Bringing Japanese Continuous Improvement Approaches to U.S. Manufacturing: The Roles of Process Orientation and Communications*

Continuous improvement (CI) has played a key role in Japan's quality management. U.S. companies have begun to adopt CI in recent years. This paper studies the implementation of CI in seven U.S. manufacturing companies. We view values as the core concept of culture that impacts CI effectiveness. Using both qualitative and quantitative data with a sample of seven companies, we observe empirically a relationship between process-oriented values and CI effectiveness. We also find that communications involving workers is strongly associated with CI effectiveness. Finally, we find an association between process orientation and communication frequency, and argue that communications act as an intervening variable between process orientation and effectiveness.     

Examining the Impact of Speed of Quality Improvement on Quality-Related Costs

The Fine (1986) quality-based learning curve model is extended to include the consideration of speed of quality improvement. The model demonstrates that under different circumstances rapid quality improvement effects are either beneficial or detrimental to improvement in quality-related costs. Hypotheses are developed from the analysis of this speed of quality improvement model. The hypotheses are tested in an automotive parts manufacturing company with five similar plants. Results show that with an increase in the speed of quality improvement, the rate of growth in prevention and appraisal costs decrease and the rate of growth in failure costs are unaffected. Rapid speed of quality improvement does yield lesser decreases in failure costs than slower, steadier improvement. However, rapid speed of quality improvement does not yield the predicted lesser decrease in prevention and appraisal costs than slower, steadier improvement. Rapid speed of quality improvement might or might not benefit the organization, perhaps an explanation for some Total Quality Management (TQM) failures. A more deliberate, learning organization is suggested from this research.     

Measuring the Congruence Between Market Requirements and Manufacturing: A Methodology and Illustration*

This paper presents a measurement methodology, based on existing research in the manufacturing strategy and general strategy areas, for evaluating the congruence between market needs and manufacturing plant capabilities. The proposed methodology has several important advantages over current approaches. First, the methodology uses available data and statistical techniques to measure market-manufacturing congruence. As a result, it is not dependent on assumptions about “classic” process choices. Second, the proposed methodology can evaluate the strategic fit between market needs and manufacturing in light of one or more performance criteria. Third, the methodology can be used to derive scalar measures of market-manufacturing congruence, allowing users to evaluate congruence for a large number of products, customers, or market segments. The theoretical basis, research objectives and major steps of the methodology are discussed, followed by an illustrative example from a North American manufacturer. Finally, the applicability of the methodology to a wide range of strategic manufacturing decisions is discussed.     

Vendor Performance and Alternative Manufacturing Environments*

Today, many American firms are demanding a high level of performance from their major suppliers while at the same time reducing the number of them. Vendor performance is an important aspect of maintaining low production costs and high product quality. In this study, we examine the effects of poor vendor quality and vendor lead time uncertainty in a variety of manufacturing environments using a comprehensive simulation model. The results indicate that the effect of poor vendor performance on various manufacturing firms depends on the number of stocking points and the degree of component commonality. Moreover, disruption of the manufacturing system caused by poor vendor performance can be manifested in higher levels of inventory and order backlogs. We introduce the concept of supplyside uncertainty, as it relates to component-part commonality, to demonstrate that in certain environments commonality reduces order backlogs but increases total inventories and creates an environment that is very sensitive to vendor quality problems. Finally, several conjectures are posited for future research.     

Toward an Understanding of the Factors Affecting the Quality of the Audit Process*

The accounting profession has faced increasing pressure from external parties to monitor and improve the quality of the audit process. Similar to other service oriented industries, the accounting profession's ability to meet these pressures has been hampered by the lack of an objective means by which to evaluate process quality. In this research, groups of experienced auditors from two international accounting firms were used to develop and validate a set of key factors influencing the quality of the audit process and a corresponding set of measures for evaluating audit quality. The results support the belief that there exists a consensus among experienced auditors on a set of key audit quality factors which have a significant impact on overall audit quality. The results obtained go beyond those in prior audit quality research, in that the factors identified cover a broader scope and recognize the significant effect of the audit environment on process quality. The consistency between groups in the profession provides support for further use of the nominal group techniques in developing quality measures for processes in other service sector areas.     

