Transformational changes in manufacturing in India have been unpacked at the Lean Summit Africa 2018, in Cape Town, holding important lessons for ramping up efficiency and boosting competitiveness in South Africa.
Takayuki Furuhashi, who is considered an international guru in the field of operation management, as well as organisational transformation and leadership development, has helped to transform the manufacturing sector in India.
He told delegates at the conference how he had turned the manufacturing process of tractors in India on its head with his Sell One Make One (S1M1) programme.
He designed a new concept starting from the end-customer to replace the traditional batch production. Instead of producing tractors and then waiting for orders to come in – in a market that often fluctuated – the S1M1 concept works on the basis that every time a tractor is sold at the dealer, a new one is produced the next day.
Once a tractor is sold, the system adjusts, allocates orders and converts them to the assembly list for the next day's production.
“By applying real time across critical aspects across the plant, delivery to farmers is updated in real time. The information flows to the plant to replenish the same models of tractors the next day.”
The programme, which started in 2016, has been extremely successful. The number of tractors produced increased from 9.3 an hour in August 2016 to 12 an hour this year. “This was possible, as we made it extremely efficient, and streamlined production, while delivery requests to suppliers were calculated automatically every day,” said Furuhashi.
There was also a big improvement in supplier performance.
“Mismatching can create chaos. The S1M1, which relies on the flow concept, increases efficiency and productivity. Any industry, not only in manufacturing, can apply the flow concept and they will improve their production,” said Furuhashi.
The new system is an example of the Lean approach, an integrated system of industrial principles that enables companies to reduce waste and costs and, at the same time, boost standards and productivity.
“When I started S1M1, the first step was to implement a mindset change, and then get leaders and employees to forget the old system and introduce a new one,” Furuhashi told delegates at the summit.
Furuhashi has also streamlined the way procurement is done and tightened up on unnecessary waste in automotive sales departments, where he says 80% of current daily jobs can be unnecessarily wasted in sales and scheduling.
Through his Visionary Small and Medium Enterprises, or VSME, programme, Furuhashi has focused on suppliers in the automotive industry. He described an explosion of growth in the Indian car manufacturing industry, which produced only one make of car in 1969 – the Ambassador. Today, India produces one thousand makes of car at a rate of four-million cars a year. It is targeting the production of six-million cars by 2020.