Industry Forum

The answer to the ultimate question!What is the best approach to improvement? Only a slightly simpler question than “What is the meaning of life, the universe and everything?”

There are many well-known practitioners and writers publishing their findings and recommended approaches. And of course, a number of people branding their approaches as the ultimate solution.

However, this week I read an article by a much admired leader in all things lean, Jim Womack, which made me stop and think.

In his article, Jim describes how in the last year he has started advising clients to make changes in one single place in an organisation, as opposed to starting with the big picture and the end-to-end value stream. This enables the team to discover what things they need to address across the whole organisation to ensure they have a functioning and stable environment, that gives a solid foundation for sustainable improvement.

This reminded me of the way in which I was taught to approach improvement by the Master Engineers from Nissan, Toyota and Honda.

Work in small steps

Always, always work in small steps towards your overall goal.

There are two key reasons for this;

  • If you apply a small improvement now, the savings will start straight away and build up over time.
  • If you delay until you design a complete and perfect solution, the chances are you will lose focus and never implement any improvement at all.

This is summed up in a quote attributed to Mark Twain; “Continuous improvement is better than delayed perfection.”

It’s a bit like climbing a very large mountain. Rather than one long steady slope, there are a number of peaks to conquer along the way. And if you look ahead, you can see the nearest peaks, but not the highest. You have to keep on climbing to reach the summit.

The answer to the ultimate question!

 

The summit, or your overall goal, is best represented by your vision or mission statement. Research shows that the most sustainable improvement activities are those whose targets are linked to achieving that goal.

Your strategy is like the route you chose to the summit. It breaks down attainment of the goal into achievable segments. You then choose and deploy the tools that are best suited to achieving each segment.

Top deployment tip

When working on one of the segments and deploying a tool, break your actions down into even smaller steps and trial your ideas as you go.

Always encourage your improvement team to try out an improvement idea immediately, and don’t spend money on it straight away.

The answer to the ultimate question!You can mock up the suggested countermeasure, or solution, using whatever materials you have to hand. Sticky tape, cardboard, spare pairs of hands and the ability to scrounge are your best friends here.

Use cardboard cut outs of equipment to trial a new layout. Use people to act as stands or shelves. Borrow equipment from another area. Sketch out shadow boards or document layouts.

The key is to trial the idea and check that it works before you make permanent changes and spend money. (Remember to use the Plan, Do, Check, Act cycle).

Keep going

Keep moving through the small steps to complete the segments of your overall plan. This allows you to see progress and build on your successes.

I always use these 3 phrases to remind the improvement team to work in small achievable steps, no matter what technique is being deployed and what their end goal may be.

  • Do it now! No excuses.
  • Use your wisdom, not your money!
  • Improvement is infinite, better is not good enough.

Take a look at our Leadership Development Programme, which is a programme designed to manage the sustainability of all improvements made in the workplace. We have three courses in the programme:

If you’d like to speak to one of our experts, drop us an email or call us on +44(0) 121 717 6600.

digital factory smallFor many years we have been successfully using VSM to help us plan how our businesses will operate in the future. Many of us will have started around 2003, using Learning to See by John Shook and Mike Rother. But is the mapping tool becoming obsolete in the world of virtual and augmented reality?

Mapping the information and material flows and understanding how long it takes us to deliver the finished product to the end user has many benefits.

It allows us to diagnose our current state and then plays a vital role when we design how we will operate more effectively in the future. Key is ensuring we meet or even exceed customer expectations in a way which ensures we can make a profit and maintain a healthy cash flow.

VSM is at its most powerful when used as a strategic tool to support our policy deployment cycle.

Aligned to our vision and mission statements, it helps us create a road map of how to achieve the ideal state. We get clear priorities and detail on which improvement tools to use, where and what the desired outcomes are.

Under threat?

For me a key part of the mapping process is using a cross functional team who go to collect actual facts about how the process really works. And of course the giant roll of paper we put on the wall!

