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.