A Reexamination of ‘Measuring the Congruence Between Market Requirements and Manufacturing: A Methodology and Illustration'*

This paper reexamines the idea of developing an index of manufacturing fit with market requirements. Bozarth and Berry's (1997) recent work provides a starting point. Several conceptual and methodological issues relating to the Bozarth and Berry approach are raised. It is argued that the indifference profile concept suggested by the authors bears reexamination.     

The Impact of Quality Management Practices on Performance and Competitive Advantage

As decision makers become more involved in implementing Total Quality Management, questions are raised about which management practices should be emphasized. In this exploratory investigation of the relationship of specific quality management practices to quality performance, a framework was constructed. It focuses on both core quality management practices and on the infrastructure that creates an environment supportive of their use. In addition, it incorporates two measures of quality performance and their role in establishing and sustaining a competitive advantage. Path analysis was used to test the proposed model, with multiple regression analysis determining the path coefficients, which were decomposed into their various effects. Weak linkages were eliminated. The trimmed model indicated that perceived quality market outcomes were primarily related to statistical control/feedback and the product design process, while the internal measure of percent that passed final inspection without requiring rework was strongly related to process flow management and to statistical control/feedback, to a lesser extent. Both measures of quality performance were related to competitive advantage. Important infrastructure components included top management support and workforce management. Supplier relationships and work attitudes were also related to some of the core quality practices and quality performance measures. The results were interpreted in light of Hill's concept of order winners and order qualifiers and Garvin's eight dimensions of quality. They indicate that different core quality management practices lead to success in different dimensions of quality, and that those dimensions function differently as order winners and order qualifiers.     

Redesigning a Cellular Manufacturing System to Handle Long-Term Demand Changes: A Methodology and Investigation*

Cellular manufacturing systems have been proposed as an alternative to the job shop since they provide some of the operational benefits of a flow line production process, while retaining to some extent the flexibility of job shops. However, this must be balanced against the possibility of additional initial investments in equipment to form the cells and a certain loss in manufacturing flexibility, particularly in terms of the ability to deal with long-term demand changes. This paper presents a model-based heuristic cell system redesign methodology to deal with such demand changes. The methodology is validated and applied to system designs generated from several data sets published in the literature. Results show that different kinds of demand changes incur distinct kinds of costs. Further, characteristics of cell designs that can handle long-term demand changes at least cost are identified.     

Evaluating the Deming Management Model of Total Quality in Services*

This article uses the Deming management model developed by Anderson et al. (1994b) as an initial template to analyze total quality in services. While the literatures addressing quality management have developed separately for products and services, the founders of total quality portrayed this management philosophy as universally oriented. Our study first replicates two earlier studies that tested the Deming management model in manufacturing industries. Using hospitals as our unit of analysis, we realized findings similar to the earlier manufacturing studies. Next, we used contributions from the MBNQA literature to test an enhanced model. Our subsequent findings support the MBNQA concept that “leadership drives the system that creates results” and provides evidence of the ubiquitous importance of leadership for ensuring the success of a quality improvement program. Finally, an anomaly of this study and those published earlier is the inability to find support for the relationship between continuous improvement and customer satisfaction. Integrating the substantial work in the service quality literature focused on customer satisfaction measurement is recommended to future researchers to help resolve this issue and further enhance the model.     

