Redesign the Factory 6 0f 6

Cross-Functional Team (CFT) Organization

The cross-functional team concept for a focus factory provides for a self-contained management team with total product family focus and full ownership and management of the focus factory. A cross-func­tional team may consist of members from various disciplines required to assume the total operation's responsibilities. The extent of full rep­resentation depends upon the economics and utilization factors.

Each CFT also functions as a quality improvement team and is led by a CFT leader who focuses on the network of processes from the beginning to the end in satisfying customer orders instead of individual functional areas. Various cross-functions within the CFT interface with the company's core support organizations, such as engineering, qual­ity assurance, sales, materials, and cost accounting, for technical ex­pertise and for ensuring the operations perform day-to-day activities within the realm of the company's standard operating practices. The interactions between CFT members and the core support organization aim at resolving production issues and ensuring compliance to quality standards and customer requirements and specifications.

Each CFT assumes the full ownership of the operations manage­ment functions, namely, material planning, manufacturing engineer­ing, quality engineering, production, inspection, labor and cycle time tracking, and meeting customer commitments and financial performance of the focus factory. The ERP/JIT system provides the rate schedules to work teams to plan their work load and personnel assignments. Each team tracks its daily actual production to plan. Any problems relating to the schedules, personnel, tools, materials, or work orders are re­solved by the CFT. The performance measurements for rates, customer commitments, and kanban inventory are tracked and corrective actions are taken by the CFT. This approach transfers the production control responsibilities from the centralized production control to local respon­sibility and control with major focus on the customer requirements.

BENEFITS

A total approach of designing the factory for synchronized flow manu­facturing and integrating ERP, JIT, and QM initiatives provides a pow­erful tool for a company to take advantage of the synergetic benefits of these initiatives and their direct impact on improving quality and pro­ductivity, reducing cycle times and costs, and thereby providing an immediate and ongoing competitive advantage. In particular, the inte­grated approach can lead to as much as a 60 to 70 percent reduction in material planning, kitting, material handling, and expediting activities and a 30 to 40 percent reduction in stores and manufacturing space. The streamlining of material flow from the suppliers through produc­tion along with the availability of parts for first use reduces obsoles­cence, reduces work-in-process inventory by 50 to 70 percent, and im­proves inventory turns by many folds.

The virtually linear production and material flow eliminates redun­dant operations like inspection and material handling. The streamlined flow managed by work teams can provide initial results of a 40 to 60 percent reduction in the manufacturing cycle time, 20 to 30 percent improvement in productivity and throughput and 50 to 60 percent re­duction in scrap and rework. While actual results will vary from com­pany to company, the integrated approach will definitely provide an opportunity for considerable improvements in quality, price, delivery, flexibility for product varieties, and customer satisfaction, and hence a sustained competitive advantage.

CONCLUSIONS

The proposed integration framework consists of synchronized flow lines and a reliable and well-disciplined planning system like ERP inte­grated with JIT manufacturing that are developed, managed, and con­tinuously improved by the work teams trained on quality improvement techniques. It provides a method to leverage the synergy among the described technologies to bring about radical changes and provide con­nections between marketing and manufacturing strategies. In addition, this approach provides the opportunity for creating and internalizing a world-class culture and creating an environment for being highly re­sponsive to ever-changing customer needs.

The proposed focused factory framework provides a methodology for integrating and synchronizing people, products, processes, and sys­tems with the principles of flow manufacturing, QM, JIT, and ERP, and enables companies to manufacture at lower costs a variety of prod­ucts customized to specific customer demand and deliver them in very short delivery cycle times.