Managing the Manufacturing Flexibility in a Piston Ring Manufacturing Plant - A Case Study

Gupta, A B

Abstract

The present manufacturing systems have become very complex. This requires the manufacturing systems to rapidly adjust itself to changes, complexities, and uncertainties. Therefore, flexibility is needed. At the same time, productivity is also desired due to resource crunch and severe competition. This paper presents an approach for managing flexibility in a piston ring manufacturing firm, keeping productivity improvement in mind. The values of various types of flexibility have been found at various intervals of time for the plant. Various types of productivity have been calculated for the corresponding time intervals. The trends of flexibility and productivity have been determined. An approach has been suggested for managing flexibility in future. A hierarchy of flexibility, listing the order in which various types of flexibility should be focused in future, is also given. SAP (situation-actor-process) analysis has been carried out to arrive at learning issues.

Keywords : manufacturing flexibility, productivity, SAP analysis

Introduction

The manufacturing systems in the modern era have become very complex as a variety of materials, machines, tooling and other inputs are being employed for production purpose. This complexity along with market uncertainties require the manufacturing system to respond quickly to changes. For that, flexibility is needed. Flexibility is the ability of a system to respond or react to a change with little penalty in time, effort or cost (Upton, 1994). The change may be internal or external . Flexibility is also the ability to do things differently or do something else should the need arise (Bahrami, 1992). Flexibility is the exercise of free will or freedom of choice on the continuum to synthesize the dynamic interplay of thesis and antithesis in an interactive and innovative manner, capturing the ambiguity in systems and expanding the continuum with minimum time and efforts (Sushil,1997). Flexibility is a multi-faceted concept with different connotations (Sushil, 1999). Strategic, organizational, financial, information systems and manufacturing flexibility have been identified as the cornerstones of enterprise flexibility (Sushil, 2000). There are various types of flexibilities. A comprehensive classification of flexibility is provided (Browne et. al., 1984) by describing eight types of flexibilities. Besides flexibility, proper utilization of resources is essential due to unprecedented competition coupled with acute resource crisis. Enhancement in productivity is the key to success. One of the method of improving productivity is to measure productivity. Productivity can be measured either as total productivity or partial productivity, i.e., material productivity, labor productivity, energy productivity, and equipment productivity. The paper presents an approach for managing flexibility in a piston ring manufacturing plant, keeping productivity improvement in mind.

Methodology for Measurement of Flexibility and Productivity

The methodology involves measurement of existing levels of different types of flexibilities. For this, various parameters contributing towards a particular type of flexibility are identified. A paired comparison of these parameters is carried out by drawing a position matrix to find out their weight. Further, questions have been framed related to these parameters in a specially designed questionnaire to know the response of the manufacturing firm to these parameters. Various types of flexibilities have been measured on 0-1 scale as explained in Appendix I. The trends in various types of flexibilities have been measured by comparing their values with the values of the last year and with that of five years back. At the same time, productivity values (partial as well as total) of the manufacturing firm have been found out for the corresponding periods by finding actual output and various types of inputs in monetary terms. The trends of various types of productivities have also been determined. Correlation have been established between various types of flexibilities and productivities. Based on the past trends and existing levels of various types of flexibilities and keeping in mind the correlation between flexibilities and productivities, an approach has been suggested for managing flexibility in future.

Relationship Between Various Types of Flexibility and Productivity

The relationships between various types of flexibility and productivity have been determined by finding out product moment correlation. Data has been collected from 50 enterprises in India regarding levels of various types of flexibility and values of productivity. The results of the correlation are entered in Table 1. The results depict that routing flexibility is positively and significantly related with material productivity. This may be attributed to the fact that with higher routing flexibility , the work-in-process reduces and due to this the deterioration of WIP also decreases, thus, increasing material productivity.

Volume flexibility is positively and significantly related with energy productivity (r = 0.363, significant at p

Product-mix flexibility is significantly and positively related to total productivity (r = 0.318, significant at p

Labor flexibility is significantly and positively related with total productivity (r = 0.287, significant at p

Design-change flexibility is significantly and positively related to labor productivity (r = 0.279, significant at p

The correlation matrix depicts that machine flexibility is not significantly related with any factor productivity or total productivity.

Planning flexibility is significantly and positively related with material productivity (r = 0.285, significant at p

Communication flexibility is positively and significantly related with total productivity (r = 0.281, significant at p

Total flexibility is positively and significantly related with material productivity (r = 0.305) at p

Present Status

Goetze (I) Limited, Bahadurgarh (Punjab), a private limited company, came into being in 1954 through a collaboration between Escorts Ltd. and Goetze Werke AG of West Germany. The plant turns out a wide variety of piston rings for bi wheelers, heavy/light commercial vehicles, motor cars, tractors, and stationary engines ranging from 38 mm to 160 mm diameter. The company is catering to the requirements of all market leaders in original equipment manufacturing and also to replacement as well as export market. The company has maintained steady growth in piston rings in view of ready acceptability of its products. From the modest production of 22,517 rings in 1957, it touched a figure of 19 million in 1995-96.

