WCM (World Class Manufacturing)

Prepared by Özcan ÇAVUŞOĞLU

1. Meaning & Scope 10. WCM Checklist
2. Criteria 11. Types of Operation Which
3. How a WCM is Achieved ? Creates a WCM Units
4. Characteristics of World-Class 12. Just In Time (JIT)
Organizations Manufacturing
5. How to Make an Organization 13. JIT Improvements to
World-Class? Manufacturing
6. World-Class Manufacturing: 14. CONWIP Control
What it takes? 15. Factors Which Can Make a
7. Implementing WCM WCM
8. Contrasting Mass Production & 16. Some Other Factors
WCM 17. Conclusion: Control of
9. The Grades for WCM Operation
CASE: Fiat

 It refers to the practice followed in a
manufacturing organizations, in order to
consistently deliver exceptional performance,
frequently in excess of expectations.

 World Class Manufacturers are those that
demonstrate industry best practice.

There are two overriding
criteria when using this
checklist to judge whether
your company can be
regarded as World Class

1) How does the company
compare with its best
competition?

2) Has the company
increased its score since
last year?

 Develop the awareness of the need to make the
transition to World Class Manufacturing

 Develop the ability to search for relevant tools and to
apply them effectively

 Monitor progress so that an improvement program can
be systematically utilized.

1. Customer service.
2. Quality control and assurance.
3. Research and development/ new product development
4. Acquiring new technologies
5. Innovation
6. Team-based approach (adopting and using effectively)
7. Best practices (study and use of)
8. Manpower planning
9. Environmentally sound practices
10. Business partnerships and alliances
11. Reengineering of processes
12. Mergers and acquisitions
13. Outsourcing and contracting
14. Reliance on consulting services
15. Political lobbying

1. Worker productivity (improvement)
2. Employee training and development
3. Open communication between management and employees
4. Employee benefits and perquisites
5. Codes of workplace conduct
6. Conflict resolution
7. Employee satisfaction
8. Flextime arrangements
9. Management-employee-union relations
10. Child care

6. World-Class Manufacturing: What it
takes?
1. Competitive analysis strategies (cost efficiencies in operations,
speed to market, research and development supremacy, zero
defects, real-time order management etc.)
2. Production and supply chain (collaborative planning, forecasting
and replenishment, collaborative manufacturing and product design,
supplier-managed inventory etc.)
3. Customization strategies (building to order, customized mass
production, global sourcing and manufacturing, etc.)
4. Electronic commerce strategies (supply management, Internet
ordering, status and availability tracking by Internet)
5. Compensation systems (product profitability, inventory levels,
manufactured/delivered costs per unit, worker productivity, employee
retention rates, etc.)

Success WCM Tools Measurement Indicators
Factors
1. Cost control Just-in-time logistics, · Inventory holdings
quality at source and · Absence of defects and rework
supply chain management · Cost of incoming materials
tools
2. Quality Statistical Process Control, · Customer return rates
fool-proofing to prevent · Internal reject, rework & scrap
errors, Pareto analysis of rates
types and causes of · Supplier quality Performance
production defects
3. External Just-in-time logistics, · Time from customer order to
flexibility quality at source and delivery
supply chain management · Delivery frequency & reliability
tools to customers
· Delivery frequency and

Success WCM Tools Measurement Indicators
Factors
4. Internal Cellular layouts, single unit · Machine changeover times
flexibility flow, production pulling, · Batch and lot sizes
Kanban signaling system, · Inventory levels
single-minute exchange of · Throughput time through factory
dies for rapid machine changeover, · Machine utilization levels
supply chain
management
5. Capacity • Multi-tasking, · Numeracy and literacy levels
to change • Multi skilling, · Labor/management turnover levels
(Human • Quality circles, · Absenteeism rates
resource • Kaizen groups, · Training expenditure and types of
development) • Training, training
• Incentive schemes. · Employee development
· Suggestion schemes/continuous
improvement
6. Innovation Concurrent engineering, · R&D expenditure
capacity new product development · Proportion of sales from
techniques new products

