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Agile Manufacturing: Forging New Frontiers

Main Home >Paul T Kidd > Paul T Kidd's Books - Non-Fiction > Agile Manufacturing Forging New Frontiers Home > Introduction

Agile Manufacturing: Forging New Frontiers

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Agile Manufacturing

Paul T Kidd

ISBN 0-201-63163-6 (Hardbound)

Publisher: Addison Wesley

Price: See buy on-line link

Publication Date: June 1994

 
 

Agile Manufacturing: Forging New Frontiers

Introduction

Manufacturing industry is on the verge of a major paradigm shift. This shift will take us away from mass production, way beyond lean manufacturing, into a world of Agile Manufacturing.

We spent most of our time during the 1980s and early 1990s copying the Japanese. Now we may be about to teach the Japanese something. For a change, US manufacturing industry is realising that it has very little to gain, in the long term, by copying what other people are doing. There is now a growing realisation that global preeminence in manufacturing can only be achieved through innovation. We can learn from others, but in a highly competitive world, we can only become world leaders if we develop new ideas that take us beyond the state-of-the-art.

Since the 1950s our manufacturing industries have been dominated by the paradigm of mass production, which has led to enormous wealth creation and supported an ever increasing standard of living. But there has been a price to pay for this prosperity. As our factories became geared up to producing large volumes of low variety and low cost products, they became inflexible and lost the capability to respond to rapid shifts in market conditions. This was not a problem, as long as everyone was playing the same mass production game, but it is now clear that our Japanese competitors were not playing this game. Over an extended period the Japanese, in effect, developed their own manufacturing paradigm, what today we call lean manufacturing. This is so called, because it is concerned with manufacturing products with less of everything - less time to design, less inventory, less defects, etc.

Lean manufacturing was not developed overnight. The Japanese gradually worked away at the development of their manufacturing paradigm, with companies like Toyota acting as pioneers, in much the same way that Ford pioneered mass production. By the late 1970s many Japanese enterprises were starting to outperform our own. Today, in the 1990s, there are some industrial sectors where several of our enterprises have become wholly or partly owned by the Japanese. The fact of the matter is, that both in the US and in Europe, there has been a gradual loss of competitiveness. As the lean manufacturing paradigm became established in Japan, generating competitive edge for those Japanese companies who were using it, the mass production paradigm, dominant in US and European industry, was contributing to this loss of competitiveness, which has now become a major economic problem.

We should ask ourselves what we are going to do to restore our competitiveness? Should we adopt lean manufacturing in our own enterprises? Should we mimic the Japanese? Or should we do something different and something better?

Without doubt there are now a significant number of people who believe that we have to adopt lean manufacturing. But in adopting this approach we run the risk of forever chasing after a moving target, for the Japanese are not going to standstill and wait to be outperformed by US and European enterprises. The Japanese will keep innovating and perfecting their methods. Thus, adopting lean manufacturing can only be a short term measure aimed doing something to close the competitive gap. In the longer term, if we want to catch up with and overtake the Japanese, lean manufacturing is not the answer. What we need to do, is something which the Japanese cannot do.

Enter Agile Manufacturing. This is not another program of the month. Nor is it another term for computer integrated manufacturing (CIM), or any number of other fashionable buzzwords. Agile Manufacturing is primarily a business concept. Its aim is quite simple - to put our enterprises way out in front of our primary competitors. In Agile Manufacturing, our aim is to combine our organisation, people and technology into an integrated and coordinated whole. We will then use the agility that arises from this integrated and coordinated whole for competitive advantage, by being able to rapidly respond to changes occurring in the market environment and through our ability to use and exploit a fundamental resource - knowledge.

Fundamental to the exploitation of this resource is the idea of using technologies to lever the skills and knowledge of our people. Our people must also be brought together, in dynamic teams formed around clearly identified market opportunities, so that it becomes possible to lever one another's knowledge. Through these processes we seek to achieve the transformation of knowledge and ideas into new products and services, as well as improvements to our existing products and services.

The concept of Agile Manufacturing is built around the synthesis of a number of enterprises that each have some core skills or competencies which they bring to a joint venturing operation, which is based on using each partners facilities and resources. For this reason, these joint venture enterprises are called virtual corporations, because they do not own significant capital resources of their own. This helps to make them Agile, as they can be formed and changed very rapidly.

Central to the ability to form these joint ventures is the deployment of advanced information technologies and the development of highly nimble organisational structures to support highly skilled, knowledgeable and empowered people. Agile Manufacturing builds on what is good in lean manufacturing and uses what can be adapted to western cultures, but it also adds the power of the individual and the opportunities afforded by new technologies.

Agile Manufacturing enterprises will be capable of rapidly responding to changes in customer demand. They will be able to take advantage of the windows of opportunities that, from time to time, appear in the market place. With Agile Manufacturing we will be able to develop new ways of interacting with our customers and suppliers. Our customers will not only be able to gain access to our products and services, but will also be able to easily assess and exploit our competencies, so enabling them to use these competencies to achieve the things that they are seeking.

The key to agility however, lies in several places. An agile enterprise needs highly skilled and knowledgable people who are flexible, motivated and responsive to change. An agile enterprise also needs new forms of organisational structures which engender non-hierarchical management styles and which stimulate and support individuals as well as cooperation and team working. Agile manufacturing enterprises also need advanced computer based technologies.

To achieve Agile Manufacturing, enterprises will have to bring together a wide range of knowledge in the design of a manufacturing system that encompass suppliers and customers, and which addresses all dimensions of the system, including organisation, people, technology, management accounting practices, etc. Most importantly, the inter-related nature of all these areas needs to be recognised, and an interdisciplinary manufacturing systems design method adopted as standard practice. This means going beyond the multidisciplinary approaches that are currently being adopted, and looking at areas between professions.

