Engineering management 2Coursework 2015/2016

Ahmad Sultan

B00199916

ContentsQuestion 1.............................................................................................................................................3

Sales and marketing (1a)...................................................................................................................3

Finance (1b).......................................................................................................................................3

Supply chain logistics and shipping (1c).............................................................................................3

HR and training (1d)...........................................................................................................................3

QA and QC (1e)..................................................................................................................................4

Question 2.............................................................................................................................................4

Layout and layout analysis.................................................................................................................4

Question 3.............................................................................................................................................6

Lean maintenance (TPM)...................................................................................................................6

Question 4.............................................................................................................................................8

Lean or lean six sigma (rotor blades) (4a)..........................................................................................8

Lean six sigma (aero engines) (4b).....................................................................................................9

Question 5...........................................................................................................................................10

Force field analysis (5a)...................................................................................................................10

Culture (5b)......................................................................................................................................11

Evaluation of the culture (5c)..........................................................................................................11

Question 6...........................................................................................................................................12

Organisation’s corporate strategy (6a)............................................................................................12

Alignment (6b).................................................................................................................................14

Engineering functional strategy (6c)................................................................................................14

Question 7...........................................................................................................................................15

Supply chain management (7a).......................................................................................................15

Importance of supply chain management (7b)................................................................................15

References...........................................................................................................................................16

Question 1

Sales and marketing (1a)

The marketing and sales side of the business would come to an understanding of the ability of the process and the system in which the operation take place, the scales and marketing department would feed back to the operations department would then feed them to the relevant department to satisfy the client demand. Operations would also adjust the process to make sure the process is meeting the targets to achieve the best outcome. After operations and all the relevant depart have carried out the necessary changes, operations would tell marketing what they can and can’t do.

Finance (1b)

The contribution of the finance department is to fund the projects at hand in an organisation and whether the organisation would able to afford changes or to buy in any machinery. For example if the a small company’s finance department decides that they are going to create a colour coded system with in the production line then the finance departments role would be that they would have to work up a budget that the company would be able to afford which would be sent to all parts in the department to notify them of the new investment. The finance department would also research the return on the investment to show to operations department to outline the cost and returns on the investments also how long it would take for returns.

Supply chain logistics and shipping (1c)

The role of supply chains and logistics is to take order and put orders through to the relevant suppliers, this department would also work with finding ways in reducing lead times by prioritising the levels of orders that they put on production. The information for orders are given to the production department which they would need to for fill the it and then the production department would feed information back with the information how much was produced. The orders to be put through are given from the production department where they are then put through to the suppliers.

HR and training (1d)

HR and training department is connected to every department in the organisation where there is training needed or new recruits needed to improve the company. The HR department is also involved in creating a work friendly environment to ensure productivity and moral to stay high. The training department is responsible for supplying the organisation with extra training or training new recruits and offering the courses to give the employees the skills needed to carry out their jobs. For example when a new methodology is implemented the HR and training department are responsible for recruiting the correct skill set to apply the implementation.

QA and QC (1e)

The QA and QC departments (quality assurance and quality control) main role is to make sure that all the products that leave the factory are defect free and measure up to the organisation standards. Quality assurance department ensures that all the measures to create a defect free product are in place for example put in place product check stations and instruction manuals for checks to be carried out by the station workers them self’s. quality control department ensures that all the precautions for checks and the equipment needed to create the perfect environment for a defect free environment, quality control also gathers information for what type of training is need to feed back to HR to refresh employees in how the process could be improved.

Question 2

Layout and layout analysis

When companies use different tools and techniques to assist in analysing their plants layout and how it could be optimise.

The advantages of CAD for example, is that it takes less time to draw a conception sketch which reduces the amount of money that could be spent on the layout and also if the production line needs to come to a halt. Costly mistakes in the design can be avoided when using CAD because in the program the faults are very obvious and can be corrected. As a computational aided design the program can be altered at any given point which doesn’t mean that when there is a setback everything has to be started again. The limitation of CAD is that not anyone can use it as there is training needs to be supplied to the staff that are going to carry out the improvement of the layout of the process which can be really expensive to the company, the start-up costs can be high also as the program can be expensive too as it is a subscription costs every year for industrial use.

One of the layout assisting programs that have advantages and limitations are virtual reality where the program uses 3D simulation to give a real life visual and just like every other software used has advantages and limitations, the advantage to using virtual reality is that it creates a real life image to work with which give an idea to how the process would look like, the program also give the opportunity to explore the design which gives a sense of space. But just like every other software this program has its down side, the equipment used for this sort of work can be very expensive and also needs specific skill sets which can most like mean that it has be outsourced or the training for it means that a lot of time and capital have to be invested.

