KBL – Innovation Ideas and Recommendations (Indore, India)
Geoff Evamy Hill
Knowledge Integration, University of Waterloo, Canada
http://about.me/geoffevamyhill
01 July 2013
Preface
Over the course of June 2013, I have been training and researching under the mentorship of Mr. Subodh Shrivastava in order to gain knowledge and skills in the area of business design, supply chain management and manufacturing. I have had the opportunity to improve theoretical knowledge and practical knowledge through immersion at the KBL Dewas plant.
I was presented with three problems that KBL currently faces in order to focus my experience:
1. How might we transition to a pull manufacturing and distribution system at KBL? What is the appropriate balance between push and the ideal system of pull?
2. How might we implement new Information Technology solutions to support this transition?
3. How might we shift company culture, attitudes and thinking to adapt into a pull system from the grass roots?
Over the course of the month, I have identified a number of responses to these questions facing KBL. I focused particularly on problems #1 and #3.
I appreciate the transformative opportunity that KBL has given me to become immersed in its processes. I hope that my perspective as a non-technical, foreign, strategic-design practitioner will be of use to the company.
Introduction: Follow “The Goal”
The Goal, outlined by Eliyahu Goldratt in the eponymously titled book, is for the business to be able to make more money now and in the future. The main blockages of this are shortages or excesses in the manufacturing and distribution system. We want to build systems that are responsive, having higher availability with lower inventory. The system must produce the right item, at the right time, in the right quantity in order to do this. Flow is the ideal.
This is the inspiration for the future of Kirloskar. The vision is an agile, resilient and responsive organization that meets the needs of the market, now and in the future. It needs to be built on a strong foundation. There needs to be a culture of ownership and motivation to foster it. There must be a free flow of knowledge throughout the organization between the supply and demand side in order to synchronize with the realities of the market. Corporate Culture and Information Technology are therefore extremely important elements of the system.
Push vs. Pull
There is considerable theory and application of what is considered to be the ideal business system- one that operates allowing inventory to be “pulled” through the system according to the demands of the market. This is opposed to the traditional “push” method, focused on capital investment churning out product in order to strictly maximize output on machines.
Ideally, the demands of the final consumer should be as closely linked to raw materials as possible. The inventory should move through the system as quickly as possible, based on the pull. This will generate throughput, a measure of success that favours speed and volume through the constraining nodes in the system rather than strictly the utilization of all capital to its capacity.
The pull approach focuses on single piece flow, and make minimum order quantity a thing of the past. The focus is on aligning capacity to the actual demands of the market, what is demanded in which quantity and when. Firms must evolve towards mass customization, not dictating minimum or economic order quantity but instead being agile to respond directly to demand.
Implementing a pull-based system is the most important business development project that Kirloskar can implement. I have chosen to focus on the problems in this context. I believe that this transition can be supported by a cultural shift.
My Project – A basis for Synchronized Manufacturing and Distribution System
Over the course of June and July, I have been exposed to many areas of KBL Dewas, from management to product design to factory processes. I have closely observed and taken notes about all of these processes, and have done extensive brainstorming and research to identify many potential high impact innovations. This is the product of my own holistic analysis of new business and manufacturing strategies in the context of Kirloskar.
In this report I will succinctly present a selection of the best ideas for solving the problems identified. These are meant to be potential leads for new thinking. I have re-ordered the categories in terms of the immediacy and importance of their impact. I have chosen a number of ideas to elaborate on; these are ones that I feel have particular potential.
I strongly believe that an emphasis on implementing culture and awareness strategies in the short term will build a strong long-term foundation for generating appropriate and grass roots solutions for future challenges. A culture of openness and ideas will allow opportunities to more easily present themselves.
High Opportunity Projects
Culture & Awareness
Building a culture of innovation and motivation will support the long-term implementation of pull and efficient production methods.
1. The Kirloskar Solution
- Concept
- Kirloskar should shift its internally shared business vision to being a manufacturer of solutions instead of a manufacturer of products or pumps. This shift in culture will help everyone, from factory floor workers to senior management, take pride in their work as something that is deeply needed by people in the market place.
- Why?
- The idea that a company just sells a product is a deeply held notion of push manufacturers. Companies that focus on producing product will produce product whether it suits the demands of the marketplace or not. Instead, a solution implies a product that suits the need of a person. Kirloskar does not only produce pumps, each pump it produces is made to help solve the problem of a particular person. This idea meshes with single piece flow, each item is being pulled through the system for a purpose in the world.
