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Contract Managing: Helping EMS Providers Stay Competitive
December 31, 1969 |Estimated reading time: 6 minutes
For EMS providers, global diversity of the end consumer drives the need for flexibility, speed, agility, visibility and regulatory compliance.
By Sharron Lifshitz
Products manufactured in China may ultimately be used anywhere in the world. EMS providers must understand and follow a growing set of standards and governmental requirements for exporting products around the world — all while complying with the brand owner's quality requirements and developing a strategy for lean manufacturing. In the complex landscape of technology solutions available to manufacturers, manufacturing process management (MPM) and its ability to support detailed product and process traceability as part of a lean strategy is a key solution for these requirements.
MPM
MPM supports the entire manufacturing process within a product lifecycle, from process planning and detailed process engineering to full production execution. Connecting all members of the manufacturing chain into a single virtual enterprise, MPM helps EMS providers build production strategies to support their business goals. MPM offers an open, scalable software platform and applications suite that provide a collaborative environment for authoring, simulating and managing manufacturing processes across the extended (virtual) enterprise of the supply chain.
A typical manufacturing IT system includes CAD and PDM systems that describe and manage the data involved in the product bill of materials (BOM). ERP systems exchange supply chain and customer information with the shop floor and shipping department for the "when and where" of the overall process. MPM is the link between the "what" and the "when and where" — the system of record that describes "how" the product should be manufactured. MPM also allows EMS providers and their customers to know how they are doing in that critical process by measuring as-planned vs. as-built performance.
Properly creating and managing critical manufacturing information and communication flow in an outsourced environment may seem daunting, but with proper MPM tools to manage the process and support cultural change, it can result in increased revenues and decreased time-to-market.
Lean Manufacturing
Lean manufacturing focuses on minimizing waste while creating flexibility within the manufacturing process. It aims to reduce response time to customer demand, capital investments and inventory, as well as eliminate waste of all kinds.
As companies outgrow the use of Microsoft Excel to support lean programs, many want lean-specific software, which can be defined by four key areas of functionality:
- Model: The ability to graphically represent a value stream, perform simulations and instantiate product family tracking.
- Calibrate: The ability to calculate and adjust appropriate lean control points, including TAKT time, Kanban sizes and supermarkets.
- Operate: Support of the requisite data collection as the actual product flows through the value stream.
- Improve: The ability to identify points of high variability and the root causes to adjust and improve.1
Much about lean is common practice — demand-driven production, visibility and inventory replenishment techniques find parallels with recent supply chain concerns. EMS manufacturers, like everyone else, increasingly are comfortable with software that enhances productivity, and lean is growing from inside the factory out to the extended enterprise. Software to design, model and operate a lean enterprise is readily available.2
MPM creates and executes lean manufacturing processes by providing the necessary pathway from lean manufacturing to lean product design by fostering concurrency, reuse and integration. Through MPM, lean manufacturing helps create key business value with faster time-to-market and time-to-volume.
MPM offers the ability to model and calibrate a production process through a central process repository — users can reuse parts and best practices of manufacturing processes from previous projects or other sites.
MPM also provides stored knowledge for new line and workstation design, cost estimation and proposal generation. Users can compare and decide among process alternatives and standardize processes to deliver lean thinking across sites and the enterprise. MPM verifies lean processes with simulation and helps eliminate trial-and-error waste in process improvements. MPM provides an integrated set of functions to map a value stream for continuous improvement, improve factory/line layout and production flow and analyze workplace design logistically and ergonomically. Better process analysis through MPM offers reduced setups and simulation, while task management provides optimized throughput. This set of software functions in itself is lean thinking.
Figure 1. Pareto drill-down analysis lets engineers and managers analyze historical defect data to identify corrective actions and implement process improvements.
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Planning and Execution
Process planning involves design, simulation and optimization of new product introduction (NPI) and engineering change processes. (Figure 1) Process planning systems help implement and follow best-in-class processes for introducing new and changing products into manufacturing quickly and effectively, speeding overall time-to-market and time-to-volume. Process execution systems manage work orders, monitor production performance and track products. Execution systems also allow for real-time process data collection, material management, performance monitoring, schedule changes and exception notification. Mechanisms to improve product quality and reduce costs also are an essential part of process execution systems. MPM links planning and execution systems to allow true product and process traceability, resulting in capabilities EMS providers can use and sustain to keep ahead of the competition and exceed customer expectations. (Figure 2)
Figure 2. Real-time reports provide increased visibility to operator performance, setup status and actual changeover times to improve planning.
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Product and Process Traceability
Implementing planning and execution systems designed to work together, EMS providers can achieve comprehensive product traceability, from specific component lots through finished assemblies, as well as process traceability down to the exact feeders that placed the components. A traceability system saves money by minimizing manufacturing issues that might result in product recalls, even helping to eliminate them by identifying suspect products before shipping. Traceability systems also enable EMS providers to easily support standards and regulatory compliance. Standards such as ISO 9000, in Element 4.8, require systems in place to identify product through all stages of manufacturing. Regulatory compliance issues, such as the European Union's Waste Electrical and Electronic Equipment (WEEE) Directive, require a clear statement of how to properly handle discarded products for any electronic product sold in the EU. This means knowing exactly what materials comprise a product, as well as proper disposal. To meet these regulations through true product and process traceability, EMS providers must have a system that links process planning and execution. (Figure 3)
Figure 3. Traceability solutions help improve process issues, as well as provide standard product traceability reports to meet customer and regulatory agency requirements.
Key criteria for selecting a partner for these business systems include a proven track record of electronics domain expertise, experience in implementing similar systems, ability to service a global customer base, and a clear vision of growing the value of implemented systems. Such solutions require detailed project planning to ensure complete, successful implementation and, ultimately, sustainable use and acceptance over the long term. An important aspect of project planning is identifying the depth and breadth of the software system, and then making sure the implemented solution can scale as change requires. To support this, the solutions themselves must be modular and scalable. Most importantly, world-class solution providers bring expertise to help create manufacturing knowledge infrastructure.
Conclusion
EMS providers who implement advanced, connected manufacturing process planning and execution systems as part of a lean manufacturing strategy — via MPM — will be able to demonstrate a commitment to continuous improvement and their ability to compete worldwide. Their resulting ability to adapt to changing market demands and increasing complexity of regulatory requirements will give them a global competitive edge.
References
- AMR Research, "Lean Software Application: The Market is Finally Catching Up to the Demand."
- ARC Advisory Group, "Selecting CPM Software Solutions for Lean Manufacturing," March 2004.
Sharron Lifshitz, Tecnomatix Unicam Inc., may be contacted at Sharron.Lifshitz@tecnomatix.com.