8. Contrasting Mass Production & WCM

Critical Control Mass Production World Class
Points Manufacturing
Logistics · Large batch · Single unit flow production
production · Just-in-time inventories
· Just-in-case · Flexible machinery and
inventories rapid machine changeover
Specialized
machinery
Quality · End of line inspection · Quality-at-source at each
· Reworking of defects part of production process

Work organisation · Division of labor · Multi-tasking and multi
between skilled and skilling
unskilled workers · Continuous improvement in
· Specialized R&D and green areas as well as
product development specialized staff

 "W“ - World class
 "X“ - Very good but not quite
world class – (country class)
 "Y“ - Better than many – (city
class)
 "Z“ - Poor – (village class)

Q1) Do you have a 99% or better level of
customer ser vice (or product availability)?

Grade Criteria

W 99% or better customer service level (on time in full
or availability).
X 95% up to 99% customer service.

Y 90% up to 95% customer service.

Z Below 90% customer service.

10. WCM Checklist

Q2) Does everyone in the company know who the key
customers are and what differentiates the company’s
products and services from the competition?

Grade Criteria
W Everyone knows key customers through a new
employee induction scheme and regular updates,
meetings, notices etc.

X Most people know key customers.
Y Managers know key customers.
Z Customers known mainly on a "need to know" basis.

10. WCM Checklist
Q3) Do all staff who are in contact with customers
have the authority and empowerment to resolve
customer problems?
Grade Criteria
W A person answers telephone calls within 4 rings and takes
responsibility to deal with the call either immediately or by
getting back to the caller within 24 hours. Similar
standards are used for e-mail and written complaints.
X A person answers telephone calls and takes responsibility
to deal with the call either immediately or by getting back
to the caller within 5 days. Similar standards are used for
e-mail and written complaints.
Y Customer problems are dealt with as soon as possible.
Z Many customer problems are outstanding or not
satisfactorily resolved.

10. WCM Checklist

Q4) Do Kanban control your supply chain?
Grad Criteria question
e
W At least 75% of your shipments to customers controlled
by Kanban or vendor managed inventory (i.e. shipped /
delivered based on customer usage) or you are able
and willing to make Kanban shipments if requested.
X Some but less than 75% of shipments under Kanban
control or you are probably able to make Kanban

shipments if requested.
Y You may be able to make Kanban shipments if
requested.
Z You would not make shipments under Kanban control.

11. Types of Operation Which Creates a WCM Units
The Kanban Control Concept

Kanban control Kanban control. The Kanban
means that the Movement of parts messages can take
authority to make shown in blue, the form of an e-
or move an item is circulation of mail, fax, card,
based on that Kanban in red. empty container or
item's usage Machines are require you to visit
unless there has shown as circles their plant to
been a properly and buffers as replenish their stock
approved and triangles. The last of your products
strictly limited buffer is the (usually referred to
deviation finished goods (FG) as vendor managed

12. Just In Time (JIT) Manufacturing
Just in Time manufacturing is a systems approach to developing
and operating a manufacturing system. We will take an example
of banking process:

In short, JIT means making what the market wants, when it
wants it. JIT has been found to be so effective that it increases
productivity, work performance and product quality, while
saving costs

13. JIT Improvements to Manufacturing

In Summar y, JIT
Systems requires
Changes in:
 System Design
 Organization
Attitudes and
Structures
 External
Relationships
 New Management
Priorities
Tim
e

14. CONWIP Control

CONWIP stands for Once the parts are released, they
Constant Work-In-Process, are processed as quickly as
and designates a control possible until they wind up in the
strategy that limits the total last buffer as finished goods. One
number of parts allowed way to view this is that the
into the system at the system is enveloped in a single
same time Kanban cell: Once the consumer
removes a part from the finished
CONWIP control. Movement goods inventory, the first
of parts shown in blue, machine in the chain is
circulation of release authorized to load another part.
authorizations in green.

