Competitive Production Systems

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1 School of Innovation, Design and Engineering 1 Competitive Production Systems KPP202 Introduction to competitive production systems Mats Jackson and Anders Hellström School of Innovation, Design and Engineering Product and Process Development

2 Introduction What is a production system? What is a competitive production system?

3 The production system Transformation of input to products, from supplier to customer PRODUCTION SYSTEM Manufacturin g Suppliers Parts Manufacturing Assembly System supplier Hardware Software Service

4 A Systems View on Production A system can be defined as a group of objects that are joined together in some regular interaction or interdependence toward the accomplishment of some purpose [Banks et. al., 1996] The logical purpose of the system is its function. This can be e og c p pose o e sys e s s c o. s c be altering material, energy, or information.

5 A Systems View on Production A model of a transformation ti system can be described das the sum of all elements and influences (and their relationships among them and to their environment) that participate in a transformation [Hubka et. al., 1988]. TP - technical process TS technical system Hu human system AEnv active environment In the technical process an operand is transformed from the initial state, Od 1, to its final state, Od 2

6 A Systems View on Production The production system can be characterized as a transformation system, a system of a set of components whose function is to convert a set of inputs into some desired d output through h a transformation process. A component may be a machine, a person, a tool, or a management system. Input may be raw material, a person, or a finished product from another system.

7 The production system The production system creates products, being hardware, software, or service, with value for a customer. Thus the production system is a system, which transforms input into tangible or intangible products including the physical facilities and the support functions.

8 Product- and Process Development PRODUCTION SYSTEM Hardware Software Service

9 Competition and the production system?

The Challenge of the Manufacturing Industry Demand of

Uncertainty of what products and what volumes to produce

shorter Quick change-over in production between different

10 The Challenge of the Manufacturing Industry Demand of consumers are changing more rapidly than ever before Uncertainty of what products and what volumes to produce are larger than before Product life cycles are getting shorter Quick change-over in production between different products Quick phase in of new products New technology Change management

11 The strategic value of manufacturing Development of quality, flexibility, cost reduction continuous productivity development... Purchasing controlling supplier relations... Product development, producability, TTM... Industrialization - ramp-up... Environment... Bengtsson, L., 2001, Outsourcing manufacturing an analysis of a learning dilemma

12 The strategic value of manufacturing The strategic value of manufacturing is less related to equipment and facility and more related to the knowledge/competencies that exist and contributes to the company s long term development

13 Customer value? The abilities of the product that the customer values and is ready to pay money for Customer value can be divided into order qualifiers and order winners

14 Order qualifiers The criterias that have to be fullfilled in order to get a customer to consider you as a supplier Order winners The criterias that makes a customer choose you as a supplier

15 Competitive advantage competitive priorities in production (Miltenburg 1995) Strategy Cost red. Differentiation Cost Quality Delivery Flexibility performance + innovation

16 Competitive production systems Cost Cost per part Quality PPM, Guarantees Delivery performance Delivery reliability, delivery time Flexibilitet Changes in volume, product mix Innovation Product- and process development

17 Productivity - An Overall Measure of Competitiveness

18 Productivity OUTPUT INPUT >1 Input of production factors

19 Defining productivity Productivity Partiell productivity One resource Total-factor productivity All resources

20 Measuring productivity Productivity is closely related to the efficiency and effectiveness of operations Efficiency means doing things right Production is working as planed Effectiveness means doing the right things Changing products and processes

21 Production development

22 Production Development Productivity Kaizen - Kaikaku - Kaizen New product or process? Time

23 Production Development New technology Development of products and processes Analysis and working methods Tools and equipment Change management Organization Cooperation People, knowledge, and creativity

24 The goal within industry - Lean Production? The term lean comes from using less of everything compared to mass production. This means using less human effort in the factory with less manufacturing space, less investments in tools, less engineering hours to develop a new product in shorter time, keeping less inventory, fewer defects in production, and production of a greater and ever growing variety of products How to implement?

25 Next two lectures Craftmanship Make what the customer wants => Large demand d for products large scale manufacturing Mass Production => The challenge of producing customized products with efficient manufacturing Lean Production => Business environment dominated by change and uncertainty

Lean Manufacturing 1

Lean Manufacturing 1 Definitions Value - A capability provided to a customer at the right time at an appropriate price, as defined in each case by the customer. Features of the product or service, availability,