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The struggle with mass customization

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Operations Excellence by Sepp Gmeiner
Sepp Gmeiner is a partner with Lignum Consulting. For feedback, questions and/or suggestions please email s.gmeiner@lignum-consulting.com

When we talk about increasing productivity, most of the time we have the shop floor in mind. How can we get more done with the same number of people - is the common approach.
There is nothing wrong with that approach. Even when we constantly push production to reduce the labour content, we can still become more productive on the shop floor.
Today’s column describes examples from kitchen cabinet manufacturing; however they are somewhat applicable to most woodworking companies. When talking with kitchen cabinet manufacturers, I sometimes provoke them by saying that kitchen cabinet manufacturing is so easy. “… you cut boards, and after egebanding and drilling you assemble a box…!”
That part is easy! What is not easy is managing the complexity. Look down the assembly line and count how many identical cabinets are being processed next to one another? Most of the time you will see that every cabinet is unique. Only occasionally will you see two or three identical cabinets side by side.
In the world of mass customization, the variety is almost unlimited. Just for fun, in one company we calculated the theoretical options for one standard catalogue item (i.e. 24"wide base cabinet with one drawer and one door) To everybody’s surprise, when we multiplied the available door styles with the available wood species, multiplied with the stain and paint options, continue to multiply with the case material options, drawer and hinge options the total grew rapidly. Finally, multiplying by 20 door handle options took us way over the one million mark of permutations. At that time we had not touched on any custom sizes and custom variations. We calculated further that if the company had a 400-cabinets/day capacity they could work for 10 years on this one model and never duplicate a cabinet.
Most Canadian kitchen manufacturers now produce to customer order, producing 1-4 kitchens at a time. In our 400-cabinet/day example, we produce about 8-10 kitchens per day. The worker at the assembly line has a one-minute takt time for each cabinet. Once one cabinet is done, the worker needs to learn (receive some instruction) on what to do with the next cabinet. The same situation happens in the machining process. Parts arrive almost randomly from the previous operation and need to be edge banded in different colours, or drilled in different drilling patterns.
Looking at the manufacturing process this way clearly shows where the challenge lies. In the old, traditional batch manufacturing, a new instruction for the next process step kept you busy for hours or even days; now it is minutes or seconds. Reloading and delivering the information timely, accurately and consistently is the challenge.
We have established what the customer wants (purchase order), but the different workers and the different machines need the information at a specific time in a very specific and consistent format.
Mastering this information process and developing this to the company’s key competence is the key to the future productivity increases.
I started to measure and benchmark different companies on how productive they are in converting customer requirements into work instructions. I wanted to know how many people are employed for tasks after the product has been sold and the purchase has been documented /specified, and before the manufacturing starts. If the order needed to be re-entered - for whatever reason - (i.e. different software) these employees were counted. The engineering of custom products, scheduling and production control, purchasing, yield optimization and CNC-programming as well as purchasing are all functions which ‘translate and prepare’ the customer expectation into work instructions. Sales and the kitchen planning process, initial order-entry and administration were excluded.
We also excluded customer service, but one could argue that customer service is required because the information (in the big picture) was not processed accurately.
This head count per company was co-related to the size of the operation and measured in cabinets per day.
These data points were placed in a simple graph (see Image 1). This unscientific approach shows the correlation and that a trend line can be established. There are factors, like level of customization, which create a data spread. But the difference reflected clearly, that the companies below the trend line were more productive because they had a more robust organization in place.
One might question the value of the graph. However, such a benchmark can be an eye opener. If you are below the trend line, you will most likely have already spent a lot of effort to get the company there. It is a nice acknowledgment of the result. If you are on the trend line or slightly above, you are within the majority. This means you should not neglect improving the operation, however, you might have other priorities. If you are significantly above the trend line, it is in my opinion, urgent that you put resources together and work on improvements.
Process mapping of your frontend processes is often a good start. Reviewing the use of your software is another good starting point. Plant tours and networking with peers is meaningful and cost-effective. Do you have the right software? Do you use the right software the right way? Are your processes sufficiently integrated?
A little focus and management attention to this subject can often yield immediate results and improvements. 

Sepp Gmeiner is a partner with Lignum Consulting.
For feedback, questions and/or suggestions he can be contacted at s.gmeiner@lignum-consulting.com.

 

 

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