Fundamentals of Business

Manufacturing

Manufacturing is the application of tools and a processing medium to the transformation of raw materials into finished goods for sale.

The changing methods of manufacturing
√ Mass production (also called flow production production, repetitive flow production production, or series production production) is the production of large amounts of standardized products on production lines. Mass production is capital intensive, as it uses a high proportion of machinery in relation to workers. With fewer labour costs and a faster rate of production, capital is increased while expenditure is decreased. However the machinery that is needed to set up a mass production line is so expensive that there must be some assurance that the product is to be successful so the company can get a return on its investment.

√ Just In Time manufacturing
is an inventory strategy implemented to improve the return on investment of a business by reducing in-process inventory and its associated costs. The chief engineer at Toyota in the 1950s 1950s, Taiichi Ohno Ohno, examined accounting assumptions and realized that another method was possible. The factory could implement JIT which would require it to be made more flexible and reduce the overhead costs of retooling and thereby reduce the economic lot size to fit the available warehouse space. JIT is now regarded by Ohno as one of the two 'pillars' of the Toyota Production System.

Over a period of several years, Toyota engineers redesigned car models for commonality of tooling for such production processes as paint spraying and welding. Toyota was one of the first to apply flexible robotic systems for these tasks. Some of the changes were as simple as standardising the hole size used to hang parts on hooks. The number and types of fasteners were reduced in order to standardiz standardize assembly steps e and tools. In some cases, identical subassemblies could be used in several models.

What is waste?
Any activity that absorbs resources but add no value.
Types of waste
Elimination of waste is the goal of Lean, Toyota defined three types of waste: muda or non value value-added work, muri or overburden and Mura or unevenness.
The original seven muda 'deadly wastes' are:
√ Overproduction (production ahead of demand)
√ Transportation (moving products that is not actually required to perform the processing)
√ Waiting (waiting for the next production step)
√ Inventory (all components, work in progress and finished product not being processed)
√ Motion (people or equipment moving or walking more than is required to perform the processing)
√ Over Processing (due to poor tool or product design creating activity)
√ Defects (the effort involved in inspecting for and fixing defects)