Over the past few weeks, we have been working hard on this new infographic with our favorite designer.
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(And a Chinese version can be found here).
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TRANSCRIPT
A BRIEF HISTORY OF ADVANCES IN MANUFACTURING PRACTICES
From the Early 20th Century to Modern Manufacturing Principles
American Factories 1900-1940: the Push System
Lots of unskilled labor that has to be given very simple and repetitive operations, and that is paid by the piece.
Centralization of each type of operation to make batches as large as possible (push system). The production cycle is several weeks long.
The Ford Motor Company in the 1910s: Experiments with the Assembly Line
The largest manufacturer of the time achieved a continuous flow from machining to assembly. It allowed for a much faster production, with much less inventory.
Ford also implemented industrial engineering methods developed by Frederick Taylor.
The “one best way” became standard work instructions for all workers.
1940-1945: New Training Methods Appear
Factories suffered from a shortage of skilled personnel.
The US Army pushed many manufacturers to apply the Training Within Industry (TWI) program. It helped raise productivity and improve quality.
1950s-1970s: Golden Age of the US Industry
In most product categories, American factories had no real competition.
TWI was quickly forgotten. Continuous improvement was not seen as a priority.
General Motors’ management style became the norm, even at Ford: push system, clear separation between management and workers.
Meanwhile in Japan… Emergence of Lean Manufacturing
The US government funded the introduction of TWI in Japan, where many companies adopted it.
From the 1950s to the 1970s, Toyota refined the TWI teachings and Ford’s continuous flow to become more competitive than American car companies.
Reaction from American Factories in the 1980s
In many sectors, US manufacturers were facing strong competition from Japan.
They had different responses:
Ford followed Deming’s advice (change is necessary for survival). They adopted lean manufacturing principles and tools, with success.
GM, instead, pursued the dream of a “lights out factory”. From 1980 to 1986, they invested $45 billion in robots. In 1986, they declared this investment brought “no efficiency gains”.
Oh, and What are Chinese Factories Trying to Do?
Full Automation — Against the Lessons of GM!
They are asking the WRONG question: “how can we buy robots that will completely replace operators?”
Does full automation reduce labor costs? No!
Engineers replace low-skill workers, but labor costs don’t disappear.
Someone must tend to high-speed machines and stop them as soon as quality gets unstable.
Does full automation give a competitive advantage? No!
You will be forced to accept only orders for large production runs, and lose flexibility.
The RIGHT questions are:
– How can we make our employees more productive by buying machines that help them do the work faster?
– How can we make our employees more productive by reducing the time wasted on transportation, picking, searching, and waiting?
– How can we improve our processes so that human errors get noticed immediately or even prevented, before they become defects?
This is what Chinese factories will have to do, if they want to survive!
We have been seeing huge amounts of worker turnover. This has caused previous training methods to become non-effective and complicated assembly techniques impossible.
So productive workers and improved processes are great …. but so is design-for-ease-of-assembly …. even better is design-for-high-worker-turnover-and-low-skill-workers … make the parts easy to assemble, implement a strong first-day training regiment, make defects hard to manufacture and easy to see.
Also, teach factory managers that every defect, every unit that has to be re-worked …. this is $. This drives your cost up and efficiency down. We see most factories with the idea “build and ship” coupled with “90% is good enough” … and then we need to reject shipments and re-work. The understanding of these costs is not strong in management.
I agree. Design for ease of assembly is equally important.
Ideally, the workers who are very productive are better paid, and have a richer work content (more variety) and have less turnover.
The concept of cost of non-quality hasn’t been grasped widely in China. It is the customers’ responsibility, i think. They need to insist, year in and year out, on improvements in quality. I think this trend will be stronger in the next 5 years.
Yes … we had good improvements over the past years until mid-2012 and now in 2013. Turnover is the #1 issue. This used to affect mostly line level workers, not it is with the line supervisors, production supervisors, and even industrial / quality engineers.
The turnover is so bad that on a daily basis, there might not be anyone familiar enough with the product to teach the workers how to assemble. We are spending more and more time on accurate and detailed Work Instructions ….
Wow. In which city are you based?
Have you put a cost (number of rmb per year) on that excessive turnover? Your HR people need to search and hire, the supervisors need to train, productivity is low for certain period, etc.
And do you do “exit surveys” where you ask the staff leaving the factory what the factory should do to keep more of its workers?
Comparing the cost of the high turnover to the cost of keeping more workers is interesting.
We’re a sourcing company in Shenzhen so cannot control the factories (too much). We do have our own QEs and Manuf Engineers in the factories as support.
The factories have the turnover … I see my staff picking up the training role almost on a daily basis. We identify (internally) the critical stations then visit the lines frequently. If the critical station operators are different or new, we do the training.
One factory in Shunde says they are averaging over 200% turnover for line workers annually. And running at about 80% of what they need.
And not just salary issues … also working environment, living conditions, respect from management … the workers are really thinking hard about their lifestyle and making choices. I have even seen factories putting in Air Conditioning!
ALG
I see. Yes, of course it’s not just the salary. Basket ball courts, A/C, etc. all count.
I’d love to meet you when you have time for lunch. You can reach me at ra(at)sofeast.com. Thanks!