September 18, 2002 Product Realization in the Defense Aerospace Industry Presented By: Tom Shields LAI 2 - Shields 091802 ? 2002 Massachusetts Institute of Technology web.mit.edu/lean Content Content ? Part I ? General lean concepts in factory design ? Part II ? Introduction ? Manufacturing System Design Framework ? Validation research results ? Conclusions - 3 - Shields 091802 ? 2002 Massachusetts Institute of Technology web.mit.edu/lean Lean from the Toyota Production System Shows How It All Relates System Shows How It All Relates J I T J I D O K A Leveled & Balanced Production Cost control through the elimination of waste TPS KaizenStandardized Work Right Qty Right Mix Right Time Perfect Quality Engaged and Creative Workforce - 4 - Shields 091802 ? 2002 Massachusetts Institute of Technology web.mit.edu/lean Aerospace Factory Designs Have Many Things to Consider Have Many Things to Consider ? Production volume ? Product mix ? Product design ? Frequency of changes ? Complexity ? Process capability ? Type of organization ? Worker skill/knowledge ? Cost ? Quality ? Performance ? Delivery ? Flexibility ? Innovativeness Factory Design Input Output Focus Here - 5 - Shields 091802 ? 2002 Massachusetts Institute of Technology web.mit.edu/lean Benefits from a Focus on Process Rather Than Operation Improvements Rather Than Operation Improvements ? Operations ? Value adding ? Transportation ? Delay (2 types) ? Inspection ? Factory Design ? Layout choices ? Operation policies ? Process Technology ? Tapping human knowledge X X Store in Warehouse Move to Staging Store at Staging Move By AGV Machine X X Part B Part A O p e r a t i o n Factory Design I X Storage Value Adding Inspection Transport Types of Operations - 6 - Shields 091802 ? 2002 Massachusetts Institute of Technology web.mit.edu/lean Only Understood Processes Can Be Improved Can Be Improved ? Establish models and/or simulations to permit understanding ? Ensure process capability & maturation ? Maintain challenge of existing processes Tools ? Five Whys ? Process flow charts ? Value stream mapping ? Statistical tools ? Data collection and discipline - 7 - Shields 091802 ? 2002 Massachusetts Institute of Technology web.mit.edu/lean Definite Boundaries Exist Between Flow and Pull Between Flow and Pull Flow ? MRP used for planning and control ? Group technology ? Reduce the number of flow paths ? Batch or single items ? Inventory to buffer flow ? Process control ? Minimize space & distance traveled with contiguous processing established Pull ? Takt time ? Balanced production ? Level production ? Response time less than lead time ? Standard work ? Single item flow ? Correct problems immediately - STOP if necessary - 8 - Shields 091802 ? 2002 Massachusetts Institute of Technology web.mit.edu/lean Lean Tools Can Apply even if JIT System Not Logical JIT System Not Logical ? Value stream mapping ? Work groups to implement change ? Visual displays and controls ? Error proofing ? Standardized work ? Quick changeover ? Total productive maintenance ? Rapid problem solving ? Self inspection ? Five S’s Source: J. Miltonburg, Manufacturing Strategy ?1995, p31. - 9 - Shields 091802 ? 2002 Massachusetts Institute of Technology web.mit.edu/lean Part II - 10 - Shields 091802 ? 2002 Massachusetts Institute of Technology web.mit.edu/lean Introduction Introduction ? Matured aerospace industry ? Industrial innovation theory ? Implications on the aerospace industry - 1 - Shields - 091802 ? 2002 Massachusetts Institute of Technology web.mit.edu/lean Matured Aerospace Industry ? Customers demanding specific capabilities ? Cost and affordability more prominent ? Innovation characteristics have changed Pictures taken from the Air Force Website (http://www.af.mil/) 12 - Shields 091802 ? 2002 Massachusetts Institute of Technology web.mit.edu/lean Utterback’s Dynamics of Innovation Model Innovation Model ? Rate of product innovation highest during formative years ? As product matures rate of process innovation overcomes product innovation ? Very mature products have low levels of both product & process innovations - 13 - Shields 091802 ? 2002 Massachusetts Institute of Technology web.mit.edu/lean Theory in Application Theory in Application Number of Firms Time Fluid Phase: Rapid technology innovation, many firms founded Transition Phase: Shakeout, competition shifts to process Emergence of the Dominant Design Specific Phase: Stable, small number of firms competition shifts to price Destabilizing changes in technology or process can destroy industry! Source: Data (cars), from Entry and Exit of Firms in the U.S. Auto Industry: 1894-1992. National Academy of Science: theory concepts from Utterback, Dynamics of Innovation, 1994 - 16 - Shields 091802 ? 2002 Massachusetts Institute of Technology web.mit.edu/lean 0 10 20 30 40 50 0 5 10 15 20 25 30 35 1860 1880 1900 1920 1940 1960 1980 2000 Year Aeronautics: Jet transport and jet fighter-bomber Cars: enclosed steel body Typewriters: Open, moving carriage Natural progression? Government intervention motivated by cold war Number of major U.S. Aerospace companies Industrial evolution and the emergence of the dominant design Number of major typewriter companies 80 60 40 20 Number of major automobile companies Extension of Theory to the Extension of Theory to the Aerospace Industry Source: Murman, et al., Lean Enterprise Value, 2002 - 17 - Shields 091802 ? 