i
PAPER WITHIN Production Systems AUTHOR: Nerea Zubikarai Iturralde
JÖNKÖPING July 2020
Lean management´s
impact on lead time
of ETO processes
ii This exam work has been carried out at the School of Engineering in Jönköping in the subject area Production system with a specialization in production development and management. The work is a part of the Master of Science program.
The authors take full responsibility for opinions, conclusions and findings presented.
Examiner: Kerstin Johansen
Supervisor: Nina Edh Mirzaei
Scope: 30 credits (second cycle)
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Abstract
Lean management is considered a key to lead time reduction while being efficient, in order to survive in the actual market. Despite this, there is relatively little research done about implementation of lean management in ETO processes. Knowing that ETO processes are a reality in the industry, because there is a demand of customized products in the market. Nonetheless, the early phases of the ETO processes are critical. The purpose of this study was therefore to investigate how lean management can be used to understand and early phases of ETO processes, in order to evaluate potential lead time reduction. Analysing issues that arise when implementing lean in this kind of processes, such as variety, variation and standardization. The empirical data was collected from two different companies with ETO processes on different stages of lean implementation. A theoretical background in the area is supported by a comparison of the historical development and current state of two companies. The access to these two companies provides a view of the state before lean implementation and during implementation, and also a brief view of the effects. This helps to
understand how lean management could be implemented in ETO processes. As a result, this research describes what should be considered when implementing lean management in early phases of ETO processes and what the effect of this
implementation could be.
Keywords
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Contents
1
Introduction ... 1
1.1 BACKGROUND ... 1
1.2 PROBLEM DESCRIPTION ... 2
1.3 PURPOSE AND RESEARCH QUESTIONS ... 3
1.4 DELIMITATIONS AND SCOPE ... 3
1.5 OUTLINE ... 3
2
Theoretical background ... 4
2.1 PROCESSES ... 4
2.1.1 Time and cost in production processes... 6
2.2 WHAT IS LEAN? ... 6
2.3 LEAN ENGINEER-TO-ORDER ... 8
2.3.1 Variety and variation ... 9
2.4 LEAN ASSESSMENT TOOLS ...10
2.4.1 Value Stream Mapping ...10
2.4.2 Rapid Plant Assessment ...11
2.5 STANDARD OPERATIONS AND MODULARIZATION ...12
2.6 ANALYTICAL FRAMEWORK ...13
3
Method and implementation... 15
3.1 RESEARCH DESIGN ...15 3.2 RESEARCH PROCESS ...16 3.2.1 Case selection...16 3.2.2 Data collection ...17 3.2.3 Data analysis ...18 3.3 RESEARCH QUALITY ...19 3.3.1 Credibility ...20 3.3.2 Transferability ...20
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3.3.3 Dependability ...20
3.3.4 Confirmability ...20
3.4 ETHICS...20
4
Findings ... 21
4.1 HISTORICAL PROCESS DEVELOPMENT OF COMPANY 1 ...21
4.2 CURRENT STATE OF THE PROCESS AT COMPANY 1 ...24
4.3 HISTORICAL PROCESS DEVELOPMENT OF COMPANY 2 ...29
4.4 CURRENT STATE OF THE PROCESS AT COMPANY 2 ...30
4.5 COMPARISON OF CURRENT STATE OF COMPANY 1 AND COMPANY 2 ...32
5
Analysis ... 34
5.1 RQ1 ...34 5.2 RQ2 ...376
Discussion ... 39
7
Conclusions ... 40
7.1 FURTHER RESEARCH ...408
References ... 41
9
Appendices ... 46
9.1 APPENDIX 1:RPA ...46 9.1.1 Theory of RPA ...469.1.2 Results of each company and reasoning ...47
9.1.3 Comparison of both companies ...49
9.2 APPENDIX 2:PROCESS FOLLOWED IN COMPANY 1 BEFORE PROJECT ...50
9.3 APPENDIX 3:DOCUMENTS USED FOR DATA COLLECTION...53
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List of figures
Figure 1: Scope definition... 3
Figure 2: Process structure based on Bellgran & Säfsten (2010) ... 4
Figure 3: Product development process based on Ulrich (2003) ... 5
Figure 4: Activities included in the concept development phase based on Ulrich (2003)... 5
Figure 5: Lean 8 wastes based on Melton (2005) and Womack & Jones (1996) ... 7
Figure 6: Benefits of Lean implementation based on Melton (2005) and Abdulmalek & Rajgopal (2007) ... 8
Figure 7: Relationship between variety, cost and revenue and their effect on profit based on Ripperda & Krause (2017) ...10
Figure 8: VSM process explained based on Keyte & Locher (2004), King & King (2015) and Nash & Poling (2011) ...11
Figure 9: Example of distribution of time before and after standardization based on Sakamoto (2010) ...13
Figure 10: Analytical framework ...14
Figure 11: Process followed to carry out the research based on Melton (2005)...15
Figure 12: Types of manufacturing machines over time ...22
Figure 13: Evolution of dedication in hours of technical office department for each kind of machine ...23
Figure 14: Evolution of dedication of assembly hours for each kind of machine ...23
Figure 15: evolution of hours dedicated per machine by the technical Office department ...24
Figure 16: Relationship between different steps of the process ...25
Figure 17: Activities of early phases of production in Company 1 ...27
Figure 18: Overview of the process followed in Company 2 ...29
Figure 19: Product development forecasting method...31
Figure 20: Standardized process defined for early phases of the ETO processes in Company 1 ...36
List of tables
Table 1: Lean principles and related practices based on Lyons et al. (2011) and Womack & Jones (1996) ... 7Table 2: Sales of Company 1 in 2018 ...16
Table 3: Information about interviewees ...17
Table 4: Conventional paradigm terms vs. reformulated terms based on Guba & Lincoln (1989) and Halldórsson & Aastrup (2003) ...19
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Table 6: Quotation department´s lead times ...31
Table 7: Future lead time and value added time definition for Company 1 ...35
Table 8: Documents used in data collection ...53
1
1 Introduction
Lean is a methodology that was created based on the Toyota Production System (TPS) and has been evolving over 80 years (Netland & Powell, 2017, pp. 3-5; Clarck et al., 2013). However, it is important to emphasise the difference between many aspects within Lean, such as Lean Production or Lean Manufacturing, Lean Product Development and Lean Design Management, which are focused on distinct areas (Downey, 2017). Lean construction and Lean manufacturing have been tackled with great enthusiasm from the beginning, but other concepts such as Lean design
management were not equally welcomed (Emmitt, 2011). This gives an image of the magnitude of lean nowadays.
