Dedicated to What?

On vacation this week along with a large portion of the U.S. population, I stopped in at an antique auto show to enjoy the products of days gone by. My favorite was this souped-up 1923 Model T Roadster (pictured at right.) Brilliant fire engine red with polished brass hardware. We call this a “custom car”, a labor of love (and expense), de-evolved from assembly-line mentality back to craft. I’m not sure how Henry Ford would feel about it. This was the first “machine that changed the world,” built on a dedicated moving assembly line. The red paint color and brass hardware actually were available on this Tin Lizzie, contrary to the public any-color-they-want-as-long-as-it’s-black position for which Mr. Ford was well known.

In the years since his famous quotation, the tide has turned a bit on customer selection as was predicted in 1987 by Stan Davis. Coining the term “mass customization,” he envisioned a combination of information and production automation that would provide customized products with the efficiency of mass production. Oddly, this strategy presupposed a condition that also limited customer choice: commoditization. Customization would be achieved through mix and match of modular computer configurable components and software. For certain types of products and services, this was the realization of Stan Davis’ vision. But for many others, Fordism flourished – commoditization without selection. The reality in the 1980’s for a product as simple as an egg was that carton size was limited to one-dozen only. Producers standardized on one-dozen to manage production and distribution costs. Even the perforation in the dozen-egg carton (that permitted a small user like me to split a container for purchase) disappeared! When I first encountered that new “standard”, I assumed the egg cartons were defective, and used my penknife to split the container for purchase. For this transgression I was lectured by the store manager, “Now, what am I going to do with other half dozen?”

“Maybe someone else will buy it,” I replied. [That particular incident spawned the GBMP DVD, Dozen Eggs.] Today, a visit to the food mart reveals an amazing selection of egg quantities available for sale: 4,6,8,12,18, 30 and even single eggs. In fact, the trend is evident for nearly every product and service. We, the customers, demand a broad choice, and we get it.

What has not changed so much are the dedicated assembly lines. I see them often in businesses large and small. These lines are activated only when customer demand calls for production. “We build only for customer requirements,” a customer proudly announced to me as we gazed at an idle assembly line. In fact, his factory was filled with idle assembly lines awaiting customer orders.

“Can’t you build more than one family of products in that cell?” I ask.

“Oh, no,” comes the reply from the factory manager followed by issues:

“We’d have to change out all of the material.”

“The machines are specialized to build only one family.”

“We wouldn’t be able to handle fluctuations in demand.”

“We’d mix parts up.’

“There would be too many jobs for assemblers to learn.”

“Our quality [inspection] system would be too complicated.”

“Scheduling would be a nightmare.”

And finally, “That would cost too much.” According to what costing system, I wonder?

Can you think of any Lean countermeasures to these issues?

How about in your business? Are you attempting to provide customer selection with often idle production or service lines? Share a story.

O.L.D.

One thought on “Dedicated to What?

  1. Joel

    In the pharmaceutical industry, entire production facilities are often dedicated to single products, often with disastrous results. I’ve seen entire buildings filled with brand new equipment collecting dust due to unsatisfactory late-stage clinical trial results. Biological products, with lead times measured in years suffer from wildly inaccurate demand forecasts and consequently, severe over/under-production on dedicated lines. Passing these costs on to the customer, it’s no wonder the image of Big Pharma continues to suffer.

    Reply

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