Plants 10
Tank 4 Ass’y
Stamping Ass’y card Plants
No Flow
by
Change
Over 12 card
Uptime
7
(Pitch = 14 Units)
Cycle-Time Driven. Batches. Perform to TAKT & Pitch. Zone Maintenance & Fast Response
Produce to Order
Load Leveling and Pull
METRICS Activity
1999 2000
1ST 2ND 3RD 4TH 1ST 2ND 3RD 4TH
Item Current Target
Establish TAKT & Flow in Tank Ass'y
Total product cycle time
Stamping Changeover Reduction
Parts / Person Hour Reduce Stamping Buffer
Delivery Performance Move Ass'y to Plant 10
Establish TAKT & Flow in Sender Ass'y
Inventory (days)
Pull To Sender Ass'y
Overtime
Uptime Training
Thank you

Lean Manufacturing
Hyderabad Campus
BITS Pilani
Hyderabad Campus
Lean Manufacturing
 Value Stream mapping
 Work Cell

Recap
 Material flow is integral to TPS as it affects the lead
times and inventories on the shop floor
 The principal reasons for intermittent movement of
materials is batch manufacturing, long set-up times
and an attempt to reduce per unit costs
 Product type layouts were used in mass
manufacturing for high volume parts. Process layouts
were meant for low volume job shops.

Recap
 Group layouts were developed as a hybrid

between product and process layouts. They were
efficient in terms of flow and could be used for
low to medium volumes of families of products
 Typically, value is added to parts for less than one
percent of the time it spends in the plant.
However, the majority of improvement efforts are
focused on improving this one percent. There is a
larger potential for benefits by looking at the
remaining time the part spends in the system.
11/19/2021
Recap
 Value Stream Mapping is a macro level charting
technique that highlights the discontinuities in flow in
a system. It can be used as a tool to significantly
improve material flow and system throughput
 Value Stream Mapping is applicable to both
manufacturing, as well as non-manufacturing
processes.
 By analyzing the current state maps and applying lean
principles, we can greatly reduce discontinuities in
material and information flow.

Lean Principles to Develop Production Line
 Avoid over-production – produce to takt time
 Develop Continuous Flow
 Where continuous flow is not possible, use supermarket pull
– Used when operations are far apart
– Used when an operation is done at a supplier
– Used when operations are not balanced
– Used when process is unreliable
 Schedule only one process
– It is called the “pace maker”
– Linked to the customer order
– Downstream processes have to be continuous flow
 Production Mix
 Create Pull Production
Key Questions For The Future State
1.What is the takt time?
2.Will you build to a finished goods supermarket from
which the customer pulls, or directly to shipping?
3.Where can you use continuous flow processing?
4.Where will you need to use supermarket pull systems?
5.Which will be the pacemaker process?
6.How will you level the production mix at the pacemaker
process?
7.What increment of work will you consistently release to
the pacemaker process?
8.What process improvements will be necessary?
Case Study

current-state map for St. Clair Pallet, a
commercial pallet manufacturer

Observations
Currently, the production manager schedules production
manually at each process based on perceived daily
priorities.
There are frequent changes to the schedule (shown by the
dotted lines). Lead times ranged from twelve to fifteen
days, and 10 percent of orders are late.
Workers are paid a piecework rate and work as fast as they
can. Cycle times at assembly are unstable and range from
80 to 120 seconds.
 Inventories are high in the wood yard and between each
process. Changeover time at the multi-saw is thirty minutes
and at the notching machine is 20 minutes.
kaizen opportunities
 Implement a type A pull system using assembly as the
pacemaker. Pull items from a finished goods store
containing a day's worth of inventory. The store will
accommodate emergency orders, which often disrupt the
operation. Our takt time will be 68 seconds.
 Combine the multi-saw and notching machine in a cell with
two operators.
 Implement a store between assembly and sawing and
notching and another in the wood yard. Use kanbans to
replenish items withdrawn from each store.
 Assign daily scheduling to the production supervisor, which
will free up the manager's time for kaizen.
kaizen opportunities
 Stabilize the assembly process. Rebalance the work so
that two instead of four operators can do it. Reduce
assembly changeover times to less than five minutes.
 Rebalance the saw and notching machine work so two
operators can do it in a cycle time of thirty-five
seconds. Reduce changeover times to less than five
minutes for each machine.
 Apply visual management and 5S at each of the stores.

Future State Map

Benefits
 Lead time reduced to three days.
 Wood yard inventory reduced to ten days (from sixty
days).
 Work-in-process inventory reduced to two days (from
eight days).
 Finished goods inventory reduced to one day (from
five days).
 Productivity improved by 43 percent (manpower
reduced from seven to four with no loss of output).
Operators released thereby will be reassigned.