In this chapter, a background of the problem is given, the problem is described and based on that the purpose and the research questions are defined. Later, delimitations and scope are specified and the outline is mentioned.
1.1 Background
The term lean was first introduced in 1988 by John Krafcik with the article ‘‘The triumph of the lean production system’’, from that title it is possible to deduce that it started with a focus in production and material activities (Krafcik, 1988). When implementing Lean methodology, in 2005 it started to be notorious the fact that the research was focused only in manufacturing companies (Ahlstrom, 2004; Haider & Mirza, 2015). After that, started the investigation about applicability in other fields such as service companies, trying to move away from tangible, manufacturing operation fields (Ahlstrom, 2004). But still in 2010, because of the difficulties found for its implementation in areas other than manufacturing, it was being concentrating on “high volume low variety processes and focus on back office activities, which are most similar to manufacturing” (Portioli-Staudacher, 2010, p. 652). Therefore, in processes with high variety and low volume, such as Engineered-to-Order (ETO) processes which has high level of customization, application of lean practices is not that straightforward because generally manufacturing companies focus mostly on production activities for serial products (Ahlstrom, 2004).
Customization is strongly related to variety in products or processes, and this at the same time, is related to variation (Tseng et al., 1996). That variation, as it is not correctly managed most of the time, increases the complexity in the process, and the result is an increase in the lead time and cost of products that fulfil the individual requirements of each customer (Tseng et al., 1996; Yalcin, 2009). Further explanation about this topic will be provided in the next chapter (in the section: Variety).
The TPS is a strategy “for producing cost efficient parts without compromising
quality” (Haider & Mirza, 2015, p. 5) and this is one of the objectives of lean. The
increase in effectivity driven by technological development allows to decrease the lead time and cost of customized products without decreasing quality, which could be helpful to stay competitive in the market (Yalcin, 2009). The TPS is focused on eliminating non-value-added time and addressing quality, based on control and
2 reduction of defective parts, in order to reduce the cost, which is also a very important point in lean (Ohno, 1988; Haider & Mirza, 2015). Lean thinking has its origin in TPS, that is the reason why both concepts have so many similarities. The
understanding of lean as TPS´s toolbox constituted by independent tools, where just some of those tools can be picked from, leads to inappropriate implementation (Rüttimann & Stöckli, 2016). “The result is that ETO producers struggle to improve
their performance adequately using the standard Toyota Production System (TPS) lean toolbox” (Netland & Powell, 2017, p. 286). But those tools are not created to be
applied in environments as the ones of ETO processes so in this environments there are issues to make improvements. (Netland & Powell, 2017)
1.2 Problem description
When the products are customized, the early stages of the ETO processes have a greater effect on the lead time of the product than later stages; that is because,
problems can arise at any step of the process, but could be avoided in the early stages. When mentioning early phases of ETO processes, in this report it refers to the first steps of the product development, this is visualized in Figure 1 and further explained in Processes section. As a result, the lead time of ETO products is difficult to forecast (Netland & Powell, 2017). The ETO products, are produced in high-variety, low-volume project-based production environments (Netland & Powell, 2017). That is the reason why it is essential to define the process in detail in the early phases of the project, to avoid delays or unexpected problems on the following processes, in order to stay competitive in the market.
Lately, company managers feel a rush to become lean as soon as possible and when lean tools are not understood correctly, it can result in misapplications (Pavnaskar et al., 2003). The origin of this problem is that managers often focus only on the visible aspect of the process, the production steps that have a direct effect on the result, and they forget about previous steps of the process, the ones that could be initiating the problems that are identified, the ones can be seen (Shah & Ward, 2007). As if they are in the fable of the blind men touching different parts of an elephant, they all imagine that it is something different, and none of them can imagine it is an elephant until they see it. It is easier to understand and solve a problem that you can see and relate
directly to its source, and managers know taking decisions about what they see. Problems with a hidden source that can cause negative effects later in the process are more difficult to solve.
Therefore, on the one side there is the need for improvement in ETO processes in order to stay competitive in the market. On the other side, this improvement is difficult to achieve by implementing lean, due to the fact that ETO processes are far from the originally intended field of application. As a result, the problem identified is the difficulty to apply lean in ETO processes, while considering the importance of starting from the early stages of the process.
3 1.3 Purpose and research questions
As it has been explained in the Problem description, the problem identified and the reason to do this research is the difficulty to apply lean in ETO processes. To answer to that and try to find a solution for it, a purpose has been stablished for the research:
Investigate how lean management can be used in early phases of ETO processes, in order to evaluate potential lead time reduction
This purpose has been broken down into the following research questions:
• RQ1: How can lean management be applied to improve early phases of ETO processes?
• RQ2: What are the potential effects that lean management has on the lead time for early phases of ETO processes?
1.4 Delimitations and scope
The analysis of the research was limited to ETO processes, mainly focusing on the early stages, in the steps that are mentioned in Figure 1. However, the effect on the whole process of the actions carried out in the early stages has been considered. The main theoretical areas covered in the report are lean management and first activities in production processes. The empirical data analysed will be collected from two
companies of the machine tool sector, but effort will be done to maintain transferability to other sectors with ETO processes.
Figure 1: Scope definition 1.5 Outline
First of all, the topic is presented and briefly explained in the introduction, mentioning the different areas of the purpose through the research questions. In the second
chapter, the baseline of the topic will be provided connecting recent and historical theory relevant to the topic. Method used for the research is discussed in the next chapter. In the fourth chapter, the findings from the companies selected for the research are explained and the empirical data is presented; then, these findings are analysed with the support of the theory. After that, the results are discussed and concluded. Lastly, there is a chapter where possible further research is mentioned.
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2 Theoretical background
In this chapter, relevant parts of the current literature are exposed. Referring to the purpose of the research: “Investigate how lean management can be used in early phases of ETO processes, in order to evaluate potential lead time reduction”. First of all, convenient information about processes is provided, as well as the most significant concepts in it. Then, the main topics, lean management and the ETO concept, are described and the relation between both of them is exposed. The
following sections are focused towards the tools needed to assess lean processes and improve their lean implementation. After that, possible tools to solve the problem are introduced. In the end, a section is dedicated to explain the framework of the whole chapter.
