Low-Volume-High-Mix
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Introducing the only course available on:

Concurrent Engineering and Build-to-Order for
Low-Volume/High-Mix Environments


This unique combination of leading-edge methodologies is based on the multiple books both these subjects, with the latest being:

• : “Design for Manufacturability: How to Use Concurrent Engineering to Rapidly Develop Low-Cost, High-Quality Products for Lean Production.” This book had revised editions published every couple of years since 1990, based on the authors 25 years of experience providing DFM seminars to clients in many industries..

“Build-to-Order & Mass Customization; The Ultimate Supply Chain Management and Lean Manufacturing Strategy for Low-Cost On-Demand Production without Forecasts or. Inventory.”

Dr. Anderson is the only consultant or author who has written leading-edge books
and conducted many customized classes on both these subjects.

The Need for a course on DFM and BTO for Low-Volume/High-Mix

Companies struggle to build many product variations in low volume, because most of our experiences, classes, and books are based on  Mass Production , which only works if it can amortize lengthy setups and a plethora of expensive tooling over large batches or long runs. Sound familiar? Read on:

The Class on DFM and BTO for Low-Volume/High-Mix Environments

BUILDING LOW-VOLUME/HIGH-MIX PRODUCTS QUICKLY, EVEN ON-DEMAND

The best solution to this conundrum is to develop families of products and concurrently engineering flexible processes. Here is how to do that for two categories of manufacturing processes.

For flexible processes, like machining and any computer-controlled process, which are capable of programmably building a wide variety products on-demand providing the following criteria are satisfied:

Quick loading of raw material stock. For quick loading, standard raw material would be loaded or fed into the machine tool as:

• long bar stock that would be feed into a machine tool and automatically cut-off after machining, as is often done in lathes or screw-machines, or

• cut-to-length from a central “source cell” in which

• the cell could also cut pieces on-demand for “each user” See illustration of such a “source cell” for sheet metal at: http://www.halfcostproducts.com/scm_cost_reduction.htm

• the cell could be a kanban source that makes several bins (or stacks) of parts before the matching bin at the machine tool empties. See illustration of a two-bin kanban system at: http://www.build-to-order-consulting.com/kanban.htm

• Pre-cut stock can be quickly loaded into

  flexible fixtures that are versatile enough to accept all stock (or parts) in the cell.  Several flexible fixtures could be permanently mounted on a machine tool bed.

  flexible or specialized fixtures could also be affixed to pairs of "pallets" that  can be loaded and clamped down off-line and then swapped into a standard position on a machine tool bed.  For multiple sub-groups in the family, there could be a unique pair of fixtures for each sub-group.

Quick-loading Programs. CNC machine tool programs can be quickly downloaded from (a) library of pre-written programs for pre-configured variations or (b) programs written “on the fly” from dimensions that are loaded into “templates” in parametric CAD, which will then generate CNC programs, as shown in the “CAD/CAM” station in the illustrations in the Mass Customization article.

For inflexible processes, like castings, forgings, stampings, molded parts, and bare printed circuit boards, consolidate many shapes into only a few versatile versions, to greatly reduce tooling costs and setup charges. If you don’t do this, every shape will need expensive tooling and long setups for each batch of parts, which will then be built in batches and inventories to amortize these costs.

SUPPLYING PARTS AND MATERIALS FOR LOW-VOLUME/HIGH-MIX

Standard raw material grades. Raw materials would be standardized on one grade, usually the best grade the best strength, the best finish, the best purity (etc.), and the best availability.  For existing products, it should be possible global conversion to a "better than" substitution for each material that has too many versions.  For instance, the author, as Manager of Flexible  Manufacturing at Intel's Systems Group, converted all 5% tolerance resistors to the 1% tolerance family also in the database, thus cutting in half the number resistor types in all factories.

  • Design new product families around aggressively standardized parts and materials so that they can be always available or spontaneously pulled into production with the following techniques:

Steady flows of aggressively standardized parts and materials can be arranged to flow into the plant.  Just match the tonnage in to the tollage out.

