The International Motor Vehicle Program gained notoriety for articulating the lean production principle in its successful book, The Machine That Changed the World, which focused on the automotive industry but proposed the argument for lean production for other industries as well.
MIT and the Center for Technology, Policy and Industrial Development has since built a significant research infrastructure for studying the automotive industry. The Lean Aircraft Initiative, also housed within the CTPID, extends the "lean" principle by seeking to improve productivity and affordability in the defense aircraft industry.
Using the same in-depth research approach characteristic of the IMVP, the CTPID is examining the technologies and practices of Agile Manufacturing -- a concept some observers see as the next major framework for world-class manufacturing.
The concept of Agile Manufacturing was introduced in 1991 by a government-sponsored research effort at Lehigh University. The CTPID's new project, sponsored by the Advanced Research Project Agency and the U.S. Air Force, and in partnership with Lehigh, aims to "put meat on the bones" of the Agile concept articulated at Lehigh.
In the business world, to be "agile" is to master change and uncertainty and to integrate a business' employees and information tools in all aspects of production. For the consumer, agility translates as customer enrichment. The goal of an agile manufacturer is to present a solution to its customer's needs -- and not just a product. A producer does this by learning what a consumer needs now and will need in the future.
For businesses, agility translates as cooperation that enhances competitiveness. An agile community crosses company borders and works together. A company that can best perform a particular business function shares that knowledge with the other companies in the industry.
Agile and lean are not synonymous terms. One of the biggest difference between the two can be seen in supplier relationships. Lean manufacturers, particularly Japanese automakers, believe that successful relationships must be cultivated over a long (20 year) period. Agile manufacturers feel they can find the best suppliers by searching the market of open competition whenever they need a service.
To gain a working perspective of Agile Manufacturing, MIT and Lehigh have equally deployed 28 faculty, staff and graduate students from both their management and engineering schools to three industry locations: General Motors Saginaw Steering Works Division; Vought Aerospace; and Ford-Louisville Assembly Plant and its primary sheet metal supplier, Budd Company.
Vought Aerospace is a first-tier aircraft subsystem supplier and contributes to the "aircraft" aspect of the project's research agenda. GM - Saginaw is a first-tier components supplier; and the Ford-Louisville plant assembles the Ford Explorer. These companies support the "automobile" research agenda.
At each of these sites, the research team has established pilot studies to develop more agile transfer of design information within and between suppliers and assemblers. According to Carlo Cadet, the program manager, the lessons learned from these sites are designed to migrate to other industries, and that is essentially the Air Force's purpose for funding this project.
The Situation...
The aerospace industry is characterized by items that are highly engineered, made in low volumes, and subject to government procurement rules and intense regulation. The items being studied at Vought include commercial and military fuselage and engine inlet assemblies; empennages, or tail assemblies; and elements of computer-based and paper-based design data. This variety will give generality to the overall study, according to Prof. Daniel Whitney, Senior Research Scientist at CTPID and site coordinator for the Vought case study.
The automotive industry also works with highly engineered products and intense regulation, but production numbers at a given factory are immense compared to the aircraft makers. An auto-assembly plant can push out fifty or more cars an hour, as opposed to typical aircraft production of fifty or so planes a year.
The items being studied at Ford and GM include sheet metal body assemblies and power train assemblies made for domestic and foreign customers. Each kind of business customer has different needs and different suppliers. Also, firms must convert product requirements into engineering terms quickly and find the right suppliers or in-house manufacturing capabilities. Heading the automotive case studies at Ford and GM respectively are Site leaders David Gossard, MIT Professor of Mechanical Engineering, and Sloan Research Assistant Martin Anderson.
The Proposed Remedy...
To accomplish its goal of developing an agile transfer of design information at the project sites, the research team is identifying critical transactions between companies; linking transactions to clusters of specific engineering; identifying transactions that do not add value; identifying and inserting missing transactions; and speeding up the processes by providing computer tools and database access that connect people and their transactions to engineering data.
More specifically...