2.1 Processes
A process could be defined as “a number of activities to carry out in order to achieve something, a course of events resulting in something required” (Bellgran & Säfsten, 2010, p. 114). A process requires the structure shown in Figure 2:
As it is possible to see in Figure 2, processes are not closed systems, but information and resources are needed to carry out a process and get an output as a result (Bellgran & Säfsten, 2010). Therefore, a process will not create any value, unless it is provided by information and resources (Bellgran & Säfsten, 2010). It should be pointed out that processes are used to create value for the customer, no matter if it is an internal or external customer (Bellgran & Säfsten, 2010).
However, the word process is a general term that can include different types of processes. According to Harrington (1991) when related to industry, processes could be divided into two groups:
• Production process: in this group are included all processes associated to the action of the product being delivered to the external customer.
• Business process: all processes that support the production processes are included in this group.
Referring as early phases of ETO processes, to the first steps of the product development. Product development is “an interdisciplinary activity requiring contribution from nearly all the functions of a firm”; but marketing design and manufacturing are the central functions (Ulrich, 2003, p. 3). In Figure 3 it is possible to observe the generic product development process:
Input
Process
Output
5 Figure 3: Product development process based on Ulrich (2003)
In the following points, each of the phases mentioned in Figure 3 will be described based on Ulrich´s (2003) book about product development:
• The planning phase, which is also called “phase zero”, starts with the identification of an opportunity guided by the corporate strategy and market objectives and limited by a technology assessment.
• In the concept development the need of the target market are identified, in case of ETO processes there is a only target customer for each project (Netland & Powell, 2017). A concept, as it is defined by Ulrich (2003), “is a description of the form, function, and feature of a product and is usually accompanied by a set of specifications, an analysis of competitive products and economic justification of the project”.
• The system level design phase comprises a decomposition of the product into subsystems and a preliminary design of key components. As an output from this phase it is obtained a functional specification and a layout of the products subsystems.
• The detailed design holds specific information about the geometry, materials of every single part of the product.
• The testing and refinement phase consists on constructing the product and evaluating different prototypes, which are usually not constructed in the same way as they will be produced.
• The product made using the intended production system is constructed in the production ramp-up phase.
When this document refers to early phases of ETO processes, it refers mainly to the concept development phase, even though the planning and the system level design are also included. To improve the understanding of the concept development phase, the activities that are part of it will be mentioned in Figure 4. This process is guided by the mission statement and as a result a development plan is obtained. Observe that economic performance analysis and competitive products benchmarking is carried out continuously in the process.
Planning Concept Development
System-Level
Design Detail Design
Testing and Refinement Production Ramp-Up Identify customer needs Stablish target specifications Generate product concepts Select product concepts Test product concepts Set final specifications Plan downstream development
Figure 4: Activities included in the concept development phase based on Ulrich (2003)
6 2.1.1 Time and cost in production processes
The success of most of the firms is highly dependent on their ability to identify customer needs, quickly create products that meet those needs and produce them at a low cost. (Ulrich, 2003). In the previous sentence the most important factors when being successful are time and cost, so these two factors and their roles are going to be analysed more in depth in this section: (Ulrich, 2003)
• Product cost: is the manufacturing cost of the product, includes spending on tooling and capital equipment besides the incremental cost of producing each unit of product. The profit will be depending on the product cost, but it is also related to the sales volume and price.
• Development cost: is the money spent by the firm to develop the product. It is usually a significant part of the investment done to get the profit.
• Development time: is the time needed for the team to complete the product development. The development time can determine how responsive is a firm to competence´s reaction, and also how fast the team’s effort is received as economic return.
• Production time: covers the period from the moment that input enters the production till the completion of the finished product as an output.
The high performance of those dimensions, keeping all of them as low as possible, should lead to economic success, other performance criteria can also be significant such as quality or capability (Ulrich, 2003).
According to Ignizio (2009) 10-40% of the steps executed within a process in an average company could be either eliminated or refined. One of the key aspects to relate time and cost in a production process is the ability to divide value added and non-value added time (Gregory & Rawling, 1997). Using time as an indicator can be effective to reduce the cost by improving the performance, by reducing the non-value added time (Whicker et al., 2009).
The literature shows that the lead time is a critical performance factor and influences the customer demand, which is at the same time related to the number of customers and survival opportunities in the market (Altendorfer, 2017). A mistake in the estimation of the lead time could lead to insolvencies (Kenley & Wilson, 1986). In conclusion, it is not possible to deny the significance of both factors, time and cost, for a company to stay competitive in the market and also about the close relationship between both concepts (Dursun & Stoy, 2011).
2.2 What is lean?
Nowadays, there are numerous articles and books written by academics and
practitioners about lean, still there is not a precise and agreed way to define it (Shah & Ward, 2007). However, there is a main idea which is extended and accepted from most researchers, which explains that lean is a methodology focussed on elimination of waste and continuous improvement, and considers anything that does not create value for the customer a waste, causing a reduction in cost (Bartels, 2005;
Kosieradzka et al., 2012; Haider & Mirza, 2015). According to that main idea, a possible definition of lean could be the following one: “Lean production is an
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concurrently reducing or minimizing supplier, customer, and internal variability”.
(Shah & Ward, 2007, p. 791). The definition of lean is completely opposed to the concept of “make to stock”, and more aligned to the concept “make to order” (Haider & Mirza, 2015). Lean methodology could be summarized in four main principles that can be observed in Table 1, where each of the principles can be followed using different practices.
Table 1: Lean principles and related practices based on Lyons et al. (2011) and Womack & Jones (1996)
Lean principles Lean practices Align production
with demand
Pull system, Levelled production, Mixed-model production, One-piece flow, Takt-time pacing, Cellular manufacturing
Eliminate waste 5S, Visual control, Standard operations, Mistake proofing, TPM, Quick changeover, Statistical process control
Integrate suppliers JIT deliveries, Supplier development activities, Long- term contracts, Supplier rationalisation
Creative involvement
Team-based problem solving, Quality circles, Cross functional training, Autonomation, Job rotation, Worker-driven Kaizen
When it comes to waste elimination, initially seven wastes that had to be minimized were identified (Melton, 2005; Womack & Jones, 1996), but later another waste was joined to the initial ones and accepted by most of the researchers (Wibowo et al., 2018). The eight wastes are mentioned in Figure 5 and explained briefly later on:
Figure 5: Lean 8 wastes based on Melton (2005) and Womack & Jones (1996)
Lean
wastes
Over production Transport Inventory Waiting Over processing Motion Defects Non-utilized talent8 1. Over production: is referred to every product made for no specific customer or
any product, process or manufacturing facility that is developed when it is not adding any value.
