Do not forget the strategic architecture of your manufacturing network while offshoring

Offshoring manufacturing to low labor cost countries has become trendy. Nearly everyday one sees an announcement in the business press of companies moving to China or India. Whilst production cost is an important consideration in choosing a location for the factory, we argue that one should not become victim of a herd effect and that other parameters e.g. quality, flexibility, transportation and energy costs, etc. need to be taken into consideration in the determination of the optimal manufacturing network. Relocating a factory is changing the strategic architecture of the company's manufacturing network and requires a long term view and a good model to design the architecture of the manufacturing network. Based on empirical survey research and a set of case studies we provide such a model to think about the roles of factories in the strategic manufacturing network of the firm. But we go beyond a classification and a descriptive model and we provide a set of six managerial issues that require senior management's attention in determining the optimal manufacturing network and its dynamic evolution. We argue for example that senior management needs to build a balanced portfolio of different types of factories, has to have a performance measurement system adapted to the type of factory, as well as the appropriate leadership for each of the different types of factories and needs to actively manage the dynamics and the flows of innovation in the factory network. Key words: international manufacturing, network management, outsourcin

Lean Thinking and Transferring Lean Management - The Best Defence against an Economic Recession?

Productivity growth is a fundamental means for society to improve its living standards. Productivity growth comes from technological change (new ways of producing goods and services) and better organisation of production (better ways of using available resources given available technology). Both processes operate simultaneously and, in practice, it is difficult to distinguish between the effects of each process. The processes are dynamic and affect individual activities differently over time. These years, manufacturing functions have been transferred rapidly and globally from mature countries to emerging countries. This paper is about the lean philosophy and the critical elements for successful transfer of lean management among sites and countries

The impact of knowledge management processes on organisational performance

Copyright @ 2012 ISEing.In today's increasingly competitive business environment, the use of knowledge to gain a competitive advantage has become a serious concern for all organisations. However, despite the increasing number of studies relating to Knowledge Management (KM) in developed countries, few studies have explored this issue within the context of developing countries. Moreover, some industries have been affected more acutely than others in the transition to a knowledge-based economy. Towards covering this gap, this study aims at investigating the impact of Knowledge Management processes on Organisational Performance (OP). In this paper, the authors propose a conceptual model through an in-depth investigation of the previous and current studies in the area of Knowledge Management and Organisational Performance. Through an extensive classification of Knowledge Management processes, the proposed model explores the impact of each Knowledge Management process on improving the level of Organisational Performance. It is envisaged that this model can play a role in guiding the process of Knowledge Management implementation in order to maximise the beneficial effects of Knowledge Management processes on Organisational Performance

Model of Tacit Knowledge Transfer in Lean Management Implementation in an Organization

The increase in competition worldwide had driven organizations to face with new challenges. The situation had prompted the manufacturers to perform a variety of effective strategies such as the implementation of lean manufacturing system in their organization. In this study, the key elements in developing the lean tacit knowledge transfer within the organization were identified. In addition, this study also investigates the transfer of lean tacit knowledge, which involves the sender and the recipient of lean knowledge within the organization. Data were collected through a single case study for a period of 2 months in an automotive manufacturing plant in Malaysia. The results of the study found that the lean knowledge could be developed through a number of key elements. A model of tacit lean knowledge transfer was developed to help improve work performance during the implementation of lean manufacturing system. In addition, the development of the model can explain how lean knowledge was developed and transferred from one party to another in the organization. The existence of such a model could assist an effective lean manufacturing implementation with every organization should has a good lean knowledge and understand how to properly implement lean in the production process

Assessing the drivers of virtual knowledge management impact in European Firm’s performance : an exploratory analysis

E-Business is a phenomenon that has progressed over the past decades at record speed, with considerable promise and hype. It has been embraced with varying degrees of enthusiasm and impact by both large firms and Small and Medium Enterprises (SME). Parallel with its development, E-Business has attracted research interests, seen in a plethora of new modules, programmes, models and tools. Knowledge Management (KM) is one tool that seams to gain a more relevant role, especially as managing knowledge has become increasingly important to all companies. Appropriate KM practices within organisations can be seen as one of the prerequisites to the enhancement of continuous performance improvement in the interne-based context. Thus, our aim is to develop a conceptual framework related to KM practices in a virtual context and to identify the nature of the relationship existing in those knowledge-driven elements and performance achievements. This paper aims to bridge the gap between the KM and e-business performance-related literatures from the viewpoint of European firms by establishing a model tested in European companies. For this purpose, we used a structural equation modelling analysis. The results show that KM has a positive impact on the maximization of e-business performance and that some elements individually have a positive influence on e-business performance. As limitations of the study, we consider the need for more research into this field and the inclusion of news elements such as technological readiness and management support to KM initiatives. The present study advances knowledge on the nature of the relative importance of different components of Internet-based KM as drivers of e-business performance and reinforces its importance as an integrated e-business tool.info:eu-repo/semantics/publishedVersio

Enhancing Lean Manufacturing Utilizing Industry 4.0 Technologies: A Focus on Cyber-Physical Systems

