This document analysis different business improvements techniques stating the benefits and limitations of the improvement techniques and going further to reviewing and reflect on the social, commercial and economical factors that affect these business improvement techniques. Investigation on the engineering and manufacturing processes and systems by explaining in details one type of the system known as the lean or Sigma manufacturing system in depth is critically evaluated based on benefits to business: productivity, quality and cost.
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In today’s very competitive market environment, there is a dire need for enterprises to ensure continual improvement in all their operations. Manufacturing companies always continue to face increasing pressure to improve the quality of their products, to increase productivity and to reduce costs with the available scarce resources. Service firms need to reduce their response time so as to eliminate errors and ensure customer satisfaction. Deployment of suitable techniques to ensure continued improvement thus proves to be a necessity. Through these techniques process capability need to be enhanced which will do away with any kind of defects?
Mechanical Engineering is a field of engineering that deals with the application of engineering principles, physics and material science to analysis, designing , in manufacturing and in mechanical systems. Manufacturing Engineering on the other hand is still field of engineering that deals with various manufacturing processes and practices, research and development of the manufacturing systems, machines, equipment and tools and outline of the manufacturing processes being a core part and parcel of this field.
BITs (Business Improvement Techniques)
Business improvement techniques or process improvements also known as business process reengineering entails improving the quality, productivity and the response time of a business process by doing away with activities that add no value and also doing away with unnecessary business costs. An improvement technique(s) thus brings about overall effectiveness in the business operations and processes through optimization of the organization`s underlying processes and activities so as to achieve more and more efficient results.
Business Improvement Techniques are very important and beneficial for the different types and sizes of companies in each and every sector so as to remain competitive and relevant in today’s challenging business environment. Implementation of Business Improvement Techniques usually requires a dynamic culture change throughout the whole organization. The organizations that have been in a position to successfully implement a philosophy of continuous improvement over the time have had benefits of reduced costs of operations reduced inventory costs, increased sales and profitability, improved team work and better customer service level and thus leading to customer satisfaction. These Business Improvement Techniques can apply to the organization as a whole in any particular sector of the economy starting from service providers, to government departments to the health care sector then to construction, agriculture and also from manufacturing.
The techniques are also very pivotal in the development of a vision, goals, objectives and a strategy towards yielding extraordinary gains in the business. Through these Techniques proper mapping and identification of key processes is done and the information is systems are designed to ensure that information flows within the whole organization in the right order and manner. Another benefit of these techniques is that through them defective points are noted or identified and areas or points of “waste” are also identified. Recommendations in terms of ways and methods of introducing business those which will eliminate waste and provide bottom line benefits to the business are formulated.
Despite the fact that Business Improvement Techniques have numerous bottom line benefits the techniques still have some limitations. The process of Business Improvement Technique is quite engaging and tiresome it surely requires diligence, dedication and concentrated efforts for it to bear fruits or yield the expected results. The process is also usually costly to implement despite having very many benefits it requires resources in terms of skilled and experienced manpower, hiring of experts and also machinery, tools and equipments especially for a manufacturing organization so as to effect the recommended changes.
Thorough and detailed analysis of any available information and gathering of data may in a way strain the organization. In-depth training of workers and staff, regular monitoring and evaluation thorough planning, scheduling and organizing are also highly inevitable if the improvement technique is to succeed. It also takes time for the benefits of implementing the improvement technique to be realized at times even years after the start of the implementation process. Resistance to changes by some people in the organization is also an expected limitation in an endeavor to improve the business, some factions in the organization may feel threatened and insecure with the changes brought about by the techniques in terms of changes to processes and systems in the organization. At times workers and even some customers tend to oppose changes to the existing processes and systems. Difficulties can also be experienced before the new established or streamlined processes and systems can become fully operational and functional.
The Sigma Six
Sigma Six is a powerful management philosophy business improvement technique developed by Motorola that champions setting of very high objectives, collection of data and its analysis to give out results to a really high degree so as to reduce defects in the products and services offered by the organization. The word “Sigma” originates from a Greek letter sigma which is usually used to denote variation from a certain set standard. The Six Sigma philosophy is based on the fact that if you take consideration of the many number of defects through measuring there is in a process then it becomes easier to figure out how to eliminate the defects systematically and get near to perfection as much as possible. For Six sigma to be achieved by any organization or company it cannot be producing more than 3.4 defects per one million opportunities in which case an opportunity is taken to mean a chance for nonconformance.
