All entries for November 2018

November 27, 2018

A STORY of INDIAN MANUFACTURING

I have picked up this title from a book. It has it's own relevance. This story will be from my perspective, hence it is referred to as ,"A Story". I will not dive deep into the history but try to put down important facts from my own perspective. India had a very rich resource base and produced products for the global market. The manufacturing sector was booming and in the 16th Century india had a 30% share in the global output while britain had 2% share. The reason was the competitive advantage that india posessed in terms of skill and resources. This is known as the traditional flexible manufacturing phase.

The major changes that occured in the indian manufacturing environment were mostly due to state and government control. There are a couple of facts to back up my claim, when mughals arrived to india they treated india as their place of administration. They started to include territories inside the mughal empire and that helped in free trade. Now , due to the huge size of the empire there were less barriers and more trade opportunities. Hence, state played an important role in the structuring and booming of the manufacturing sector. Next the East India Company came in there was a period of British Raj. They provided instability to the indian economy and that is where our economy started to decline. When the whole world was facing the modern manufacturing shift, India was not able to innovate and grow because the country had no government existence. The britishers imposed policies which discriminated against the indian manufacturing sector. During 1850s, India lost it's comparitive advantage.

The dualistic nature still exists in the indian economy. It was a special feature of all the economies of the world. They had both small and large firms to start off with, but slowly and gradually they all converted into modern manufacturing units. We can talk about JCB which was a family business and which transformed into a modern manufacturing unit. But somehow, India has missed that transformation. Presently, there are still certain firms which are unorganised and come under the category of small businesses, on the other hand there are businesses which are a part of the modern industry. The industrial revolution that took place across the globe was due to the techonological methods and introduction of new techniques. There were different organisational structures that were introduced. All these things helped in the industrial revolution in the eighteenth century.

All the major economies of the world have gone through the industrial revolution but India has somehow missed this phase. India has grown straight into a service giant without utilizing the potential of it's manufacturing sector. There were a lot of opportunities when india could have prospered it's manufacturing. During the end of mughal era, India was one of the top exporting nations across the globe. It was in the traditional flexible manufacturing phase then. As the other economies in the world, it was a time for india to make use of it's comparitive advantage and enter into a modern manufacturing using the machines to produce goods and better technology. Also, the new industry needed protection from the outside market to help in growth of the local industry. Both of this did't take place. There was no stable state control in india to facilitate the introduction of new methods, no policies. And also the indian manufacturing sector was discriminated against and it lost it's comparitive advantage.

The second possible opportunity could have been after the independence. But somehow we were not able to make use of it as well. The policies by the nehru government helped the industries a lot on the supply-side and the state owned industries started to become stagnant because of the subsidies from the government. There was a lack of innovation. The government further didn't provide the freedom to the private enterprises and that restricted it's growth. Even the reforms of 1991 did nothing to transform the labour market. The indian economy still holds a lot of characteristics of the traditional system. Still there is a lot of dependence on traders to sell goods and give consumer feedback. Cluster industries are still prevalent. There exists a dualistic economy and it has not transformed even after centuries. There are a lot of segments in the economy due to which people stick to making low cost and poor quality products because of higher number of middle and lower income group people. Approximately 80% of the organisations are in the unorganised sector. It becomes difficult for the government as well to design policies in such an environment.

This background knowledge raises a lot of questions. It is important to learn from the past mistakes and try to build on them. Probably we are again at a stage where we as a nation can make or break the manufacturing sector. Again, the world is looking towards india as a great potential market as it happened in the 16th century. This time there would be no colonization or EIC. There might be other factors that can hamper our growth loop. A lot of merchants in India who started accumulating wealth in the 1990s are looking further to convert their circulating capital into the fixed capital. It is exactly what happened in the 17th century. At that time we didn't have the right structural stability to drive the nation forward, but the same mistake should not be repeated. It is upto the people to elect a stable government.

Another important aspect that can be looked at is the creation of knowledge sharing and innovative environment. The concept of cluster innovation can be used to drive growth.There are a lot of things to consider. It is important again to understand the root causes and make a startegy to tackle them. We cannot be depended just on the government to make a change. As individauls we need to think how to contribute to the growth environment. Yes one person can make a change given that you identify the right problem to hit upon. It is a way of thinking that matters.

