- Manufacturing as a Production Vs. Manufacturing as a Service -
In parts 1~3 of this series, we discussed the complexities hidden within interfaces and the fundamentals that go into the development of interfaces. Today we will take a more detailed look into the trends and prospects of the role of interfaces in typical physical systems manufacturers and their relationship to manufacturers’ cyber systems.
‘The Role of IT in the Interaction between ‘Me’ and You’ (Part 1):
http://www.lgcnsblog.com/it-trend/the-role-of-it-in-the-interaction-between-me-and-you-part-1/
‘The Role of IT in the Interaction between ‘Me’ and You’ (Part 2):
http://www.lgcnsblog.com/it-trend/the-role-of-it-in-the-interaction-between-me-and-you-part-2/
‘The Role of IT in the Interaction between ‘Me’ and You’ (Part 3):
http://www.lgcnsblog.com/it-trend/the-role-of-it-in-the-interaction-between-me-and-you-part-3/
Manufacturing System that Repeats Change
There are 3 main activities that give the core value to the traditional product-centered manufacturing industry. These 3 activities are product development, the creation of complete products through components, raw materials and resources (power, personnel, equipment etc.) and the creation and consumption of goods through product trade (sales and purchasing). In other words, this is the process of making things easier and less expensive and finding ways to sell them. The output of a manufacturer meets the end user (customer) via the supply chain through the design, materials and components that go into the final product or products.
However, manufacturing and supplying products properly to meet customer satisfaction and bring benefits to businesses is easier said than done. This is because it is impossible to avoid the environmental and system uncertainties in manufacturing. So, various studies and technologies are not developed just for the sake of convenience but they are also developed for anticipating, preventing and controlling these many unpredictable variables.
The assembly and production process (left) at an automated Tesla automobile plant (linear) and the non-linear limited production process at a manufacturing plant (right)
(Source: blog.agupieware.com/; tajpharma.com/)
According to the predictions of the futurologist Alvin Toffler, the informatization and personal customization as well as mass customization of today is accelerating. Because of this, manufacturing system management along with large-scale analysis and the relationships between suppliers and customers is becoming globalized. As a result, the competition between companies is also becoming more open and overcoming the boundaries of the convention of space and time. The traditional activities that give core value to manufacturing are changing through the development of IT and manufacturing technology at the dawn of the 21st century industrial revolution. This refers to more efficient management of existing systems through technological innovation, the increase in productivity through atomization and other activities that promote the creation of new value. Also, with the simple in the creation of labor manpower in production environments, the manufacturing industry is now dreaming up new business models to attract diverse stakeholders in all areas of the industry. But what role does IT play in these changes?
Virtual – Physical Manufacturing System
We will now take a look into what basic tangible and intangible items go into a system and how they are connected. Above we referred to the objective of manufacturing systems and the activities that bring value to those systems. This can be explained further through the data below.
General manufacturing system with product and component flow
If we look at the data above, we can see that the combined actions of manufacturing consisting of ‘design – ordering – production – shipping’ are the framework of the ‘virtual – physical system’ that makes up the manufacturing system. This is merely the process of abstracting different standards from 2 systems that implement different input and output formats. This process is divided into the business process (manage information, control physical systems using it and determine through connecting with the other virtual systems based expanded value chain) and physical process (modification of physical objects).
Software such as the most significant virtual manufacturing system, ERP (Enterprise Resource Planning[1]), follows the overall flow of physical product manufacturing. ERP also adds additional value to the information obtained from physical systems through one business process. This revamped information allows for assistance, support and administration for the optimum management of physical systems.
Similarly to virtual system structures such as ERP aggregated modules, embedded physical objects (production equipment etc.) are combined to make up the complete physical manufacturing system. Moreover, these systems are combined to make up bigger systems such as industries or supply chains. We can see something similar to a fractal being implemented here.
True physical systems have their value (materials→components→products) in the real product processing and modification of dynamic independent objects. Based on this basic objective, various subordinate equipments are used for each function and category. While virtual systems such as ERP make it possible to economically track information for the planning, products and materials that goes into making the related product. In this case, subordinate computing modules are used for each function. With the product value focused classification shown in the graphic above, With the product value focused classification shown in the graphic above, the basic industrial activities included in the interaction between enterprises can be categorized as production, logistics, quality control and business management.
At any rate, as we can see in the graphic above, order information and other product related information plays a very important role when 2 or more manufacturing systems are integrated. The arrows in the graphic represent the flow of information pertaining to product orders and other value added activities. The ‘flow of information’ is shown in red and the ‘flow of physical objects’ is shown in blue. The arrows show the macroscopic communication and relationships between 2 different systems.