Sigma Six has six processes namely Six Sigma DMAIC and Six Sigma DMADV, each term deduced from the major steps in the process. Six Sigma DMAIC is a process that deals with defining, measuring, analyzing, improving, and controlling of existing processes that fall below the Six Sigma standard or specification. Six Sigma DMADV deals with defining, measuring and analyzing designs and also verification of new processes and even products that are striving to achieve the Six Sigma quality. All Six Sigma processes are implemented by Six Sigma Green Belts or Six Sigma Black Belts, which are then overseen by a Six Sigma Master Black Belts. Six Sigma proponents argue that it has mega benefits to the company. These benefits include an up to 50% process cost decrease, cycle-time improvement, a less waste of materials and company`s resources, a better understanding of customer needs and requirements, multiplied customer satisfaction, and also more reliable products and services that can be trusted.
Six Sigma can be a really costly improvement technique to implement and can even take several years before the company begins to see its benefits or bottom-line results. Some of the Companies that have practiced and still practice Six Sigma are, General Electric, Texas Instruments, Scientific-Atlanta, Allied Signal and many others.
Cases showing application of Six Sigma Technique in the Industry
The samples below shows some Six Sigma projects evidencing the improvements and changes to processes and systems that were ongoing some of which were very problematic and people would wonder whether those problems could have actually been saved at all at all. It is the Six Sigma technique or approach that leads to these companies identifying their problems and thus be in a position to seek solutions to them many of these projects that were tackled by Six Sigma teams would not have been tackled or addressed at all. Some of these sample cases are:
Sample Case 1: CANCEL THAT NEW PLANT
The case involved a highly successful new pain-killer drug, a pharmaceutical company launched plans to set up a $200 million production facility so as to double its capacity. As the effort of setting it up were starting some people from the company who were new participants in the company’s Six Sigma effort resolved to investigate some of the short-term steps that can boost production in the existing plant. As they collected data, the group or participants first realized that it was only about 40 percent of the drug that was being packaged was usable or could be used. Looking further, they discovered that the sealing method that was being used for the drug vials was very inconsistent that some of them would not be completely closed, while at the same time others were too long to fit in the box. The team thus used a number of testing and refining of the
Sealing process by use of different design experiments methods and finally determined the very best combination of inputs or factors that is the time, temperature, distance and so on that could be used to ensure a good seal. Effecting these changes and an addition of few $50 parts to regulate and change the sealing equipment was done and there was no need of establishing the new plant.
Sample Case 2: REPAIRING REPAIRS
A major organization dealing with appliances repair realized the need to improve its capacity to return items to the customers in accordance to when the goods were promised to be returned. Many are the times that repairs were late and the customers became disappointed when they would call in or drop by the organization premises to pick up their appliances or computer.
A multi-level DMAIC team decided to narrow their scope to two repair locations and to diligently and carefully analyze all the causes leading to late repairs. The first discovery is that the time taken to repair one product was only part of the problem and that the time taken to ship appliances back and forth from repair shop to the customer site also was the main and big contributor to delays or missed dates. Based on the findings together with the cost/benefit analysis the team in assistance with other colleagues engaged in the two pilot facilities or projects implemented a few changes so as to streamline the process and increase the number of appliances being returned to customers when promised.
Lean Sigma on Manufacturing Systems and its Importance in the Production system
The value of Lean Manufacturing System is best comprehended when at the particular time that its impact of change on economics is properly understood. This manufacturing engineering philosophy is based on designing a manufacturing process or system that very well blends together the essentials of minimizing cost and maximizing profit. The main fundamentals with these systems are Labor, Materials and Machines or Equipment referred to as 3Ms of manufacturing. A very well balanced 3M results in: Maximum utilization of both skilled and unskilled labor; optimal use of the plant size; Smooth traffic movement of materials, labor and automotives. It can also lead to minimum grand total manufacturing costs of the products being produced; Reduce investment; reducing labor requirement and utilization of more productive equipment. Disposition of less productive or unproductive equipments; Flexibility to keeping in pace with market and customer changes and also Increase Return on Net Asset are other results of use the 3M fundamentals.
Three steps involved in the accomplishment of the ultimate manufacturing engineering lean philosophy namely: The first step is to design a simple manufacturing system; one commences the process of system design as simple as possible with just a low volume through the system. The second step is the realization that there is always a room for improvements and thus refining the first step as much as possible. The third step is to continuously work on and improve the lean manufacturing system design concept with addition of the appropriate insertion of and balance of automations, conveyors and in necessary cases the buffer stocks. Additional concepts can be generated that could lead to satisfaction of product and the technical marketing requirements of the products. Through a thorough re-examination of intra- and inter- technologies, through past production process errors and the lessons learned. The competitive analysis of techno-communication may be applicable and finally selection of the proper manufacturing system concepts to be adopted for further considerations or developments should be based upon a thorough analysis performed or done in accordance with the established selection criteria.