There are a lot of questions that need to be addressed again. To make an excellent organisation, it becomes necessary to set the core values , then define the vision and purpose. I feel there are a lack of indian organisations which can compete in the global environment. There is a new LONG WAVE that is taking place in the nation in order bring a transformational change. It will not be easy to revive the third pillar(manufacturing) of the economy. It is not easy but it has been done by other countries in the world. The post world war Japan has displayed amazing grit and determination. We can learn the good things and take it ahead from there.

This was a overview of the macro level picture. As a manager it becomes necessary to look at the micro level and think about the practical steps that might be taken and the anticipated results.


November 25, 2018

LEAN AND SIX SIGMA

The week was a brilliant one. There were a lot of simulations that helped us learn a lot. There was something important to take away from each day. If I need to implement these principles in my organisation, I need to understand them to the core. Talking about lean six sigma, I need to start thinking on lean principles in order to impleemnt them. For example, James Horton (from bombardier) told that he went into starbucks and observed that it is so annoying to wait in the queue for your turn to get coffee. That is a non-value added waste in the process. As a manager I need to think on these lines in order to implement the approach successfully.

One of the major learnings was to not make assumptions about the process and try to understand it first. It aligns with the principle of knowledge put forward bt Deming. After understanding the root causes it becomes necessary to treat one problem at a time. If we try to implement solutions for multiple problems we cannot know exactly which solution is effective and which is not. To have a complete know how of the process take it step by step.

Also, it might be possible that individual departments and processes may work well individually, but it doesn't mean they will work together as a system. It aligns with the appreciation of a system. During making a plane, we tried to time the individual processes but at the end the whole system of assembly line was not able to come together. It is important to develop a systems thinking. Think of organisation as a whole and start thinking. The biggest obstacle that one can face as a manager is the resistance to change. That is one thing that I need to learn to tackle. One way is to involve the employees in the evolution of the idea. But, given the organisation environment that I have seen back home, it is not that easy to do. I need to reflect back every day and try to find the right solutions for these obstacles.

I have always been taught to listen to the customer. It is the most important aspect of the business. But now I know a few scientific ways to implement it. Process improvement is always about the listening to the voice of the customer and listening to the voice of the process. According to the Takt time we can then figure out in what time I need to make one product in order to fulfill the demand. JCB factory had a lot of visual signals. These can also be an important point to consider while running an organisation.

Lean is about improving the speed of the process and six sigma is about making the best quality on point. Considering a basketball game, reducing the time taken for a ball to be transferred from one corner to other comes under the lean thinking and hitting the ball on point/target with minimum variation is the six sigma ideology. They can be used together well. Reducing the waiting time in a queue in coffee shop is a non-value added waste which can be removed by introducing the online order and payment system before entering the cafe. It reduces the waiting time and increases value added time. This comes under the lean thinking(reducing cycle time).

In my organisation most of the products are made in batches. Once a batch of sole is applied on the shoe, then the whole batch goes under the next step. This method keeps the customer waiting. The customer waits for the whole batch receives a large quantity at once. A better solution can be single piece production(assembly line). It can help to introduce concepts of Just-in-time and help to reduce costs. This is an approach that I need to consider. It can save a lot of time and money. It can help to address the issue of batch defect and a single defected product can be treated in the assembly line without affecting the other products. Initially, I would like to start off with the pull system. It helps overcome the problem of overproduction. We will be making the products on the demand of the customers. TAKT time can help further to design the process.

Lean requires a learning organisation in action, which requires a culture of continuous improvement, which further requires to identify the problems in implementing the continuous improvement culture. This is the methodology of identifying the root cause. I need to figure out from where I need to start off. There has to be a starting point.This is the beauty of self-reflection, it helps you to understand where you are and what needs to be done right to achieve a particular result. There are a lot of things to consider.


November 21, 2018

TAGUCHI EXPERIMENTATION

Today was the third day of the PIUSS module. We were introduced to Taguchi loss function and experimentation. It was the time to revisit an already known fact. It is important to get the design of the process and product right because design itself can save a lot of cost and improve quality. It is something we learnt in the plane making simulation. During making the plane, we all made a major mistake and focussed on improving himan training, but the actual focus should have been the process improvement. Today was the time to make helicopters fly in the air for as long as possible. We need to make sure that we do as few tests as possible in order to save experimentation costs. We used orthogonal arrays to identify the major control factors that will keep helicopter in the air for longer. This time my focus was on improving the design of the helicopter. We started off with considering some important factors. While designing the helicopter, I thought that the idea of making a streamlined tail is going to be a major factor and it will help the helicopter to stay in the air (I was again making an assumption, how can you conclude something without having data and analyzing the process? My bad). We listed 7 factors and calculated the Signal noise ratio for eight different prototypes. We got good results. But now arises the major question. We know that we have a good model. But did we really know why that particular model was a good model? It is a very important question to answer. Because there are a lot of factors that play a role in defining the design. The same thing I ahve experienced in the industry as well. Sometimes people end up making good products, but they don't know why it was good. Everything cannot be relied on hit and trial. So using the L8 array we found out the major and most significant factors.