2. Waiting: waiting time of people, product or equipment that is not adding any value.
3. Transport: moving the product too many times, while the product is being moved it can´t be processed.
4. Inventory: Storage cost money, no matter if it is of products, raw materials or intermediates.
5. Over processing: if a certain activity within the process doesn’t add any value to the product.
6. Motion: excessive movement of people, data, information and decisions. 7. Defects: if an error occurs during the process, re-work should be done to fix it. 8. Non-utilized talent: Highly talented employees should be involved and
empowered in the company´s business process, to use their ideas, skills and time to benefit the company and make improvements.
When all identified wastes are minimized or eliminated, several benefits could be identified in companies, those benefits are mentioned in Figure 6 (Melton, 2005):
Figure 6: Benefits of Lean implementation based on Melton (2005) and Abdulmalek & Rajgopal (2007)
2.3 Lean Engineer-to-Order
The order fulfilment strategy must be chosen according to the time that is needed to produce a product and how much time is the customer willing to wait for it (Holweg, 2005). Engineer-to-Order products are uniquely designed and produced exclusively for one customer (Lampel & Mintzberg, 1996; Hilletofth, 2009). When the process involves a customized design of the product or service, Engineer-to-order (ETO) strategy should be used (Holweg, 2005).
It has to be considered that the three primary enemies of production performance are variation, complexity and weak leadership (Ignizio, 2009; Kersten et al., 2006). Lean production has traditionally been useful eliminating variability by standardizing products and processes, but the main point of ETO is designing and producing a product specific for a customer (Powell & Stoel, 2017). This fact automatically introduces variety in the production system, and when variety is not correctly
Less process waste Reduction of lead time
Less re-work
Reduction of inventory Increase process understanding Financial savings
9 managed, brings variation with it (Powell & Stoel, 2017). Another example of the difficulties found for lean implementation in ETO is that Holweg (2005, p. 609) criticises lean production because of being “too inflexible and not applicable in markets like ETO” due to the volatility inherent to the nature of the production (Katayama & Bennett, 1996).
Even if some simple lean practices can be applied in ETO and improvement is generated, many practices´ applicability is limited; alternative methods are necessary to get the greatest benefits from lean in ETO (Powell & Stoel, 2017). Therefore, dysfunctional variability should be reduced but variety is necessary to keep customization even if it increases complexity (Powell & Stoel, 2017). In addition, innovation is needed in most of the cases to find the best solutions for each customer demand, resulting in a process change. To sum up, apart from the general
requirements, ETO companies are challenged with these additional demands that increase the complexity of the production process (Kersten et al., 2006).
2.3.1 Variety and variation
The terms variety and variation are used several times in this research but sometimes both concepts are confusing and their meaning and their effect on the process are not correctly understood. The term variety in this research is referred to as utilization of different components, parts or assemblies in order to give different functionalities to the same product. The term variation is used as the differences found in the process of product development from one product to another, both of them carried out in order to meet the customer demands (Lockyer, 1998).
Including variety in a process increases the variation in it (Ignizio, 2009). While, variation is one of the primary enemies to production performance, as it was mentioned in Lean Engineer-to-Order; variety is essential if some degree of personalization is required in the process (Ignizio, 2009). Variety is vital in ETO environments in order to meet customer demands, but if too much variety is included, more variation will be in the process which would reduce the performance and
consequently increase the cost (Quelch & Kenny, 1994). Unnecessary variety should be eliminated no matter if the reason is external or internal (Quelch & Kenny, 1994). In Figure 7 is possible to analyse the relationship between variety, cost and revenue and their effect on profit. According to the graph (Figure 7) there is only certain amount of variety that allows to optimize the profit (profit 2). Apart from that decreasing the cost (cost 2) or increasing the revenue (revenue 2) can also directly affect the profit.
10 Figure 7: Relationship between variety, cost and revenue and their effect on profit based on Ripperda & Krause (2017)
Additional efforts made in the product development and production process may cause variety, financial drawbacks and increase in lead time (Mundt, 2015). As a consequence the main effect of variety is the increased complexity of products, data and processes and the decreased transparency in cost (Mundt, 2015).To reduce the negative effect of variety, this should be controlled, the product development process has a great impact on it (Kipp & Krause, 2008).
2.4 Lean assessment tools
Several tools can be used to assess how much a company follows lean management. In this section, assessment tools that are noteworthy for ETO processes are explicated. 2.4.1 Value Stream Mapping
The value stream is all the processes or actions that are required to take the product through the flow, starting with raw material and getting as a result the finished product (Rother & Shook, 2003; Wigerfelt, 2017). In the value stream, value added actions as well as non-value added actions are included (Rother & Shook, 2003). The value stream perspective requires working with the wholistic view of the process, on the big picture; leaving on a side the individual processes for a general optimization (Rother & Shook, 2003).
The value-stream mapping (VSM) is a tool that helps the user understand the flow of material and information through the value stream using something as simple as a pencil and a paper (Rother & Shook, 2003). VSM has demonstrated its effectivity when identifying and eliminating wastes in different environments, for example in assembly facilities by following the production path and drawing the material and information flow (Seth & Gupta, 2005). The drawing would provide a visual representation of the value stream (Seth & Gupta, 2005).
A process should be followed in order to make a VSM correctly, this process is visualized in Figure 8 in order to make it more clear.
11 Figure 8: VSM process explained based on Keyte & Locher (2004), King & King (2015) and Nash & Poling (2011)
2.4.2 Rapid Plant Assessment
The Rapid Plant Assessment (RPA) is a tool developed by R. Eugene Goodson in the early 1980s, therefore everything in this section is based on this source and will not be referred after every sentence (Goodson, 2002).
The RPA was born from the need to approach a plant tour with an educated eye. The objective of the tool is to identify the strengths and weaknesses of a plant in an
accurate way and in a reduced amount of time, such as a plant tour. On top of that, the results can be available in less than one day. It is based on visual information, and it can also be applied in your own organization.
The RPA rating sheet presents 11 categories to assess how lean a company is: • Customer satisfaction • Teamwork and motivation • Safety, environment, cleanliness
and order
• Condition and maintenance of equipment and tools
• Visual management system • Management of complexity and variability
• Scheduling system • Supply chain integration • Use of space, movement of
materials, and product line flow
• Commitment to quality • Levels of inventory and work in
process
Choose product or
product family
• It will be preferable to choose representative products/ product families, with volume or stable demand.
