Positioning the Firm

• Cost
• Speed

• Quality

• Flexibility

Manufacturing Management
 Positioning the Firm: Cost
• Waste elimination
– relentlessly pursuing the removal of all waste

• Examination of cost structure

– looking at the entire cost structure for reduction potential

• Lean production
– providing low costs through disciplined operations

Manufacturing Management
 Positioning the Firm: Speed
• Fast moves, Fast adaptations, Tight linkages
• Internet
– Customers expect immediate responses
• Service organizations
– always competed on speed (McDonald’s, Federal Express)
• Manufacturers
– time-based competition: build-to-order production and efficient
supply chains
• Fashion industry
– two-week design-to-rack lead time of Spanish retailer, Zara

Manufacturing Management
1-3
 Positioning the Firm: Quality

• Minimizing defect rates or conforming to design

specifications.

Manufacturing Management
 Positioning the Firm: Flexibility
• Ability to adjust to changes in product mix, production
volume, or design

• Mass customization: the mass production of customized

parts

• National Bicycle Industrial Company:

– Offers 11,231,862 variations

– Delivers within two weeks at costs only 10% above standard
models

Manufacturing Management
 Policy Deployment
• Policy deployment
– translates corporate strategy into measurable objectives
throughout the various functions and levels of the
organization.

• Hoshins: Action plans generated from the policy

deployment process

• The process of forming objectives would continue in

a similar manner down the organization means of
achieving objectives for one level of management
becoming the target or objectives of the next level.
Manufacturing Management
 Policy Deployment

Derivation of an Action Plan Using Policy Deployment

Manufacturing Management
 Balanced Scorecard
• Balanced scorecard: Measuring more than financial
performance
 Finances
 Customers
 Processes
 Learning and growing

• Key performance indicators

– set of measures to help managers evaluate
performance in critical areas
Manufacturing Management
 Balanced Scorecard Worksheet

Manufacturing Management
 The KPI S-M-A-R-T Rule

• Specific - Clear what the KPI exactly measures.

• Measurable - define a standard, budget or norm, to make it
possible to measure the actual value and to make the actual value
comparable to the budgeted value.
• Achievable - Every KPI has to be measurable to define a standard
value for it.
• Relevant - give more insight in the performance of the
organization in obtaining its strategy.
• Time phased - It is important to express the value of the KPI in
time.

06/10/2020 Manufacturing Management 10

 Balanced Scorecard

Radar Chart Dashboard

0-40% -- Red (Danger Zone); 40-60%--- Yellow

(Cautionary Zone); 60-100 %--- Green (Moving
ahead Zone)
Manufacturing Management
 Product Design
BITS Pilani
Pilani Campus

06/10/2020 12
 Outline
• Design Process
• Rapid Prototyping and Concurrent Design
• Technology in Design
• Design Quality Reviews
• Design for Environment
• Quality Function Deployment
• Design for Robustness

06/10/2020 13
 Design Process
• Effective design can provide a competitive edge
– matches product or service characteristics with
customer requirements.

– ensures that customer requirements are met in the

simplest and least costly manner.

– reduces time required to design a new product or

service.

– minimizes revisions necessary to make a design

workable.
06/10/2020 14
 Design Process

• Product design
– defines appearance of product

– sets standards for performance

– specifies which materials are to be used

– determines dimensions and tolerances

06/10/2020 15
 Design Process

06/10/2020 16
 Idea Generation

• Company’s own • Salespersons in the

R&D department field
• Customer complaints • Factory workers
or suggestions • New technological
• Marketing research developments

• Suppliers • Competitors

06/10/2020 17
 Idea Generation

• Perceptual Maps
– visual comparison of customer perceptions

• Benchmarking
– comparing product/process against best-in-
class

• Reverse engineering
– dismantling competitor’s product to improve
your own product
06/10/2020 18
 Feasibility Study
• Market analysis
– Design and evaluate customer surveys, interviews,
focus groups or market tests to assess the demand
potential of the proposed product.

• Economic analysis
– Production and development costs are compared with
estimated sales volume.
– Appropriate price and image
– Quantitative techniques like cost- benefit analysis,
decision theory, NPV, IRR
06/10/2020 19
 Feasibility Study
• Technical/strategic analyses:
– New technology requirements; risks and capital
investments involved; Labour and management skill
required; capacity requirements; competitive advantages
and corporate strengths will be gained; core business
compatibility
• Performance specifications:
– These are developed for the product concepts that pass the
feasibility study and approved for development.
– What the product should do to satisfy the customer needs.

06/10/2020 20
 Rapid Prototyping
• Testing and revising a preliminary design model
• Build a prototype
– form design
– functional design
– production design

• Test prototype
• Revise design
• Retest
06/10/2020 21
 Form and Functional Design
• Form Design
• How product will look?

