Saturday, February 2, 2008

Breakthrough Process Improvements in Watch Component Industry: A Case Study

Hierarchical model for Breakthrough process Improvement
Breakthrough process improvement projects, which are undertaken to tackle operations management problems, pose significant challenges to development teams. In such settings, existing approaches are limited or inappropriate and objectives are ambiguous. A clear gap in literature still exists between engineering oriented tools (such as TRIZ, QC, Six Sigma) and business process redesign (BPR) oriented models when it comes to marrying process ideas with the enabling technology while ensuring maximum impact for the innovation. The problem gets further compounded for industries where major technological and process development is traditionally carried out by equipment manufactures and hence limited control over the process innovation efforts of equipment suppliers and designers. One such industry is watch component manufacturing which is quite unusual in comparison to traditional manufacturing industries in terms of technology and systems.

Using watch component manufacturing as a case study, authors present a hierarchical model of process innovation in a multi-project environment especially involving third-party led retrospective process improvement initiatives. The model provides a framework for understanding the process of process innovation in watch dial manufacturing, as well as the possible roles of consultants, the equipment / process design suppliers, and the operating companies throughout this evolution. The applicability of this process improvement approach to other manufacturing industries has also been deductively verified although not incorporated in the current paper.

In much the similar way that a complex production planning process is progressed through hierarchies of aggregation and dis-aggregation to exploit the similarities to derive synergy and economies of scale despite high variety, the proposed process innovation/ improvement framework can be traced through plans for synergy realisation from the ideation phase down to execution level. The progression through these multiple phases is marked by changes in the relative levels of process/problem identification, consolidation and innovation planning activity.

Technological innovation traverses through three main phases: uncoordinated, segmental, and systemic. As illustrated by the case of dial manufacturing, companies operating in an industry that has reached the systemic stage will find little or no scope for innovation in the core manufacturing technologies. In such an industry, the fundamentals of the manufacturing process are almost frozen or stagnated. At this stage, the pursuit for productivity improvements focuses on cost reductions from task structuring and specialization, task integration, and automation.

However, irregular shape of components and high variety and small batch meant they were not amenable for automation. Generally, equipment manufacturers play an increasingly important role in refining existing technologies and improving equipment reliability and capabilities. To catalyze any breakthrough improvement at this stage, the suggested framework can deliver more bang for innovation effort that otherwise wouldn’t be worthwhile. Such efforts are facilitated by close cooperation with the innovation (operations) consultant and operating companies, which can contribute process ideas and expertise that the equipment manufacturers might otherwise lack.
Written by Debashish Jena, FPM Student (Operations), IIM Lucknow

1 comment:

Ajax said...

Nice case study, but could you elaborate on practical applications of the concept used especially in a service sector.

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