VSM

 

So is our “traditional” way of mapping under threat from powerful applications supported by cloud technologies or the real time collaboration across continents made possible by augmented reality (AR)? Will we loose the hands on, collaborative approach that has always worked wonders in reaching consensus on the way forwards?

The future

I don’t think we should change the practical, cross functional team approach to the mapping method. While in some cases the introduction of VR and AR will enable better collaboration, let’s not throw out the roll of paper just yet.

But we should definitely introduce digital technology in another way.

We know that used in the right way these technologies help us to eliminate waste and reduce lead times. This happens in both the information and manufacturing flows.

So let’s introduce some new icons into our mapping and incorporate the advantages of the emerging technologies into our designs.

Traditionally we have used icons like these to depict the ways in which we transfer information; manual (solid line), electronic (lightening flash) and informal or ad-hoc flow (dotted). And we add detail with icons for sheets of paper, computers and telephones.old information flowsI bet you’re thinking …… “That looks a bit old hat!”

Well how about we introduce symbols to show wireless transfer and use of cloud technologies? Could we show smart products in transit along the extended value stream?

New information flow

 

Will kanban cards become things of the past, to be replaced by symbols for smart products that wirelessly transmit the signal to produce?

before and after smart products

As our manufacturing environment evolves at an ever increasing pace I think we need now more than ever, the clear vision provided by future state mapping.

So, I would love to see some of your future state digital manufacturing maps, with vastly reduced time lines. Or maybe you would like to share your ideas for new icons?

Improvement programmesWhen I first learned about the 7 Wastes (some 20 odd years ago!), it was a light bulb moment.

The root of every single improvement method was revealed. You will probably have noticed how most of these blogs mention waste somewhere.

But it’s one thing to be able to recite the wastes and another to be able to spot and rigorously eliminate them.

I often find that people have heard about the wastes, but don’t have a solid approach for elimination. This results in missed opportunities when deploying all the other lean tools and techniques.

Follow these 5 straightforward steps to maximise your activity results

1. You have to go and spot it!

Get a team together (who have had a brief introduction to the waste categories) and go and observe your target area.

Use the method best suited to the task you are watching:

  • Stand and watch – good for repetitive, short cycle tasks.
  • Video and playback later – good for tasks that take under an hour.
  • Draw it, use a flowchart, process map or value stream map – good for lengthy tasks and those that involve operations that are difficult to observe e.g. admin and computer based tasks.

You can combine the methods as well.

Top tip: Take a list of the 7 Waste categories with you. It helps you to remember what you are looking for.

2. Write the waste you spot on a Post It® note

The most important thing to write is a description of what you see – the waste observed. You can add the waste category and suggest a countermeasure afterwards.

Improvement Programmes

Encourage the team to identify as many different wastes as possible.

Top tip: Liken each Post It® note to a £10 note (it used to be a fiver – but that was a long time ago!)

3. Organise the notes

After quite a short time the team will have generated a huge amount of notes. You need to group these together so you can prioritise them.

Start with this simple method and develop it as you learn by doing.

First organise by category, grouping together similar observations.

Improvement programmes

 

 

Then prioritise which ones you are going to tackle first. There are many ways of doing this, like using a grid with impact and cost axes.

Improvement programmes

Start with the high impact, low cost ideas. Of course any safety concerns must be dealt with first.

4.Eliminate the wastes

Go and implement the countermeasures.

Top tip: Transfer each group of wastes onto a follow up sheet so you don’t loose any, especially those in the lower priority quadrants.

A good sheet will help you follow a Plan, Do, Check, Act approach.

5. Tell everyone about your improvements

Communicate how much easier and quicker the tasks have become for the people who carry them out. Use pictures, do demonstrations, use KPIs, discuss at team briefs.

Don’t forget to train people in the new methods and incorporate the changes into any existing documentation like Standard Operating Procedures, costings etc.

Prove to the management team how the activity has benefited the bottom line. Read this article to see how to translate the improvement into cash.

The more you actually do waste elimination activities, the better you will become. If you want any help or some more tips for tricky activities please contact us.

