28th International Conference of the TOC Practitioners Alliance - TOCPA www.tocpractice.com
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9 November 2016, UK
Amberol Preparing for growth Aquila Yeong, Amberol Ltd / NTU, UK Roy Stratton, NTU, UK 09 November, 2016
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28th International Conference of the TOC Practitioners Alliance - TOCPA
Agenda
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Breaking constraints to business growth – Knowledge Transfer Partnership (KTP) – Management time – Transparent delegation
Amberol case – Outline – TOC process map – Hybrid buffer management – Software features
Conclusion www.tocpractice.com
28th International Conference of the TOC Practitioners Alliance - TOCPA
Knowledge Transfer Partnership (KTP)
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Growing SMEs in the UK 2 year government funded (1 year to go) Amberol – constraints to growth Adopting focused management systems Design, develop and implement IT based management tools based on SDBR.
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28th International Conference of the TOC Practitioners Alliance - TOCPA
Business Growth
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(Greiner, 1998)
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28th International Conference of the TOC Practitioners Alliance - TOCPA
Phase 3: Delegation
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“The next era of growth [phase 3] evolves from the successful application of a decentralized organizational structure.” “It is difficult for top-level managers who previously were successful at being directive to give up responsibility to lowerlevel managers.” “Top management that is aware of the problems ahead could well decide not to expand the organization. Managers may, for instance, prefer to retain the informal practices of a small company, knowing that this way of life is inherent in the organization’s limited size, not in their congenial Personalities. If they choose to grow, they may actually grow themselves out of a job and a way of life they enjoy.” (Greiner, 1998) www.tocpractice.com
28th International Conference of the TOC Practitioners Alliance - TOCPA
Amberol
Capacity is not effectively exploited
Demand is very seasonal
Pressure on management time is a major constraint to the organisation’s growth
Operate on an MTO basis
There is no formal means of managing FS
Delivery performance monitored manually <90%
Quality control is subjective and informal
Monthly stock checks Stock control system is not effective Manual stock records
Capacity planning is informal
Processing time data is absent / incomplete
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Priority control is informal
Work Order BOM data inaccurate
Product costing and pricing is not systematic
BOM is inaccurate and incomplete Absence of accurate integrated information systems
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28th International Conference of the TOC Practitioners Alliance - TOCPA
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Growth cloud Because... - Delegation systems are not in place - Owner does not wish to give up responsibility - Only means of ensuring visibility of the entire system
Manage current throughput
Owners’ time committed to daily operations
Grow the business
Develop future throughput
Owners’ time committed to new business developments
Because... - To guide the future direction of the business - Essential to ensure longer term sustainability www.tocpractice.com
28th International Conference of the TOC Practitioners Alliance - TOCPA
Management Time
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Constraints – Flow time – Bottleneck /CCR – Management time
Growth without revolution (Greiner, 1998) • Transparent delegation
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28th International Conference of the TOC Practitioners Alliance - TOCPA
Transparent delegation
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Means of avoiding confusion – Simplifying cross-functional control • • • •
CCR planning Planned load control Order acceptance Buffer management
– Releasing management time • New markets • New products
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28th International Conference of the TOC Practitioners Alliance - TOCPA
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Growth cloud
Manage current throughput Focused management: TOC based signalling tools to support transparent delegation
Grow the business
Develop future throughput
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28th International Conference of the TOC Practitioners Alliance - TOCPA
Amberol
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Founded in year 1969 Manufacturing Industry/Rotational Moulding Small Company/Family Owned Business Products: – Planters with unique ‘Aqua-Feed’ Self-Watering System – Bins – Customised Products Niche Market: mainly government/private institutions/entities
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28th International Conference of the TOC Practitioners Alliance - TOCPA
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28th International Conference of the TOC Practitioners Alliance - TOCPA
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Wicker Basket
Stone Trough
Barrels
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28th International Conference of the TOC Practitioners Alliance - TOCPA
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28th International Conference of the TOC Practitioners Alliance - TOCPA
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Manufacturing Characteristics (1/2) • Mainly MTO (Make-To-Order) • 18 colour options • Customised options: moulded graphics, crest and etc • Seasonal Demand (for planters) • Standard quoted delivery date: 3 weeks
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28th International Conference of the TOC Practitioners Alliance - TOCPA
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Manufacturing Characteristics (2/2) • Small batch/order quantities (70% less than 10 units; 94% less than 50 units) • 30% of the product requires more than a single mould • Touch Time is significant • Heavily shared resources
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28th International Conference of the TOC Practitioners Alliance - TOCPA
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Challenges • • • • •
Push System (Black-Box) Hidden Resource Capacity When should the excess capacity be utilised? Lack of Visibility Management tied down by day-to-day tasks
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28th International Conference of the TOC Practitioners Alliance - TOCPA
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Identify the Most Suitable Solution • • • •
Sage (Manufacturing Module)? Lean/Kanban? Other Manufacturing System? TOC?
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28th International Conference of the TOC Practitioners Alliance - TOCPA
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Process flow
Moulded intermediate Stock
purchased component stock
Order specific purchased components
Name plates Powder
Mould & Trim
Assemble
Wrap & Dispatch
Customer
Standard Lead time= 3 weeks
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28th International Conference of the TOC Practitioners Alliance - TOCPA
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Oven
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28th International Conference of the TOC Practitioners Alliance - TOCPA
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28th International Conference of the TOC Practitioners Alliance - TOCPA
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28th International Conference of the TOC Practitioners Alliance - TOCPA
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Process flow, control and buffering Moulded intermediate Stock
purchased component stock
Name plates
C C C
Powder
Order specific purchased components
Mould & Trim
C
Assemble
Wrap & Dispatch
D
Customer
Lead time= 3 weeks
D
C
Control point
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Stock buffer
Capacity buffer
Time buffer
28th International Conference of the TOC Practitioners Alliance - TOCPA
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Buffer Design Consideration 6 Days
3 Days
3 Days
3 Days
Standard lead time 15 days
Why not shorten the lead time? Why the need for ‘Pooling’? Why the need for ‘Blue Zone’? What if the necessary Touch Time exceeds 50% of Buffer?
