“Leagility” - Essay Example

The term “Illegality” was introduced in the supply chain design to avoid or minimize inflexibility and overage in the supply chain by making it lean and agile. This will keep production cost down and allow the supply chain to be flexible enough to keep up with the uncertainties and rapid changes on product demand. The term Illegality is based on two paradigms: “Lean” and “Agility” operations, not only by the combination of the two words, but also by the combination of the two meanings. This combination will be explained later in more detail.

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This paper discusses the term Illegality in reference to supply chain design and how the term came to be. It will also provide a detailed definition of what Illegality means ND how it’s a critical part of the supply chain, to include how the two paradigms “Lean” and “Agility” work to make a profitable supply chain. This paper will provide facts and opinions from different reports and write-ups from subject matter experts, news reports, and other documents. Lean manufacturing prospered in the asses and continues to be talked about today.

However, in pursuit of greater flexibility, elimination of excess in inventory, shortened lead-times, and advanced levels of quality in both products and customer service, industry analysts have popularized the terms “world-class manufacturing” and “lean reduction” (Sheridan 1993). In the asses, industry leaders were trying to formulate a new paradigm for successful manufacturing enterprises in the 21st century; even though many manufacturing firms were still struggling to implement lean production concepts. In 1991, a group of more than 150 industry executives participated in a study.

Their efforts culminated in a two-volume report titled “21st Century Manufacturing Enterprise Strategy”, which describes how US industrial competitiveness will or might evolve during the next 1 5 years. As a result, the Agile Manufacturing Enterprise Forum (AMBER) was formed and the concept of agile manufacturing was introduced. I To really understand the term Illegality we must first define what “Lean” and “Agility” means in today’s supply chain. Leanness is the production process that eliminates all sorts of waste to include time in order to ensure a level production schedule.

Agility refers to the ability of an organization to exploit profitable opportunities in a volatile market place using market knowledge and virtual corporation. For many, “Lean manufacturing” and “Agile manufacturing” sound similar, but they are not. Lean manufacturing is a response to competitive pressures with limited resources. Agile manufacturing, on the other hand, is a response to complexity brought about by constant change. Lean is a collection of operational techniques focused on productive use of resources.

Agility is an overall strategy focused on thriving in an unpredictable environment based on the needs and demands of the customer. Focusing on the individual customer, agile competition has evolved from the unilateral producer-centered customer-responsive companies inspired by the lean manufacturing refinement of mass production to interactive producer-customer relationships. I Leanness and agility were considered tradeoffs, but Anally et al. Propose the injection of the two paradigms with a decoupling point embedded in the value chain.

The decoupling point represents the point that a customer order turns into a production plan and is depicted by the value chain strategy. The further the decoupling point moves up the value chain, the more the value chain is configured around customer pull. The decoupling point also represents the natural stockholders point to account for variability. It is critical to note, however, that agility and leanness cannot be employed at the same point in a value chain design. Surprisingly there are many similar characteristics of leanness and agility.

Table 1 shows these characteristics and how each relates to each paradigm. Table 1 The importance of different characteristics of leanness and agility ii Characteristic Lean Agile Use of market knowledge Essential Essential Virtual corporation’s stream/eliminated supply chain Essential Essential Lead time compression Essential Essential Eliminate waste Essential Desirable Rapid reconfiguration Desirable Essential Robustness Arbitrary Essential Smooth demand/Level schedule Essential Arbitrary It is noticeable that the characteristics are remarkably similar with the exception of robustness and smooth demand.

To be responsive, an agile manufacture must be robust, in that it must be able to respond to the changing demands of the end-user. However, a lean supply chain is only efficient under relatively smooth demand. The concept of a decoupling point in the supply chain design can make these two mutually exclusive characteristics compatible. Iii Under a networked supply chain, each participant must determine which strategy to pursue based on its customer’s requirements, where its customer is the next link in the supply chain.

Ultimately the decision is based on the end-user of the entire apply chain and the ability of the supply chain to control demand through customer relationships or information technology (IT). The decoupling point is characterized by level demand upstream and variability downstream. As a result, the upstream process is push plan, pull execution; thus the need for leanness and the downstream process is a flexible pull based on the customer’s order.

The number of value streams converges at the decoupling point, as sub assemblies and components are brought together according to the end-user’s order. In this respect the decoupling point is related to postponement, and the closer the decoupling point moves mainstream, the more customized the product becomes. Iii In conclusion, the term “Illegality” is based on two basic paradigms “Lean” and “Agility”.