2002 Massachusetts Institute of Technology web.mit.edu/lean Implications for the Aerospace Industry ? Producibility and cost are more competitive factors ? Manufacturing inputs should carry more weight ? Emphasis should be on process innovation ? Firm core competencies must match industrial maturity ? Manufacturing strategy cannot be stepchild to platform strategy Result: Heritage equipment, facilities and mindsets drive manufacturing system design - 18 - Shields 091802 ? 2002 Massachusetts Institute of Technology web.mit.edu/lean Proposal Proposal Characteristics ? Uses principles of systems engineering ? Visual depiction of “design beyond factory floor” ideas ? Manufacturing as part of the product strategy ? Manufacturing system design is strategy driven, not product design driven ? Combines multiple useful tools ? Provides insights into order and interactions A holistic manufacturing system design framework to ensure process considerations are integral to the product development process - 19 - Shields 091802 ? 2002 Massachusetts Institute of Technology web.mit.edu/lean Manufacturing System Design Design ? Manufacturing system “infrastructure” design ? Manufacturing strategy ? Operating policy ? Partnerships (suppliers) ? Organization structure details ? Manufacturing system “structure” design ? Buildings, location, capacity ? Machine selection ? Layout ? WIP - Stakeholders Corporate Level Business Unit Product Strategy Suppliers Product Design Design Manufacturing Marketinging [Interpret] [Seek approval] Manufacturing System Design Design ` Society Employees Mgmt Govt.Suppliers Customers Stockholders (Corporate Strategy) (Business Strategy) Stakeholders Corporate Level Business Unit Product Strategy Suppliers ProductProduct DesignDesign Manufacturing Marketinging Requirements/Considerations/Constraints Manufacturing System Design/Selection Implement (pilot) Evaluate/Validate Rate Production [Interpret] [Seek approval] DFMA,IPT 3-DCE Concurrent Engineering ? VSM ? Kaizen ? Trial & Error ? Kaikaku - Miltenburg, - 3P, - 2D plots, - MSDD, - AMSDD design Kaizen Manufacturing System Design Design Modifications Fine Tune Finalized Product Design Make/Buy Risk-sharing Partnerships - Analytical Tools, - Simulation Tools Customer Needs Technical Feasibility Feasible performance guarantees - Stakeholders Corporate Level Business Unit Product Strategy Suppliers ProductProduct DesignDesign Manufacturing Marketinging Requirements/Considerations/Constraints Manufacturing System Design/Selection Implement (pilot) Evaluate/Validate Rate Production [Interpret] [Seek approval] DFMA, IPT 3-DCE Concurrent Engineering ? VSM ? Kaizen ? Trial & Error ? Kaikaku - Miltenburg, - 3P, - 2D plots, - MSDD - AMSDD design Kaizen Manufacturing System Design Design Modifications Fine Tune Finalized Product Design Make/Buy Risk-sharing Partnerships - Analytical Tools, - Simulation Tools Customer Needs Technical Feasibility Feasible performance guarantees - 23 - Shields 091802 ? 2002 Massachusetts Institute of Technology web.mit.edu/lean Insights from the Framework Insights from the Framework ? Linkage of strategy and manufacturing system design ? Three important characteristics ? Phase presence ? Phase timing ? Breadth across functions Hypothesis: following the framework process will result in the development of effective manufacturing system that meets the goals of the corporation - 24 - Shields 091802 ? 2002 Massachusetts Institute of Technology web.mit.edu/lean Framework Validation Framework Validation Research Design ? Case study - 14 assembly sites (6 aerostructures, 2 electronics, 2 launch vehicles & 4 space) ? Real time “fly on the wall” ? Retrospective Method ? Structured interview to assess framework congruence ? Strategy linkage ? Phase presence, timing and breadth ? Performance metric (actual/planned) - 25 - Shields 091802 ? 2002 Massachusetts Institute of Technology web.mit.edu/lean Framework Validation Results Framework Validation Results Framework Congruence versus Performance Framework Congruence 20 30 40 50 60 70 80 90 100 A c t u al/ P lanned P e rf ormance 0.0 0.5 1.0 1.5 2.0 2.5 3.0 3.5 R 2 = 0.71 Group 2 Group 1 Ac t ual/ P lanned Per f orm ance - 26 - Shields 091802 ? 2002 Massachusetts Institute of Technology web.mit.edu/lean Scoring Breakdown Scoring Breakdown Framework Congruence Phase Presence Timing Breadth 96 25.90 30.71 39.38 94 25.90 30.00 38.05 91.9 22.48 29.00 40.38 81.7 18.57 26.62 36.62 78.3 23.24 24.19 30.86 77.67 20.90 25.90 30.86 69 21.24 26.62 21.19 57 17.24 19.76 20.14 53.5 13.33 15.90 24.29 50.3 12.33 17.90 20.14 45.3 15.00 18.76 12.29 26.73 7.33 11.76 7.67 Group 1 Group 2 How important are the different aspects? ? Which of Phase Presence, Timing or Breadth impacted the ability of the system to meet its planned performance? - 27 - Shields 091802 ? 2002 Massachusetts Institute of Technology web.mit.edu/lean Determinants of Performance Determinants of Performance Breadth Score versus Performance Breadth Score 5 10 5 0 5 0 5 0 5 A c t u al/ P lanned P e rf ormance 0.0 0.5 1.0 1.5 2.0 2.5 3.0 3.5 Group 1 Group 2 Ac t ual/ P lanned Per f orm ance - 1 2 2 3 3 4 4 28 - Shields 091802 ? 2002 Massachusetts Institute of Technology web.mit.edu/lean Strategy Presence Results Strategy Presence Results Existence of Strategy versus Framework Congruence Existence of Manufacturing Strategy Framework Congruence 0 20 40 60 80 100 No Strategy Present Strategy Present Group 1 Framew ork Congruence - 29 - Shields 091802 ? 2002 Massachusetts Institute of Technology web.mit.edu/lean Conclusions Conclusions ? Competitive advantage from manufacturing excellence (enterprise strategy) ? Performance more closely related to how system designed (not production volume) ? Manufacturing as a true participating partner with the other functions (coequal status) -