 

 

 

AutomotiveThese guidelines have been put together for the use of current and potential suppliers into the automotive supply chain. It is intended to be used as an aid to understanding what an automotive customer will expect in terms of service and documentation and explain why this is the case.

The guide has been constructed with help from Rolls Royce Motors, Bentley, Aston Martin and Jaguar Land Rover in order to align it with the needs of original equipment manufacturers (OEM’s), who are required to mandate certain requirements in order to comply with their own and also international standards.  Most notably the automotive specific standard ISO/TS16949. A central theme of this standard is that the OEM’s need to demonstrate that they have control of the whole cycle of making a vehicle from concept through to launch and even beyond into spares/warranty. In order to be compliant with this, the OEM’s need to be able to prove they also have control of all the supplied parts that they buy. Due to this, they will need a lot of information from a supplier in order to be able to satisfy this requirement.

 

Further information:

Rebalancing the UK economy following the crash of 2008 is widely understood as a desirable national goal.pound notes
The recent progress of UK manufacturing can be assessed via the Annual Business Survey data which Office for National Statistics (ONS) have just released covering the period from 2008 to 2014. It shows that manufacturing gross value added (GVA) increased by £7.8bn or just over 5% between 2008 and 2014.

The detailed sector changes suggest that the global economy is impacting on different parts of manufacturing in very different ways. Food manufacturing increased GVA by £2.2bn, automotive by £7.3bn and machinery and equipment by £1.5bn. Several manufacturing sectors decreased in size while others stayed roughly level in GVA terms.

The non-financial economy as a whole increased in GVA by £195bn between 2008 and 2014 – by over 20% which is more than the total manufacturing GVA of £157bn in 2014. There are important linkages between manufacturing and services, however, and a key example of these linkages is the retail motor sector which increased GVA by £31bn between 2008 and 2014 to a total of £189bn. Professional and Technical Services are also often linked to manufacturing and this sector’s GVA increased by over £41bn between 2008 and 2014 reaching a total of £148 bn.

One element in the increase in GVA in automotive manufacturing has been the significantly increase in investment in the sector not just in car plants but also in the supply chain. Strengthening the supply chain had been identified as a priority by the Automotive Council where industry leaders set an overall national strategy with Ministers and overseas investments have been secured as a result.
Food-Manufacturing-(Small)

This Summer DEFRA minister, Lynn Truss, launched a related initiative for the food and farming sectors. Food manufacturing is the largest UK manufacturing sector and one of the largest in Europe. A meeting with over eighty industry representatives committed to the development of a long term plan with a 25 year time horizon for food and farming. They affirmed an ambitous vision for the sector and its potential to drive growth. Achieving the potential will involve building skills especially via apprenticeships, using modern technology and building an overall brand to lever export growth.

 

An interesting similarity between automotive and the food sector is the importance of effective supply chain management especially as part of successful new product introduction. The UK food manufacturing sector launches over 16000 new products every year.

As part of its 2015 Manifesto the All Party Manufacturing Group (APMG) endorsed the type of approach adopted in automotive and food. It said:long term government policies, prepared in collaboration with industry and with buy-in from across the political spectrum, are the single best way to instill confidence and security across the manufacturing sector. The manifesto set out specific proposals on innovation, skills, finance and taxation, energy, trade and investment and SMEs. APMG has set up an independent in-house depth research unit, The Manufacturing Commission, funded by the EPSRC and the EEF. It aims at driving new thinking about UK industrial policy.

The formation of a Manufacturing Commission follows on the APMG’s 2013 research inquiry and report ‘Making Good: A Study of Culture and Competitiveness in UK Manufacturing’, which warned that UK manufacturing is being prevented from becoming ‘wholly competitive’ by a national industrial culture that discourages companies from investing in vital long-term business drivers such as skills development and technological innovation.