15. Factors Which Can Make a WCM

Before commencing implementation of control systems
there are always five beneficial things to do which will make
any method of control easier to implement and make the
system work better operationally
(Generally world class manufacturing businesses have
done these things)
 Reduce time wasted in setting and reduce
set up times
 Form Natural Groups (cells)
 Reduce throughput times
 Postpone product mutation
 Remove the trivial many, to focus on the vital
few

 We have started a program designed to achieve the standards of excellence
associated with World Class Manufacturing (WCM) policies: a company
organization methodology that leads to excellence of the entire production
process through the continuous improvement of all performances and the
contribution of all company employees, at every level.

 Our manufacturing facilities use the Fiat Advanced Production System
(FAPS),an integrated model that optimizes production and logistic
processes.

 The program was launched two years ago but the plants of Tychy in Poland,
Melfi in Italy and Bursa in Turkey have already attained a competitive rating
according to World Class Manufacturing criteria

2. WORLD CLASS MANUFACTURING
WorldClass Manufacturing principles apply to all aspects of plant organization,
from the quality system to maintenance, from cost control to logistics, in a
perspective of continuous improvement.

WorldClass Manufacturing (WCM) in fact was born of the collaboration
between Fiat and the best European and Japanese experts, with the aim to
enhance the production standard to a recognized world standard.

The system is based on a systematic reduction of all types of loss and waste
through the contribution of everyone and the rigorous use of methods and
standards.

2. WORLD CLASS MANUFACTURING
 The system is based on a systematic reduction of all types of loss and waste through
the contribution of everyone and the rigorous use of methods and standards.

 Care for the Environment is one of the pillars of the system, encompassing all the
people, regulations and rules of conduct making up our Environmental Management
System (EMS).

 This is the management tool that will enable us to determine, reduce and control the
environmental impact of our manufacturing facilities, knowing that every activity has
repercussions on the environment.

 The system specifies a number of actions geared to the reduction of the
environmental impact of manufacturing activities, both in order to ensure
compliance with the applicable regulations and in order to prevent the waste of
energy and natural resources

3. TOFAŞ
Tofaş has been the best of the world in manufacturing, now it
will set a model for Chr ysler’s world beside Fiat’s.
(18.11.2009)

Tofaş who has been producing Fiat branded passenger cars and
commercial vehicles for 41 years in Turkey with the cooperation of Fiat
S.P.A and Koç Holding and who has manufactured its 3 millionth vehicle in
2009 has received the “Silver Level” (World Class Manufacturing) award, it
has achieved in WCM, with a ceremony, organized in Turkey.

Being the first production center that has achieved “Silver” level in “World
Class Manufacturing” in Fiat’s world, Tofaş’s Bursa factory has been
chosen as the factory who has “the highest quality and who makes the
safest manufacturing” after the last audit, carried out by WCM teams last
week.

3. TOFAŞ
Tofaş has been the best of the world in manufacturing, now it will
set a model for Chr ysler’s world beside Fiat’s. (18.11.2009)

FiatGroup’s CMO (Chief Manufacturing Officer) who has come to Turkey for the
ceremony on Tofaş’s being chosen as the best factory; Stefan Ketter explained,
“Making R&D and manufacturing of important models like Fiat Fiorino, Linea
and Doblo, Tofaş’s place in the Fiat’s world as is very strong without any
dispute.

Tofaş’s success globally is a true example of discipline, quality and success in
this period when Fiat and Chrysler factories are in common action in terms of
production in world’s class”.

World Class Manufacturing

Stefan Ketter

Lingotto - November 8 & 9, 2006

WCM Focus

All Employees

Waste and Losses

Standards and Methods

Lingotto - November 8 & 9, 2006 2

Structure/Objectives

Workplace Quality Maintenance Logistic
Organization

Total Industrial Total Quality Total Productive
Method Control Maintenance
Just in Time
Engineering
& std.

