Kasra Ferdows

Lasting improvements in manufacturing performance: In search of a new theory

Abstract Is there a way to avoid trading off one capability for another in manufacturing? The prevailing wisdom says no. But some manufacturers seem to have been able to defy that: compared to their competitors, they have better quality, are more dependable, respond faster to changing market conditions and in spite of all that, achieve lower costs. How can this be explained? Our aim here is to provide an explanation. We contend that the nature of the trade-offs among manufacturing capabilities is more complex than has been assumed. Depending on the approach taken for developing each capability, the nature of the trade-offs change. In certain cases not only can trade-offs be avoided altogether, but in fact one capability would enhance another. They become cumulative. Moreover, when a capability is developed in this way, it is likely to be more lasting and less fragile than if it were developed at the expense of other capabilities. We go on to suggest a model which shows how this can be done: To build cumulative and lasting manufacturing capability, management attention and resources should go first toward enhancing quality, then—while the efforts to enhance quality are further expanded—attention should be paid to improve also the dependability of the production system, then—and again while efforts on the previous two are further enhanced—production flexibility (or reaction speed) should also be improved, and finally, while all these efforts are further enlarged, direct attention can be paid to cost efficiency. We use data from 1988 European Manufacturing Futures Survey (167 respondents) to test and illustrate our model. While we cannot “prove” our model, nevertheless, we believe there is enough evidence for a critical reexamination of traditional managerial approaches for improving manufacturing performance. For example, except for the cases when there are obvious slacks in the production system, the belief that costs can come down quickly and lastingly needs to be questioned. Lasting cost efficiency in production can be achieved only through improvements in other capabilities.

Influence of Manufacturing Improvement Programmes on Performance

Today, to improve productivity in manufacturing, one has a large variety of improvement programmes at one′s disposal. Zero defects, value analysis, just‐in‐time, manufacturing lead time reduction are just a few of a long list of potential action programmes. Their real impact is not always clearly described, and manufacturing managers often have to start implementation on a basis of belief. In this article we use the database of the European Manufacturing Futures Survey to explore some of the medium‐term effects of these improvement programmes on manufacturing performance. The conclusions show that there are no simple cause‐effect relationships between single improvement programmes and manufacturing performance. Tenacity in implementation is required since some programmes have negative effects in the short term, but can have positive effects in the long term.

Building factory fitness

Purpose – The purpose of this paper is to introduce the notion of fitness in production as something different from leanness and show that building fitness puts a factory on a course of developing cumulative capabilities and improving its ability to respond to changing market and business conditions.Design/methodology/approach – The paper examines the process of design, launch, and management of a fitness program in 42 factories of the Hydro Aluminum Extrusion Group on five continents between 1986 and 2001. The design was based on the “sandcone model” proposed by Ferdows and DeMeyer but the sequence of capabilities was modified to improve safety, reduce process variability, codify and share tacit production know‐how, improve responsiveness, and improve labor and machine efficiency.Findings – Most factories showed improvements higher than industry average in these capabilities during the 15 years. Moreover, they improved the capabilities listed earlier in the above sequence faster than those listed later, ...

Manufacturing in the world: where next?

Purpose – The past three decades have seen the transformation of manufacturing involving its global dispersion and fragmentation. However, a number of recent developments appear to suggest that manufacturing may be entering a new era of flux that will impact the configuration of production around the globe. The purpose of this paper is to address the major emerging themes that may shape this configuration and concludes that most of them are still in their initial stages and are not likely to create a radical shift in the next few years in how manufacturing is configured around the world. These themes were presented in a special session on “Manufacturing in the World – Where Next?” at the 2013 EurOMA Conference in Dublin, Ireland. Design/methodology/approach – The paper provides a series of perspectives on some key considerations pertaining to the future of manufacturing. An evaluation of their likely impact is offered and insights for the future of manufacturing are presented. Findings – The importance of...

Exploring the importance of cultural collectivism on the efficacy of lean practices

Purpose – The purpose of this paper is to assess the influence of cultural collectivism on the efficacy of lean practices. Furthermore, this study assesses whether or not potential cultural disadvantages related to the level of individualism at the national level can be compensated for at the organisational culture level.Design/methodology/approach – Hofstede’s cultural dimension of individualism is used to test whether practicing a collectivistic culture at the organisational level can fully compensate for the potential disadvantages of being geographically situated in an individualistic culture when practicing lean manufacturing.Findings – Results suggest that cultural collectivism at the national and organisational level have a significant impact on the efficacy of lean practices. Furthermore, the negative impact of being situated in an individualistic country cannot be fully compensated for through practicing a collectivistic organisational culture when practicing lean.Originality/value – This study represents a comprehensive attempt to simultaneously assess the collectivism cultural components of lean practices at the national as well as at the organisational level.