•In the case of the product families it has to be considered that all products need to follow similar steps and use the same equipment.
Draw present
state
•Draw a map with each process and information flow, following the product or product family´s route.
•Do not use standard times, gather actual data.
Draw future state
•Draw a map that shows the ideal futre state, where there is a value creating flow; use the present state as a starting point.
•Aiming for a continuous flow, with the objective of getting the shortest lead time possible with available equipment.
Create action plan
•Create an action plan to get to the future state map starting from the present state map. •Introduce changes step by step and set relistic dates.
Carry through
•Test and evaluate activities before carrying through. •Continue working with other products or product families.
12 For each of the categories there are one or more yes-or-no associated questions
(Appendix 1: RPA). According to these answers, each category will be given a value. The main advantage of this standard tool is that those values can be compared
between different companies. The fact that it does not ask for taking notes is very convenient when making a tour, as the tool does not recommend it to get as much visual information as possible.
The total score of all categories will be between 11 and 121, the higher the punctuation the leaner the plant is. The questions can be also used to guide the questions to be made in a tour. Right after the tour, the members that made the visit should meet in order to share their observations and based on those observations develop a report about how lean the plant is.
2.5 Standard operations and modularization
Modularization is the capacity of adding or removing modules from a system without affecting the rest of the system (Koren et al., 1999). Modularization can be used to control the variety in the product development and as a result to reduce the internal complexity. That is the reason why in ETO processes, where variety and complexity are high, it is important to use methods that help to reduce it (Blees et al., 2010). In order to ensure the interchangeability of the modules, they should be standardised. An option for it is to have shared components for different modules. In this way, different modules can be combined instead of creating the whole new system for a new
customer need (Mundt, 2015).
On the one hand, the standardization of modules and components has already been mentioned but another important aspect that could be standardized are the operations. According to Filip Geerts, CECIMO Director General “Standardisation and
certification are important elements which could boost the competitiveness of the European industry at the global level” (European Association of the Machine Tool Industries and related Manufacturing Technnologies, 2020).
When optimizing operations, the distribution between Basic Functions (BF) and Auxiliary functions(AF), and possibly waste, has to be identified (Sakamoto, 2010). Figure 9, shows the reduction in production time that standardization can cause when focusing on those factors. 29% of the time initially used in the process could be eliminated via standardization probably because it was a waste (Sakamoto, 2010).
13 Figure 9: Example of distribution of time before and after standardization based on Sakamoto (2010)
The difference is due to the fact that the initial working activities were not controlled, so the employees had done them in their own way based on their personal experience (Sakamoto, 2010). Therefore, when the standard working methods are implemented, an improvement can be observed.
2.6 Analytical framework
In Figure 10 it is shown a framework of the structure followed by the theoretical chapter. The goal of this graphic representation is to understand the application area of the theory previously exposed.
There is the production process with all the steps required in each case. If analysing each of the steps in detail, they require the accomplishment of several activities that are not represented in order to have a general view. According to the representation of the process (Figure 2), the process has an input in the beginning and an output in the end. Lean management is a way of thinking and not a tool, therefore it is applied in the whole process, affecting at the same time the input and the output. The Rapid Plant Assessment evaluates how lean the company is and it gets the wholistic view of the company for it. As the project is focused on the early stages of the processes, the standardization and modularization are applied on the first steps of the process. Nevertheless, the whole process is analysed to estimate the effect of the changes, not only in the areas directly affected, but also in the succeeding steps.
Basic Functions 49% Basic Functions 61% Auxiliary Functions 51% 29% Auxiliary Functions 39% Improved 19% Standardi zation
Initial production time
14 Figure 10: Analytical framework
15
3 Method and implementation
In this chapter, the methodological approach chosen for the research is explained and described. First of all, there is a general description of the method followed in the research. The second section goes more into detail about the different methods used. After that, a quality analysis is done.
3.1 Research design
The research was designed as a double case study. Two companies were analysed and compared with each other. Most of the empirical information used in the research was provided or facilitated by the companies. The project follows the structure shown in Figure 11, but this report is only focused on the first three steps of the process. The last two steps will be up to the company to conclude the project, but it is necessary to include them in Figure 11 to get the holistic view of the project. When designing the change, VSM structure is followed.
Figure 11: Process followed to carry out the research based on Melton (2005) Case studies are often carried out using qualitative methods as participant
observations and unstructured interviewing, due to their usefulness in generating intensive and detailed information, avoiding exceptional reliance on a single method (Knights & McCabe, 1997). Based on this definition, this research has been defined as a case study and the research had a qualitative approach because in depth
understanding of the situation is needed. Qualitative data has been collected from informal talks and interviews. The way this has been done is specified in the following subchapter; only on this way has been possible to collect the kind of data that the objective of the research requires. Quantitative information, of the lead time and value added time of the activities and historical data, has been used only as a support and has also been provided by both companies. It is a case study because the analysis was done based on the existing literature, using a deductive approach, with the objective of finding a way to apply that theory in a certain environment, where it is not usually applied. It was an intensive study based on qualitative interviewing and focussed on two organizations. Comparison has been sought between both companies in order to find out what best practices are and see the results.
Collect data Analyse data Design the change Make the change Measure benefits
16 3.2 Research process
The research started by getting an overview of the theory related to the topic and parallel observations were made personally by the author at the first company; empirical data collection was also made with data provided directly from the companies involved.
3.2.1 Case selection
The sector used for the research is the customised machine tool sector due to the fact that it is a good representative of Engineered To Order (ETO) products, because of the high customisation machines produced in Europe in this sector (Filip Geerts, 2020). These two companies (Company 1 and Company 2) have been chosen because the group that they belong to is one of the leading organizations in the Spanish machine tool sector, according to ICEX (2011). Both of these companies were chosen within the group because one of them has already implemented Lean Manufacturing in one of their product lines and the other one is aiming for it in the near future. This means that a comparison can be made between the two cases. It is possible to compare both companies because of their similarities: the products they produce are similar(same process), they belong to the same sector(same market conditions), they have the same geographical location, they work within the same group (same values, same employee conditions, similar division of departments internally).
The company chosen for the research provides sheet metal forming machines to other industrial companies, but it also gives technical assistance to their clients and provides parts for the machines that could be damaged. Table 2 shows the approximate
proportion of each of the activities that the company 1 does, the importance of each of the activities when it comes to economical input, this shows that most of their income comes from the machines that are produced in the company, that is the process that its analysed in this research.