Quality Technical Service
Focus Productivity
Improvement Efficiency Level

zero zero zero zero
Target
waste defects breakdowns inventory

Values People involvement, value creation, customer satisfaction


WCM Principles

1. World Class Safety is the foundation of World Class
Performance

2. WCM Leaders have a passion for standards

3. In a World Class Company the voice of the customer can be
heard in the plant

4. WCM does not accept losses of any kind (The goal is
always Zero: accidents, service & quality defects, inventory,
breakdowns)

5. A rigorous application of WCM methods guarantees the
elimination of losses


WCM Principles

6. In a World Class plant all abnormalities are immediately
visible (Dust & contamination free, tracking, control charts …)

7. WCM takes place in the workplace, not in the office

8. WCM is most effectively learnt by practicing the techniques
with the plant teams

9. The power of WCM comes from the involvement of people

10. World Class companies create the energy of a crisis in the
face of continued success


Main Actual Activities

2005A 2006E 2007E
WCM Basics / Safety

Training / Leadership / Organisation

Cost Deployment

Investments & Fix Plants

Labour efficiency / Capacity Utilization

Environment / Ergonomy

Maintenance Process

Quality Process Improvement

Logistic Process Time


Actual Best Results/WCM Audit

Workplace
Organization Quality Maintenance Logistic

Methodologies
1 Safety New approach
2 Cost Deployment 100 % plants
3 Focused Improvement 147 events
4 Work Place Organization 7 model areas
5 A.M.: Autonomous Maintenance 58 model areas
6 P.M.: Professional Maintenance 34 model areas
7 Quality Control 10 model areas
8 Production Logistic System 4 model areas
9 Early Equipment Management First exercises
10 People development/qualification New approach
11 Environment New approach

100%


Model Area: Tychy/Poland

People Involvement: Proposals/Employee/Year

4,5
Target = 4
4,0

3,5

3,0

2,5
Implementation
2,0 rate 50%
1,5

1,0

0,5

0,0
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec


Model Area: Melfi

Quality: Electric Check Defects - Grande Punto

- 50%


Model Area: Melfi

Productivity: Hours per Vehicle - Grande Punto

-12%
in 8 months


Average Hours/Vehicle

Vs. Benchmark (Harbour Report)
- 20%*
Segment Ranking

A Leadership

B Leadership

C Top 5

D Top 10

LCV Leadership

2006E 2010E

* As result of new vehicle introduction


Labour Productivity Target (Italy/Poland)

100%
Technical efficiency
Losses Waste/Rework - 30% Losses
Line Balancing Range

- 50%
Non Value Added
• Logistic layout
• Time Optimization

Operation
Operation

Actual 2010E


Towards World Class Manufacturing
100

90

Competitive Consolidation /
80
Level
Autonomous
70 Improvement

60 Horizontal
expansion
50

40

30

Knowledge
Saving: > €500mn
20 creation
Model areas
10
2006E 2007E 2008E 2009E 2010E
0
1 3 5 7 9 11 13 15 17 19 21 23 25 27 29 31 33 35 37 39 41 43 45 47 49 51 53 55 57 59 61 63 65 67

months form program launch


WCM - Extension towards Suppliers

Cost Quality Maintenance Logistic

Q M L
€

SUPPLIER
World Class Manufacturing integration/extension
throughout Supplier Process Engineers


WCM - A Corporative Approach

WCM

Implementation,
Auditing and
Best Practice Sharing


WCM (World Class Manufacturing)

More Related Content

What's hot (20)

Viewers also liked (8)

Similar to WCM (World Class Manufacturing) (20)

More from Özcan Çavuşoğlu, Ph.D.(Cand.) (7)

Recently uploaded (20)

WCM (World Class Manufacturing)