Removing the barriers in manufacturing : The 1990 European manufacturing futures survey

The 1990 European Manufacturing Futures survey shows that European manufacturers are doing well. Efforts in total quality management and improvement of deliveries are paying off; the factories have been cleaned up and reorganized. The creation of the post-1992 single market is not expected to change the total number of their factories, but is likely to demand a more customized output and service to more markets from each factory. More non-EC competitors are expected to enter and set up plants in Europe. The leading European manufacturers are focusing increasingly on establishing closer links between production and the other functions in the company as well as with suppliers, customers, and others outside the company. This is done partly through technology, partly through interfunctional teams, and partly by modification of procedures. The goal is to remove the barriers to free flow of information, goods and people to and from the factory. This is a bold move, but as the logical next step to the improvement efforts within the factory, it is unavoidable. The excitement of the 1992 single market, and the opening of the Eastern European markets, can hinder such risk-taking ventures in manufacturing. But, in fact because of the new opportunities, uncertainties and potential turbulence in Europe in the next few years, there is even more reason for bringing the factory in closer contact with its environment. This will be risky, but for the European manufacturers, the favorable recent results provide a window of opportunity to prepare for the factory without borders.

Relating the Firm’s Global Production Network to Its Strategy

This chapter provides a high-level review of the literature on global production networks and suggests that this area offers a fertile ground for future research. An important issue deserving attention is the relationship between the firm’s strategy (particularly its manufacturing strategy) and the structure of its global production network. The chapter offers a model for this analysis. The model allows delayering the production network into clusters of plants based on the characteristics of the products they produce and the production processes they use to produce them, and gauges whether each cluster has the appropriate level of resources to carry out its strategic mission. The chapter also reviews the literature on transfer of know-how in global production networks. This is another area that deserves attention, particularly the choice of appropriate mechanism for this transfer under different conditions.

Keeping up with growing complexity of managing global operations

Purpose The purpose of this paper is to argue that operations management (OM) scholars ought to be among the thought leaders in research into the design and management of global production networks, but too few of them currently are. It suggests possible reasons for what is holding them back and calls for ideas for removing the obstacles. Design/methodology/approach This paper is a viewpoint. Nevertheless, it reports results of an indicative survey and uses example cases to illustrate and support its arguments. Findings The survey confirms the conclusions from previous studies that the number of publications specifically in leading OM journals focusing on management of global operations is small. Relatively high levels of detail and dynamic complexity and hysteresis of variables affecting the management of global operations are identified as the major hurdles. Applying analytical modeling, a popular research methodology among OM scholars, may be of limited use as it mandates making too many simplifying assumptions. Empirical research is also difficult because it is time consuming and requires access to often sensitive data and may require longitudinal studies. These are tough problems with no clear solutions. Originality/value The paper urges OM scholars to take on the broad and strategic problems in management of global operations. That would not only change how the OM discipline is viewed, but it would also benefit the firm, the economy, and the society.

Modelado de operaciones globales .

La gestion de las redes de produccion global se esta convirtiendo en algo muy complejo. El problema fundamental ya no es donde producir un producto, sino donde llevar a cabo las distintas tareas individuales de produccion. Las empresas de America Latina se encuentran en ambos extremos de este proceso. Se enfrentan al problema por producir sus propios productos y servicios para toda la region de America Latina y por ser sede de operaciones subcontratadas a otras empresas (concretamente, aquellas con estrategias de proximidad para dar servicio al mercado norteamericano). En este articulo se presenta un marco de trabajo que ayuda a esquematizar la evolucion de las redes de operaciones globales de una empresa. El estudio se basa en un analisis detallado de cuatro empresas y en ejemplos de otras tantas (caso especialmente relevante es el de Zara). El articulo no se centra en ninguna region concreta del mundo, ya que el marco de trabajo presentado es extrapolable a todas las empresas de America Latina. A medida que esta region va mas alla de ser una fuente de suministro de materias primas para el resto del mundo, los problemas de diseno, ajuste y redes de produccion global merecen una atencion mas pormenorizada por parte de los directivos de la region.