- Benefits
- The idea that each pump is not just a pump but a solution to a practical problem that faces the person who demands it will set the conditions for grassroots understanding of pull systems. In particular, this will help to motivate factory floor workers. Labourers in the factory face an issue of alienation from the outcome and purpose of their work as they only focus on one aspect of the production, whether that is testing or assembly. Setting up an awareness campaign showing how these pumps are actually used in the end, and that they are used to solve problems and not to simply be sold, will help to motivate workers. The idea of the Kirloskar Solution meshes well with the company’s current branding of “Enriching Lives”.
- How?
- Create a poster and awareness campaign in the factory and offices which includes new slogans and visuals that emphasize the final uses of Kirloskar pumps (e.g. farmers, factories, cities). Ensure that in future that this is the language and philosophy through which the company is viewed.
- Accompany this with an emphasis on national pride, Kirloskar pumps area helping to build India
- Market Kirloskar pumps as not just pumps, but a full fledged solution to various problems.
- Educate workforce using means below (Spreading ideas)
2. Spreading the Ideas of Pull to support culture shift.
- Concept:
- Company-wide awareness of the strategies that Kirloskar is trying to implement will be essential for future success. This involves educating the work force from top to bottom about new methods. Everything in this regard must emphasize the development of a company wide HOLISTIC view.
- Why?
- It is a matter of putting high-level strategies in language that wins their hearts and minds and encourages people to naturally adapt. A pull and single piece flow system requires the buy-in of the entire company to work most effectively. When buy-in and understanding is achieved, there will be better opportunities for all employees to identify important areas for the company to innovate
- How?
- Training tools and sessions: All members of office and management positions should be given an opportunity to quickly learn about SMDS. This will give everyone an equal background for buy-in. It will be useful to create a Kirloskar internal simplified and abridged reading of The Goal by Eliyahu Goldratt. This could be paired with other abridged readings. All employees and all new employees should read this text, and there should be recorded discussion groups that bring together employees across departments to generate new solutions to company problems based on the Theory of Constraints.
- Redesign company exhibit: the reading and training tools may not be useful for all members of Kirloskar, particularly more visual thinkers or people with lower reading ability. Therefore, the exhibit of pumps and new techniques at the entrance of the factory should be redesigned as an interactive museum emphasizing analogical and visual learning.
- Currently, the boards teaching about new methods are too data heavy and difficult to understand for all members of the company. Also, the exhibit is too focused on the technical aspects of the pumps. The exhibit should feature simplified explanations of things like the “chain” concept from Theory of Constraints, and the teachings of the training tools in language that factory workers can understand. It could be as simple as creating an exhibit around the physical analogy and demonstration of the chain, as well as models of SMDS. This, paired with stories and visuals of how the pumps are used will help to create grassroots understanding and buy in both to new production strategies and purpose. This, paired with the culture shift towards the idea of Kirloskar solutions, will help to begin a culture shift.
3. Cross-Functional Teams & User-Centric Design
- Concept:
- Kirloskar should continue its emphasis of forming cross-functional teams with multiple disciplines and stakeholders included, and should embrace user-centric and empathic design methods to design its products and processes.
- Why?
- It can be difficult to bring together a group of diverse people to work on a project together (technical and business, client and supplier, manager and factory workers), but bringing together many perspectives is the best way of breaking down assumptions and coming up with the best solutions. Any one group lacks perspective on another, and therefore can have blind spots. This is also true about creating products; we must fully understand the consumers’ perspective before we can offer a solution.
- How?
- Office interior redesign
- Offices should be designed to encourage closer collaboration and reduce barriers to cross-functionality. This will more closely integrate teams and encourage the growth of ideas. The best way of doing this is to implement a flat hierarchy. Future offices should have all departments as closely together as possible and should not have enclosed offices; instead they should have open desks and breakout rooms for private work when necessary. Meeting rooms for cross-functional teams should be made available and easy to access.
- Design thinking & Creative Problem solving
- Departments should continue to use brainstorming sessions in order to problem solve with multiple groups of stakeholders. Initiatives like that in the foundry where at least once a month the foundry management and workers group together to solve bottleneck problems is useful and allows for the creation of solutions that are well suited for management and the workforce. Kirloskar should continue to do this. With a base knowledge in the concepts of pull, SMDS and ToC that Kirloskar is trying to implement, meetings of cross-functional teams will be very fruitful in generating the best new ideas and solutions. Inclusivity, collaborative problem solving and openness for everyone to share their perspectives will benefit the company greatly.