I was surprised seeing the results. We had the best Signal-Noise ratio. But did we really know why it was so? Before the start of the process I assumed that streamlined tail design is going to be the difference. But data showed a whole different story. It was the use of transparent tapes that was a significant factor in increasing the air time. Tail design made a difference but not much. till is the power of scientific process and data interpretation. Now I imagine how do manufacturing companies back in my city operate. i am sure they don't collect data. I am sure that they somehow know why they achieved a particular result. After today's experience I can just think of how many wrong assumptions they might be making. It is important to follow the DMAIC process. The implementation will be interesting. Looking forward to it.


November 19, 2018

CHANGE MANAGEMENT

I am into the module week for six sigma. Today we tried to improve a process using the six sigma. At the start of the day, I learnt a very important fact that 95% of the six sigma project fail to get implemented due to the socio-economic reasons. Hence, once again people become the foundation for everything. It is important to manage change. It is always necessary for the organisation to tell people , why are you making such changes. It helps people to understand better and creates a sharing environment. Resistance towards change is normal, good managers listen to employees with empathy and guide them from resistance towards change till the achievement of results. Hence, change management becomes a critical success factor in the implementation of six sigma apart from the various tools and techniques.

We did a simulation for trying to improve the process capability and control. The whole DMAIC cycle plays a major role in guiding through the right steps. We found out that are process was not giving the best results. Hence, we started to analyze the process. Here comes a very important learning, always verify the root causes and try to develop the possible solutions. The major reasons for wastage were identified. At the end of the we as a team were trying to find the solutions of improving the process. Initially we were trying to figure out too many things at once and not looking at the root causes. Our focus was more on the special causes and we started training the operators. If we keep on doing the same process, it is difficult to get a different result. It sounds so simple, yet the managers tend to forget the basic things. The supply issues were one of the root causes in the process, so we need to find a solution to get the right materials without wasting much of the time. Also, the process has to be consistent. Working with the team today, I gained a practical experience about change management. It requires a lot of involvement from people. Once everyone is sharing the common vision the process can be changed and better results can be achieved. Looking forward to implementing changes in the process tomorrow.


November 17, 2018

SoPK and SIX SIGMA

I feel that the System of Profound Knowledge(SoPK), put forward by Dr. Deming is a very holistic concept which tends to cover a very wider area. It can be applied in any situation and in any type of organisation. The main feature of the system is that it is very flexible and non-descriptive. It is a philosophy that can be applied to all forms of organisation. It gives me a foundation on the basis of which I can start a new culture in any organisation. The main drivers of an organisation are it's people. SoPK lays a lot of emphasis on the stakeholders and people.

If a manufacturing organisation has to do well, it can use SoPK as the foundation stone. It also talks about the Statistical Process Control (SPC) which is important to inculcate to have scientific measurement programme which avoids decisions just based on intuition. A possible way to develop an excellent organisation can be divided into various stages. The first step could be adopting the philosophy of SoPK and introducing various tools which can be specefic to particular organisations. Then we can look further to inculcate Continuous Improvement culture and Learning organisation.

Compared to SoPK, six sigma is a statistical tool which focusses on process improvement and quality management. It requires the support of various other tools to help the organisation develop holistically. Organisations tend to forget the the involvement of people during the implementation of six sigma. It focusses on customer results and cost reduction as a way of cnsumer satisfaction.The implementation of six sigma naturally creates perfect hierarchy structure, which is against the principles of SoPK. Six Sigma aims to achieve whatever is already included in the SoPK.

A better approach can be to implement six sigma keeping in mind the philosophy of the SoPK, taking the implementation step-by-step. There are various possible ways in which six sigma and SoPK will conflict each other. For instance, six sigma has black belt professionals who will implement it in the organisation. Training of all employees comes with a lot of cost hence there will be a hierarchial structure in the organisation which can hamper employee involvement. Lack of six sigma knowledge can have detrimental effect on the organisation violating the principle of "Theory of Knowledge" mentioned in SoPK.

