Competitive Production Systems

Transcription

1 Competitive Production Systems from Ford to Toyota Anders Hellström School of Innovation, Design and Engineering KPP202 1

2 Lecture 9 Thur 4 Oct 13:15-16:15 From Ford to Toyota Organizational Change, 5 steps Lean implementation, examples, Swedish Lean Initiative, Produktionslyftet Groups status of INL 2 part B Questions and discussions Anders Hellström 2

3 Discuss in groups of 2-3 persons What is a competitive production system? Take example from Pharmaceutical industry University education Car industry for 10 minutes 3

4 Globally increasing manufacturing activity Economic activity within Manufacturing , at constant 1990 prices in US dollars. Source: UN Stats A world wide 42% increase in manufacturing activity (at constant prices) % increase in GDP world wide (gross domestic product) 4

5 Lean production PPU402 5

6 A historic development Craft production Make what the customer wants => Large demand for products with large scale manufacturing Mass Production - Henry Ford => The challenge of producing customized products with efficient manufacturing Lean Production Taiichi Ohno => A business environment dominated by change and uncertainty

7 Discussion Is it possible to compete with craft production today?

8 Craft production today Aston Martin, Koenigsegg etc. precision-made and designed in-house hand-made metal and carbon fibre craftsmen that produce low volumes of incredibly high quality

9 The industrial revolution The industrial breakthrough is often dated to the end of the 18th century in England, the textile industry - forerunner Changes in material supply The colonization gave possibilities for cheap material cotton Changes in ways to distribute products New ways for transportation gave possibilities to deliver products far away Changes in the labor market Large-scale agriculture with increased productivity and the decreased mortality rates gave urbanization and a surplus of labor 9

10 A historic development Henry Ford is often said to be one of the persons behind the development of mass production it was in Detroit that the first real mass-productive production system for cars was born - Ford s model T began to be produced in

11 A historic development 1800 craft production of automobiles No car dealers Hand built in small numbers Specified according to customer demands No standards measuring problems => dimensional creep A luxury item

12 Henry Ford Henry Ford was 40 years old when he founded the Ford Motor Company, which would go on to become one of the world's largest and most profitable companies. Ford was launched in a converted factory in 1903 with $28,000 in cash from twelve investors. During its early years, the company produced just a few cars a day at its factory on Mack Avenue in Detroit. Groups of two or three men worked on each car from components made to order by other companies. Henry Ford (ca. 1919) 12

13 FORD Mass production Model T (1908) Manufacturer Ford Motor Company Production Predecessor Ford Model S Successor Ford Model A Body style(s) Engine(s) Transmission(s) Curb weight Designer Touring,, roadster, ton, closed cab ton truck, coupé, two door, center door, station wagon (SUV), convertible 177 in³ (2.9 L) straight-4, 20 hp Rear wheel drive, planetary gear, 2 forward speeds 1,200 pounds (540 kg) Henry Ford, Childe Harold Wills, Joseph A. Galamb and Eugene Farkas

14 Mass production, how? The key to mass production of automotives: precision manufacturing interchangeability of components thesimplicity of attaching them together division of labor - the demand for versatile labor was not important when the assembly operations were broken down so that anyone could perform them the human being became interchangeable and in some cases eliminated by automation later - the moving or continuous assembly line 14

15 Precision manufacturing Measuring standards e.g. Johansson gauges There are only two people I take off my hat to. One is the president of the United States and the other is Mr. Johansson from Eskilstuna, Sweden. Henry M. Leland, around At the end of his career, in 1923, Johansson started to work for Henry Ford at the Ford Motor Company, in Dearborn, Michigan. 15

16 Interchangeable parts Eli Whitney (1780s-1820s) is sometimes credited with developing the armory system of manufacturing in 1801, using the ideas of division of labor, engineering tolerance, and interchangeable parts to create assemblies from parts in a repeatable manner. 16

17 The assembly line The assembly line concept was not "invented" at one time by one person, and no one person is the "father" of it. It has been independently redeveloped throughout history based on logic. Its exponentially larger development at the end of the 19th century and beginning of the 20th occurred among various people over decades, as other aspects of technology allowed. The assembly line was introduced to Ford by William C. Klann upon his return from visiting a slaughterhouse at Chicago's Union Stock Yards and viewing what was referred to as the "disassembly line" where animals were cut apart as they moved 17 along a conveyor.