The Agile research team is using six tools in its work: transactions analysis, activity/cost chains, organization maps, key characteristics, and contact chains. Some of these are new while others are extensions of existing research techniques or adaptations of methods being used in industry already. Along with many of these tools, the team is developing pictorial ways of capturing the information. Called "maps," each map shows one view of the physical, organizational, informational, or engineering information being shared by web participants. These maps are proving useful in understanding the web environment. No single map, however, seems able to show the whole situation.
Explained briefly below are examples of the tools used in this study:
Transactions analyses are interview-based studies of how organizations operate. Performing transactions analyses at the partner sites led the Agile team to recognize the inherent complexities of engineering partnerships and showed the need to develop tools to make the complexities visible and deal with them. Transactions analyses reveal where intensive transactions activity occurs and also permit one to see how activities at one point in the process are linked to activities elsewhere. Actual transactions do not correspond to official organization charts or approved information transfers, and the degree to which they differ is a good indication of how the participants must skew the official process in order to make progress.
Activity/cost chains are an extension of activity-based costing. They are the result of using direct cost measurement techniques during the transactions analyses. In many cases, transactions can be associated with costs, so that cascades of transactions can be linked in order to sum up their component costs. Activity/cost analyses show how much it costs to do some basic activity such as to make a design change, adjust a fixture, or tighten a tolerance. Knowing costs can help justify improvements in design and business processes. However, most companies do not know their actual costs to the required accuracy and usually compile costs in functionally defined cost centers rather than associating them with processes, especially when those processes cross functional boundaries and enter the web.
Organization maps show explicitly who does what in the web of suppliers. These maps turn out to be quite complicated, since assemblies and related tooling seem to be divided up into very small elements and each element is contracted out to a different supplier (at least in the car industry). If companies were to make these maps during early product design, they would be able to plan out who should be in the partnerships and begin thinking about who should do what. Supplier selection criteria could be formulated based on where suppliers lie in the map and what their part is in delivering the final customer requirement. However, it appears that the web grows over time without top level awareness or management.
Key Characteristics (KCs) are currently in use at each of the three partner companies and at many others. KCs are aspects of the product that require close attention. They are intended to capture customer requirements and express them systematically as design and production metrics. Hundreds of specifications, dimensions, and tolerances typically appear on drawings. The assignment of a KC to a dimension or surface finish, for example, indicates that this particular aspect is the important one to deliver. Different companies have utilized this idea in different ways. GM distinguishes key product characteristics (KPCs), that the customer is aware of, and key control characteristics (KCCs), that the manufacturer must control in order to deliver the KPCs.
Contact chains link the key characteristics of assemblies of parts and fixtures to each other so as to describe how fitup is supposed to be achieved. KCs, for example, highlight visible fits like those around car doors, since fitup dimensions and tolerances are documented by the chains and fitup is a KC for customer satisfaction. A metric the Agile team has proposed is to count how many company or organizational boundaries are crossed by a single contact chain. The assumption is that smaller is better. If companies define these contact chains early in design, they can assign responsibility explicitly to the different suppliers for their roles in supporting the chains. However, it appears that while individual engineers commonly calculate these chains for local assembly fitup analyses, the contact chain concept has not been utilized as a way of unifying the work of several cooperating companies. No current computer aided design (CAD) tools include contact chain representation capability, although the potential to add this capability exists. CAD is commonly used to define parts, less often for assemblies, and hardly at all for assembly fixtures.
Agility Metrics are intended to help companies determine if they are operating in an agile way. A list of 100 esablished questions provide general guidance in this area, but a more precise set of metrics is needed. The Agile team wishes to develop tools and methods that relate directly to the web activities it finds among its industry partners. These will be aimed at returning quantitative results from measures that are easy to understand and easy to calculate.
While this multi-site research project might not solve all the complexities contained in engineering partnerships, the project leaders do suggest that their methods may help in analyzing many specific challenges. This will help customers and suppliers understand each others' needs earlier and more clearly.