The Main Change is Happening Due to Shift in Demands of Customers
Transcript of The Main Change is Happening Due to Shift in Demands of Customers
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Discussion of Production under Pressure
Question:
1. The author describes a change from mass production of stable product lines of poor quality to a
situation using new technology leading to broad product variety, short lead time and high
quality.
a) Why is this change happening?
b) What implications does it have for manufacturing firms and their operations?
Answer:
a) The change is happening due to new emerging trends in production due to shift in customer
requirements. The source of major changes comes from
1. Increased competition
2. Social changes
3. New technological advancements
These changes are consequently requiring the change in production manager behaviors to shift from
static skills to more dynamic ones. It is also requiring transformations in current production setups from
routine assigned tasks to broader production functions.
In mass productions era, the major concerns were production with a little attention paid to quality of
production, processes and system. However, shift in demands required a variety of product lines from
single production facility, reduced lead times, low costs and better quality posing new challenges for
production managers.
b) Author sees the change from mass production to era of new technology as a major challenge for
local industry. The change is posing a major threat to US manufacturing industry as industry and
production managers are not well prepared for the challenge.
Author raises his concern that many senior management members and production managers are
overlooking these changes. Rising pressure level and demands are putting managers under stress.
Educators and researchers are also unable to train managers up to mark for such challenges. The
specialized workforce is also not available in required number.
Author has characterized problems due to the challenge in three major classes
1. New Pressure from outside the firm
2. New problems within the firm
3. The impacts of accelerating technology
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Pressure From Outside
There is a huge external pressure on the production abilities of the manufacturing firms and
their operations. These can be mainly categorized as increasing competition and marketing
pressures
Increasing Competition
There are two sorts of competitions that are putting pressure on the manufacturing industry.
These can be categorized as local industry competition and foreign competition.
Local industries having overcapacity and corporate objectives of growth and diversification has
made the local industries to expand their boundaries to new production lines. This has increased
the competition among the local industry tougher. Defense and consumer industries are looking
opportunities in each other. These factors are intensifying the competition.
Globalization is also posing a threat to local industry. Foreign companies are taking the lead due
to better price and quality. They have also removed their shortcoming of distribution and
service facilities.
Marketing Pressures
Companies are also facing intense marketing demands for shorter lead time, improved quality
without much impact on price and more immediate deliveries. Frequent new products and
modified product launches raise the demand to replace old uninterrupted long runs with special
run. Special runs in turn required more setups, different worker skills, special purpose tools,
unique processes and quality and production control techniques.
Pressure from Inside
As the author suggests, the internal pressures are always there with the industries but it is the
critical nature of change and other two factors which has raise the intensity of the problem.
Reevaluation cost control, manning the operation and handling the paper work fall under this
category.
Reevaluating Cost Control
The costs control has become a difficult task as indirect labor costs and fixed costs getting higher
in proportion than direct labor and variable costs. Change is work condition also posing
challenge that how to motivate employ through wages and incentives. Old techniques of labor
control are not being well enough to serve the task
Manning the Operation
Challenge to handle two diverse classes of highly skilled labor force and relatively unskilled
workforce put a big task in front of management. Low college fees and its recognition as quick
way of earning a job is a big attraction for youngsters but it is also drawing future potential off
the track. Management is also suffering from describing the right person for the right job. There
is a demand of work-force management change along with changes happening around in
environment.
Handling paper Work
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The demand of new challenges is becoming a new better information system which would be
more complex rather than old paper work phenomenon. New communications and resulting
integrated systems are making production managers job even tougher.
Accelerating Technology
Technological changes are posing challenges in following ways
Equipment decisions
Newer equipment has enhanced various production aspects including productivity, quality,
product design but it has also made the equipment decision more difficult. New technology is
quite expensive than older one so careful decision is required for the equipment purchase as
there is a high degree of uncertainty about feasibility, reliability and economic life of the new
equipment.
Engineering Changes
From the mass production age where a single layout plan had worked for long time and
methods-engineering groups worked for them, the new workplace was having a shift to where
work had to be done for new products in bits and pieces. This problem was a big challenge for
the production manager as they had to devise the properly engineered layout for the jobs.
Materials and Processes
Another rising problem was due to constant induction of new materials and processes. Research
trends bringing new materials by every day in the market which not only posing a challenge to
adjust and make new processes and equipment but handling the manning, maintenance and
controls for them as well.
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Q # 2
Demand of rigorous standards of performance with inadequate improvements in the means of handling
them is the major cause of concern for the author. He argues that managers lack in coping to the
demand of change because of the enlisted factors
1. Outmoded Tools
Production managers had outdated tools to co-op with the current scenario. Demands
of the current challenges were comprehensive thinking, requirement to analyze and
define systems for needs and jobs to be done, careful planning and co-ordination of
technological functions, work of people and informational procedures. Indirect labor,
introduction of new products and planning for integrated and flexible systems make the
current management tools ineffective to accomplish the task.
2. Adaptive Problem with Useful new methods
According to author, new tools have been developed that are good enough to cope with
the changes. However, there are some problems associated in adapting new
technology. First the major concern is complexity of the new tools. Training
requirements to understand and implement new techniques is higher. Moreover,
researchers have more emphasized on theoretical aspects rather than practical
applications of new tools. Simplified models have eliminated vital factors and are
inaccurate and misleading.
3. The Talent Shortage
The shortage of right talent to accomplish the task under current pressure
circumstances is also a concern for the author. In the past, production managers werepromoted from the lower production ranks to the higher ones. Business education
schools were also equipping the managers with the right education for their tasks.
However, both the industry and business schools were unable to equip the industrial
people with the right skills for the new work environment. Manufacturing engineers
were usually graduates from the engineering colleges and did not required much
business education for the production activities. Recently the trend was shifted and
even engineers now required to have some business knowledge to run the operations
matters more smoothly.