The industry is a significant part of our economy, providing our material goods in a highly mechanized and automatized way. The industry has gone through three acknowledged revolutions, and now the industry is on the verge of the fourth industrial revolution as known as Industry 4.0. Industry 4.0 surfaced in the 21st century and has gained interest exponentially after 2016. However, the research on this topic is still in its early stages. Thus, this has been taken into account as the research is conducted on a more specific topic. Industry 4.0 composes of many different technologies, from which the main focus of this thesis' is on Cyber-Physical Systems and what they might offer to Lean Manufacturing. The aim of this thesis is also to provide basic knowledge of lean and Industry 4.0 in general so that it allows more profound exploring of Cyber-Physical Systems and helps to perceive the possibilities more extensively. This thesis also presents significant concerns regarding the use of Cyber-Physical Systems. Based on these topics, the conclusion can be formed to answer what possibilities Industry 4.0 offers. The main findings from this literature review prove that Industry 4.0 and Cyber-Physical Systems can offer a great variety of possibilities to Lean Manufacturing. As it is debated that Lean Manufacturing, as is, is reaching its limits, implementing Industry 4.0 technologies are becoming crucial to maintain competitive capability. Cyber-Physical Systems could offer enhancement through streamlining the manufacturing process, reducing waste and workload, and better deficit and abnormality detection, for example. As a contribution, this thesis provides information in a chronological order to provide extensive enough understanding and an answer to the research question

Industry 4.0: The Future of Indo-German Industrial Collaboration

Industry 4.0 can be described as the fourth industrial revolution, a mega- trend that affects every company around the world. It envisions interconnections and collaboration between people, products and machines within and across enterprises. Why does Industry 4.0 make for an excellent platform for industrial collaboration between India and Germany? The answers lie in economic as well as social factors. Both countries have strengths and weakness and strategic collaboration using the principles of Industry 4.0 can help both increase their industrial output, GDP and make optimal use of human resources. As a global heavy weight in manufacturing and machine export, Germany has a leading position in the development and deployment of Industry 4.0 concepts and technology. However, its IT sector, formed by a labor force of 800,000 employees, is not enough. It needs more professionals to reach its full potential. India, on the other hand, is a global leader in IT and business process outsourcing. But its manufacturing industry needs to grow significantly and compete globally. These realities clearly show the need for Industry 4.0-based collaboration between Germany and India. So how does Industry 4.0 work? In a first step, we look at the technical pers- pective – the vertical and horizontal integration of Industry 4.0 principles in enterprises. Vertical integration refers to operations within Smart Factories and horizontal integration to Smart Supply Chains across businesses. In the second step, we look at manufacturing, chemical industry and the IT sector as potential targets for collaboration between the two countries. We use case studies to illustrate the benefits of the deployment of Industry 4.0. Potential collaboration patterns are discussed along different forms of value chains and along companies’ ability to achieve Industry 4.0 status. We analyse the social impact of Industry 4.0 on India and Germany and find that it works very well in the coming years. Germany with its dwindling labor force might be compensated through the automation. This will ensure continued high productivity levels and rise in GDP. India, on the other hand has a burgeoning labor market, with 10 million workers annually entering the job market. Given that the manufacturing sector will be at par with Europe in efficiency and costs by 2023, pressure on India’s labor force will increase even more. Even its robust IT sector will suffer fewer hires because of increased automation. Rapid development of technologies – for the Internet of Things (IoT) or for connectivity like Low-Power WAN – makes skilling and reskilling of the labor force critical for augmenting smart manufacturing. India and Germany have been collaborating at three levels relevant to Industry 4.0 – industry, government and academics. How can these be taken forward? The two countries have a long history of trade. The Indo-German Chamber of Commerce (IGCC) is the largest such chamber in India and the largest German chamber worldwide. VDMA (Verband Deutscher Maschinen- und Anlagenbau, Mechanical Engineering Industry Association), the largest industry association in Europe, maintains offices in India. Indian key players in IT, in turn, have subsidia- ries in Germany and cooperate with German companies in the area of Industry 4.0. Collaboration is also supported on governmental level. As government initiatives go, India has launched the “Make in India” initiative and the “Make in India Mittelstand! (MIIM)” programme as a part of it. The Indian Government is also supporting “smart manufacturing” initiatives in a major way. Centers of Excellence driven by the industry and academic bodies are being set up. Germany and India have a long tradition of research collaboration as well. Germany is the second scientific collaborator of India and Indian students form the third largest group of foreign students in Germany. German institutions like the German Academic Exchange Service (DAAD) or the German House for Research and Innovation (DWIH) are working to strengthen ties between the scientific communities of the two countries, and between their academia and industry. What prevents Industry 4.0 from becoming a more widely used technology? Recent surveys in Germany and India show that awareness about Industry 4.0 is still low, especially among small and medium manufacturing enterprises. IT companies, on the other hand, are better prepared. There is a broad demand for support, regarding customtailored solutions, information on case studies and the willingness to participate in Industry 4.0 pilot projects and to engage in its platform and networking activities. We also found similar responses at workshops conducted with Industry 4.0 stakehold- ers in June 2017 in Bangalore and Pune and in an online survey. What can be done to change this? Both countries should strengthen their efforts to create awareness for Industry 4.0, especially among small and medium enterprises. Germany should also put more emphasis on making their Industry 4.0 technology known to the Indian market. India’s IT giants, on the other hand, should make their Industry 4.0 offers more visible to the German market. The governments should support the establishing of joint Industry 4.0 collaboration platforms, centers of excellence and incubators to ease the dissemination of knowledge and technology. On academic level, joint research programs and exchange programs should be set up to foster the skilling of labor force in the deployment of Industry 4.0 methods and technologies