But what do we do when information required in the communication between 2 systems cannot be converted, or the converted information cannot be properly processed? This is similar to when a soccer player sees a team mate in a great position to score a goal but when they try to pass the ball, they miss the ball completely. So IT plays the role of managing interaction and connectivity between individual systems or entities and their related actions. IT works as the synapse network in the brain but for manufacturing systems.
Household ledger style business system and refrigerator style storage system
Of course an actual manufacturing system is much more complicated but the fundamentals are similar to a household ledger (business system) and refrigerator (storage). When a mother plans and prepares the daily meals (3-4 products per meal) for the home, she refers to the household ledger and the refrigerator. She also prepares meals according to the recipes she knows. Let’s take a closer look at this comparison between a manufacturing system and a mother planning and preparing meals for the household.
The Relationship between the Household Ledger and the Refrigerator
(1) Bread and other side dishes can be ‘Made-for-Stock’ (strategy for when products should be made and when they need to be supplied) or made in advance, or they can Made-to-Order according to what the family requests (orders). This is the strategy for production according to orders and supply.
(2) The inventory of the necessary ingredients (Stock on Hand) against the ledger is checked along with the mother’s extra ingredients stored away and then the mother goes to the supermarket (Sourcing/Procurement Process). The cost of the ingredients and space in the refrigerator are considered and then the appropriate amount (Economic Order Quantity) is purchased to store (Source-to-Stock) and then ingredients that are needed on the spot are later purchased at a local market or ordered when needed (Source-to-Order). This is the strategy for procuring materials.
(3) The mother must begin cooking (Production Process) while considering the type of ingredients and the amount needed (Resource Capability), the number of people (Master Production Schedule), the number of people (Lot Size) and how long the meal will take to prepare (Processing Time/Lead Time) according to her experience (Data Historian) to have the meal ready by dinner time. Then planning must be done for when dishes will be served (Dispatch Rule, Policy) or the order in which dishes are prepared (Scheduling).
(4) Before the meal is prepared, the state of the ingredients must be checked and the mother should know how to cook to suit the taste of the family (Quality Control and Quality Management).
(5) There should also be alternatives such as ordering delivery (OEM, Procurement) prepared in case mother gets sick or the oven breaks or there is some other unforeseen problem.
(6) Pots, pans and other things used while cooking (Resource Equipment) should be assessed (Resource Maintenance) so that planning can be done when they need to be replaced. In the case that there are left over after a meal (Stock, Inventory), it can be thrown away or eaten again the next day.
(7) Also, when there is food left over after a meal, the meal can be modified or items can be added (Sales/Inventory Management) to improve the quality of the meal the following day.
(8) Ingredients eaten and ingredients purchased are recorded in the ledger each day the ingredients are managed in the refrigerator (PLM; Product Life Cycle Management).
(9) Planning is also done for tomorrow, next week or even next month. For example, when vegetables from today are left over, they can be used for a vegetable medley the next day (Short Term Planning). If mother is planning to cook spaghetti on Monday of next week but there are guests coming on Tuesday so a larger and more special meal is necessary, she must adjust the meal plans (Tactical Planning). If meal expenses were too high this month, then she should arrange (Strategic Planning) to lower spending.
Ultimately, the scale will be much different but even with the large flow in a manufacturing system, the decisions are similar. As in the graphic above, the blue text represents ‘things that are related to physical production systems and entities’ and the red text represents ‘things that are related to the management and administration of products/resources, information and business systems. In actuality, the example of the mother and the title of this article are not unrelated. We typically recognize meals we receive at home or at a restaurant as service as opposed to a product. But, considering the hundreds of different foods and hundreds of people that will eat these foods, there is really not much of a difference between this and a manufacturing process. It is harder to get a much clearer insight into management and administration than that. But now we must add OT (Operation Technology) and IT.
We have now discussed the changing image of the manufacturing system and virtual-physical manufacturing systems. In the next installment we will look into the core objects that go into manufacturing systems and the relationships between them.
Written by SeungYup Lee
Finished his doctorate at Pennsylvania State University and is now working as a researcher. Received his masters in industrial systems engineering at Yeonsei University his doctorate in industrial engineering at Pennsylvania State University. Is currently focusing on Formal model based hybrid SoS engineering, Diverse Simulation based methodology (agent, discrete event, system dynamics), manufacturing and supply chain systems, IT-based industry convergence and Cyber-Physical System.
[1] A system for management of integrated internal business process information through various software modules (Production Planning, Accounting, Human Resource Management, Order Processing, SCM and Distribution Planning) for individual functions.
[back to the article]