Transcript Main Title - المنظمة العربية للتنمية

IT and Manufacturing Competitiveness
Fouad Mrad
ESCWA Technology Centre
The Global Competitiveness Report 2010–2011
World Economic Forum
competitiveness as the set of institutions, policies, and factors that
determine the level of productivity of a country (12 pillars)
Ninth pillar: Technological readiness
Technology has increasingly become an important element for firms to
compete and prosper. The technological readiness pillar measures the agility
with which an economy adopts existing technologies to enhance the
productivity of its industries, with specific emphasis on its capacity to fully
leverage information and communication technologies (ICT) in daily activities
and production processes for increased efficiency and competitiveness.
ICT has evolved into the “general purpose technology” of our time, given the
critical spillovers to the other economic sectors and their role as industry-wide
enabling infrastructure.
Whether the technology used has or has not been developed within national
borders is irrelevant for its ability to enhance productivity.
The central point is that the firms operating in the country have access to
advanced products and blueprints and the ability to use them.
What is Technology?
“Technology” as defined by Encarta
Dictionary:
– Application of tools and methods; the study,
development, and application of devices,
machines, and techniques for manufacturing
and productive processes, or
– Method of applying technical knowledge; or
Knowledge is the Industrial raw material
INPUTS
TRANSFORMATION
OUTPUTS
Factors of Production
Production Process
Production Objects
(Materials)
Multistage conversion
processes
Productive Labor
Produced Goods
Tangible (products)
Intangible (services)
Productivity
(output, input)
Production Means:
Production facilities
Production
Information
Production & Manufacturing:
Knowledge System
UTILITY
PROGRESS OF MANUFACTURING INDUSTRY
WHEN
INDUSTRY
INNOVATION
Cottage Industries
1700s
Mechanization
1800s
1900s
Centralized Industry
Process Industries
Manufacturing
Industries
Cellular
production
Automation
Transistors
IC’s, computers
Stand-alone automated CNC
Machines/ Robots/Computers
Networks
Integrated Workshops
Internet
E-Manufacturing
2000s
Market requirements
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Low price
Better features
Better performance
Short delivery time
Higher Reliability/Support
Wide product line
Custom made product
Variable order size
E-Marketing/procurement
System Attributes
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Low direct labor
Low WIP inventory
High throughput rate
High machine utilization
Low setup time
Low tool change time
Process flexibility
Quick design modifications
Accessible designs and material
(Documentation)
Manufacturing Productivity
Strategies
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Specialization of operations: extreme efficiency
Combined operations at the same machine
Simultaneous operations at multiple machines
Increased flexibility with programming and tool
changing
• Automated material handling and storage:
inventory control, parts, raw material, fixtures,
products.
Manufacturing Productivity
Strategies cont.
• Automated inspection allowing correction &
lowering scrap
• Process control and optimization reducing
cycle times and costs and improving product
quality
• Plant operations control: planning, scheduling,
floor and quality control
• Computer integrated: design, plan, process
control, and business marketing and
procurement.
Why IT in Manufacturing
• Technology is not new to manufacturing
• Technology created immense amount of
information
• Should be communicated for use in the rest of
the Enterprise
• Information has become the fourth largest factor
of production - as important as
– raw materials,
– Labor, and
– capital
Why IT In Manufacturing?
• Increase in productivity
• Reduction of Labor Cost: Reduce Human Touches
• Find and terminate non competitive suppliers
• High cost of not using IT:
• Saving in materials: Less Scrap and rework
• Improved Quality: Better reporting and Tracing
• Reduction of time to market
•Reduction of work-in-Process: Inventory Control
• Increase in flexibility: Retooling, Produce to order
•Increase Sale: revenue from better market position
E-Manufacturing costs
I. Acquisition / Deployment /Maintenance Costs
1) Purchase of equipment
2) Installation and Interfacing
3) Plant layout modification (if needed)
5) Hiring/Outsourcing of skilled workers
6) Retraining of workers
Acquisition Issues
• High perceived risk
• Inadequacy of Traditional capital budgeting techniques
High Perceived Risk
1) Capital investment
2) Unproven technology
3) Performance of early installed systems
4) Rapidly developing technology
5) Availability of experienced personnel
6) Rapid job retraining
7) Communication standards
Capital Budgeting Techniques
Quantification of strategic and qualitative benefits:
• Quality
• Flexibility
• Delivery reliability
• Fast response to market demands, etc
•Asset management (people, material, equipment, etc)
The Hierarchical Evaluation Approach:
Strategic Evaluation
1. Choosing the competitive strategy
2. Specifying the market requirements
3. Specifying the manufacturing system requirements
4. Choosing the manufacturing system configuration
5. Identifying the organizational constraints
6. Iterative strategic evaluation if needed
e-Manufacturing Roadmap
“It is not enough that people want to do their best. They
must know what to do!” Dr. W.E. Deming.
“Plant Floor Meet the World.”
 No need for complete redesign of a plant floor
 Elements in place for a good starting point
 Competencies: Design, Operate, Maintain, &
Synchronize
 Enablers: Integrated control and information,
Integration of business and production systems,
Asset management and reliability-centered
maintenance
E-Manufacturing Areas
Internet
E-Manufacturing
ORGANIZATIONAL
Business Planning
ERP
Finance
Marketing
B2B
Distribution
E-Procurement
Corporate Services
OPERATIONAL
CAE
CAM
CAD
CAQ
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CNC
Robot
PLC
Test
Acquisition
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E-Manufacturing Strategies
A way of thinking about deriving operations
excellence out of an organization
• Take advantage of IT
• Leveraging the Internet to achieve results
• Selective and Justified
• It is not an all-or-nothing proposition
• Use modular, scalable applications
• Use commercially available IT tools
Opportunities
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Easy to install/integrate with existing systems
It does not require redesign of a plant floor
Elements in place for a good starting point
Computer based plant-floor controls
generate a wealth of information about
productivity, product design, quality, and
delivery.
• E-Manufacturing is key in unleashing this
information in a cost-effective manner
Recommendations
• Join an industry cluster and/or strategic
alliance
• Must be flexible in design and production
• Need innovation leading to productive
processes and products
• Increased Product Technological /
Creativity Edge (Niche: Innovation,
Design, Software)
• Higher Production rates: Improved
Production Technology (Management,
Systems, Quality, Automation)
IT is NOT all Rosy !
• IT provides strong competition tools
• The customer really does rule-and with an
iron hand controlling a mouse
• Power to the consumer given by Internet
as a buying tool and information source
• Get help from an expert: Outsourcing!