May 15 2013
Lloyd’s Confuses Lean with Outsourcing | The Strategic Sourcerer
See on Scoop.it – lean manufacturing
“Lean manufacturing practices can create efficiency and reduce waste, but smaller inventories put companies at risk for major supply chain disruptions. Many organizations are reconsidering their procurement strategies for emergency preparedness after discovering their operational vulnerability in the aftermath of the 2011 earthquake and tsunami in Japan, as well as the flooding in Thailand, according to Lloyd’s.”
Since when is purchasing parts from half-way around the world a “Lean manufacturing practice”? Toyota and Honda do import parts into the US from Japan, but they have been working steadily to increase the domestic content of the cars they build in the US.
In a Lean supply chain, you use as many local suppliers as possible and only buy from afar if you can’t help it. And local suppliers are subject to the same disasters as you, and inventory in the pipeline is just one more asset that can be destroyed in the earthquake or tsunami.
In the late 1930s, the German aircraft industry organized its supply chain in a system called “ABC,” which involved frequent deliveries from nearby suppliers and almost no inventory at the assembly site. It was in anticipation of a man-made disaster: enemy air raids. Allied bombs could not destroy components that had yet tp be made.
The article just reiterates the old belief that you can protect yourself against shortages by holding inventory. It may work for crude oil, but not for the 30,000 items needed to build a car. To protect against a Fukushima type event, you would have to keep weeks of safety stocks of all the items all the time, which is not a practical idea.
See on www.strategicsourceror.com
May 24 2013
Canada, a Model for Australia’s Automotive industry? | Business Spectator
See on Scoop.it – lean manufacturing
“Ford Australia’s move to close its two Australian plants from 2016 and transition to import-only brands only reinforces the sense of a looming death knell. But that isn’t the case with every developed-world auto sector struggling to compete with high domestic production costs and cheaper, mostly-Asian-built imports. Canada’s auto sector has also struggled with factors that would sound familiar to an Australian onlooker, such as its own high dollar, volatile domestic demand, offshore competition and wavering government subsidies.
But as much as those conditions in Canada instigated uncertainty, cuts and job losses, that struggle, which gained pace as the global financial crisis took hold, has also produced a level of productivity-focused innovation worth noting for any manufacturer or policymaker wondering if Australia’s auto sector has crossed its rubicon.”
Ford is closing its plants in Australia, which threatens the entire local automotive industry. The author looks to Canada for a model Australia could follow for this industry to survive and thrive. The article is mostly about Canada, and specificially about the Magna Dortec door latch plant Northeast of Toronto.
See on www.businessspectator.com.au
Share this:
Like this:
By Michel Baudin • Press clippings 0 • Tags: Australia, Automotive industry, Canada, Dortec, Ford, Lean, Magna, Toyota, Toyota Production System