Table 2: Sales of Company 1 in 2018 Sales 2018 breakdown
84.13% Sales regarding machines 12.03% Sales regarding spare parts
3.80% Sales regarding technical assistance 0.04% Sub products and waste
Company 1 is a medium enterprise with not much variation on the number of
employees. Company 2 is a bigger enterprise but as only one line is considered for the analysis, it is considered as both companies have a similar size and it is also a
cooperative. The fact that they are cooperatives is important because they are
“committed to helping people develop and generating wealth for society through job creation” (Mondragon S. Coop., n.d.). Which means that among their values it is
17 social responsibility: encourage employment creation and 84% of the staff are
cooperative members, contribute to sustainable development providing wealth for the surrounding, they apply an equitable wage scale.
3.2.2 Data collection
First, to get a general overview of the process, information provided in introductory meetings and informal talks with employees was used. Observations were made about the layout and the manufacturing process. According to that an RPA was completed about each company. RPA was chosen because it is a valid method to get a general overview of how lean a company is, the result is quantitative and can be compared with results of another company due to its objectivity.
Once a general idea was obtained, in Company 1, semi structured interviews have been carried out to get a more detailed view of the process. One first round of interviews has been conducted with representatives of all affected departments to understand and make the first draft of the development process that is followed for each product. Table 3 shows the number of interviewed employees and the
classification in different departments, it also shows the function of each person. Any other information has been deleted in order to protect interviewees anonymity. Table 3: Information about interviewees
Interview Department Function of interviewees
1 Marketing CEO
2 Offers Two offers technicians
3 Technical office Technical director
4 Purchasing and
procurement
Chief procurement officer and procurement technician
5 Production Production manager and head of automation
The objective of these interviews was to draw the flowchart of the activities carried out in the company, so general questions were asked, such as: what are your everyday activities, what does your job consist on or explain the process of the part of the project that you are responsible for, all of them directed to get that general draft. Once the interviewer got basic information, during the interview the process was drawn in order to work directly on it and get feedback about it. That’s why semi-structured interviews were used, depending on the information provided by the interviewees about the development process, questions were asked to understand the areas that were not completely understood. The representatives were chosen by the company according to the knowledge they have about the process.
The objective of the interview was explained to all participants via email when setting the time, but also just in the beginning of the interview in order to have a clear focus.
18 After that, a second round of interviews was conducted to get more detail about the issues mentioned in the following points:
• Amount of time needed for each activity
• Check the sequence of activities and make corrections on the flowchart if necessary
• Responsible of the task • Decision making criteria
• Documents used during the development process
• Errors of the process or ideas for improvement, in the interviewee’s opinion The second round of interviews has only been done with the employees working with the early phases of the ETO process, activities where the research is focused on. An agreement was reached regarding the future state proposition by all affected
employees, this made everything simpler and a focus group of all affected employees not necessary.
Documents in any format have been collected with any relevant information of historical or current data, those documents have been received mainly directly from the companies, it has been complemented with information collected from the internet. A list of all the documents used to collect information is in Appendix 3: Documents used for data collection”. Most of the data has been collected from the interviews so it is mainly of qualitative nature, but quantitative data from analysed documents and also from the interviews was also helpful and complementary. 3.2.3 Data analysis
First of all, the RPA of both companies was analysed in order to get a general overview of both cases. This analysis was based on the values given to each of the categories that compound the RPA, in addition, reasoning for each of the values was also considered (9.1.2); based on that, all categories one by one and the overall result were compared between both companies (9.1.3). Doing so, it was possible to compare both cases in detail and identify the differences between both cases, the results of the actions taken in Company 2 could also be checked.
Considering that one of the main information sources of this research when it comes to empirical data were the interviews, they can be classified in two groups: the first round and the second round. The first round of interviews have been done with all the affected departments, as shown in Table 3, and the objective was to get a flowchart of the process, as the development process was not previously defined. The level of detail in the early phases of the process has been higher than in the following
processes, the flowchart was mainly completed during the interviews itself. This was considered as the most reliable way to reflect the real process, as the interviewees had complete freedom to make changes at the moment, so the interviewer was working as a guide to push the employees to reflect and find the way to reflect reality as well as possible. After the interviews, observing the result and reflecting about it was the interviewers’ task, to see if the flowchart made sense as it was or needed any changes, in that case confirmation was asked to the employees.
19 The second round of interviews had as objective to obtain a more detailed overview of the early phases of the ETO process, therefore, the interviews done to the employees that participate in those activities were recorded because the objective was to get the most information possible from it. For that, a table was created (Table 5) with the most significant information of each of the activities, so questions were asked in order to complete the table, this gave the opportunity to search for inefficiencies in the early phases of the ETO process. Some hints were already given by the employees during some informal talks and the two rounds of interviews.
On top of that, the documents mentioned in Table 8 were also analysed in search of additional information that could be helpful when identifying inefficiencies. The information obtained from each of the documents is also specified in the table. This information was directly obtained from the documents.
Based on all that, an optimized cross-functional chart was proposed, illustrating the “how it should be” process and the table ,shown in the analysis (Table 7 and Figure 20), was completed once again, this time values were decided by consensus between the affected parts and keeping the example of the other company.
3.3 Research quality
Research quality assessment is usually carried out using the conventional paradigm, the conventional paradigm´s criterion are the following ones: internal validity, external validity, reliability and objectivity (Guba & Lincoln, 1989). However, considering that this research is qualitative, the way in which this kind of research is judged is a polemical issue (Sandelowski & Barroso, 2002; Hope & Waterman, 2003; Rolfe, 2006)
.
According to the research carried out for this report, the author agrees withN.J. Petty et al. (2012) who state that “ the different epistemological assumptions of qualitative research require different criteria to that of quantitative research.” (N.J. Petty et al., 2012, p. 381) because when it comes to implementation, the initial concepts are modified or reformulated (Flick, 2018). Therefore, the initial terms are reformulated into the terms shown in the Table 4:Table 4: Conventional paradigm terms vs. reformulated terms based on Guba & Lincoln (1989) and Halldórsson & Aastrup (2003)
Conventional paradigm criterion Reformulated terms
Internal validity Credibility
External validity Transferability
Reliability Dependability
Objectivity Confirmability
20 3.3.1 Credibility
Translating this concept to the research, all results will be sent for feedback to the respondents, in order to get the minor difference possible between their constructed reality and the representation of the author.