There is one other important aspect about six sigma.Organisations with unstable and unorganised processes should first focus on removing special causes. It is important to stabilize the process first. Then the organisation can move forward and focus on control chart variation and six sigma. There is a module week to follow, I am looking forward to challenge my thought process and have a transformational week.


November 15, 2018

Good Managers MANAGE PROCESS not RESULTS

We all are into a very interesting week of our study, Currenting doing the "Process Improvement Using Six Sigma" module. I believe six sigma is more statistiacl controls and measurements , it is a single loop improvement tool. There is a reason why I am interested by this module. Back in India my organisation does not use the measurement systems to define outcomes, it just uses the experience. If there is a decrease in sales or profits, generally the cited reason is the recent government policies. The question that arises in my mind is , "What if the process of our organisation is not stable enough to support those changes?" It can be possible that the situation never improves if a better process is not introduced.To manage processes efficiently and effectively, it is important to instil the measurement mechanisms. The outcome can not always be a guesswork, it is important to make control charts. I feel control charts could be the first step to start measurement mechanism.

Other inherent feature of human beings is to resist change. Introduction of such mechanisms can cause people to resist it. It may even take some time to get it right. It is necessary to keep on learning the Statistical Process Control. All tye successful manufacturing organisations follow this up, example the control charts and process indicators that I spotted at JCB.

Most maangers fail to understand the concept of common cause and special cause. I look forward to imbibe this teaching in the coming week. Once I have a stable team and a stable workforce, I can go out and look at my processes. But I do not really know how to define stability scientifically. Then probably I can start off by implementing the control charts and even further after I can think about six sigma. It is a powerful tool. One teaching from today, "Never give bonus based on the Common Cause." It is so easy to understand yet so difficult. I always think about quality goods, yesterday it got defined. It means on target with minimum variation. I always have to eye the target. There are no acceptable limits to target. Just the eye of the fish to target. Also,"Averages are meaningless without the knowledge of variation". A very deep thought.

As the blog entry heading suggests, a good manager will only focus on the process, not the result. My mentor MS Dhoni(one of the most prolific cricketer in this era) always talks about the process as well. Slowly and steadily this teaching is dripping down my mind. The hitting the target with the golf ball simulation played yesterday was a good example of this as well. What it taught actually was that do not try to introduce changes without measuring the results. Taking a link from my last blog, think critically before you do something , remove any personal or emotional bias. Most managers end up with changing the process without even having a good sample space by measuring the process.This lands the company into trouble.

Dr. Deming once said, "Drive out Fear" ; therefore if we focus on process and not result we can drive out fear. I think that most of the organisations in my sector are making decision-driven data not data-driven decisions. The only thing that comes into my mind is that it is going to be a very long journey,let's sit tight and enjoy it. Feeling excited and anxious at the same moment.


November 04, 2018

DEVELOPING A SIGHT FOR CRITICAL THINKING

With each and every day you get to learn something new. I had a very interesting conversation with a PhD student the other night. The conversation made me realize what are the areas that I need to focus on as a person to develop a aptitude for critical thinking. The person was debating how he would regard China and India as "poor" countries and not developing countries. The reason for that was the income disparity between the people and how the few influentiual rich people just skew the chinese national income graph above the basic poverty level. First of all I was shocked about the fact and thought how can a potential superpower be called a 'poor' country , but as the discussion went forward I realized what critical thinking actually is.

This teaching is going to be of utmost importance for the rest of my life. I am going to work in the sector which is crowded by several problems. I need to review most of the problems and not be biased towards the outcome of it. Having a perception about a topic and being biased towards it hampers learning. As researchers we all need to look at the various facts and get evidence to back it up. For my further research I need to keep my patriotic feelings aside and research about the problems from a neutral perspective , keeping the emotions aside. This kind of mindset will even help all of us in the long run where we criticaly review various facts and then make our argument, this way we can ensure that we are not stopping ourselves from learning the entire year.


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  • Good post Saurabh. I agree that sustainable success in any field cannot be achieved through a quick … by Paul Roberts on this entry
  • Thank you for your thoughts Paul. Critically analysing the point, most of the business have short te… by Saurabh Kukreja on this entry
  • Lots of thoughts here Saurabh. Picking up on your last point, perhaps the starting point is to consi… by Paul Roberts on this entry

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