• Functional Design
• How product will perform?
• Reliability
• Maintainability
• Usability
06/10/2020 22
 Computing Reliability
Reliability: The probability that a product will
perform its intended function for a specified length
of time under normal conditions of use.

Components in series

0.90 0.90 0.90 x 0.90 = 0.81

06/10/2020 23
 Computing Reliability

Components in parallel

0.90
R2

0.95 0.95 + 0.90(1-0.95) = 0.995

R1

06/10/2020 24
 System Reliability

0.90

0.98 0.92 0.98

0.98 0.92+(1-0.92)(0.90)=0.99 0.98

0.98 x 0.99 x 0.98 = 0.951

06/10/2020 25
 System Availability (SA)
MTBF = Mean Time Between Failures : Reliability can also be
expressed as the length of time a product or service is in
operation before it fails.

MTTR = Mean Time To Repair: Maintainability refers the ease

and/or cost with which a product or service is maintained or
repaired. One quantitative measure of maintainability is MTTR.

MTBF
SA =
MTBF + MTTR

06/10/2020 26
 System Availability

PROVIDER MTBF (HR) MTTR (HR)

A 60 4.0
B 36 2.0
C 24 1.0

SAA = 60 / (60 + 4) = .9375 or 94%

SAB = 36 / (36 + 2) = .9473 or 95%
SAC = 24 / (24 + 1) = .96 or 96%

06/10/2020 27
 Usability
• Ease of use of a product or service
– Ease of learning
– Ease of use
– Ease of remembering how to use
– Frequency and severity of errors
– User satisfaction with experience

06/10/2020 28
 Production Design
• How the product will be made
– Simplification
• reducing number of parts, assemblies, or options in a
product

– Standardization
• using commonly available and interchangeable parts

– Modular Design
• combining standardized building blocks, or modules, to
create unique finished products

– Design for Manufacture (DFM)

• Designing a product so that it can be produced easily and
economically

06/10/2020 29
 Design Simplification

(a) Original design (b) Revised design (c) Final design

Assembly using One-piece base & Design for push-and-

common fasteners elimination of snap assembly
fasteners

06/10/2020 30
 Final Design and Process Plans
• Final design
– detailed drawings and specifications for new
product or service
• Process plans
– workable instructions
• Necessary equipment and tooling
• Component sourcing recommendations
• Job descriptions and procedures
• Computer programs for automated machines

06/10/2020 31
 Concurrent Design

06/10/2020 32
 Technology in Design
• Computer Aided Design (CAD)
– Assists in creation, modification, and analysis of a
design
– Computer-aided engineering (CAE)
• tests and analyzes designs on computer screen
– Computer-aided manufacturing (CAD/CAM)
• ultimate design-to-manufacture connection
– Product life cycle management (PLM)
• managing entire lifecycle of a product
– Collaborative product design (CPD)
06/10/2020 33
 Collaborative Product Design (CPD)
• A software system for collaborative design and development
among trading partners
• With PLM, manages product data, sets up project workspaces,
and follows life cycle of the product
• Accelerates product development, helps to resolve product
launch issues, and improves quality of design
• Designers can
– conduct virtual review sessions
– test “what if” scenarios
– assign and track design issues
– communicate with multiple tiers of suppliers
– create, store, and manage project documents

06/10/2020 34
 Design Quality Review

• Review designs to prevent failures and ensure value

– Failure mode and effects analysis (FMEA)
• a systematic method of analyzing product failures
– Fault tree analysis (FTA)
• a visual method for analyzing interrelationships among
failures
– Value analysis (VA)
• helps eliminate unnecessary features and functions

06/10/2020 35
 FMEA for Potato Chips

Failure Cause of Effect of Corrective

Mode Failure Failure Action
Stale low moisture content tastes bad add moisture
expired shelf life won’t crunch  cure longer
poor packaging thrown out better package seal
lost sales shorter shelf life

Broken too thin can’t dip change recipe

too brittle poor display change process
rough handling injures mouth change packaging
rough use chocking
poor packaging perceived as old
lost sales

Too Salty outdated receipt eat less experiment with recipe

process not in control drink more experiment with process
uneven distribution of salt health hazard introduce low salt version
lost sales

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 Fault Tree Analysis (FTA)

06/10/2020 37
 Value Analysis (VA)

• Eliminate unnecessary features and functions

• Used by multifunctional design teams
• Define essential functions of an item
• Determine the value of the functions
• Determine the cost of providing the functions
• Compute Value/Cost ratio
• Design team works to increase the ratio

06/10/2020 38
 Design for Environment and
Extended Producer Responsibility
• Design for environment
– designing a product from material that can be recycled
– design from recycled material
– design for ease of repair
– minimize packaging
– minimize material and energy used during manufacture,
consumption and disposal

• Extended producer responsibility

– holds companies responsible for their product even after its
useful life

06/10/2020 39
 Design for Environment

06/10/2020 40
 Green Areas

• Green Sourcing
– use less material
– use recycled if possible
• Green Manufacture
– is energy from renewable sources
– amount of waste produced
• Green Consumption
– product’s use of energy
– is product recyclable and maintainable
• Recycling and Re-Use
– design products to be recycled or re-used
– save energy and money