Case Study
Auto Component
Industry
References
 Naga Vamsi Krishna Jasti, Aditya Sharma, (2014) "Lean manufacturing implementation using value
stream mapping as a tool: A case study from auto components industry", International Journal of
Lean Six Sigma, Vol. 5 Iss: 1, pp.89 – 116.
 Jason Fretz, Brian Grannan, Aaron Lininger and Jeff Lovell (2014), “Value Stream mapping”,
https://www.google.co.in/url?
sa=t&rct=j&q=&esrc=s&source=web&cd=2&cad=rja&uact=8&ved=0CCMQFjAB&url=http%3A
%2F%2Fiwse.eng.ohio-state.edu%2Fisecourses%2Fise608%2Fdcs%2FValue%2520Stream
%2520Mapping.ppt&ei=4xXvU4WZDNjr8AXurYKACw&usg=AFQjCNFQFCzDEtVVb4vEJxALc4t
6uf3mWA&sig2=RR_0HvaDql3jYCv5X9-nqw&bvm=bv.73231344,d.dGc
 Pascal, D (2010), Lean Production Simplified , Second Edition, Productivity Press, London, UK.

Machine Cells
 A group of machines used to complete a sequence of

operations on a family of parts
 The parts in a family does not have high volumes, but
the family has sufficient volume to justify the
dedication of the machine cell
 By restricting the movement of each part to a small
area, material handling and control is easier,
inventories are low and therefore lead times short.
This gives the machine cells the efficiency of product
layouts

Machine Cells
 Unlike product layouts, group layouts/machine cells
have the ability to accommodate a family of parts
 Due to this, when product mix and volumes change,
the machine cell is able to absorb the fluctuation. This
makes the group layout/machine cell flexible like the
process layouts
 Machine cells are easy to supervise and schedule
 WIP and lead times tend to be low

Machine Cells
 Machines are arranged typically in a U-shaped layout
 Each operator is assigned multiple machines, not of the
same type
 Input and output stations tend to be near each other
next to a transportation aisle
 Components are delivered either to the first station and
moved with the product, or delivered by a water spider
to each station

Machine Cells
 Generally the machining capacity is more than required.

 As production volume changes, adjustment is made to the
staffing of the machine cell. This makes the machine cells
flexible in terms of product mix and volumes
 By making a group of workers responsible for the complete
production of a part, there is a greater sense of satisfaction
for the workers
 Due to better communication within the cell, if there is a
quality problem, it is detected quickly and adjustments
made to prevent further defectives from being produced

Machine Cells

Tapped Lecture-4

Machine Cell Design
 Takt time determines the pace at which the cell
should complete one piece

Takt Time
 The first step is to calculate the takt time for
the cell
 This is done by dividing the total working
time in a day/shift by the sum of the
daily/weekly requirements for all the parts
assigned to the cell
 It is important that while doing so, the
volumes of individual products is relatively
close to each other (within 30% of each
other)
Cell Capacity
 The next step is to determine whether there is
adequate equipment capacity in the cell
 the total equipment times required for each
equipment type is calculated and compared with the
time available
 No. of machines= Total process time
-------------------------
Available time x Uptime

Capacity Calculations
Total requirements = 97000 secs per day

Total time available = 460*60 = 27600
Total number of machines required = 97000/27600*0.95 = 3.7 = 4 machines

Frequency of Production
 Small Lots
 Setup time
 We should take the station/operation which requires
the maximum set up time and see how much time
remains after deducting the variable processing time
from the total available production time in each cycle.

Frequency of Production
 Assume that there are 5 products in a product family.
 If the total variable production time required for this family
on a machine which has the maximum setup time is 24500
seconds per shift (including machine uptime)
 The available production time per shift is 27600. Therefore
the time available for setups per shift = 27600 – 24500 =
3200 seconds
 Since the number of parts in the family is 5, the maximum
time Available per part per shift = 3200/5 = 640 seconds or
10.7 minutes
 Depending on the individual set up times we can determine
whether it is feasible to cycle through all parts once a shift
Traditional Approach in Manufacturing
 Traditional way of looking at manufacturing
 Piecemeal optimization
 Specialized dedicated equipment
 Focus on keeping equipment and labor busy
 Managing by numbers/work to quotas
 Use of inventory to take care of external and internal problems
 Quality was not designed or manufactured in. It was inspected
 It was felt that machine breakdowns, setups were given
 Suppliers were not to be trusted
 Manufacturing schedules were based on forecasts

Problems of Traditional Manufacturing
 Not responsive to market conditions/customer needs