Automatic resupply can be arranged with:

  • Kanban, which can automatically resupply parts that can be built in small batches.  See kanban article that shows an illustration of a 2-bin kanban system at http://www.build-to-order-consulting.com/kanban.htm
     
  • Min/Max for stacks of raw materials, like sheets, which are automatically re-ordered when the stack reaches the "min" level to bring it up to the "max" level.
     
  • Dock-to-Line, which delivers parts and material directly to all points of use, with quality assures "at the source" so it does not have to go through your incoming inspections.  If parts go to any form of "Raw Materials Inventory," they will usually be "kitted" into a batch of parts for matching batches of production, which is the opposite of flow and, thus, incompatible with Build-to-Order.
     
  • Breadtruck or Free Stock, in which a local supplier keeps part bins full and bills the company at the end of the month. This supports build-to-order by ensuring that these bins can be positioned at all points of use.
     
  • Pulling parts from suppliers on-demand.  Note that this only works consistently when the supplier is actually building your parts on-demand

Beware of situations where suppliers are trying to "pull" your parts
from
their warehouse, which is not a consistent source of supply. 
Worse, if the supplier is out-of-stock, it will blame
your forecasts.

  • Build parts on-demand in your own factory   If your suppliers can not do this, you may have to using all the principles presented herein.

If part and material proliferation is preventing you from doing any of this, identify the cause and do appropriate remedies (next).

Causes and remedies of problems building low-volume/high-mix

       The biggest supply chain and operational challenges occur if a high-mix of products comes with a high-mix of parts and materials. Next is what must be done to stop the causes of all these problems.

Stop taking all orders. Many companies want to raise sales, and sales bonuses, by taking all orders, regardless of how hard they are build and supply, how much they lose money on a total cost basis, or how much they add to a proliferated “mix” of un-synergistic products

• Stop acquiring more of a “mix” of parts and materials.
Order fulfillment problems get exponentially worse when a bad acquisitions policy increases the mix of “orphans,” that have no synergies regarding parts, materials, or processing. Most industrial orphanages are caused by looks-good-but-ultimately-counterproductive acquisitions, which can be avoided and rectified as follows:

          All merger and acquisitions must immediately stop acquiring incompatible products, especially if they and all there parts are to be dumped into existing plants, which may have been optimized for your current operations and your supply chains. Formally, this can be done by (a) adding this criteria to the “due diligence” that is supposed to be done before acquisitions, (b) ensuring that Operations, SCM, and Engineering managers have veto power, or a least scrutiny, over proposed mergers and acquisitions, and (c) achieve real “organic” growth by implementing all the principles on this site rather then going for the illusion of growth through mergers and acquisitions. For more, read the ar article on mergers and acquisitions .

• Rationalize away the worst of the proliferation
. Product line rationalization, based on total cost, can identify the least synergistic products with the hardest-to-get parts/materials and then drop then immediate drop from the catalog or web-site. If these are really must be sold for some valid reason, then the acceptable choices are:

• Incorporate them in to a synergistic new product family

• Outsource them to others, even competitors (to keep them busy on those while you use all the principles of this site to leap forward). 

• If Sales and Marketing are convinced these products will really make money, then isolate them into a self-supporting “profit-and-loss center” which will do what it takes to build these with its own people, without (a) draining away people building the cash-cows or development new products or (b) having to be subsidized by overhead, which, without a good cost system, will then ultimately be paid for by your best products as a “loser tax.”

These are the general principles. Pass around this article or URL to educate and stimulate interest

In customized seminars and webinars, these principles are presented in the context of your company amongst designers implementers, and managers, who can all discuss feasibility and, at least, explore possible implementation steps

In customized workshops, brainstorming sessions apply these methodologies to your most relevant products, operations, and supply chains.

 

Call or email about how these principles can apply to your company:

  Dr. David M. Anderson, P.E., CMC
fellow, American Society of Mechanical Engineers
www.design4manufacturability.com
phone: 1-805-924-0100
fax: 1-805-924-0200
e-mail:
anderson@build-to-order-consulting.com

copyright © 2017 by David M. Anderson

Book-length web-site on Half Cost Products: www.HalfCostProducts.com

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