Manufacturing Practices Of New Era

World Class Manufacturing (WCM)

 World Class Manufacturing (WCM)
• World Class Manufacturing (WCM) is a structured and integrated
production system that involves all manufacturing processes in the site
and entire organization from the leadership to the people on the shop
floor.
• It refers to the practice followed in manufacturing organization, in
order to consistently deliver exceptional performance frequently in
excess of expectations.
• To achieve world-class status, companies must change procedures and
concepts in order to optimize their processes. This will lead to
reconstructing relationships with suppliers, purchasers, producers, and
customers.
 Steps to make the system efficient
• Reduction of set up time and in tuning of machinery: It is important that
organizations are able to cut back time in setting up machinery and also
tune machinery before production.

• Cellular Manufacturing: It is important that production processes are

divided into according to its nature, with similar nature combined together.

• Reduce WIP material: It is normal tendency of manufacturing organization

to maintain high levels of WIP material. Increased WIP leads to more cost
and decreased WIP induces more focus on production and fast movement
of goods.
 Steps to make the system efficient
• Postpone product mutation:
  To achieve a higher degree of customization many changes
are made to final product. However, it is important that
mutation conceived for the design stage implement only
after final operation.
• Removal the trivial many and focus on vital few: 
It is important for organization to focus on production of
products which are lined with forecast demand as to match
customer expectation.
 Seven keys to becoming a world-class
manufacturer
• Reduce lead times
• Speed time-to-market
• Streamline outsourcing processes
• Cut operations costs
• Exceed customer expectations
• Manage the global enterprise
• Improve business performance visibility
 Principles of World Class Manufacturing

• Implementation of just in time and lean management

leads to reduction in wastage thereby reduction in cost.

• Implementation of  TQM leads to reduction of defects

and encourages zero tolerance towards defects.

• Implementation of total preventive maintenance leads to

any stoppage of production through mechanical failure.
 Advantages of WCM
• Increased competitiveness.
• Development of new and improved technology and
innovation.
• Increased flexibility.
• Increased communication between management and
production employees .
• Increase in work quality and workforce empowerment.
 Barriers in the path of WCM
• Poor planning
• Lack of coordination among the processes
• Employee resistance
• Financial constraints
• Lack of appropriate monitoring
• Lack of employee education and training.
• Partial implementation of WCM techniques
 Barriers in the path of WCM
• Lack of organizational communications
• Poor quality infrastructure facilities
• Inadequate tools and equipment
• Non clarity of the organizational objective
• Lack of continuous quality control
• Lack of attention to the needs of internal and external
customers
Jugaad
Also known as Frugal Innovation or Frugal Engineering. It is
an innovative solution fix in crisis using available resources.

• The use of jugaad is commonplace in India. It means finding a

workaround for a problem for which regular or inexpensive
solution is not available.
• Jugaad is a colloquial Hindi word that roughly translates as an
improvised quick-fix for a problem for which standard and/or
affordable solution is not available in the market and society.
• Jugaad also refers to products that are used for purposes for
which these are not inherently designed.
Jugaad, like any innovation, can be classified in two
categories:
a) Product oriented – Eg: Jugaad Vehicle, and Mitti cool
Refrigerator
b) Process oriented – Eg: using washing machines for making
lassi, a blended yogurt drink, and using pressure cooker to
generate steam for making Espresso coffee.
• Over the period, the meaning of jugaad has evolved from
finding a workaround to also mean “frugal innovation.”
• Frugal innovation means coming up with affordable
products and services, especially but not limited to the low-
income populace.
• The aim of frugal innovation is to serve people without
compromising the safety, efficiency, and utility of the
products.
• However, jugaad products, usually lack basic safety
features, and are characterized by shoddy design features.
Dimensions of Jugaad
 Limitations of Jugaad