3d blue Diagram with arrowThe chairman of Industry Forum, Mike Baunton is a member of the Manufacturing Commission. As far as UK automotive is concerned Mike believes there are significant opportunities in the supply chain, in environmental performance and in skills. There are excellent examples of UK automotive companies leading in each of these areas but if we could get all automotive companies to the levels of the best we could accellerate growth.

Global manufacturing companies are increasingly building their strategy as a integrated global portfolio facilities. As far as the UK’s strengths are concerned from this perspective, Mike points out that the UK has deep expertise not just in all aspects of modern manufacturing but also in the support services needed to make manufacturing competitive. We speak the worlds language, we have access and support for world markets.We have an open economy and supportive legal and political framework plus both competent and flexible working practices.

He points out that many countries support manufacturing both directly (through grants and tax incentives for example) and indirectly through tariff barriers, export incentives etc. However, countries beyond the UK typically apply short term incentives which are incompatible with the long term investment goals of many manufacturing companies. We in the UK have demonstrated a consistency of approach and the support that should encourage even more inward investment.

Mike descibes the Manufacturing Commission research priorities as making recommendations to Government to support industrial sustainability. In the context of the work they are looking at not just environmental sustainability but resilience, supply chain strength, skills and long term research and development capability.

All the evidence shows that a national manufacturing strategy can pay off provided it is pursued consistently in the mediumWorld-map-small and long term. Major manufacturing nations in Asia, Europe and North America are all developing this kind of strategy and taking a keen interest in how competitor nations approach the topic.It is very encouraging to see that the UK is developing its own distinctive research based approach aligned with our national strengths.

 

 

Further information:

digital technologies Will deploying digital technologies boost your productivity, QCD performance and global competitiveness?

This is the message we get from all the promotional information. But as with any new system or equipment, we need to evaluate the pros and cons before rushing in to purchase.

To really improve performance and bottom line we need to ensure we are eliminating real waste, not just speeding up tasks classified as waste or non value adding (nva).

Let’s have a look at a few examples.

Smart tools and wearable tech

Imagine using a smart torque wrench liaising with a variety of smart products during assembly. It tightens to the correct setting with a high level of accuracy, sends data to be captured for compliance on your safety critical item and then reconfigures the setting instantly for the next product.

Bad quality through user error is eliminated, and time to collate compliance data is vastly reduced. Key here is that if the tightening is a value added task and regulation states you must have compliance data, then you have almost certainly eliminated some waste.

Now consider the scenario where warehouse workers are using wearable tech to assist picking and stock taking. Using multiple hands free devices will speed up the operation and reduce errors (bad quality) and operator motion. But we must question the need for the warehouse in the first place. Are we overproducing? Eliminate waste in the value stream before investing in tech.

Virtual and Augmented Reality

Using VR and AR instead of manual design systems and paper based Standard Operating Procedures reduces waste (see last blog) and speeds up the whole design process.  But they are not a cure-all. There are other important actions you should take to speed up time to market.

Using in sight displays of near live data analysis may reduce operational wastes. But don’t loose the value of gathering a team together to problem solve and eliminate root causes.

Linked systems

Seamless digital manufacturing systems, that replace manual processes, can speed up feedback and reporting by eliminating the wastes of using the old system. Like time spent retrieving information and transferring to different systems, errors and waiting for others to finish tasks. But again don’t automate wasteful or nva tasks, review the information flow first. Electronic storage space and bandwidth do cost money and can be wasted!

Big data and other analytics

Using cloud and IoT technologies can boost the power of Condition Based Maintenance and CMMS systems to predict machine failures before they occur. This reduces downtime and production costs but comes at a price. I recommend that you evaluate what you need from your CMMS system first and consider scaling it up over time.

Cloud based speech analytics are being used to improve customer services; resolving issues more quickly and preventing future costs. I’ll let you decide for yourself if this is speeding up a reactive approach or is it being proactive?

Summary

A key message from the Advanced Engineering show was that we need to use lean techniques as well as emerging technologies to improve performance and productivity. Robots and machines can not do problem solving and improvement activities like humans can – yet!

We need to be aware of what technology can do and deploy what we need, to drive out real waste and solve problems.