- Field Trips
- Teams involved in the creation of new products, those composed of designers, marketing people, process engineers and factory workers, should do and take their design work to the field wherever possible. They should immerse themselves in the settings where the new pump would solve a problem, and speak to and observe potential end users. The team should be working to empathize with the potential end user and his problem as much as possible in order to create the best pump possible. The advantage here is that the team can identify needs that the user has that the user might not even know he has, and use the insights. As Henry Ford said, if he had asked the people what they wanted “they would have asked for a faster horse.” This approach of more hands on design follows in the company tradition of S. L. Kirloskar, who in his autobiography Cactus and Roses, uses opportunities to talk to farmers and factory workers first hand in order to create the solutions that best serve their needs.
- Office interior redesign
Pull System
Kirloskar must be agile, it must be flexible and it must be entrepreneurial in order to create the most opportunity for growth and resilience.
- Total Pull: Extreme case
- Concept:
- Identifying what Kirloskar would look like as a 100% pull oriented enterprise may not be realistic, but this imaginary exercise can help to expose some potential opportunities. In the long term, Kirloskar must operate as a balance between push and pull strategies, while maximizing pull.
- How?
- Cellphones
- Kirloskar should create infrastructure that supports the direct sale of pumps through cell phones and online with a pay-on-delivery method. Purchase with a cell phone, and your pump is delivered to you in 3 days. This online network should also be linked directly to distributors, so that the company can know exactly when and where inventory is being sold, and allow this knowledge to let throughput be pulled through the system.
- 3D Printer
- The use of 3D printer in the immediate future for rapid prototyping will allow Kirloskar to responsively and quickly design and redesign pumps for the market without the high cost and slow process of current prototyping methods. In the future, it would be possible for Kirloskar to use 3D printers and additive manufacturing as a replacement for all forge activities, allowing total single piece flow, zero waste, and allowing each pump to be built to complete custom standards. Kirloskar would be able to produce pumps to each customer’s unique specifications. A customer could simply input the exact demands on an ordering website or at a distributor, and a completely customized pump for their specification could be delivered later.
- Adaptable factory floor- Aligns with SMDS
- Kirloskar needs to be agile in order to take full advantage of the pull system. The best strategies now might not hold in a few years time, and inertia should not be the reason it is held back. One important innovation for SMDS is the configuration of the factory floor. Kirloskar is currently in the process of reconfiguring the floor to maximize efficiency and reduce constraints. It is certain that new constraints and efficiencies will become apparent in the future, but cost may be a barrier.
- It is very important that Kirloskar not only reconfigure the factory floor shortly, but design in the ability for the floor to be modular and adaptable. Each work station and cell should be on wheels at the extreme, it should be able to be reconfigured easily at low cost in less than a week. As well, workstations should be modular. If one workstation is not efficient, the cell should have the allowance of being able to “swap out” with a newly designed, more efficient workstation. This modularity and flexibility on the production floor will help for adaptation for future changes. Workstations should also be flexible to be most efficient to be operated by people of different genders and sizes.
- iv. Employee Stats
- Concept:
- Kirloskar already keeps track of its employees skills and attendance, particularly on the factory floor. It could be useful to continue to track more data about their individual accomplishments in order to set up a further incentive system of nominal awards based on a type of level progression. In the future, it might also be useful to set up a profit sharing system to further motivate employees.
- Concept:
- Cellphones
- Concept:
- Ergonomics, Dance and Stretching
- Concept:
- Apply ergonomic principles to all parts of the factory processes. Use ergonomist and dance consultants to analyze all current movements done by factory workers, and redevelop physical processes to become more efficient and healthier. Develop a system of stretches and exercises specific to each role to improve worker happiness and efficiencies.
- Why?
- Each worker is like a machine, using ergonomics and dance to make their movements easier and more efficient makes them “well oiled” machines. Workers doing a more natural and more varied set of movements will be happier and less inclined to boredom than those whose do the same types of inefficient motions. Using dance consultants, following India’s strong tradition of dance, will add further inspiration to worker’s conditions. Careful analysis of the best methods for assembly workers jobs and developing these movement systems will reduce strain and errors by workers, making them able to work more effectively over time. A 2008 issue of the International Journal of Industrial and Systems Engineering says that improving ergonomics can improve worker efficiency by 50%. Workstations should also be designed to be adjustable to the physical specifications of different sizes of men and women.
- How?
- Create an interdisciplinary team of process engineers, ergonomists, and a dancer to inventory and analyze all workstation and worker activities. Design, prototype, redesign, and implement new movements for all employees’ new movements that increase efficiency and health and that reduce boredom. Develop specific stretches for each position, and encourage workers to do these during lunch, along with exercise in the form of campus walks. Train workers with new processes.
