Quick, think of an essential resource for a manufacturing company.
Did you think of machinery, labor, or money?
If so, then you’ve guessed wrong. If you thought the answer is time, then pat yourself on the back!
The amount of time taking place from order to delivery is make-or-break for any manufacturer. It may not seem obvious, but the three alternatives I listed all play their respective role of time. Investing money in people and machines is a result of trying to meet customer deadlines.
Although simple in concept, saving time is a difficult task for many manufacturers. This concept is where quick response manufacturing plays a significant role.
Quick Response Manufacturing
The concept of quick response manufacturing (QRM) is a strategy of cutting lead times in all aspects of manufacturing operations. When implemented, a QRM program:
· 95% reduction of lead times
· 30% reduction of the finished product cost
· 60% improvement in on-time delivery
· 80% reduction of rework and scrap
Two types of businesses use a QRM:
· A company producing small batch engineered materials
· A company that doesn’t need to engineer products, but offers many different pieces with varying demand
Necessity is the mother of invention, and QRM is no exception to that saying.
The roots of QRM go back to Japan after World War II. Following the war, the Japanese industrial complex was in shatters. Rebuilding its manufacturing base required a new tactic: Just-In-Time (JIT) Manufacturing.
Gerhard Plenert, a supply chain expert, provides four theories why JIT implementation became necessary in Japan:
- Money: Japan’s war effort depleted cash reserves eliminated opportunities to finance large inventory production.
- Space: Japan didn’t have enough real estate to build large factories
- Resources: an island nation, Japan doesn’t have any natural resources
- Labor: despite a high unemployment rate, labor efficiency methods weren’t developed yet
It seems that JIT was an accidental invention. Plenert wrote that Japan developed small factories using small inventories of material only used for products being worked on. Because of this setup, inventory levels and investments were kept low while providing fast turnaround on natural resources.
The Advent of Lean Manufacturing
The JIT process of World War II restored Japanese manufacturing to a point where the country became an international exporting competitor.
In the 1950s, Japanese automakers recognized its production level was nowhere near the United States. Taiichi Ohno, a Toyota executive, decided to examine the reason for that disparity in production.
His conclusions were revolutionary. Ohno thought there were two reasons Toyota lagged: inefficiency and wastefulness. With the problem identified, Ohno made eliminating any waste and inefficiencies in the area of production under his responsibility. When Toyota sent him to the United States to observe American manufacturing methods, a surprising thing influenced his thinking: supermarkets. He returned to Japan with the idea of pulling inventory based on watching US shoppers grabbing items off store shelves.
Based on that experience, Ohno developed the Kanban replenishment card for restocking. His concepts became known as the Toyota Production System (TPS), making Ohno the father of lean manufacturing.
Don’t Forget Quality & Efficiency
Inventory reduction was Ohno’s calling card, but not his only one. Quality and efficiency became the cornerstones of his working theory. He worked developing ways of manufacturing products efficiently and of consistent quality.
A key focus of lean manufacturing has always been quality. The philosophy of continuous improvement is a lean core tenant.
The Root of Manufacturing Systems
In the 1970s, Japanese and European companies grew with international markets by producing cheaper goods, eroding the market share of the United States. As a response, manufacturers in the United States started a competitive strategy based on cost, so efforts reducing cost became a primary aim. Then, in the 1980s, Japanese manufacturers proved a manufacturer could produce a quality product when less cost. Their focus on continuous improvement led to companies competing to create the least expensive product.
US manufacturers were slow to catch on. By the time they realized the shift in strategies, they had lost a large part of their market shares. As lean manufacturing migrated west, many manufacturing processes popped up with lean as the root such as Six Sigma, Kaizen, or total quality management. QRM became one of the most popular shoots grown from the source of lean.
Quick Response Manufacturing shortens lead times, improves quality, reduces cost, and eliminates waste within a manufacturing organization. At the same time, QRM increases market shares and competitiveness because customers receive improved products faster.
Speed versus quality has always conflicted manufacturers. Increasing production speed creates the potential for mistakes. An effective QRM process run by a disciplined team, such as Schuette Metals, takes that potential into account and decreases the chances of errors through a system of continuous improvement.