I hope you enjoyed this series of blogs on emerging technologies and how they will shape our future. I would love to hear about your thoughts and experiences.

Risk management is part of the portfolio of most firms. For example, contracts are always instruments to share risk between the parties. Or again, risk management should shape audit strategy and be the bedrock of health and safety practices. Product design includes risk management methods such as failure mode effect analysis (FMEA) which is a core tool within TS 16949. Lean and agile product development approaches also aim to minimise risk. Recently the expression ‘stress test’ has entered everyday speech from contemporary financial sector risk management.

SC-smallRisk management is growing in importance as new and improved products, processes and services are more and more the bedrock of the growth strategies of most firms. Last year food and drink manufacturers in the UK, the largest manufacturing sector in the uk, introduced some 16,000 new products, part of the reason why food manufacturing is one of the sectors that expanded most between 2008 and 2014. Everyone accepts that there is a significant risk dimension to such market introductions as most new products fail still. With innovation increasingly based on new technology, especially digital technology, businesss risks are increasing for other reasons too. Introducing new technology brings important supply chain risks as new technologies usually mean new suppliers. There is now a well established trend for supply chains to become more elaborate, more diverse and more extended. Major organisations, including the U.S.

 

Pentagon for example, have identified this supply chain development as bringing important new capability and skills challenges and needs in supply chain management and strategy to cope .There are also developments in the business environment which are intensifying risks as it become more volatile, ambiguous, chaotic and uncertain (VACU). The Cambridge Risk Centre last year produced a taxonomy for complex risk management based on twelve categories of threat. These include financial shock, trade dispute, political violence, geopolitical conflict, natural, climatic, environmental or technical catastrophe, disease outbreak and humanitarian crisis. Most if not all of these can disrupt an extended supply chain and it is easy to think of recent examples of disruption which have made the headlines.

Deloitte recently published a review of the factors shaping the investment approaches of US headquartered manufacturers up to 2020. Produced with the Manufacturing Alliance for Productivity and Innovation it examined whether the well established strategy of off-shoring should be balanced in future by more recent developments in the global economy favouring a different strategy. For example with the increasing importance of advanced manufacturing techniques how sound is it to develop the global manufacturing footprint in new territories where the environment involves several significant unknowns? The study recommended that top management ensure that geopolitical risk is factored into global investment decisions over the next five years. In this kind of risk work a strategic risk is one which undermines the fundamental assumptions on which a strategy is based or the organisation’s capability to meet its goals.
Massachusetts Institute of Technology’s David Simchi-Levi, Cornell’s William Schmidt, and Yehua Wei at Duke, have created two new metrics to “help prioritize the financial or operational impact of risk that lets companies focus their mitigation efforts on the most important suppliers and risk areas,”

Time to Recovery (TTR) is the time it would take a network point to become fully functional after a disruption. Ford hasRisk-small used suppliers TTR information combined with its own data to identify risk exposure at each of its network sites. Time to Sustainability (TTS) indicates the maximum duration that the supply chain can match supply with demand after a network disruption. Evaluating inventory and other available supply, this metric reflects how long the customer can continue to be served while the network point is down. If the TTS is greater than the supplier’s TTR, risk is low. By contrast, if the TTS is less than TTR, its disruption creates financial and operational complications.
Another important aspect of strategic risk management is risk monitoring and firms will need to introduce or expand this capability. We can all think of risks that loom large currently but which two or three years were only the concern of specialist communities.
The UK is fortunate in the availability of information and expertise on emerging risks, much of which comes at low or zero cost. There are also thriving consultancies in the UK business services sector specializing in area specific political and geopolitical risk analysis. It is important that risk monitoring within firms is elevated beyond media monitoring as part of the marketing function and provides a regular structured input to senior decision-makers.