- Concept:
- Involving Distributors and Suppliers in innovation
- Concept:
- Similar to creating an emphasis on cross-functional teams and awareness of new business methods throughout the company, it will be important to share innovations, insights, and participation as much as possible with distributors and suppliers. Doing so will help them to innovate their supply chains to a similar degree. This will help by improving Kirloskar’s throughput on both ends of its system.
- Why?
- Transparency is important, and as ToC points out, the system is not independent. Kirloskar’s supply chain relies very much on its distributors and suppliers, and if they are not running efficiently they will pose a significant constraint. Including them in the firm’s transformation, with the right legal protections, will benefit everyone. SMDS involves everyone.
- How?
- Include suppliers and distributors in new product development projects and in the new education and awareness campaign.
- Concept:
Information Technology
Information Technology is a tool for maximizing the utility of knowledge transfer and communications. These are a few brief ideas on this topic.
- Co-Development
- Concept: similar to the cross-functionality of team, this is a simple recommendation that all relevant stakeholders are closely involved with the development and implementation of new IT solutions, including suppliers and distributors. This will help to make the solutions as relevant to each department as possible, and will reduce the headaches of the surprises in implementing new software.
- Transparency
- Concept: IT should be an opportunity for building more transparency in the company. It should allow people in all departments the ability to use data, even data that might not seem relevant, to further company goals and create transformative information. Blockages to information within the company run contrary to innovative growth. This is also the importance of encouraging all employees, from management to factory floor, the ability to easily dialog with each other.
- Big Data- Digitize Everything –
- Concept: We live in an era of extraordinary complexity and massive volumes of information, but we shouldn’t let this scare us. We can use it to our advantage. Strides should be made to collect as much data as possible, and to build the tools to analyze this data. Virtually all processes in the factory should be recorded and the data filtered. The right tools will allow Kirloskar to build models and to automatically assess barriers and constraints more quickly, and set up simulations of better methods. There are also opportunities to use things like smart phones to order pumps and to be used as a distribution tool, but also to create apps to count inventory. Imagine a cell phone app for Kirloskar employees which at the click of a button can take a photograph of a grouping of standardized inventory and count it, and tell where each piece has come from and is going. This could hook up to central software and give further insights. Knowledge is power!
Conclusion
I hope that this work will be useful for the company. I believe that a particular emphasis on culture & awareness (particularly the design of a new training program and emphasis on Kirloskar as a solution) as well as ergonomics will be a particular benefit to the company. These are simple to implement and will promote long-term growth. SMDS can happen, with strong leadership from the top and a fertile, motivated and accepting culture at the bottom. Kirloskar is on the right track with its current leadership. Please feel free to contact me if any extrapolation on this work is needed. It has been a pleasure and gift to learn so much more about Indian business and industry by working with Kirloskar.
Geoffrey Evamy Hill
Links
Ergonomics
http://alexanderwhitley.com/blog.php
http://www.iacindustries.com/get-started/ergonomics/how-to-bring-ergonomics-to-the-factory-floor.asp
http://www.wired.com/design/2013/06/75watt-design-art/#slideid-150545
Appendix
Synthesizing Problem of Constraints
Geoffrey Evamy Hill
Kirloskar Brothers Limited
08JUN13
Introduction- The Problem
In a business, the production chain and financial chain run alongside each other and are interdependent. Each must support the other to foster healthy operation and growth of the system. The goal is for the business to be able to make more money now and in the future. The main blockages of this are shortages or excesses. We want to build systems that are responsive, having higher availability with lower inventory. The system must produce the right item, at the right time, in the right quantity in order to do this.
Framework of Concepts in the Problem of Constraints
Push vs. Pull
There is considerable theory and application of what is considered to be the ideal business system- one that operates allowing inventory to be “pulled” through the system according to the demands of the market. This is opposed to the traditional “push” method, focused on capital investment churning out product in order to strictly maximize output on machines.
Ideally, the demands of the final consumer should be as closely linked to raw materials as possible. The inventory should move through the system as quickly as possible, based on the pull. This will generate throughput, a measure of success that favours speed and volume through the constraining nodes in the system rather than strictly the utilization of all capital to it’s capacity.
Traditional Emphasis (Push)
Throughput/Constraint Emphasis (Pull)
4. Machines (investment)
5. Man (highly skilled)
6. Material (takes up space, use as capacity requires)
4. Material (replenish as demand dictates)
5. Man (flexible and multi-skilled)
6. Machines (a tool)
The pull approach focuses on single piece flow, and make minimum order quantity a thing of the past. The focus is on aligning capacity to the actual demands of the market, what is demanded in which quantity and when. Firms must evolve towards mass customization, not dictating minimum or economic order quantity but instead being agile to respond directly to demand.