There are other methods of simulation for example the string diagram where it would show the movement of a working and in proportion how far, this could help in reviewing a work station and minimise the movement therefore the finding where the savings can be made. The

disadvantage is that the process would have to be monitored and revised before the changes can be applied therefore time would be lost.

AIEOUX analysis where the process is reviewed and given priorities in which section could be tackled first on the bases of listing and it is as follows:

A= Absolutely importantE= Extremely importantI= Important O= Ordinary U= unimportant X= keep apart at all times

The graph below shows how the departments would be placed in a list and how every department’s relation with the other department would be recorded.

Figure 1: showing the using of an AEIOUX diagram and the use of it (Management & Development centre, No Date)

The example above shows the following:

Departments that can interact in order of the most important to the least

1-21-32-63-54-65-6

Departments that should be kept apart1-43-43-6

As seen above this could work on any scale from department to station, if it was work station this would show which work station can operate without being close to each other therefore giving the outlining to how the new layout to the plant can be like.

Question 3Lean maintenance (TPM)

Before answering this question TPM (total productive maintenance) and the relationship between TPM and OEE (overall equipment effectiveness), world class and autonomous maintenance. The reason why a lot of businesses don’t embrace full TPM is because if the test every product they make they would not have any product available for their clients, TPM relates to OEE calculations to give states for the process the equation for it is as follows:

OEE= availability x performance x quality rate

Availability = available time – down time x 100

Performance rate = ideal cycle time x processed quantity x100

Quality rate = processed quality – defective quantity x 100

The quality side of this calculation would include testing the product before sending it out to the clients to make sure it is working which means that for example if it was a light bulb making process the bulbs would break and no product would be produced.

Another reason is that it would cost more than it save which mean that it is a waste which isn’t very lean especially that it is a lean tool or as some publications would refer to it. The main disadvantage is also the fact that the prices of raw materials may differ from one batch or line to another which makes it hard to determine the OEE value accurately which is also a waste and not lean if implementing lean is something that the company is looking to work on. The companies that may implement this method would have set costs for their materials (there are very few companies that have a set cost of raw materials). A large amount of companies find it very difficult to cut down adjustment time, minor stoppages or set up time due to the nature of the changes or the health and safety checks that need to be taken.

Autonomous maintenance (AM) is one of the main eight pillar of TPM which focuses mainly on the equipment used in the process. This process would identify the equipment that needs replacing in order of the biggest contributors then using OEE to find out the break down the major causes of minor stoppages, break downs and loss of speed due to the equipment being worn out. This process can eliminate up to 70% of preventable degradation of equipment which can prevent stoppages, equipment failure and health and safety hazards. AM grew out of 5s activities which is what TPM has its foundations built on.

Some companies find it easier to implement 5s than AM methodology or that they would find that not all the aspects that AM methodology covers may agree with their process which means that they would have to adjust the methodology to their own process which means that they may not embrace TPM fully.

The six big loses that autonomous maintenance:

Loss OEE factor Source of lossBreakdowns Loss due to

downtime Tool failures Maintenance

Set-up and adjustments Loss due to downtime

Change over Shortages Start-up time Major adjustments

Small stoppages Loss of speed Machine jams Minor adjustments Blocked or dirty sensors Cleaning time and checks

Slow running Loss of speed Human error Equipment failure Equipment out of place due to wear

Set-up defects Loss of quality Products defecated due to warming up of machines

Products needing rework done on them

Production defects Loss of quality Product being defected during a steady state production

Products needing rework done on them

Table 1: Showing the big six losses that TPM reduces

Question 4

Lean or lean six sigma (rotor blades) (4a)For a company that employs more than 500 would mean that they are a medium to large company which also mean that there would be some amount of waste to some degree. For a manufacturer of rotor blades means that the company has suppliers which means that the supply chain needs to be revised using root and cause analysis to find the cause of any issues for any costs from supply chains, delays and defected products delivered.

