Systems Thinking in Manufacturing

1. Systems Thinking in Manufacturing Bhavya Lal ESD.83 November 13, 2001 Zhou Dynasty Bronze Wine Vessel 11th century B.C.

2. Continuum of Systems Thinking • Shifts in Systems Thinking in Manufacturing • Manufacturing becoming more systems driven • necessitated and facilitated by customer demand and availability of technology • System boundary shifting and systems getting more complex • around the “enterprise” rather than “process” • mass customization

3. Characteristics of Systems • Environment/Boundary - Manufacturing systems exist within an environment that is external to them the boundary "defines" the system • Parts - which are themselves systems • Processes - things go on inside the system that ensure that it fulfils its purpose and survives • Input and Output - things enter the system from the environment and enter the environment from the system • Dynamic - change in non-linear ways • Hierarchical, Complex etc.

4. Key System Characteristicsin the Context of Manufacturing • Manufacturing is an open system • interactions with the environment • eg supplier dependence, customer preferences, economy, availability of raw materials etc.

5. Key System Characteristicsin the Context of Manufacturing • Internal Processes, Structures and Interactions • things go on inside the system that ensure that it fulfils its purpose and survives • 12 variables • 66 linear (11+10 +.. +1) • 220 triangular relations 12!/(3!*9!)

6. Key System Characteristicsin the Context of Manufacturing • Feedback the control mechanism in manufacturing • measuring the output of the system, comparing the output with a standard and using any difference to modify subsequent input to ensure that the output conforms to the required standard

7. Craft Production • 1885 • machine then harden • fit on assembly • customization • highly skilled workforce • low production rate • high cost • Evidence of Systems Thinking • internal relationships among sub-tasks FEW • interactions with the environment MINIMAL • feedback loops ELEMENTARY, ONE?

8. Mass Production • Ford (1908) combined in an assembly line to mass produce the Model T • Eli Whitney - Interchangeable parts • Elihu Root - Division of labor • Oliver Evans - Continuous flow production • Frederick Taylor - Time and motion studies to improve efficiency of workers • After assembly line took off, a car took 10 seconds to assemble instead of 12 hours and 20 mts • William Durant (1904) recognized manufacturing as more than designing new products or improving production systems. Made GM/Chrysler large complex corporations

9. System Boundaries: Onion not Parfait • Layer 1: Around the Manufacturing Process Itself Input Process Output Feedback

10. Mass Production • Evidence of Systems Thinking • internal relationships among sub-tasks RISING • interactions with the environment MODERATE • feedback loops FEW • 1913 • parts interchangeability • moving production line • production engineering • workers as automatons • unskilled labor quality problems • high production inflexible • low cost

11. Toyota Production System (Lean) • Initially fed by information and automation, but soon realized needed new concepts - ways of thinking • lifecycle • overlapping steps • not solely concerned with the technology of making the widget but also with the role of people, the organizing processes and the relationships and interactions

12. Systems Boundaries II • Layer 2: Entire Manufacturing Enterprise HR Materials Management/ Purchasing Design Production Planning Prototyping Feedback Manufacture Shipping Sales Marketing

13. Toyota Production System (lean manufacturing) • 1955+ • workers as problem solvers • worker as process owner enabled by training, minimal inventory, JIT • eliminate waste • responsive to change • low cost • high productivity/quality • Evidence of Systems Thinking • internal relationships among sub-tasks TIGHT • interactions with the environment SIGNIFICANT • feedback loops TIGHT

14. Mass Customization • What it is • delivery process through which mass-market goods and services are individualized to satisfy a very specific customer need, at an affordable price. • serves as the ultimate combination of "custom-made" and "mass production." • rapidly emerging as the organizing business principle of the 21st century. • based on a product strategy, not just product Dell Computers

15. MC System Characteristics • Dynamic • Feedback loops • process tech loop • integrate design and sales before production • product tech loop • defines the product types, rates, features and options. • define all the associated marketing information • Technology Intensive • Interactive media, eg Internet • Shared customer information systems Source: http://www.managingchange.com/masscust/newpara.htm

16. System Boundaries III • Layer 3: Societal - Manufacturing a sub-part of society Transportation International markets Manufacture Enterprise Education Suppliers Competitors Government regulations Technological Change Import/export Society/Family Values

17. Mass Customization • 2000+ • small volumes - in many cases, lot sizes of one • competitive cost, timely deliveries • move away from centralized manufacturing to more distributed production. • a high degree of product/service flexibility, • reduced inventory risk, and a competitive edge in the marketplace. • Evidence of Systems Thinking • internal relationships among sub-tasks TIGHT • interactions with the environment BASIS OF APPROACH • feedback loops TIGHT

18. Summary: Continuum of Systems Thinking

19. Why the Shift? New Paradigm • What has changed about manufacturing? • It is now globalized, networked, customized, digitized • This has changed the definition of manufacturing • old - transformation of raw materials into useful goods • new - general transformation of resources to meet human needs