18 Scientific Management F. W. Taylor ( ) Published "Scientific Management" in 1911 factories are managed through scientific methods rather than by use of the empirical rule of thumb Taylor created planning departments, staffed them with engineers Task allocation is the concept that breaking task into smaller and smaller tasks allows the determination of the optimum solution to the task Taylor have been credited with destroying the soul of work, of dehumanizing factories, making men into automatons 18

19 Scientific Management F. W. Taylor ( ) Taylor s attitude towards workers was full of negative bias [Taylor, 1911]:..in the majority of cases this man deliberately plans to do as little as he safely can Even though Taylor has been extensively criticized, it is a fact that he had great impact on the view of manufacturing and the way to run operations 19

20 Discussion What do you think of Taylor and his principles?

21 A historic development Mass Production - disadvantages Extreme work specialization and task allocation gave bad working conditions with monotonic and boring tasks in a high tempo As a consequence a number of disadvantages with the mass production system surfaced: High turnover of employees Absence and injuries due to the work environment Poor motivation to improve the processes Buffers/work in progress 21

22 Mass production dissadvantages In January 1914, Ford solved the employee turnover problem by doubling pay to $5 a day and cutting shifts from nine hours to an eight hour day for a 5 day work week (which also increased sales; a line worker could buy a T with under four months' pay). 22

23 A historic development Model T By 1918 half of all cars in America were Model T Large factory in Highland park automobiles with the Model T engine You can paint it any color, so long as it s black Ford succeeded in his quest to build a car for the masses!

24 A historic development The Ford dilemma Bad organization Centralization Top-management himslef The concept was unworkable almost drove the company under in the 1930s when his mental powers declined 24

25 A historic development Mass Production on it s peak cars sold in USA Ford, GM, Chrysler - 95% of sales 6 models accounted for 80% of all cars sold

26 Discussion Is mass production still used today? Why?

27 Development towards Lean With an increasing competition in combination with a decrease in the demand for products the industrial growth rate decreased from the 1960 s and onwards Labor efficiency by itself was no longer enough to compete A number of market trends influenced this development: A growing demand for customized products Increasing quality demands Market demands for new technology The need for short and reliable delivery times TQM JIT Kanban Kaizen 27

28 A historic development Toyota Sakichi Toyoda founded the Toyoda Spinning and Weaving Company in 1918 Sakichi Toyoda invented Toyoda Model G Automatic Loom in Non-stop shuttle change type example of Jidoka - Jidoka - "intelligent automation" or "automation with a human touch Kiichiro Toyoda traveled to Europe and the United States to investigate automobiles Sold patent rights price English pounds

29 A historic development Toyota Vehicles were originally sold under the name "Toyoda. Toyoda Model AA Sedan announced in 1936 Toyota Motor Company founded in 1937 Public contest for a new name suggestions Honsha Plant started operation in 1938 Trucks to military because of WW2

30 A historic development Mass Production did not work in Japan A tiny domestic market demanded a wide range of vehicles Strong tradition in craftmanship not interchangable humans War starved for capital Competition in mainly the USA

31 A historic development Toyota finacial crisis/labor dispute 1950 Compromise ¼ of workforce was terminated Kiichiro Toyoda resigned to take responsibility Reamaining emplyees two guarantees: - life-time emplyoment - pay steeply graded by seniority not specific job functions

32 A historic development Eiji Toyoda (40 s -) Taiichi Ohno (40 s -) Toyota Production System (60 s -) Lean Production (The Machine that changed the World 1990) 32

33 A historic development Taiichi Ohno ( ) Workforce short term fixed cost Detroit - muda (waste) None of the specialist was actually adding value Organized workers into teams with team leader Improvements - responsibility A cord above every work station stop the assembly line 5 why s

34 The fundamental principle for Toyota All we do is focused on reducing waste in the time line from order to delivery - Taiichi Ohno Order in Production Money in time 34

35 A historic development Toyota Production System - improvements - High-quality manufacturing and high-quality products - TQM Total Quality Management - Continuous improvements - Long term agreements with suppliers - Teamwork

36 The House Toyota Production System Toyota Way Philosophy 36

37 Lean Tools, to understand and to be able to describe and perform 5S TPM (Total Productive Maintenance) Andon Standardized processes Flexible staffing Kanban One-piece Flow Pareto/Gannt/Ishikawa-diagrams etc Pokayoke SMED (Single Minute Exchange of Dies) SPC (Statistical Process Control) Takt... 37

38 Lean Tools Is lean a toolbox or a philosphy? 38

39 The Toyota Way The Toyota Way describes the 14 principles that form the foundation of this uniquely successful management style. Popular as a reference, well spread and systematic. 39

40 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 40

41 Summary Historic development - industrial changes have been evolving and influencing manufacturing industries over many years Mechanization, surplus of labor, new ways for transportation, and the access to raw material enabled the industrial revolution and a change from craft production to mass production The mass production era in the 20 th century was enabled through interchangeability of parts that enabled the moving assembly line among other things The focus of management in the mass production systems was labor efficiency and Tayloristic influences as means to increase productivity Lean Production was born from the challenge of producing customized products with a flexible production system with less cost than a mass-producer 41

42 Self studies See The Toyota Way book study questions KPP202, see homepage! They aim to stimulate your own studies of the text book. Large part of the written examination will consist of the same or similar question. 42