The new version of the global quality standard, ISO 9001 which has just been published. It incorporates the risk management standard ISO 31000 and brings that standard into an assessment and certification regime for the first time. This change will be carried through to all the sector specific variants of ISO 9001 including medical equipment, aerospace and automotive.
Supply chain risk management has been the subject of important developments by major manufacturing nations outside the UK. There is the German supplier assessment approach VDA 6.3 developed for automotive supply chains. This standard evaluates a potential supplier’s capability to be a reliable part of the supply chain for a new product but it is also useful to primes in developing their In the USA the premier professional association for supply chain management is the APICS who offer a comprehensive, program that will prepare participants to work on the development of a global risk mitigation strategy. To earn the APICS Risk Management Education Certificate one must complete 12 total contact hours of APICS education including 3 from the elective topics which include vulnerability assessment, currency risk and political uncertainty. Industry Forum can support manufacturers who want to enhance their supply chain risk management capability. We provide services linked to the global automotive quality standard including the core tools such as FMEA, to the German supplier standard VDA 6.3 and to the U.S. professional association for supply chain management APICS.

Supply Chain professionals must consistently update their skills and knowledge to thrive in a
competitive environment. As the leading training and consultancy organisation, Industry Forum can offer the right programme and certification in APICS . For further information please visit www.industryforum.co.uk/training or email enquiries@if.wearecoal.work

 

CPIM Temple

 

 

 

 

 

 

 

 

 

 

Further information:

New Product IntroductionIn Digital Manufacturing I mentioned that the time for NPI is being reduced, thanks to the use of technologies such as Virtual Reality (VR), Augmented Reality (AR) and 3D printing.

While these methods may have been considered too expensive, the development of the cloud and Internet of Things is making them readily accessible, even for SME’s.

Having recently seen these digital processes in action, I thought it would be good to show how they can be used to eliminate waste and reduce cost from our NPI projects.

I’ve used links to videos to show you these processes in action. Much better than words. You can Google more examples, watch out though it is addictive!

VR

A person using specialist electronic equipment interacts with a computer-generated simulation of a three-dimensional image or environment.

This technology is already used in immersive vehicle design and for creating plant layouts. Take a look at this video from Ford; it describes how VR enables real time collaboration from designers across the world.

AR

Computer generated virtual information is placed directly into our world. Unlike VR the user doesn’t require a portal to access the image.

Auto and aero manufacturers are already experimenting with AR as part of their design and development programmes. Tests show that errors and time to assemble are reduced, even for first time users.

To give you an idea of how AR works in an industrial setting, take 5 minutes to watch this clip on the Daqri Smart helmet, a piece of wearable tech.

And if that isn’t futuristic enough for you, try wearable holograms!

3D printing

Material is “printed” thin layer after thin layer in simple or complex shapes to create a fully functioning, 3D part. It is also known as additive manufacturing, rapid prototyping and free form fabrication.

New Product Introduction

 

It’s really not a gimmick! You can print strong, working, complex items. Look at this video of a working wrench being made.

If you want to know how it works, read this.

3D printing is widely used to make prototypes, but is also now being used for part production. And if you need to scale up your business – just use more printers!

The uses of 3D printing seem to be limited only by our imagination. In the future we could have 4D printing. Yes the 4th dimension is time!

Benefits

When used as part of a seamless digital manufacturing solution, these technologies help to reduce the time for design, prototyping, validation, training and ramp up to full production. And there are quality and cost benefits as well.

It becomes quicker to:

  • Retrieve information. You ask the system for what you want and it delivers it to your line of sight.
  • Transfer information from system to system (no longer manual).
  • Interpret the information you are given compared to a written Standard Operating Procedure.
  • Capture, store and distribute lessons learned (instant rather than weeks).
  • Create prototypes. There is no minimum batch size, no moulds or jigs to make and set ups are almost instant.

It becomes easier to:

  • Communicate results. Complex ideas can be shared visually with stakeholders at design reviews.
  • Visualise how the product will look and fit together before making a prototype. This allows designers to identify and resolve problems earlier in the process. It also minimises the number of physical iterations.
  • Simulate assembling the parts to eliminate operator motion waste later in the process.
  • “Immersively” train operators in advance of production.