An Investigation of Scheduling Policies in a Dual-Constrained Manufacturing Cell*

In previous group scheduling studies, labor has essentially been ignored by assuming that enough labor is assigned to each machine in the cell. In reality, however, management usually does not have the resources to employ a laborer at each machine in the cell (i.e., machines need to share labor). Both labor scheduling and group scheduling heuristics need to be administered to manage the cell effectively. This study develops and examines scheduling procedures for a dual-constrained (i.e., machine and labor) manufacturing cell. Eleven decision rules are developed and tested under 16 different experimental conditions. The experimental factors used are interarrival time distribution, cell load, setup-to-run-time ratio, and transfer-to-run-time ratio. Results show that interarrival time distribution and cell load have the greatest impact on the performance of the cell. This suggests that effective production planning aimed at reducing job arrival variation and leveling the cell load can substantially improve cell performance. Among the experimental factors, setup and transfer-to-run-time ratio factors had the strongest influence on the rankings of the decision rules. These rankings were fairly robust across all experimental conditions and performance measures. The results also indicated that the inclusion of labor as a contraint in the cell had a significant impact on the performance of several group scheduling heuristics. Finally, it was shown that the best performing decision rules consider both transfer time and subfamily setup times.     

Important Strategic and Tactical Manufacturing Issues in the 1990s*

This paper reports the identification and ranking of major manufacturing issues that American manufacturing managers and academics must focus on and resolve in the 1990s to be competitive on a global basis. Vice-presidents of manufacturing from over 75 companies across the United States were asked in a Delphi study to rank the key strategic and tactical issues facing American manufacturing in the next three to five years. Based on three rounds of a Delphi study, quality management, manufacturing strategy, and process technology emerged as the top ranked strategic issues. The top ranked tactical issues were quality control, manufacturing planning and control systems, and work force supervision. These issues were valid across diverse industry groups, since the industrial and educational background of the respondents was shown to have no impact on the final consensus rankings and opinions reported in this paper. Factor analysis of the responses by the panel revealed that certain issues tend to be consistently viewed together, and were interpreted accordingly to provide insights into the ranking of issues. Apart from building a consensus among experts on key manufacturing issues of present and future importance, this study can also be helpful for setting future academic research and pedagogical priorities for the field of production and operations management.     

A Comparative Analysis of the Relative Effectiveness of Four Dynamic Lot-Sizing Techniques on Return on Investment

The relative performance of dynamic lot-sizing techniques has been of considerable interest to researchers in recent years. While research has addressed performance in terms of cost-effectiveness, researchers have not determined the impact of dynamic lot-sizing techniques on return on investment (ROI) as it applies to finished goods' schedules. The purpose of this research is to explore the relative performance of four dynamic lot-sizing techniques with regard to ROI, namely the Wagner-Whitin, Incremental Part Period, Silver-Meal, and Groff techniques. Computer graphics are employed to analyze the relative ROI effectiveness.     

The Impact of Alternative Vendor/ Buyer Communication Structures on the Quality of Purchased Materials

This paper examines the critical interface between manufacturing, purchasing, and quality assurance by exploring the impact of two alternative structures of buyer and vendor communication on attempts to improve the quality of purchased items. Those two structures of communication are the parallel structure and the serial structure. The research analyzes and compares the advantages and disadvantages of these two specific communication structures; the results have implications for both researchers and managers. The analysis of data suggests that the parallel structure is associated with significantly higher levels of quality than the serial structure. From a managerial perspective, the results of the research suggest that manufacturers must consider the parallel communication structure as a viable alternative for improving the quality of purchased components. While this study has helped frame some key managerial issues, the need and opportunity for further research in related areas is delineated.     

A Purchasing Framework for B2B Pricing Decisions and Risk‐sharing in Supply Chains*

This paper presents a common modelling structure for (i) the implementation of operational policies by individual purchasing managers of risk‐sharing agreements among supply‐chain partners, and (ii) the integration of brick and click purchasing policies in a B2B. The problem of price uncertainty created within these two environments is modelled as a stochastic repetitive‐sales problem, applicable to any probability distribution. The model identifies sufficient conditions for regenerative ordering cycles, which allows for the use of the renewal reward theorem. The end result is a two‐price purchasing policy, which may substantially ease implementation problems across a global corporation's purchasing managers world‐wide and across B2B markets.     