In view of advancement in the technology and customer requirements, Goetze Ring plant has been the pioneer in manufacturing high value piston rings, spheroidal graphite cast iron (KVl) rings, molybdenum coated rings, profile ground rings, and thin rings. At present, the plant has captured around 48% of the market share. Around 750 persons are working in the plant out of which more than 85% are workers. The company got ISO certification from NQA, QSR in 1996.

The plant is continuously going in for upgradation of technology and automation. The plant has also been modernized by bringing in CNC machines, and special purpose high production machines. Table 2 shows various types of flexibility values in 1991-92, 1994-95, and 1995-96. The percentage changes in flexibility in 1994-95 and 1995-96 as compared to that in 1991-92 are also shown. Table 3 shows values of various types of productivity along with percentage changes for the corresponding years.

Satus and Trends of Flexibility

Changes in various types of flexibilities that have occurred in Goetze (I) Limited, Bahadurgarh plant are as follows:

Product Flexibility

The company started its operations with manufacture of compression rings and oil rings from standard cast iron material. Lower sharp rings were developed in 1992. In these rings, the bottom side of the ring was given a chamfer of 0.15 mm to provide scrapping edge instead of the usual chamfer range of 0.2 - 0.4 mm. These rings were also specially designed based on the requirement of Escorts company for their top compression ring. In 1995, the company came out with a new type of ring named IKA. The IKA ring is made of CI which is completely heat treated before performing machining operations on it. The IKA ring is very useful for higher loads. These factors have contributed towards product flexibility in the plant. The product flexibility increased by 24.39 % from 1991-92 to 1994-95, and by 38.24% from 1991-92 to 95-96.

Product-mix Flexibility

The ring plant is fully equipped to produce a large variety of rings. Various types of rings manufactured in the plant are compression rings, scraper rings, and oil rings. These rings may be plain rings, chromium plated or molybdenum coated. The plant is also fully equipped to do phosphating or tin coating of the rings, if desired by customers. Another variation is from the point of view of cross-section of the rings. There is a large variation in sizes of rings as well as section of the rings, which contributes to product-mix flexibility. There is considerable variation in share of each type of ring in total production. Till 1995, the plant was using three types of materials for ring production - standard cast iron (STD), cast iron with spheroidal granules heat treated (KVl), and steel. In 1995, another type of material, IKA, was developed. This increase in variety of materials used for manufacture of rings has also contributed to increase in product mix flexibility. Besides these materials, steel (90 Cr Mo V 18) is also being used for manufacturing piston rings for heavy duty high performance engines.

A number of operations, for different variety of rings (whether compression ring, scrapper ring, or oil ring) are being done on same machines. This parameter contributes a lot in increasing product mix flexibility as it is easier to process product mix. The negligible effort and cost required in rescheduling product mix in case of machine breakdown has also led to increase in product mix flexibility. The product-mix flexibility has increased by 56.66 % from 1991-92 to 1994-95, and by 71.50% from 1991-92 to 1995-96.

Volume Flexibility

The plant has considerably enhanced its volume capability over the years by investing in new machines/equipment, and improving upon the existing equipment, procedures, and practices. The production levels have jumped to 13,079,436 in 1991-92; 19,146,134 in 1994-95; and 19,892,911 in 1995-96. There has also been considerable increase in volume flexibility. The acquistion of CNC machinery and equipment as well as special and dedicated machines was aimed to give higher output. The increase in volume flexibility from 1991-92 to 1994-95 has been 45.25% and the increase has been 72.61% from 1991-92 to 1995-96.

Machine Flexibility

Most of the machines used are special purpose machines. Facilities exist for chrome plating and molybdenum coating of rings.

Double spindle honing machines carry two spindles and therefore, two rings can be honed at a time. These machines, to some extent, contribute towards machine flexibility..

The acquisition of CNC double cam turning and CNC splitting machine has been helpful in improving machine flexibility as changeover times have reduced. There is not much change in overall machine flexibility over the last five years. The machine flexibility increased marginally by 0.674% from 1991-92 to 1994-95, and decreased by 3.25% from 1991-92 to 1995-96.

Design- change Flexibility

At present, the company is making nearly 50 types of rings which have different cross-sections . Every year, there are design changes in the rings as per customer requirements. Nearly 30 - 35 new rings are introduced every year which have a different size or cross-section from the existing rings. A high degree of design-change flexibility is present in the system, which is depicted by large product range manufacturing, and design changes incorporated every year. The changes in the design are made as per customer demands.