Next weeks blog will look at other smart technologies and their impact on eliminating waste from our processes.

 

The future has always been uncertain, prone to surprise us. We all learn to live with this condition with more or less
success. Where large sums of money are at risk a more systematic approach has grown up. One example is audit where a risk based approach has been adopted. Auditors examine those parts of the organisation whose operation could have serious consequences in future. The priority is to scrutinise the areas where the potential negative impact is greatest.

Risk-Management---Small

The whole insurance industry is another example of risk management that everyone is familiar with. The key idea here is risk sharing to reduce the potential cost to individuals. Risk management also has been developed as a body of knowledge and practice in the investment community. The key idea is the distribution of possible profit outcomes for a particular project or programme. If this distribution is understood then it will be easier to take action which reduces the likelihood of a negative outcome. If this perspective is used routinely then an investment business will secure better overall returns.

It is now widely recognized that the current business environment has shifted in directions which make risk management more pertinent. VACU is the acronym which summarises the current environment as more volatile, ambiguous, chaotic and uncertain. A number of different trends have come together to make this state of affairs ranging from geopolitics to the rapid spread of digital tools and techniques.

In 2009 the International Standards Organisation issued ISO 31000 covering
principles and practices of risk management which is aimed at any organisation of any size in any sector. The standard is intended to help organizations increase the likelihood of achieving objectives, improve the identification of opportunities and threats and effectively allocate and use resources for risk treatment. ISO 31000 cannot be used for certificationRisk Management purposes, but does provide guidance for internal or external audit programmes. Organizations using it can compare their risk management practices with an internationally recognised benchmark. Business services organisations are offering an increasing range of products to help firms strengthen their risk management capability. For example Deloitte suggest an effective capability will engage senior management, have a strategic focus, have a risk sensing function which includes the use of sources external to the firm, use a mix of digital and human elements, have quantitative outputs and produce time series data. The UK training market is developing with, for example, two day introductory courses to risk management now available.

Health and safety at work involves certain legal obligations in respect of the workforce but is not for the most part seen as a strategic aspect of business. Nonetheless risk management is a core function and in the UK the Health and SafetyExecutive make available free online an excellent set of resources, tools and techniques. There is probably in most organisation some capability to use such tools effectively at operational level. The challenge is to develop that capability so that it can operate at strategic level.
Military and security planning is another domain where there is good experience of risk analysis. For example the
fundamental process is to first identify an asset and a threat to it. The next stage is to review the existing level of
protection to identify the vulnerabilities. Prioritizing vulnerabilities provides the basis for a work programme.

Risk ManagementFor many organisations the new global standard on digital payment security will also be a useful resource. This is version 3.1 which was released in April 2015. The Payment Card Industry Data Security Standard (PCI DSS) is a
proprietary information security standard for organizations that handle branded credit cards from the major card schemes
including Visa, MasterCard, American Express, Discover, JCB, and China UnionPay. The standard is mandated by the card brands and administered by the Payment Card Industry Security Standards Council.

It was created to increase controls around cardholder data to reduce credit card fraud via its exposure. Validation of compliance is performed annually, either by an external Qualified Security Assessor that creates a Report on
Compliance for organizations handling large volumes of transactions, or by Self-Assessment Questionnaire for
companies handling smaller volumes. There is some evidence that firms are reluctant to implement the standard because of its complexity and expense. Also there is worrying evidence that senior managers in the UK routinely take unnecessary risks in project management even though project complexity is increasing thanks to digitalisation. For example in project management it is well established that quality, cost and timeliness are hard to optimise as a totality. Typically it is safer to specifically select which of the possible pairs are the priorities for any given project. However reviews of project failures in the UK still find that the most common cause of failure is the unrealistic targets set by senior management at the start of the project.
Almost everyone has heard of SWOT analysis as part of strategic planning and clearly any alignment of weakness and novel threat will be a big priority in strategic risk management. Many people are also familiar with the environmental scanning framework, PEST, covering political, economic, social and technological domains. This is frequently extended to cover legal and environmental and also sometimes ethics and demographic. These extension raise the question of how risk is segmented in strategic risk management.