With a large work force it would be difficult to implement lean six sigma because staff are used to doing things a certain way so when implementing lean six sigma it would not work quickly or from the first time. Lean six sigma promotes giving staff ownership over their stations by applying TPM where the maintenance staff can focus on the bigger issues, this would also mean that the staffing may need extra training on the large machinery, staff may ask for extra pay for the extra work that needs to be done. 5s is another tool that should be used is included in TPM but if staff see that the new system is having effect and its visible they may get on board. TPM in general would reduce the amount of defects and increase productivity due to the size of the batches produced the quality levels are very important therefore using autonomous maintenance and tackling the six big losses is really important. Lean six sigma can help with the size of the inventory especially with a company that make large batches. Keeping it to a minimum by sorting out what is needed and what is no longer needs to be kept although inventory problems can be solved by reducing how much is produced and using up the inventory. High inventory can be a costly problem that hides problem elsewhere for example, over processing, rework, defects and motion and that’s not including the costs that would be saved on the space used and the security.

Figure 2: Image depicting the impacts of differing inventory levels (Management & Development Centre, No Date).

Lean six sigma (aero engines) (4b)Due to the nature of the work done by the manufacturer of the engines and the spare parts, where the lead time for the engines overhaul takes 30 days with a cost of £2 million. The lead time can be reduce by applying a value stream map where the current flow of work would be drawn up and future changes can be discussed with management to where they think that the most amount of time is being wasted also weather it can be reduced or if there is certain check that may take specific time that cannot be changed due to health and safety or many other reasons. A future value stream map could then be drawn up to reduce the lead time and also this could also save the company costs and the clients. By reducing the time clients will be more inclined to use the company more because it’s costing them less and taking less time. With reducing time the quality may drop so that’s something that needs to be addressed and lean six sigma methodology can be implemented to improve the quality of the work. The methods that can be applied to increase quality are 5s and having more checks on the products to ensure. By implementing lean methodology’s and TIMWOODS where both the time length and defects decrease.

Question 5

Force field analysis (5a)

FORCES FOR FORCES AGAINST

Total Score For Total Score Against

Table 2: Force field analysis

Decision: to implement Lean and in particular Autonomous maintenance

Improves the process

Reduces defects and breakdowns

Decreases lead time

Health and safety standards would increase

Machines would last longer

Work force too old to change

Large back order may affect lean implementation

Some Machines will need to be replaced

Too expensive to implement

Requires training and outsourcing expertise

SCORE: 5

SCORE: 10 SCORE: 7

SCORE: 7

SCORE: 5SCORE: 4

SCORE: 7

SCORE: 7

SCORE: 4

SCORE: 3

33 26

This diagram shows the reasons for and against lean and autonomous maintenance should be implemented. There are 5 main argument against them and the main one would be that the work force is too old to make the changes to the process, if the work force doesn’t cooperate with the change the implementation would be a waste of money and time. The way the company could tackle this problem is by implementing the process bottom-up and give ownership to the work force over their work stations. By adding more visual changes to the work place i.e. adding more colour coding and 5s the work force may be motivated to make the change with the company. As there is no room for new staff to be added and there is a growing number of employees reaching the age of retirement there would be a possibility of giving early retirement options to the employees.

Culture (5b)

Due to the fact that the employees have been told that the company is closing down the employees may have let standards slip and taken precautions that they might be laid off, which would have created a culture that not very much can change. In the opposite direction some staff would be working extra hard to ensure that they would not lose their jobs if the company decides to let some of its work force go which would also give a culture of competing to who excels with the newer staff. Due to the hard labour the staff carry in such loud, hazardous and either hot or cold environment the moral may be low with the fact that they might get laid off, these are all problems that needs to be overcome and reassured when implementing lean.

Evaluation of the culture (5c)

To boost moral which would contribute when implementing lean, is to reassure the workforce that every change made will better their work environment and secure their jobs. The work force will be more than happy to contribute to the implementation if they know that they would benefit from it, for example before the implementation the staff may be reluctant to change as this is the way they have always done things but when they are shown the difference by adding 5s to the process, giving the staff sufficient equipment to carry out their jobs, they may start believing that with that change the company will start preforming better and therefore take ownership over their own stations. The main aspect of this change in culture is to ensure to the work force that their jobs are not in danger if the implementation is successful.

Question 6

Organisation’s corporate strategy (6a)

A process of outlining a business strategy by using SWOT is to identify the strength, weaknesses, opportunities and threats to the organisation.

Strength:

To analyse the strength of the organisation is to find out the organisations best qualities and consider it from all point of view, whether the point being from the organisation, client and the competition and find the following question out:

What the company does well? What is it that our company does that’s better than others? What differs us from the competition?

Weaknesses:

To analyse the weaknesses of the business a view of the organisation from a realistic and truth aspect, finding out where the organisation lacks and needs more support whether be that in the aspect of productivity and/or high base costs.