There is however, a fundamental problem, a barrier which hinders progress in this area of interdisciplinary design. For the past two hundred years or more, the industrialised world has organised knowledge into well defined boxes which have been represented by professional groups often working in separate departments. Anything that did not fit into these well defined areas of knowledge has been ignored or allowed to fall through the cracks that we have created between professions. This has resulted in such countermeasures as design for manufacture, where we are attempting to overcome the problems that arise from our fundamental operating philosophies.

In manufacturing we have tended to treat organisation, people and technology issues independently, and for the most part this division of knowledge has worked well in the past. However, this approach does not work very well today, because over the last ten years or so the world has changed enormously and has become a much more complex place. Technologies have become more sophisticated, markets have become more global and dynamic, and people have started to become more demanding, both as customers and as employees. The traditional paradigms which fostered the growth of manufacturing industry have started to shown signs of breaking down. We are now entering upon a new era, and as manufacturing begins to move from the old industrial era to the new knowledge intensive age, new paradigms are being forged. Agile Manufacturing is a new paradigm. It is highly likely that it will form the basis of 21st century manufacturing strategy.

Interdisciplinary design will form the basis of designing Agile Manufacturing systems in the new knowledge intensive era. Interdisciplinary design however, means more than just applying knowledge from other domains, such as psychology and organisational science, to the design of Agile Manufacturing systems. It also implies looking into the unexplored areas between these disciplines and the areas where they overlap, to find new insights, new knowledge and new and original solutions. This is one of the most important challenges that managers and system designers and integrators will face in the years ahead, for interdisciplinary design leads us to new approaches and new ways of working and of thinking. However, to successfully adopt an interdisciplinary design method, we also need to:

1. Challenge our accepted design strategies and develop new and better approaches;

2. Question our established and cherished beliefs and theories, and develop new ones to replace those that no longer have any validity;

3. Consider how we address organisation, people and technology, and other issues in the design of manufacturing systems, so that we can achieve systems that are better for performance, for the environment and for the people who form a part of these systems;

4. Go beyond the automation paradigm of the industrial era, to use technology in a way that makes human skill, knowledge, and intelligence more effective and productive, and that allows us to tap into the creativity and talent of all our people.

The challenges that we face with respect to all these issues are enormous. If we look at the world of manufacturing we will see that it is very complex. There are a massive number of interconnections between the various components and elements. A manufacturing enterprise is so complex that, in the past, it has been impossible to cope with it as a whole, and it has been necessary to reduce it into manageable areas which have tended to be examined separately.

In this respect we have copied the scientific method, but the end result has been that our knowledge of manufacturing is divided into well defined boxes such as industrial engineering, mechanical engineering, software engineering, industrial psychology, etc. There is however, no natural law which states that knowledge of manufacturing should be divided in this way. These subjects are man-made, and the divisions between them are more a matter of convenience rather than anything else.

More correctly, it should be said that the division of knowledge into these boxes was a matter of convenience. This is no longer the case. In fact it is now a handicap, a barrier to progress in the field of Agile Manufacturing.

In the past we have managed reasonably well with this way of organising knowledge. It has resulted in some problems, but on the whole the benefits seem to have outweighed the costs. In the past however, we did not have to deal with some of the complex technological systems that have been designed and built over the past few decades, or with the complexities of rapidly changing market conditions, and with the several other factors which makes the world of manufacturing very complex.

Increasing technical sophistication, of course, has been vitally important to the development of all aspects of civilisation, including manufacturing industry. It could be said that technology is the axis, the pivot, the springboard of development. For without technology there would be no progress. No books to stir the imagination. No cars, no planes, no houses, no radios, no televisions, nothing. That is the power of technology. Without knowledge and access to technology, civilisation cannot develop. If a society has no access to technology it becomes trapped in a time warp, that of primitive existence.

Without technology there would be no manufacturing. But manufacturing is more than technology. Manufacturing is also about people and it is about how people and technical resources are organised. Manufacturing is about organisation, people, technology, management accounting, business strategy, etc. It is also about the connections between all these dimensions. In the past we have tended to ignore not only the connections, but also some of the dimensions themselves. We have placed too much faith in our technology, and used technology to compensate for inadequacies elsewhere, and tried to solve all problems as though they were technical problems.

All the relevant dimensions of Agile Manufacturing, such as organisation, people, technology, management accounting, etc. are however, all written in different books and taught by different people. When we pass through the educational system we learn limited and discrete lumps of knowledge. Even if people are educated in a broad range of disciplines, which sadly is still uncommon, there is rarely any indication given how these different areas of knowledge relate to one another. These relationships however, lead us to a new vision of manufacturing.

The paradigm which we call Agile Manufacturing, if it is to be successful, will involve us making a break with the things that are wrong with the way we do things today. We aim to show how better and more effective manufacturing systems and technologies can be designed based on the insights derived from the relationships between different areas of knowledge. However, to make the transition to Agile Manufacturing we need to:

1. Examine and define the underlying conceptual framework on which Agile Manufacturing enterprises will be built.

2. Explore and understand the nature of the mass production paradigm and the nature of the cultural and methodological difficulties involved in the transition to Agile Manufacturing.

3. Define a methodology for designing a 21st century manufacturing enterprise.

Our new vision of manufacturing will be based on a systems perspective of technology, organisation and people, tied to clear business vision and goals. This will help us to understand the full complexity of designing a 21st century manufacturing enterprise, and the way that the past mass production paradigm still limits our thinking today. Most of all, this systems perspective will help us to see how to approach the task of designing an Agile Manufacturing enterprise. These are the issues that are addressed in the Chapters that follow: defining what we are about; understanding the present and how it limits our progress; and the means by which we will bring about Agile Manufacturing.

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