ISO 31000 uses a risk management process which consists of the three steps: Establishing the Context, Identification and Assessment. Establishing the Context means that all the possible risks are identified and the possible ramifications are analyzed thoroughly. The best segmentation of risk for a particular firm should be clarified in this phase.
It is worth remembering that risks could be either internal or external – possible internal risks might be
employees of the company or operational inefficiency in a certain process.

Operations and Supply Chain professionals must consistently update their skills and knowledge to thrive in a
competitive environment. As the leading training and consultancy organisation, Industry Forum can offer the
right programme and certification. For further information please visit www.industryforum.co.uk/training or email enquiries@if.wearecoal.work

 

Further information:

What does Digital Manufacturing really mean?How will it re-shape our business and daily lives?

The best description I have found is this.

“The creation of a digital thread that seamlessly ties together the flow of information from design through manufacturing to end consumers, including the full life cycle of the product.”

Digital manufacturing is not just machines talking to machines on the shopfloor, but the shopfloor talking to design, maintenance, stores, sales, planning. Also, the business talking to suppliers, consumers and the actual product in use! I’ve shown some of these in this diagram.

 

 

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Digital manufacturing is also known as; Industry 4.0, Cyber physical systems (CPS), Internet of Everything, virtual manufacturing solutions and advanced manufacturing. It depends whose selling it!

Why is it different to ERP, CAD or CMMS?

Enterprise Resource Planning (for business activities), Computer Aided Design and Computerised Maintenance Management Systems only represent part of the overall picture.

Most business will also have other digital systems; for controlling robots, supplying quotes, testing and validation.

Typically none of them are linked together and so don’t feed each other information, without some form of manual intervention. Also the data collected is stored in “silos” and either analysed reactively or dumped.

If the systems don’t exchange information they can’t enable changes, control settings or allow “learning”. And if data is kept in separate silos then no linkages can be made.

So digital manufacturing is about the connection of all the different systems from one end of the supply chain to the final consumer. This allows end to end exchange of information. Three of the big enablers for this seamless connection and advanced analysis are the Internet of Things, cloud computing and big data analytics.

What are the potential benefits?

I’ve deliberately used the word potential here. It’s estimated that currently only 3% of equipment and systems are connected in some way.

But it’s changing really rapidly. Most people in the business are talking about smart factories, smart machines, smart tools and smart supply chains as well as smart products being a widespread reality by 2020/25.

This take up is helped as cloud technologies and scalability makes it increasingly affordable, even for SMEs.

However these are the main benefits that are currently being, or will soon be, realised.

Benefits in the factory and supply chain

  • Reduced time for new product development. This is assisted by the use of virtual reality, augmented reality and 3D printing in design, prototyping, simulation and testing.

These technologies are giving us; reduced potential for error, proactive issue resolution, cost reductions and quicker right first time build.

  • Streamlined feedback loops, reporting processes and near real time information analysis.
  • Improved energy and resource efficiency, resulting in a reduced carbon footprint.
  • Improved predictive maintenance systems, in turn raising safety, performance, availability and reliability.
  • Instant compilation and quicker retrieval of data for compliance purposes.

Benefits across the customer interface

  • Highly customised products are supplied, as increasingly flexible equipment allows individualised mass production.
  • Cost reductions, as systems supporting installation, service and maintenance are linked.
  • Enhanced purchasing experience, as smart products allow additional information to be seen by the customer using their smart phone.
  • Improved customer service, as cloud based speech analytics continuously improves responses to the customer.

Next week I will expand on some of these specific digital manufacturing techniques and how they will impact our improvement programmes.

Thanks to AES, Bentley Motors Ltd., EveryWare Ltd, FORCAM, National Instruments, Cambridge Wireless and Siemens at the Advanced Engineering Show 2015, UK. Your visions of the future and enthusiasm inspired me to write these blogs.

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