Consideration of two manufacturing systems that when they are combined give rise to Lean Manufacturing system that is the Flow Manufacturing System and Agile Manufacturing System. Designing a Simple Manufacturing System through flow manufacturing is a time-based process that joins together a smooth production system without any disruption. Rapidly and smoothly flowing materials from raw materials to finished goods through systematic balancing of the laborers or operators, the machine and equipment to customer demands or requirements. The objective of Flow Manufacturing is to provide the ultimate response and also produce the customer requirement, benefits of this goal being to decrease the Total Product Cycle Time, increased productivity and also increased the per capital equipment utilization. In this system of Flow Manufacturing, the performance and output is measured by the Total Product Cycle Time also referred to as the Critical Path.
Total Product Cycle Time is the longest lead time path right away from raw materials to finished goods it is the quickest possible response to a customer order with finished products. Lead Time consideration and analysis is derived from the Critical Path which helps us to outline opportunities so as to reduce or eliminate Non-Value-Adding activities and in the process shortening the Total Cycle Product Time. When reducing the variations in the rate of flow in the manufacturing system, the lead time will be reduced. These variations can be reduced through random downtimes, higher uptime, through quick changeover, lower downtime and also through improved quality through error proofs, self checks, and equipment product centered cellular layouts.
Agile Manufacturing is quite a profitable manufacturing system that is closely inter-twined to the concept of Flow Manufacturing. It goes further and builds on the Flow Manufacturing concept to further reduce the lead time, optimize asset utilization or use and build to customer demand by focusing on being able to aptly respond to customer requests and demands. It has an assumption that the customer requirement or specifications and volumes which is based on continuous changes. Program lead time is the form of measurement of Agile Manufacturing performance. The main goal is to have a system that has a smooth flow of material while at the same time maximizing the value added activities of the operator. There are other situations in the system design process that requires special consideration such as situations include: Manufacturing Process, Manufacturing System, Value Added (VA) activities and the Non Value Added (NVA) activities.
The manufacturing process entails the equipments used to create, to alter, to assemble, to measure and tests the product with the objective of meeting a pre-determined product requirement. This equipment includes machines, tools, fixtures, and gauges such as drills, grinders and test stands. The manufacturing system involves the combination of labor and manufacturing process which are then linked together with materials handling both manual or automated so as to move the material or product from one manufacturing point to the next process and to the next until it is processed into a finished product. VA or Value Added is any activity that is performed to a product as it moves along the production process that the customer perceived as actually addition of value to the product. The NVA (Non Valuable Activities) are all the activities that are associated with the production process that happen not to be adding any value to the product and thus not necessary to be performed but it is still nonetheless performed at the current moment awaiting the emergence or arousal of awareness on availability of better methods to replace it.
In Lean Manufacturing however the manufacturing cost does not necessarily have a steep drop as the volume requirements or demands of customer’s changes. This is because of the product flexibility and also equipment flexibility that can be very well incorporated into the Lean Manufacturing System. This system is mostly characterized with: investment which are done as required, more flexible equipment, more adaptability to uncertain markets in terms of volumes and products and also characterized with smaller capacity increments and more product(s) flexibility.
Lean manufacturing system design needs to be continuously improved so as to aptly respond to the customer requirements and to ensure this is by having flexibility of equipment and have the capability to match it with the product flexibility. Having uncertain customer requirements makes it important to examine the manufacturing costs over a range of volumes also been very keen not to produce beyond the requirements. This system is characterized with: investments committed upfront which is usually quite high; more rigid and complicated equipment and larger capacity increments with high customer volume demands or requirements for long periods
Lean Manufacturing System has potential for greater profitability which highly depends on utilization of its resources that is the 3Ms in terms of the materials moving the Value Activities or VA, man or labor working by adding value to the product, machine running in a manner that is more productive. Lean Manufacturing System can be successfully adopted in new manufacturing system or environment, in an existing manufacturing system requiring capitalization, new equipments or even in product relocation.
In conclusion given the increasing competitiveness in the market place it would be suicidal for a business to ignore continual improvement in its systems and operations. Manufacturing companies specifically will always continue to face increasing pressure to improve the quality of their products, to increase productivity and to reduce costs with the available scarce resources. Use of the right Business Improvement Techniques to ensure continued improvement of the business to as to keep afloat of competition and deal with changes in its environment. From this paper it is clear that Business Improvement Techniques dramatically decreases the waste chain in the business operations and also reduces the Inventory and floor space requirements. Creation of more robust production processes and systems and also appropriate material delivery systems are established and there is improved layouts for more flexibility in business as a result of the Business Improvement Techniques and thus should be a priority for any business to consider embracing.
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