Copyright 2011 John Wiley & Sons, Inc. 4-41

 Quality Function Deployment (QFD)

• Translates voice of customer into technical design

requirements
• Displays requirements in matrix diagrams
– first matrix called “house of quality”
– series of connected houses

Copyright 2011 John Wiley & Sons, Inc. 4-42

 House of Quality

Importance
Trade-off matrix

3
Design
characteristics

1 4 2

Customer Relationship Competitive

requirements matrix assessment

6 Target values
 Competitive Assessment of
Customer Requirements

Competitive Assessment

Customer Requirements 1 2 3 4 5
Presses quickly 9 B A X
Removes wrinkles 8 AB X
Doesn’t stick to fabric 6 X BA
Irons
well

Provides enough steam 8 AB X

Doesn’t spot fabric 6 X AB
Doesn’t scorch fabric 9 A XB
Heats quickly 6 X B A
Automatic shut-off 3 ABX
safe to use
Easy and

Quick cool-down 3 X A B
Doesn’t break when dropped 5 AB X
Doesn’t burn when touched 5 AB X
Not too heavy 8 X A B
From Customer

Time required to reach 450º F

Time to go from 450º to 100º
Protective cover for soleplate
Material used in soleplate

Flow of water from holes

Requirements

Energy needed to press

Thickness of soleplate
to Design

Automatic shutoff
Size of soleplate

Number of holes
Weight of iron

Size of holes
Characteristics
Customer Requirements
Presses quickly - - + + + -
Removes wrinkles + + + + +
Doesn’t stick to fabric - + + + +
Irons
well

Provides enough steam + + + +

Doesn’t spot fabric + - - -
Doesn’t scorch fabric + + + - +
Heats quickly - - + -
Automatic shut-off +
safe to use
Easy and

Quick cool-down - - + +
Doesn’t break when dropped + + + +
Doesn’t burn when touched + + + +
Not too heavy + - - - + -
4-45
 Energy needed to press
Weight of iron
-
+

Size of soleplate
Thickness of soleplate
Material used in soleplate
-
Tradeoff Matrix

Number of holes
+
+

Size of holes
Flow of water from holes
Time required to reach 450º
Time to go from 450º to 100º
Protective cover for soleplate
Automatic shutoff
4-46
 Targeted Changes in Design

Time to go from 450º to 100º

Protective cover for soleplate

Time required to reach 450º
Material used in soleplate

Flow of water from holes

Energy needed to press

Thickness of soleplate

Automatic shutoff
Size of soleplate

Number of holes
Weight of iron

Size of holes
Units of measure ft-lb lb in. cm ty ea mm oz/s sec sec Y/N Y/N
measures

Iron A
Objective

3 1.4 8x4 2 SS 27 15 0.5 45 500 N Y

Iron B 4 1.2 8x4 1 MG 27 15 0.3 35 350 N Y
Our Iron (X) 2 1.7 9x5 4 T 35 15 0.7 50 600 N Y
Estimated impact 3 4 4 4 5 4 3 2 5 5 3 0
Estimated cost 3 3 3 3 4 3 3 3 4 4 5 2
Targets 1.2 8x5 3 SS 30 30 500
Design changes * * * * * * *

4-47
Completed House of Quality

SS = Silverstone
MG = Mirorrglide
T = Titanium

4-48
 A Series of Connected QFD Houses

Product
characteristics
requirements

Part
A-1
Customer

characteristics

characteristics Process
House A-2 characteristics
Product

of
quality

characteristics
Parts A-3 Operations
deployment

Part

characteristics
Process A-4

Process
planning

Operating
requirements

4-49
 Benefits of QFD

• Promotes better understanding of customer demands

• Promotes better understanding of design interactions
• Involves manufacturing in design process
• Provides documentation of design process

4-50
 Design for Robustness

• Robust product
– designed to withstand variations in environmental and
operating conditions
• Robust design
– yields a product or service designed to withstand variations
• Controllable factors
– design parameters such as material used, dimensions, and
form of processing
• Uncontrollable factors
– user’s control (length of use, maintenance, settings, etc.)

4-51
 Design for Robustness

• Tolerance
– allowable ranges of variation in the dimension of a part
• Consistency
– consistent errors are easier to correct than random errors
– parts within tolerances may yield assemblies that are not
within limits
– consumers prefer product characteristics near their ideal
values

4-52
 Taguchi’s Quality Loss Function

• Quantifies customer
preferences toward quality
• Emphasizes that customer
preferences are strongly

Quality Loss
oriented toward
consistently
• Design for Six Sigma (DFSS) Lower Target Upper
tolerance tolerance
limit limit

Copyright 2011 John Wiley & Sons, Inc.

4-53