Largely untested Idiosyncratic Quick response

in the response to a solution to
organizational problem problems
setting

No design Not R&D centric

elements or risks
undertaken
Engage and iterate

Flex the assets

Create sustainable solutions

Shape customer behaviour

Co-create value with prosumers

Make innovative connections

Dimensional Approach

Problem
Cost Effective,
Identification
Complexity, Simple, Efficient,
Competition, Scalable
Resource Scarcity,
Jugaad ( Frugal Innovation)
Globalization
Theoretical Approach
Creative
Attitude

Need Creative Innovative

thought solution
JUGAAD
• Socio- • Recombining • Improvisations (Product/
economic hidden • Social
compulsions connections acceptance
Service)
 Example of Jugaad in Garment Industry
• FABRIC ROOM
• Make-shift ramps for procuring fabric rolls
• SPREADING
• Overhead laser for metering checked/ striped fabrics
• CUTTING
• Splicing of spread fabric to accommodate fabric defects
• PRODUCTION
• Make-shift scrap collection bags at sewing workstations
• Self-designed work-aids for easier stitching processes
• FINISHING
• Make-shift devices for removing trimmed threads
• Correction of printing defects using spotting pens

• PACKAGING
• Using larger containers to transport packed garments to
shipping cartons
 Path to be followed

Do more with
less

1 3

Do more with Do better

more with less
 What is benchmarking?

Benchmarking is a process of measuring the performance

of a company's products, services, or processes against those
of another business considered to be the best in the industry,
aka “best in class.”
 What is benchmarking?
Benchmarking is meant to identify internal opportunities for
improvement. By studying companies with superior performance,
breaking down what makes such superior performance possible,
and then comparing those processes to how your business
operates, you can implement changes that will yield significant
improvements.

• Why are others better ?

• How are others better ?
• What can we learn ?
• How can we catch up ?
• How can we become the
best in our industry ?
Operational Definition of Benchmarking
Comparing business processes,
not only performance measures
A structured technique

Benchmarking is a technique of identifying,

understanding and adapting superior practices
from organizations locally and world wide to
improve performance and achieve
priority business results.

Learn from others External focus Improvement, not evaluation

What to Benchmark?
 Why Benchmarking?
 Benchmarking is a more efficient way to make improvements.
Managers can eliminate trials and errors.
 Benchmarking speeds up organization’s ability to make
improvements. Today, time is of the essence.
 Benchmarking has the ability to bring performance up as a
whole significantly.
 Learn from others experiences.
 Set realistic but ambitious target.
 Why Benchmarking?

Performance
Improvement

Meeting
Quality Creative
standards Thinking

Benchmarking Keep pace

Innovation in with science
management and
methods technology
changes

Cope with Meeting

competitiv customer
e markets expectations
 Benchmarking Methodology

Best Practice
Overlap Competitive
• Industry leaders
• Top performers with
similar operating
characteristics

Functional Internal
• Top performers • Top performers
regardless of industry within company
• Aggressive innovators • Top facilities
utilizing new technology within company
 Levels Of Benchmarking In Competitive
Environment

 Internal benchmarking - Within one’s organisation.

 Competitive benchmarking - Analysis the performance and

practices of "best in class" companies.

 Non-competitive benchmarking – Is learning something

about a process a company wants to improve by
benchmarking.

 World class benchmarking - Ambitious and looking towards

recognized leader.
 1. IDENTIFY WHAT IS TO BE BENCHMARKED

PLANNING 2. IDENTIFY COMPARATIVE COMPANIES

Benchmarking Process

3. DETERMINE DATA COLLECTION METHOD AND

COLLECT DATA

4. DETERMINE CURRENT PERFORMANCE "GAP"

ANALYSIS
5. PROJECT FUTURE PERFORMANCE LEVELS

6. COMMUNICATE BENCHMARK FINDINGS

INTEGRATION AND GAIN ACCEPTANCE

7. ESTABLISH FUNCTIONAL GOALS

8. DEVELOP ACTION PLANS

9. IMPLEMENT SPECIFIC ACTIONS AND

ACTION MONITOR PROGRESS

10. RECALIBRATE BENCHMARKS

• LEADERSHIP POSITION ATTAINED

MATURITY • PRACTICES FULLY INTEGRATED INTO PROCESS
 The Seven Step Benchmarking
Model
Activity What is included
Step 1: Identify what to benchmark  Clarify the benchmark objectives
 Decide whom to involve
 Define the process
 Consider the scope
 Set the boundaries
Agree on what happens in the process
 Flowchart the process

