7401301 Feb 12/04 Production Management
The variety comment brought up a good and material point. Not
everyone has been around production in their careers and it's in
the production facilities in a major way where RFID will play a
role for those who incorporate it. This is boring stuff; but, it's
offered for those who may be interested and it's likely to provide
insight for some. It's bound to be long so pick your spot and it's
absolutely not going to be to everyone's taste so please feel free
to hit the button.
The objective is that if you have no prior exposure, that after you
read it you will have some decent feel for what world our readers
are in.
Overview
You are the operations manager. VP title actually. Your job isn't
to run the production lines or to ship the boxes. It's the efficient
and smooth running of the entire production operation from materials
sourcing to full trucks leaving the loading bays.
What you own can be broken down into a few pieces but should be seen
as a life cycle.
Sourcing
This consists of the arrival, storage, and on-hand of all raw material
components. Almost none is 'raw'. In this company one product is
an electric toothbrush for no apparent reason and raw materials are
the motors and toothbrushes complete from China, the plastic housings
from some company in Pennsylvania, pre-printed packaging from Avery
Denison, electric cords from two companies in Mexico, and the screws
and metal bits from a company in Denmark of all places. That's the
'raw' materials for this one product. You make 31 distinct products
at your facility.
Assembly
You have 4 good sized production lines. They're a combination of
different types of assembly. In other words each line can be set
up to produce a number of the products although no line can make
all of the products and some products can be set up to run on two
lines at the same time. Why go through all that?? You manage
demand and you get fired by not meeting it.
Basically the assembly line in a more or less automated way (this
is 100% automated; but, requires several people to run it, watch
for snags, and set up each run) puts together all the components
in the right sequence at a certain rate of speed including near the
end taping up the final cartons that go on pallets.
Think for instance that line number 2 today is supposed to run
10,000 toothbrushes complete in one package with brush stand
seperately bagged, and one packaged set of 4 brush refills, plus
instructions, warranty etc, into a larger box, and that box wrapped
in cellophane and stickered with [an RFID tag inside the cello and]
two promo tags on the outside of the cello. That's job 1. Job 2
is to run 100,000 brush refills individually packaged, put into
boxes of 10, with 20 of those put into a carton. [The cartons and
the boxes of 10 are each RFID tagged (why? because WalMart wants to
be able to break store shipments down to this number).]
You have a manager for each line and no doubt meet daily and as the
need arises. Those details are for background. Pretty soon your
just saying 10,000 KA92's and 100,000 KB90's. The meetings pretty
much have to happen regularly. For one thing all the lines need
a fair amount of maintenance and replacement parts and one of them
is being upgraded to handle next years model and can't be used for
another month.
Storage
You've had the materials storage area seperated from the finished
goods. You make sure both area's are both fully stocked as needed
and not overstocked as needed. Like I said you manage demand.
You need to meet changing requirements for product shipments. That
includes cancellations of orders. You need to understand how long
individual components take to get if you order them today and at
what size points that timeline changes (you can't just order 5 times
as many and get them as quick - or can you?). You probably have a
small sourcing department to do this. They probably should attend
those meetings.
You also own finished goods. That's a big area with 130,000 square
feet (you're in the states) of racking, 14 loading bays, small
office area for the warehouse manager and the computer whiz
sidekick (stop dozing off - this is supposed to be real). That
manager needs to attend that meeting too because the transport
co-ordinator, the forklift operators, the loading teams, and
whatever else all have to be alligned.
Shipment
Make sure the trucks are there when they're supposed to be. Make
sure the right number of trucks show up. Make sure the product
is in the warehouse to load on the trucks. Make sure the right
products get in the right quantities on the right trucks. Make
sure your in control of what's in your warehouse (well count it
again! it says there's 26 pallets).
This happens all the time and I mean it. There was a building up
to gear up for an expected shipment later. That overflowed the
area set aside for those product types. Manager HAS to store them
somewhere else until he needs them. He HAS to. So he puts them
somewhere else. This time the fork lift operator who was pushed
to do other things and had a pretty full warehouse put 4 pallets
by the open space on aisle 18 where some of last years models that
didn't ship and some from the year before are stored. This happens
because companies don't want to write off pallets and part pallets
of obsolete product and half the time sales finds ways to sell it
to someone for something.
Besides this group loads up and sends off somewhere around 35
trucks a day and haven't added staff in 2 years despite a 30%
increase in traffic.
Demand
It's very simple. The right stuff is in materials to make what
is needed, make it at the right time in the right quantities, store
it, ship it. Don't waste money...in fact do it better for less.
(One of your objectives is to cut the $135,000 in late penalties
from WalMart last year. Another is to cut the $1,150,000 in write
offs last year. Another is to find those 4 pallets with $18,000
worth of product on them that WalMart was going to get which they
did because the warehouse manager shorted the Target shipment instead).
...
Whizo stuff eh? Now you get an e-mail. Meet with the finance VP,
the CEO, the sales VP, and some RFID guys who are coming to do
a presentation. This was talked about last month when the operations
committee (opcom) went through the WalMart agenda item that is
pointing squarely at you.
Your job is to come to the meeting with the right questions.
...
Second part on the weekend. |