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28th International Conference of the TOC Practitioners Alliance - TOCPA
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Buffer Design: Scenario 1
Touch time on CCR
Current loading on moulding arm
6 Days Daily Load
3 Days
3 Days
3 Days
‘Pooled’ We promise standard lead time
Standard lead time 15 days
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Time (days)
28th International Conference of the TOC Practitioners Alliance - TOCPA
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Buffer Design: Scenario 2 Current loading on moulding arm
6 Days
Touch time on CCR
3 Days
3 Days
3 Days
Daily Load We promise standard lead time
Standard lead time 15 days
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Time (days)
28th International Conference of the TOC Practitioners Alliance - TOCPA
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Buffer Design: Scenario 3 Current loading on moulding arm
6 Days
Touch time on CCR
3 Days
3 Days
3 Days
Daily Load
We promise standard lead time
Standard lead time 15 days
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Time (days)
28th International Conference of the TOC Practitioners Alliance - TOCPA
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Buffer Design: Scenario 4 If projected buffer consumption is more than 50% Extend lead time (increments of 5 days) Current loading on moulding arm
11 day
Touch time on CCR
3 Days
3 Days
3 Day
Daily Load
standard lead time
Standard lead time 15 days
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new lead time
Time (days) Additional 5 days
28th International Conference of the TOC Practitioners Alliance - TOCPA
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Process flow, control and buffering Moulded intermediate Stock
purchased component stock
Name plates
C C C
Powder
Order specific purchased components
Mould & Trim
C
Assemble
Wrap & Dispatch
D
Customer
Lead time= 3 weeks D
C
Control point
Stock buffer Overview
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Capacity buffer
Time buffer
Detailed
28th International Conference of the TOC Practitioners Alliance - TOCPA
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Business Operation System (Before)
Moulding Raw Materials
Finishing/ Assembly
Manufacturing Information
Customer
Administration
BOM
Commercial Information
Stock Information Sage
Management
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28th International Conference of the TOC Practitioners Alliance - TOCPA
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Business Operation System (After)
Raw Materials
Finishing/ Assembly
Moulding
Customer S-DBR (Production Planning & Control)
Capacity Information
• Flow • Visibility • Continuous Improvement
Management Administration
Sage BOM
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Commercial Information
Stock Information
28th International Conference of the TOC Practitioners Alliance - TOCPA
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Implementation Invoice Dispatch CRM Finishing Purchasing Office Admin To Inform
Work Order Sales Order
Planned Load
Quotation
Master Scheduler
Moulding
To Inform
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28th International Conference of the TOC Practitioners Alliance - TOCPA
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Software Modules
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28th International Conference of the TOC Practitioners Alliance - TOCPA
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Master Scheduler
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28th International Conference of the TOC Practitioners Alliance - TOCPA
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Planned Load
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28th International Conference of the TOC Practitioners Alliance - TOCPA
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Planned Load Details
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28th International Conference of the TOC Practitioners Alliance - TOCPA
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Estimator
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28th International Conference of the TOC Practitioners Alliance - TOCPA
Conclusion
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• Business growth is closely associated with revolutions between local and global thinking. • Focused management tools are key to resolving this conflict. • The generic TOC signalling concepts / tools provide a basis for customised development. • IT systems need to be subordinate to this underlying focusing philosophy.
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28th International Conference of the TOC Practitioners Alliance - TOCPA
References
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Greiner, L. (1998) Evolution and Revolution as Organisations Grow. HBR, May-June.
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28th International Conference of the TOC Practitioners Alliance - TOCPA
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Aquila Yeong Aquila is currently engaged as a KTP associate with Ambrol Ltd and Nottingham Trent University (NTU) as a Business Process/System Designer/Programmer. At the same time, he is also pursuing his Doctorate Degree focusing on Operations Management under the supervision of Dr. Roy Stratton. He was an Electronics Engineering Lecturer and Engineering Course Coordinator in KLIUC (Kuala Lumpur Infrastructure University College) before joining Electcoms, a telecommunication service provider in Malaysia. He has held management positions in Engineering (R&D and Technical Support), Sales, and Customer Service departments in Electcoms. He holds B. Eng (Hons) Degree in Electrical & Electronics Engineering (Uniten), and pursued M. Eng in Telecommunication (MMU). He has also graduated in MBA with Dean’s Achievement Award from Nottingham Business School.
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28th International Conference of the TOC Practitioners Alliance - TOCPA
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Roy Stratton Roy is a Reader in Operations and Supply Chain Management and actively involved in TOC related teaching, research and consultancy He is Director of studies of a number of TOC based doctoral students. His is also the route leader of a TOC based Executive MBA delivered in collaboration with QFI Consulting. Previously, Roy worked for Rolls Royce Aero Engines in an internal consultancy role and has since been actively involved in a wide range of industry-based research projects. He has published widely in both professional and academic journals and has co-authored two educational books. Roy is a chartered Engineer (F.I.Mech.E.) and has been awarded a BSc in Mechanical Engineering (Nottingham), an MSc in Manufacturing System Engineering (Warwick), and a PhD in Supply Chain Management (Nottingham Trent). He is certified in all TOC ICO fields.
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28th International Conference of the TOC Practitioners Alliance - TOCPA