A Study of Labor Allocation Strategies in Cellular Manufacturing

Current research studies in cellular manufacturing have considered environments constrained only by the machine resource, when in fact the flexibility of manufacturing cells is derived mainly from its allocation of the labor resource. This research specifically examines the labor resource in cellular manufacturing, also known as group technology (GT), through a series of simulation experiments on a hypothetical GT shop and recommends conditions under which different labor allocation strategies may be appropriate. The effects of various product routings and scheduling policies on labor allocation are also examined.     

Causal Linkages in Supply Chain Management: An Exploratory Study of North American Manufacturing Firms

In this paper we investigate the key causal linkages in supply chain management. We propose a conceptual framework and test this framework on data from 215 North American manufacturing firms using structural equation modeling techniques. Three major research issues are addressed in this study: Do sourcing decisions affect the degree to which firms achieve manufacturing goals of cost, flexibility, dependability, and quality? Does the degree of manufacturing goal achievement lead to higher customer responsiveness? Does the degree of manufacturing goal achievement lead to higher internal manufacturing performance? The study examines the relationship among sourcing decisions, manufacturing goals, customer responsiveness, and manufacturing performance. The results support the notion that an integrated supply chain involves aligning sourcing decisions to achieve manufacturing goals that are set to respond favorably to the needs of customers.     

Tandem Configuration Automated Guided Vehicle Systems: A Comparative Study*

Automated guided vehicle (AGV) systems provide the flexibility and integration required for flexible manufacturing systems. Previous AGV system studies have attempted to reduce the controlling complexities commonly encountered in these systems. However, this has not been accomplished without additional resources (e.g., automated guided vehicles) and lower system flexibility. The primary objective of this study is to compare the performance of AGV system configurations that reduce controlling and modification complexities (i.e., tandem configurations) to traditional AGV system configuration. Three AGV system configurations were tested under 16 experimental conditions. Performance metrics considered were AGV utilization, mean flowtime, mean tardiness, and percent tardy. The results of this study extend the findings of the previous studies in demonstrating the viability of tandem configurations, in that the tandem configurations match the performance of traditional configuration across all performance metrics, without sacrificing ease of control and system flexibility. Finally, the cost tradeoffs inherent in selecting a particular configuration are discussed.     

A Simulation Metamodel for Response-Time Planning*

Field service management continues to be a major challenge for many service organizations as companies are required to provide more service with less resources. Especially in information intense environments, short response times for service calls are essential to avoid disruptions to a business office or production facility. Managers must regularly assess their manpower needs, and ensure that their allocation and operational decisions lead to the best service at the lowest cost. Xerox Corporation provides copiers, duplicators, and printing systems to an international market. Xerox operates a service network consisting of over 30,000 trained service personnel, each allocated to service regions by the service planning staff. Response-time planning involves many challenging problems: requirements planning at the national level, allocation planning at the district level, and operational planning at the team level. Customer service is critical and is commonly measured by response time—the time that elapses from when a service call is placed to when a service engineer begins service. This paper discusses how Xerox Corporation has used simulation models and metamodels to improve response-time planning and field service operations.     

A Simulation Study of Sequencing Rules in a Kanban-Controlled Flow Shop*

This paper addresses the problem of sequencing in decentralized kanban-controlled flow shops. The kanban production control system considered uses two card types and a constant withdrawal period. The flow shops are decentralized in the sense that sequencing decisions are made at the local workstation level rather than by a centralized scheduling system. Further, there are no material requirements planning (MRP)-generated due dates available to drive dispatching rules such as earliest due date, slack, and critical ratio. Local sequencing rules suitable for the decentralized kanban production-control environment are proposed and tested in a simulation experiment. These rules are designed so that they can be implemented with only the information available at the workstation level. Example sequencing problems are used to show why the shortest processing time rule minimizes neither average work-in-process inventory nor average finished-goods withdrawal kanban waiting time. Further, it is shown how work station supervisors can use the withdrawal period, in addition to the number of kanbans, to manage work-in-process inventories.