Theory of Constraints
Implementing a pull-based system requires a holistic understanding of the business system that is difficult to achieve with traditional accounting and assessment. Applying Goldratt’s Theory of Constraints to identify and continuously improve Capacity Constraining Resources (CCR), or bottlenecks, allows for greater control in optimizing business processes. CCRs control the overall throughput, modifying them will either increase or decrease the throughput if all other factors remain the same.
Simple calculations of time allow for insight into where constraints are located and how much optimization should be done. Cycle time (CT), or TAKT (time available over the units demanded), is the time a cell takes to complete its sequence based on the CCR. The Maynard System (MOST) is a sub-calculation for how long a worker takes for a particular task. The CT is the push of inventory through the system, and should be compared to the Pulse time (PT), or the pull. PT is the demand of the market in terms of the amount of time available. The push, CT, should always be less than the Pull, PT. The closer you can get to the pull, without exceeding the pull, the more throughput will be generated.
According to Cohen & Fedurko, there are three main types of constraints in the production chain:
– Capacity – resources that limit the overall production
– Market – amount of demand in the market
– Time – time it takes to respond to the demands of the market and the opportunity cost therein
The TOC Method is cyclical and has the following steps:
1. Identify system’s constraint
2. Decide on how to exploit the constraint
3. Subordinate everything else to the decision
4. Elevate the system’s constraint
5. If constraint breaks, repeat from step 1. Avoid inertia being the constraint.
PDCA and RADAR are cyclical philosophies of creating schemes to improve
– Plan, do, check, act
– Result, approach, deploy, assess, review
Synchronized Manufacturing and Distribution Systems (SMDS)
Are viewed holistically as systems with a base unit of cells, or group technologies, that are interdependent, modular and scalable. Individual cells will have constraints, and cells themselves will be constraints. Cells must be responsive to pull, must only require particular experts as an absolute last ditch option, and must be able to self assess. They must be responsive to demands and their members flexible. Under SMDS, cells must satisfy three requirements in order to function most effectively:
a. Integrated Maintenance – employees working in the cell must be able to keep machines running without break downs
b. RETAD – Rapid Exchange of Tools and Dyes- Allows shifting of production quickly in order to correspond to pull of demand, maximizes Effective Working Time (EWT)
i. SMED – Single Minute Exchange of Dyes
ii. IED – Instantaneous exchange of Dyes
c. Integrated Quality – the cell must be able to self assess the quality of it’s production without outside expertise
ROCE
In order to make more money now and in the future, we need to improve in balance the financial concerns of Profit, Return on Capital employed, and cashflow. The main focus of the financial chain is ROCE- return on capital employed. To make the greatest ROCE, the weakest links in the supply chain must be bolstered in a continuous, non-linear process. Only when ROCE is maximized because of this chain optimizing process should significant expansions and capital investments be made. It is important to change one link at a time in order to identify cause and effect easily. It is a process of systematic ongoing improvement.
Ideal Systems
Typically, it is a balance between the push and the ideal of pull that results in a successful business model. Not every firm may simply employ the advanced, just in time (JIT) techniques of the Toyota Manufacturing System (TPS). Careful analysis of the particular demands of the consumer and overall market must be assessed. These will factor in to the Pulse, or to revolutionize a firm in this way, a culture of embracing constant change must be fostered. Understanding and creating a hierarchy of cause and effects is an essential tool for generating changes.
Tools
Cloud-Current Reality Trees-Injections
– Methods for identifying and assessing conflicts and their assumptions in order to create solutions that optimize outcomes and reduce the impact of undesirable effects, while minimizing unintended consquences.
The Cloud
– tool for managing assumptions and creating win win scenarios in regards to necessary conditions for required outcomes
– Stage 1: Identify a problem
– Stage 2: present the situatuion in cloud form
– Stage 3: develop and challenge assumptions, create injections
Current reality tree
– For managing gap between current level of performance and desired, undesirable effects and how they endanger the system
Injection
– A solution to a problem based on challenging assumptions
Desired Outcome Branch
– Emerges from injections into the cloud
Project Ideas
-Complete whole system analysis of Dewas Plant
-Assess possible constraints in production
-Identify Constraints in distribution, assess and compare new to old distribution method- generate possibilities for further improvement
-analyze workplace productivity and develop possibilities for improvement
-Assess possibilities for new technologies to improve supply chain
-identify new possibilities for product offerings in the market and how these offerings may be integrated with the supply chain
–
Sources
The Goal- Goldratt
Subodh Shrivastava
Ankur Pathak
Oded Cohen & Jelena Fedurko
geoff evamy hill 