 Long lead times
 High cost of producing poor quality
 Keeping machine and labor busy does not increase
saleable output
 Purchased parts constitute 70-80% of value of final
product
 Workers know the best way to deal with problems on
the shop floor
 High inventory incurring cost and decreasing visibility
Difference
 Process Orientation Vs Result Orientation

Lean Approach
 Challenge all assumptions
 Produce in small batches to match customer demand
 Build in quality instead of inspecting parts at the end
of the line
 Solve problems when and where they occur
 Work with the suppliers and the workforce to use
their abilities more fully

Lean Tools
 The specific tools of lean.
 We need to differentiate between the Toyota Production
System (TPS) and the Toyota Way. TPS covers the
specific tools and techniques on the shop floor, while
Toyota Way refers to the management thinking and
policies required to make TPS successful.
 According to Taiichi Ohno the two pillars of TPS are
Just In Time and Jidoka, or Autonomation.
 Both were initiated as a result of a need to try and catch
up with American auto manufacturers in terms of
productiivity.
Thank you

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Manufacturing

3 ET ZC417 – Manufacturing Excellence BITS Pilani, Hyderabad Campus

5 ET ZC417 – Manufacturing Excellence BITS Pilani, Hyderabad Campus

7 ET ZC417 – Manufacturing Excellence BITS Pilani, Hyderabad Campus

9 ET ZC417 – Manufacturing Excellence BITS Pilani, Hyderabad Campus

How each of these initiatives deferred?

 TQM : Zero Defect

 TPM : Zero Default

 JIT : Zero Stock

 TEI : Zero Injury

WCM : Integrates IE,TQM, TPM, JIT, TEI, Six Sigma,

14 ET ZC417 – Manufacturing Excellence BITS Pilani, Hyderabad Campus

1922 1927 1938 1941 1947 1949 1951

1982 1981 1979 1971 / 72 1961 / 62 1959 1955 1954

1983 / 84 1986 1989 / 90 1992 1994 1995 1996

Copyright © 2013.All Rights Reserved with Purple .

16 ET ZC417 – Manufacturing Excellence BITS Pilani, Hyderabad Campus

These practices, when effectively linked together can be

Control Management control operations Worker empowerment

Information Information prerogative of

 World's second largest small car market

20 ET ZC417 – Manufacturing Excellence BITS Pilani, Hyderabad Campus

Indian manufacturing sector is expected to grow at 16% to

India is ranked  The BPO

 FDI inflow into

Source: National Manufacturing Competitiveness Council

Engineering: A USD 22 bn including heavy and

The balance 25% exports are from sectors like

India is presently at the cusp of a

Source: National Manufacturing Competitiveness Council

23 ET ZC417 – Manufacturing Excellence BITS Pilani, Hyderabad Campus

a) Production design andSavings to the extent of 80% plants in developed

A sustainable competitive advantage for India in Manufacturing

24 ET ZC417 – Manufacturing Excellence BITS Pilani, Hyderabad Campus

Investor’s expectations India’s manufacturing

2. Favorable economic policies, flexible 2. Many manufacturing companies

25 ET ZC417 – Manufacturing Excellence BITS Pilani, Hyderabad Campus

 Incorporated in August 25, 1947, Grasim Industries

27 ET ZC417 – Manufacturing Excellence BITS Pilani, Hyderabad Campus

29 MM ZG522 - Total Quality Management BITS Pilani, Hyderabad Campus

30 MM ZG522 - Total Quality Management BITS Pilani, Hyderabad Campus

31 ET ZC417 – Manufacturing Excellence BITS Pilani, Hyderabad Campus

32 ET ZC417 – Manufacturing Excellence BITS Pilani, Hyderabad Campus

35 BITS Pilani, Hyderabad Campus

36 BITS Pilani, Hyderabad Campus

40 BITS Pilani, Hyderabad Campus

 different companies within the same industry have

44 BITS Pilani, Hyderabad Campus

45 BITS Pilani, Hyderabad Campus

46 BITS Pilani, Hyderabad Campus

47 BITS Pilani, Hyderabad Campus

50 BITS Pilani, Hyderabad Campus

51 BITS Pilani, Hyderabad Campus

Vertical Coordination. Management of the Business Unit must clearly

Horizontal Coordination. Through a specific and consistent pattern of

54 BITS Pilani, Hyderabad Campus

Operation Strategy developed after the

Operations Strategy focuses on specific

57 BITS Pilani, Hyderabad Campus

Order qualifiers are the basic criteria that

Order winners are the criteria that

58 BITS Pilani, Hyderabad Campus

A brand name car can

Repair services can be “order winners”