3.3.2 Transferability
Transferability is dependent on the similarities of the different contexts; as a true generalization is not possible, applicability of findings will be depending on the existing variables such as time and space (Halldórsson & Aastrup, 2003).
Consequently, the author made an effort for the findings resultant of this research to be transferable to another context. However, significance of this research´s findings should be checked for any case individually.
3.3.3 Dependability
Could be referred as the concept of trackability; if a logical process is followed and decisions made for method choice are explained in detail, dependability will be achieved (Halldórsson & Aastrup, 2003).So if a good insight about the
methodological choices is given and the process followed to do the research is correctly explained and logical, it will be possible to say that this research has dependability.
3.3.4 Confirmability
The naturalistic view starts on the statement that objectivity is an illusion, so it should be shown how findings have been completed by using the data used for it,
demonstrating that interpretations and recommendations are not included in that chapter (Halldórsson & Aastrup, 2003). To ensure confirmability in this research, two people that are “external” to the analysed process have been chosen in the company and all the process followed in the research will be explained to them, confirmability level will be based on their feedback.
3.4 Ethics
It is the responsibility of all researchers to assess the ethical aspects of their work (Bryman & Bell, 2015). To ensure that this report fulfils those ethical considerations, several actions have been taken. First of all, to ensure that there are not any negative consequences for the participants in the interviews and for the companies, all names have been kept confidential, in order to maintain the anonymity of the people and companies implicated. However, as the research is about early phases of ETO processes and different functions are included on those early phases, the function of the interviewees had to be specified. Then, all interviewees had expressed their
consent to be interviewed and recorded if necessary, after being explained the purpose of the interview and the research. In addition, topics that could be identified as
21
4 Findings
In this chapter, in the first two sections the historical process development and the current state of Company 1 are described in detail, providing all the necessary data. Then, in the following two sections the same is done with company 2, followed by the comparison of both companies in the last section.
Company 1 is the one that wants to implement lean practices in their process, so the historical data aimed to get the context of the current situation whereby the most important thing is to get a clear ideas of the current state and the problems that arise in the process. Company 2 is the one that started with a lean implementation project a couple of years ago, so the historical data reflects the problems that they had in the past, similar to the ones in the current state of Company 2, and the current state of Company 2 could be seen as a prevision of how future state of Company 1 could look like. That is the reason why the actions were taken in the past, to get to a better situation in the present and the results obtained are the most important information of this part.
4.1 Historical process development of Company 1
All the information provided in this section is based on the data given by the
company´s employees, during the interviews or by data folders shared with the author. It is vital to understand the historical data in order to know where they come from, in that way it is possible to understand why nowadays
As the global market is in continuous evolution, companies try to adjust in order to fit the market. In recent years, the company has undergone some changes in strategy that affected their production and the rest of the processes directly. The effect of those changes in production is possible to observe in Figure 12. The graph shows that the number of machines produced per year has reduced significantly since 2000.
Additionally, in the first years of the measurements only three types of machines were being produced and at the end of the period, in 2018, five types of machines were being produced, due to the development of laser technology. It is possible to see that in the beginning, the number of punching machines manufactured was far bigger than the number of bending machines and nowadays, those numbers have been balanced and the quantity of machines of each type is similar, this fact shows the change from a serial production to a customized one. This means that fewer machines are being produced and the products are more customized, this meets the change in strategy of the company that focuses in a more value added product. Therefore, each of the machines have more added value for the specific customer that it is produced for.
22 Figure 12: Types of manufacturing machines over time
The personalization employed in each machine means that the difficulty and complexity for each project increased and this is directly related to the amount of hours needed for each machine, especially in design and planning phases as shown in Figure 13. The graph explains the number of hours allocated for each kind of machine in the technical office department, where most of the product development process is done. The fact that before the machines were chosen by the customer almost directly from the catalogue and nowadays almost all of them have some kind of
customization, increases the variability of each kind of machine, and consequently, increases the complexity of the process. Therefore, the process that has been followed and standardized when the production was standard, is not functional anymore for the new kind of production. It is possible to see that because even though the amount of machines reduced drastically, the amount of hours allocated by the technical office department (Figure 13) did not suffer proportional changes. Additionally, in Figure 14 we can see that the amount of hours dedicated to machine assembly, reduces
proportionally to the amount of machines being produced.
0 10 20 30 40 50 60 0 5 10 15 20 25 30 35 40
Manufactured machines
23 Figure 13: Evolution of dedication in hours of technical office department for each kind of machine
Figure 14: Evolution of dedication of assembly hours for each kind of machine This means that the changes explained affect more the early phases than the production itself. Subsequently, these previous phases are the ones that have more room for improvement now that the changes are going to be “maintained”. Due to this thought process another graph has been created that compares the quantity of
machines produced per year with the amount of hours worked in Technical Office department. As a result, in Figure 15 an evolution is shown of the amount of time allocated for each machine depending on its type, also the amount of time dedicated for each machine on average without considering the type of product. It is also
possible to see that there is an upward trend of this average. Thus, to make the process more efficient and reduce wastes, considering the new scenario, Lean management is
0 2000 4000 6000 8000 10000 12000 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
TO dedication (hours)
Punching + Shearing Bending Laser Cutting Laser Blanking
0 5000 10000 15000 20000 25000 30000
Assemble dedication (hours)
24 going to be applied to create a proposal of improvement. As it is understood in the previous chapters, the area analysed will be the early phases of the product
development, focussing mainly in offers department. However, the information provided of the dedication is from the technical office department, because there are no measurements of the offers department, but still the next step represents adequately the situation of the previous step so it can be used as a reference.
Figure 15: evolution of hours dedicated per machine by the technical Office department
There is a clear upwards trend, which is not controlled. In the previous scenario where all machines were similar, as it was a “repetitive” task, it was optimized because of experience and everyone had a clear idea of their duties. Nevertheless, in the current scenario, the company and the author realized that the process is not being controlled, because there is not even a clear guideline specifying the processes that must be followed and the way and sequence that they should have to be as effective as possible. As a result, the company needs a proposal in order to solve the mentioned problem. It is necessary to observe that when it comes to hours measurement, in the graphs it is only possible to see information from technical office because it is the only one with historical data records. But the company agrees that it is a reliable representative of what is happening in the process.
