This article is an interesting benchmark for indian manufacturers aspiring to be world-class in what they do. Technologies are used today by various organizations wherein the technology is the us perspective. Appropriate use of manufacturing technologies can improve perfomance to a large extent. Manufacturing technologies determine export .Lack of skilled operators leads to delay in skilled technology and eventually delays the progress.Technology improves productivity and effeciency . Is the technical means people use to improve their surroundings. It is also a knowledge of using tools and machines to do tasks efficiently. People use technology to imrove their ability to do work. Technology allows them to make more and better products. Our buildings are better through the use of technology. We travel in more comfort and speed as a result of technology. Yes, technology is everywhere and can make life better. Read on to find out more on the same topic.
Skilled technology use is leading to operational excellence in American manufacturing, higher productivity and ultimately, higher profitability. The study of more than 1000 US manufacturers, sponsored by the National Association of Manufacturers (NAM, USA) and the National Science Foundation (NSF, USA), shows that manufacturers. improved their performance between 1993 and 1997. The study covered manufacturers conforming to US Standardized Industrial Classifications (SIC) 34-38, which include metal fabrication, machinery and computers, electrical and electrical machinery, transportation equipment, and instruments and photo goods. These industries account for over 40 percent of the GDP contribution by all manufacturers in the US. Industries covered by SIC 34-38 are similar to the Indian industries covered by Industry Codes 34-38 used by the Government of India. Top management in the plants provided the data for the study, in a four-page survey questionnaire.
In the average plant, sales per employee (a commonly used measure of productivity) in 1993 was about $133,000 and it increased to $147,000 in 1997. In 1993, the average plant reported a return on investment (ROI) of 13 per cent, while in 1997 the average ROI was 16.8 per cent. The average US plant is one of the most productive in the world. The skilled use of manufacturing technologies is a core reason for this productivity advantage. If the average sales per employee in a manufacturing Indian plant from comparable industries is one tenth of what is reported above, it would mean that the average Indian plant employs around 10 employees for every one employee in the US.
Manufacturing technologies in use
In manufacturing, the term "technology" traditionally has been associated with hard automation or hardware-intensive equipment. This study uses the term in a broader sense to accommodate two kinds of technologies on the shop floor: "hard technology" and "soft technology." Hard technologies are hardware- (and associated software-) based technologies such as flexible manufacturing systems (FMS), computer-aided design (CAD) and computer-aided manufacturing (CAM). Soft technologies, on the other hand, include know-how and techniques such as statistical quality control (SQC/SPC), just-in-time production (JIT) and manufacturing resources planning (MRP). A total of 17 technologies were investigated. Some of the technologies have been around since the 1960s, while the others are relatively new. Figure above shows the per cent of US manufacturing plants using 17 hard and soft technologies in 1997. Some notable findings from the figure are: In 1997, the most popular technologies were CAD, CNC, LAN, and JIT in decreasing order of popularity. In 1993, the most popular technologies were CAD, TQM, JIT, and CNC in decreasing order. It appears that by 1997, JIT and TQM practices become ingrained in some US manufacturing firms - i e, some manufacturers in the US do not view them as new technologies anymore. CAD, which is the most widely used, is used by 84 per cent of the manufacturers.
Technologies rapidly growing in use
Data from companies that answered both my 1993 and 1997 surveys show that the use of local area networks (LANs) has grown more than the use of any other technology since 1993. Seventy-two per cent of these plants used LANs in 1997, compared with 46 per cent in 1993. Factory networking is taking off because LAN is the key to computerized integration. The increase in networking (or computerised integration) yields paperwork reduction, and time-saving efficiencies. In 1997, the transactions between the shop floor and production/materials planning were 58 per cent computerised, while transactions between design engineers and customers were 41 per cent computerized. It is remarkable that nearly 30 per cent of manufacturers reported in 1997 that 90 per cent of all their transactions between shop floor and production/materials planning is computerised. The growth in the use of individual technologies may taper off, but growth will continue in the use of integration technologies to increase the degree of computerized integration between internal and external units of manufacturing plants. The use of manufacturing cells showed the second-highest increase among the companies that answered the 1993 and 1997 surveys. Manufacturing cells reduce inventory, increase quality and productivity, and enable factories to become better focused. Since the implementation of cells requires multi-skilled operators, the growing use of cells increases the need for operator training. The impact of the increase in LAN and use of manufacturing cells is increased flexibility, which is the ability of a plant to produce smaller lots efficiently, and to respond faster to customer needs and demand changes. Further, the computerized integration of units inside and outside a factory contributes to flexibility in manufacturing by enhancing the speed of information flow and the ability of manufacturing systems to respond to changes. All these improvements could reduce manufacturing lead-time. Shorter manufacturing lead times are used as a source of competitive advantage in the US.
Performance and technology use
In the survey, manufacturers attributed several benefits to their use of various manufacturing technologies. Some of the notable benefits are mentioned below.
According to figure on next page, the most commonly reported benefits in 1997 are decreased manufacturing cycle-time, increased product line, decreased manufacturing cost, and increased ROI. 76 per cent of all manufacturers report reduction in cycle time (from receipt of a customer order to delivery of the product ordered for) and 75 per cent report reduction in manufacturing costs as a result of technology use. The average manufacturing plant covered in this survey reported 9.7 inventory turns (it was 8.0 in 1973 and 6.0 in 1990); that is, the average plant had 1.23 months of inventory.
One remarkable finding is the inventory turnover reported by the transportation industry (17.3), which includes the auto industry, is nearly twice the national average. The transportation industry has become a mature user of lean manufacturing principles; the industry is reaping the benefits of consistent, long-term use of such practices.
The auto industry started adopting soft technologies such as Just-in-Time Manufacturing (JIT), Total Quality Management (TQM) and Statistical Quality Control (SQC) about 20 years ago due to severe import competition from Japan and the rapid erosion of its domestic market share. The Big Three automakers in the US (Ford Motor Company, Chrysler, and General Motors) instituted standards and certification for their suppliers based on world-class manufacturing (WCM) principles, thus spreading the practice across the nation. Additionally, all major Japanese automakers have plants in the US (total Japanese auto production capacity in the US in about 2.84 million cars per year as of 2000).
Technology determines export
The use of technology rises with the degree to which firms gain their revenues from abroad. Without exception, in the case of every technology used, exporters rely on technologies more extensively than non-exporters. Overall, the evidence indicates that the use of manufacturing technologies adds a measure of competitive advantage to US exporters.
Extremely skilled use of technologies requires a thorough understanding of the technology being used, as well as constant training and retraining. The companies covered in my survey reported an average training budget that is five percent of the payroll. The training expenses may reflect any of the following: import competition, the multiple skills needed in manufacturing cells, employee reassignment and new hires resulting from downsizing in the US, and the need for maintaining high skill levels and corporate agility. Inventory turns are the highest in plants where the training expenses are the highest. On the job training (OJT) is the most commonly used training technique, although it takes more time to train an employee (8.3 months) than otherwise. Training by technology vendors is the quickest training method (5.3 months).
Delays in technology use
Among the main delays in the skilled use of technology are the non-availability of skilled labour and software problems. The lack of availability of skilled operators causes nearly five months delay in the skilled use of technology.
Lessons for India
Overall, the average manufacturing plant in the US is using and benefiting from the use of many hard and soft technologies. Technology use has given US manufacturers an enviable productivity advantage. Currently, technologies such as LAN and manufacturing cells are being introduced to enhance manufacturing flexibility in the US.
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|Posted : 10/26/2005|