There has been an increase of 12.57% in design change flexibility from 1991-92 to 1994-95, and an increase of 23.10% in the last five years.

Routing Flexibility

Nearly 80% of the machines installed in the shop are rigid special purpose machines designed specially for performing specific operations on rings, but have the facility of change of tooling, for processing different sizes of rings This feature of rigid special purpose machines limits the processing flexibility as only one type of operation can be done on a particular type of machine.

The company has recently invested a lot of money in CNC machines. The managers' view point in procuring these machines is mainly for achieving higher level of quality as these machines are being used only for precision work. However, instead of increasing machine flexibility, these CNC machines have indirectly increased routing flexibility as now it is possible to route the rings through conventional as well as CNC machines.

In some cases, the sequencing of operations can be interchanged to tackle machine breakdown. Due to these factors, there is a marginal increase of 0.24% in routing flexibility from 1991-92 to 1994-95, and decrease of 2.28% from 1991-9210 1995-96.

Planning Flexibility

The planning for production of rings is done by making a master schedule based on the annual demand. The operation schedule is then formulated based on monthly demand. Daily production schedules are finally derived from the monthly schedules keeping the requisite parameters in mind. The master schedule is made flexible and modifications can be made in it depending on customer needs. The monthly schedules although rigid, can be changed based on urgency from the customers. Sometimes, some particular type of rings can be given priority over others, if desired. Overall the system has the flexibility to change its monthly operation schedules for production planning. With diversification in product variety and product mix, planning flexibility has also increased from 1991-92 to 1995-96. The planning flexibility increased by 10.68% from 1991-92 to 1994-95, and by 11.26% from 1991-92 to 1995-96.

Communication Flexibility

Over the years, the plant had been using the conventional information system. During the last five years, some investments have been made in information management. Some of the functional areas have been computerized. The material purchase section has been computerized and production planning is being managed on computers. It is planned to manage store items especially finished stock through use of computers. The use of computer has led to increase in communication flexibility as now the available information is shared by many persons.

The computers have also been helpful in making planning decisions and modifying them. The use of computers has led to increase in communication flexibility by 71.42% from 1991-92 to 1995-96.

Labour Flexibility

The workforce in the ring plant has decreased from 811 in 1991-92 to 768 in 1994-95, and 746 in 1995-96. The company has been involved in delayering at lower level. Out of 654 workers working at present in the plant, nearly 150 workers have been trained to work on four to five machines in case of worker' absenteeism. The plant has been divided into a number of sections. Within the section, the workers have been imparted training in running four to five machines. This has increased labour flexibility. The company runs training programmes which has led to development of knowledge, skills, and attitudes of the workers and managers. These factors have been responsible for increasing labour flexibility by 8.04% from 1991-92 to 1994-95, and by 16.83% from 1991-92 to 1995-96.

Total Flexibility

The total flexibility has shown an upward trend throughout the last five years period. It increased by 33.39% from 1991-92 to 1994-95, and by 45.62% from 1991-92 to 1995-96.

Status and Trends of Productivity

The equipment productivity increased by 110% from 1991-92 to 1994-95, and by 108% from 1991-92 to 1995-96. The labour productivity increased by 55% from 1991-92 to 1994-95 and by 58.75% from 1991-92 to 1995-96.

The energy productivity increased by 14.2% and 28.39% from 1991-92 to 1994-95 and 1995-96 respectively. The material productivity witnessed an increase of 26.37% from 1991-92 to 1994-95, and an increase of 15.8% from 1991-92 to 1995-96. The development of new material IKA has decreased material productivity in 1995-96, as scrap percentage is more in IKA material. Total productivity of the plant increased by 12.73% from 1991-92 to 1994-95, and by 10.69% from 1991-92 to 1995-96.

Future Order of Flexibility Acquisition

From the analysis of the percentage changes in various flexibilities, it is clear that volume flexibility, product-mix flexibility, and communication flexibility are the ones to which the plant is giving priority. The ring plant is producing large volume of piston rings of various sizes and different cross-sectional design. At the same time, number of raw materials are being used for the rings, therefore the plant needs volume flexibility as well as product mix flexibility. At the same time, design change flexibility is also required. By and large, the plant is moving in the right direction by focusing on these flexibilities as is clear from the percentage changes in the last five years. The plant should further focus on design-change flexibility and labour flexibility, as reflected in Figure 1. Design-change flexibility can be increased by bringing changes in methods of design. Use of computer software like Auto CAD and others increase design-change flexibility. Presently drawings are being made manually. Design-change flexibility will also lead to increase in product-mix flexibility. Labour flexibility can be further increased by conducting training programmes for workers. Another flexibility that needs to be focused is planning flexibility. Planning flexibility will contribute towards increase in volume flexibility. It will also increase material productivity, which declined by 8.34 % in 1995-96 as compared to that in 1994-95. Increase in planning flexibility will also contribute towards total productivity. Total productivity had shown a downward trend in 1995-96, decreasing by 1.8 %. Based on the above discussions, the plant needs to focus on various types of flexibilities in the following order:

i) Volume Flexibility

ii) Product-mix Flexibility

iii) Design- change Flexibility

iv) Labour Flexibility

v) Planning Flexibility

vi) Product Flexibility

vii) Routing Flexibility

viii) Communication Flexibility

ix) Machine Flexibility

SAP Analysis

SAP (situation-actor-process) analysis has been carried out to determine the approach adopted by the enterprise for managing flexibility. SAP analysis (Sushil, 1994, 1997) is a method of analyzing case study. In SAP analysis, the case has been described through three basic components (situation, actor and process) that define the dynamic interplay of reality. From the analysis, learning issues have been explored.

Stuation

* Ring plant of Goetze (I) Ltd. is the largest firm dealing with production of piston rings.

* Increasing demand for higher production and design-changes in piston rings.

* Ring plant involved in building its own technology base.

Main Actors

* Managing Director of the plant as the key-decision maker.

* Top management executives as a dedicated lot.

* Employees of the firm as highly motivated workforce.

* Competitors as technology gatekeepers.

* Goetze Werke, AG of Germany as technology providers to the plant.

Process

* The company went in for technology upgradation by acquiring high production machines as well as CNC machines.

* The company went in for developing new material for rings.

* Adapting the acquired technology to local conditions to make the technology more effective.

* Developing training centre for training of employees.

* The company developed technology for chrome coating, and molybdenum coating of piston rings to gain competitive advantage over others.

Learning Issues

* Acquisition and adoption of state-of-art technology may not necessarily lead to increase in machine flexibility. It may however contribute towards increase in other types of flexibility.

* Education and training of workforce plays a vital role in increasing manpower flexibility.

* Flexibility in day-to-day management of workforce along with focus on flexibility make a lot of contribution towards the goal of achieving flexibility.

* Adapting the equipment and machinery to local conditions by bringing changes in them increases product mix flexibility as changeover times are reduced.

* Building sustainable competitive edge enables the manufacturing system to respond to large number of customers which leads to enhanced flexibility.

* Delayering in the system leads to better internal flexibility of the plant.

* Increase in volume flexibility contributes towards energy productivity, as with increased volumes, energy required per unit of product decreases.

* Labour flexibility leads to improvement in total productivity due to better and effective utilization of resources.

* Communication flexibility leads to increase in total productivity as by having higher communication flexibility, the capability to respond quickly increases.

* Higher routing flexibility contributes towards material productivity as work-in-process decreases with routing flexibility.

* Product-mix flexibility contributes to increase in total productivity.

* Design-change flexibility increases labour productivity.

* Product flexibility contributes towards increase in material productivity.

* Planning flexibility leads to better utilization of equipment, thus increasing equipment productivity.

Conclusions

Flexibility is a multi-dimensional concept. Flexibility is required to respond to uncertainties and changes. There are various types of flexibility namely routing, volume, product, product mix, labor, design change, machine, planning, communication and total flexibility. A particular type of flexibility can be measured taking into account the weight of various parameters contributing to it and the response of an enterprise to these parameters. The paper highlights the fact that it is possible to manage flexibility keeping productivity in mind as different types of flexibility have significant relationship with various types of productivity. However, the type of flexibility to be acquired will also depend on the present levels of flexibility, cost aspects and preparedness of an enterprise to acquire flexibility.

References

Bahrami H. (1992) The Emerging Flexible Organization: Perspectives from Silicon Valley, California Management Review, 33-51.

Browne J. Dubois D., Rathmill K., Sethi S.P. and Stecke K.E. (1984) Classification of Flexible Manufacturing Systems. The FMS Magazine, 114-117.

Sushil (1994) Flexible System Methodology, System Practice, 7(6), 633-651.

Sushil (1997) Flexible System Management: An Evolving Paradigm, System Research & Behavioral Science, 14 (4), 259-275.

Sushil (1999) Flexibility in Management, Flexible Systems Management Series, Global Institute of Flexible Systems Management, Vikas Publishing House Pvt. Limited, New Delhi.

Sushil (2000) Cornerstones of Enterprise Flexibility, Flexible Systems Management Series, Global Institute of Flexible Systems Management, Vikas Publishing House Pvt. Limited, New Delhi.

Upton D.M. (1994) The Management of Manufacturing Flexibility, California Management Review, 36 (2), 72-89.

A. B. Gupta

Curriculum Development Centre

Technical Teachers' Training Institute, Chandigarh

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