4.2 Current state of the process at Company 1
Once the need to optimize the way of working is clear for the company´s employees it will be easier to do something about it. The employees are the experts of the process they work with on a daily basis. Thus, they probably already identified some of the problems of the processes. That is the reason why information given by the employees is so important. Hence, most of the information provided in Current state of the
0 100 200 300 400 500 600 700 800 900 0 1000 2000 3000 4000 5000 6000 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
TO hours per machine per year
Total Punching + Shearing Bending Laser Cutting Laser Blanking Trend line (Total)
25 process comes from the employees involved directly in the processes analyzed and it has been provided in the interviews.
In Figure 16 we can see the interactions between the different departments of the company, considering that each of the departments is responsible of one step of the process.
Figure 16: Relationship between different steps of the process
In Figure 16 it is possible to see the main steps or roles in the process; and it is useful to get a holistic idea of the process, to observe how the different departments interact with each other. It needs to be considered the fact that the interactions between the different roles is not as straightforward as shown in the figure thus it only shows the main general sequence of the departments when working in a project.
Once the need to make the process more efficient is identified, as it is not possible neither logical to change the whole process at once, the process should be wholly understood more in detail in order to identify which will be the area where the research will be focused on.
In order to search for efficiency and considering that the company is implementing Lean methodology a map of the activities was completed, as a cross functional
flowchart (Appendix 2: Process followed in Company 1 before project), to identify all the activities executed. This flowchart was done in order to understand the sequence of activities and the way to work in the company. Focusing mainly on the first steps of the process, that is why steps that are not that relevant to the research are not
described in detail at any point. Based on the flowchart, Table 5 was created in order to define more in detail the process regarding the time or the information needed for each of the activities or decisions of the process. This table was used to analyze which activities where using most of the resources available.
In Figure 17 it is possible to see the part of that flowchart(Appendix 2: Process followed in Company 1 before project) which is the most relevant to the research process, the part that defines the early phases of it. On the left side it is possible to see the departments that are responsible for each activity (relating to Figure 16), There are some activities that are not clearly positioned as a task of a certain department, those activities do not have a clear responsible so in some cases they are fulfilled by
someone from one department and sometimes by someone from the other department. That is mainly due the lack of an official responsible of the task. It is possible to see that between commercial and offers departments there is not even a clear line dividing them, meaning they work so close that a division between them wouldn’t represent their reality.
26 First of all an opportunity is identified by the commercial department, arising in different ways. When a need from a specific customer is identified, feasibility of the project is evaluated, regarding the possibility of the company to create it at a
competitive price and without losing money. If it is feasible, the offer process starts providing the possible client with some basic information. If the possible customer is still interested, basic requirements are asked to be able to create an illustrative offer. If the illustrative offer fits possible customer´s expectations a definitive offer is created, which defines all the details of the product. None of the information that has to be asked for to create the offers is standardized, which delays the process because it cannot be asked all at once. In addition to all type of offers, time studies are done upon request. This study requires a big amount of resources, in addition the number of parts to be analyzed, that is not limited. After the definitive offer is shared, a
negotiation process is started and if finally there is a deal between the company and the customer, a commercial order is placed and the contract is formalized. Observe that the case of the Kickoff meeting is different and it is in the middle because
different departments are involved in this meeting. After sharing the information with the team and the necessary discussion process, a technical order is placed.
27 Figure 17: Activities of early phases of production in Company 1
28 The main observation that could be done from the flowchart is that the time studies are done in early stages of the offer process. It is an activity that requires a lot of resources so making it in the early stages, when the customer does not know how interested it is on the product offered, means a waste of resources. Because in some cases after a study is done, the customer decides that the product does not meet their needs. Because of information that could be provided with less cost for the company, such as the lead time, the functionality or the price.
Table 5 was created with the list of the activities, and the most important data of this table are the lead time and the value added time. However, as those two indicators were never measured before and mainly because of the variations from one project to another, the employees working daily with those activities did not know any
approximate value for each of them. Thus, only after insisting got some values that the employees were comfortable with, but it is important to say that these numbers are not fully reliable because depending on the project the same activity could last double the time comparing to another project, as the employees explained. Therefore, the importance of this table is because of the relationship in time between the different activities. In Appendix 4: there is a more complete table.
Table 5: Basic data of activities analysed
Activity
ID Activity Responsible department Lead time (average) Value Added time
1 Start offer process C (/ O only for support) 1 day 15 min 2 Application
questionnaire
C 1 day 10min
3 Illustrative offer C / O 1 week for C (8h for O when needed)
1h-8h
4 Definitive offer O <5 weeks 8h
5 Time study O <5 week 8-16h
6 Negotiate C / O NA NA
As it is mentioned previously, the main problem identified from this table is not the information included in the table itself, but the way employees struggle to give an approximate value for the lead time and value added time. The employees themselves do not know the lead times of the processes they do. Although, it is possible to
observe the difference in time of activities, and the time means resources. Thus, the problem identified with the time studies can be understood here, as it is one of the activities with the longest value added time.
29 4.3 Historical process development of Company 2
The objective of this section is to explain the situation of the second company before lean implementation and the steps that have been followed until today being halfway to total implementation.
The company decided to develop a project to implement lean methodology in quotations department in order to avoid any problem in the beginning that could be carried out through the project and to improve the process. The process is similar to the one exposed for company 1 and is something that has not been changed during the implementation. In Figure 18 is a general overview.
The process had several problems and that was the reason to start this project:
quotations were late and with too many indeterminations. Those two issues combined, resulted in inappropriate project launchings and longer lead times, therefore the cost also increased. The projects were started based on the available information, without a clear procedure regarding the order fulfilment or problem handling. Consequently, first of all they decided to ask themselves the following question: if we had all the information since the beginning, where would we start from? And based on that they started to define the flow that the process should follow.
The objectives of the lean implementation project stablished in the beginning were the following ones:
• Reduce cost between 10% and 15%
• Reduce machine delivery time from 12 to 8 months • Get modularity of 80% material
In the quotation department, standardized way of working and limits of lead times were established. Apart from that, the information that has to be provided in each kind of quotation has been defined to avoid indeterminations and assure a correct project launching.
Next, for the technical office department, two key changes have been done: On the one hand, products were divided into modules that could be assembled
independently according to functionality, to standardize the way of assembling always aiming for the reduction of lead time. In addition, this method avoids human error when assembling but also during design phase, because having a clear scheme of all the parts of the product avoids to have undefined or missing information, which is something that used to happen.