Step 2: Determine what to measure  Examine the flow chart

 Establishes the process measures
 Verify that measures match objectives

Step 3: Identify who to benchmark  Conduct general research

 Choose level to benchmark
 The Seven Step Benchmarking
Model
Step 4: Collect data  Use a questionnaire
 Conduct a benchmark site visit

Step 5: Analyze data and determine the  Quantitative data

gap  Qualitative analysis

Step 6: Set goals and develop an  Set performance goals

“Action Plan”  Develop an action plan

Step 7: Monitor the process  Track the changes

 Make benchmarking a habit
 Areas Of Benchmarking
Operational Strategies: Supply chain management:

• Inventory management • Warehousing and distribution

• Inventory control • Transportation

Marketing management: H.R. Practices:

• Customer service levels • Talent Acquisition / Search

• Purchasing • Training and Development
• Billing and collection • Compensation management etc.
• Purchasing practices
 Factors For Success Of Benchmarking
 Benchmarking must have the full support of senior management
and they should actively involve with this process.

 For Benchmarking, team and process training is very imp.

 Benchmarking should be a team activity.

 Benchmarking is an ongoing process.

 Benchmarking efforts must be organized, planned, and carefully

managed.

 Correct use of benchmarking can lead you to the competitive

edge in today’s business market place.
 Advantages of Benchmarking
• Product and Process Improvement:
By implementing benchmarking activity, organizations
can improve their operation process
• Time & Cost Reduction:
Bench marking is time and cost efficient because it
involves imitation and adaptation rather than pure
invention
• Competitive Strategy
By implementing benchmarking activity, organizations
can improve their operation process.
 Disadvantages of Benchmarking
o The most resistant criticism of Benchmarking comes from
the idea of copying others.
o It is not a strategy nor is it intended to be a business
philosophy. Therefore, it is a time taking technique.
o Benchmarking is not “instant pudding”. It will not
improve performance if proper infrastructure of Total
Quality Management is not in place.
Push and Pull based manufacturing
 Push pull manufacturing
Push and pull based manufacturing is a type of lean tool for inventory management. The
demand for the product will control inventory costs, carrying costs, ordering costs and
storage costs. Inventory control systems are generally categorized as push or pull
models.  In supply chain management, it is important to carry out processes halfway
between push type and pull type or by a combination of push type and pull type.

Push System:
"Push type" means Make to Stock in which the production is not based on actual
demand.

Pull System:
"Pull type" means Make To Order in which the production is based on actual demand.
Push system:
Manufacturing system in which production is based on a projected production plan and
where information flows from management to the market, the same direction in which
the materials flow. This is how many traditional production and project management
environments have worked. 
It has no limit on WIP.
If we use a demand forecast that drives the “Material Requirements Planning” (MRP)
process to ensure that materials are available for production while maintaining the
lowest possible inventory, we are relying on a push-based manufacturing strategy. The
forecast may not always be accurate so we may end up with excess inventory, especially
when shifts occur in lead times.

Pull System:
A pull system is one that is set up to respond directly to internal or external customer
demand. Production facility begins to replenish the orders based on customer demand.
It has limited WIP and focus on demand.
The goal of a pull-based lean manufacturing environment is to make nothing until there is
demand. Finished goods are not produced without a specific customer order.
Pull manufacturing works best when demand is high and steady for a relatively small
variety of products.
 Example of Push System:
An example of a push system is Materials Requirements Planning, or MRP. MRP
combines the calculations for financial, operations and logistics planning. It is a
computer-based information system which controls scheduling and ordering.
It's purpose is to make sure raw goods and materials needed for production are
available when they are needed.

the "Push type" can be considered as an escalator. An escalator continues to

supply (push) regardless of whether there is actual demand (passenger).
 Example of Pull System:
Kanban is the most well-known approach for implementing a pull system. The Kanban
card system is used to provide a sign or signal by the next step in the process or
downstream operation.
The Kanban card is, in effect, a message that signals depletion of product, parts, or
inventory. When received, the Kanban triggers replenishment of that product, part, or
inventory.
Consumption, therefore, drives demand for more production, and the Kanban card
signals demand for more product—so Kanban cards help create a demand-driven
system.