Can we do what we do better? Do we do anything bad? What can we avoid doing? What are the complaints most common about?

Opportunities:

Are there any new opportunities that can be taken advantage of which can be beneficial for the organisation? To find out more trends that can be observed from the data collected that can prove to be helpful in the sense of making the organisation better.

The advancement in technology that can be used to drive the organisation forward? Changes in the legislations/ regulations of the local government? The new uses for the current products/services (i.e. new markets to expand within)? Events taking place?

Threats:

Threats to an organisation could be internal or external, external threats are harder to influence because of things like inflation, political tensions, new competitors and new laws. Internal threats can be cause by lack of skills, lack of staffing or even resources in-house.

What the business needs to overcome to achieve targets? What threats can be tackle first? How the business would be affected by the change in technology? Is there any shortage of resources (financial situation)?

After the SWOT analysis is complete there are more questions to ask such:

What has to be dealt with immediately? Can anything be done now? What needs to be researched more? What plans are there for the future?

It is worth noting that the SWOT analysis is a method that is subject to change in every organisation as two different people can come up with two different SWOT analysis.

PESTLE analysis for Australian airlines

Political-

region stability limitations on air space carbon omissions politics foreign policies

Economical-

global financial situation rate of unemployment costs of fuel disposal income

Social-

preferences of clients change in client travelling lifestyles change in generation living standards

Technology-

internet

online meetings investments in other modes of transportation efficiency of newer planes

Legal-

laws set by governments may differ from one country to another about advertisement laws set by IATA (international air transportation association) followed at all times acts that may be considered as anti-competitive behaviour

Environment-

wild life protection carbon omission levels produced from planes must be controlled reducing noise pollution

Alignment (6b)

Strategical alignment is when all the functions in an organisation are linked together to ensure that they all preform as efficiently as possible. By connecting for example sales and marketing the company can ensure that the price for a product matches the market, an example for that is when the Australian airways marketing team researches the prices of tickets for the plane journey’s to a destination they can include sales to ensure a competitive price that the consumer would be able to afford. Same goes for marketing and sales, if they are in need skills that are not present they would be able to contact HR to recruit the correct talent to ensure the goals needed. Strategical alignment is present to ensure that all departments of the business are working together which would allow no time wasted meaning that every issue is processed efficiently.

Engineering functional strategy (6c)

There are two types production:

Production strategy- where a company decides whether they would make or buy a product and find out which is cheaper. If they buy they would be creating partnership that they may be able to benefit from.

Financial strategy- the source of funding that is made, where the organisation can select the right type of financing whether be that debiting.

Question 7

Supply chain management (7a)

A supply chain is a group of industries, activities, personnel, machine ect that work together to produce a product to the consumer. Supply chain is the journey of the parts of the products from raw materials to the finished product. Supply chain management is a network of companies that work together creates a successful and efficient production but not a single function.

The involvement in supply chain management for an all rounded successful plan, is that the procurement, the activities carried out by the logistics management, conversion and the sources that are used. The most important part in supply chain management is direct and instant communication between all companies and department within the supply chain to have a full and well established system.

It is not unusual that companies share the processes with their supplier or with the intermediate companies that the companies would have a partnership with, some companies would go as far as giving their process to third party partners. Companies share their process plans to get experience or new techniques to enhance the current process or if the supplier/clients can alter their process to improve the company’s current process.

For example caterpillar and TATA steel created a merger in supply chain management where they would study each other’s processes and try and create a supply chain that would benefit both companies. As the two companies are using lean six sigma and many other similar processes.

Importance of supply chain management (7b)

The partnership between caterpillar and TATA steel is really important due to the fact that it is an advantage to caterpillar that TATA steel understand the process that the steel goes through to create the product needed therefore TATA steel would be able to improve their process to increase profitability for both companies. Creating this partnership would mean that caterpillar and TATA steel would revise each other’s processes and give an insight to how they would almost integrate the two processes.

When the two processes are optimised to suit each other the lead time would decrease for orders which means that the levels of inventory would also decrease and that would save caterpillar cash flow, space and time to for fill orders. When the lead time form TATA steel is decreased that would decrease the lead time from caterpillar to their clients which means more saving for them having a knock on effect to the last customer.

TATA steel had help from caterpillar to make the changes to their process which is prove that supply chain management works by getting help from partners but that could also work against caterpillar in terms that the information given to TATA steel could give the same advantages to their competitors which in this case is JCB. Where TATA steel may give them some information from caterpillar which would allow JCB would become a greater competitor then what they used to be.

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