Pull-type supply chain management is based on the demand side such as JIT and CRP.
While inventory is kept to a minimum, products can be supplied with short lead times
and at high speed. At the point where "Pull type" starts to supply operations triggered
by actual demand.
So in JIT, the basic mechanism is that the production at one level only happens when
initiated by request at higher level, which is units are pulled through the system by
requests.
It has limited and final known inventory.
 Push pull system
This is a variation which companies have started to adopt which combines the best of
both the push and pull strategies. It demands a more accurate forecast of sales and
adjusts inventory levels based upon actual sale of goods. The goal is stabilization of the
supply chain and the reduction of product shortages which can cause customers to go
elsewhere to make their purchases.

A push–pull strategy, usually suggested for products which uncertainty in demand is

high, while economies of scale are important in reducing production and delivery costs.
An example of this strategy is the furniture industry, where production strategy has to
follow a pull-based strategy, since it is impossible to make production decisions based on
long-term forecasts. However, the distribution strategy needs to take advantage of
economies of scale in order to reduce transportation cost, using a push-based strategy.
 Advantages
Push System:
• An advantage to the push system is that the company is fairly assured it will have
enough product on hand to complete customer orders.
• High Level of customer satisfaction as customer demand for the product are met on
time.
• Effective in dealing with fluctuating demand.
• Also known as producer-centric approach.

Pull System:
• No excess inventory is required to be stored.
• Low inventory costs.
• Quickly adapt to changes that may occur in the work process
• Scale the optimal capacity of your team
• Deliver work items much faster
• Reduce waste of resources
• Increase productivity
• Improve flow efficiency
 Disadvantages
Push System:
• Forecasts are often inaccurate as sales can be unpredictable and vary from one year
to the next.
• If too much product is left in inventory, this increases the company's costs for storing
these goods.
• Can lead to large inventories.
• Requires maintenance of large and complex database.

Pull System:
• One major disadvantage to the pull system is that a company may run into ordering
dilemmas, such as a supplier not being able to get a shipment out on time.
• Sometimes Companies are unable to fulfill orders and hence customer dissatisfaction.
• Every job is a “high stress” rush order.
• Setup time will greatly impact throughput.
Just-In-Time (“JIT”)
• Just-In-Time (“JIT”) aims to ensure that
inputs into the production process only
arrive when they are needed.
• Just-in-Time (JIT) production is a manufacturing philosophy
which eliminates waste associated with time, labour, and
storage space. Basics of the concept are that the company
produces only what is needed, when it is needed and in the
quantity that is needed.
• Also known as Toyota production system.
• The just-in-time (JIT) inventory system is a management
strategy that minimizes inventory and increases efficiency.
 Objective of JIT

 Reduce wastes
 Improve Productivity
 Functioning of JIT
•Involves keeping stock levels to a minimum.
•Stock arrives just in time to be used in production..
• Works best where there is a close relationship between
manufacturer and suppliers.
• Goods not produced unless firm has an order from a
customer.
• Aims to get highest volume of output at the lowest unit
cost.
• A method of production control.
• No demand - no production!
• Anticipated/planned consumer demand triggers production.
• Finished goods assembled just in time to be sold to
customer.
• Component parts assembled just in time to become
finished goods.
• Materials purchased just in time to make component
parts.
• The success of the JIT production process relies on
steady production, high-quality workmanship, no
machine breakdowns, and reliable suppliers.
• Relies on many lean tools, such as Continuous Flow,
Heijunka, Kanban, Standardized Work etc.
Implementation process of JIT