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Thinking Beyond Lean

Reviewed by

Alexander KuhneKwakye Oppong

Adekunle Okunoye

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Introduction

• From Lean Management to Multiproject Concept

• Typology of various strategy• Relationship of Organisation to Business

Process reengineering• Description of traditional approches

towards organisation• Center Organisation

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Organisation in Reengineering Processes(I)

• Organisation is sensitive to a set of variables– Business Processes– Infromation Technology Use– Orgnisational Form– People Skills

• All the elements are interdependent– El Sawy focuses on Business Processes while Cusumano

and Nobeoka concentrated on Organisational form– Restructuring of any of the elements has effect on the

performance of the Organisation

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Organisation in Reengineering Processes(II)

Leavitt Diamond

Cusumano & NobeokaEl Sawy Omar

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Overview of Traditional Approaches towards Organisation

• Matrix Organisation– Combines projects with functional engineering

department• Differential Matrix

– Characteristics of Matrix• Row/Column

– Engineers reports to two different heads

» Projects Head

» Functional Head

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MATRIX ORGANISATION

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Product Team Organisation

• Organisation that create independent projects that focus on building one project at a time– Duplication of many functional activities and

component development efforts– Integration of functional departments of

product– Encourages lean practices

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PRODUCT TEAM ORGANISATION

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Key Features of Product Development Process(I)

• Complex and Multiple components• Simultaneous projects

– Lead Time– Engineering hours

• Functional Activities– Concept generation– Product Planning– Advanced Engineering– Product Engineering– Product Engineering– Pilot Production

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• Challenges– Organisation of Project around Functional Activities

• Scale and Scope economies

– Whole Product development Process

• Best result is derived from balancing of the two options

• Company performance is directly propotional to efficeint management of projects– Global and high competition– Adoption of Common Platform

Key Features of Product Development Process(II)

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• Platforms– it defines the basic structure and performance

charateristics of the product and incorporates critical aspects of design and manufacturing know-how

– Technology and Knowledge transfer between projects

– Platform component is most expensive part of product development , hence sharing platform is considered as extremely cost effective

– Quick response to market changes

Key Features of Product Development Process(III)

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Typology of Multiproject Strategy

• New Design

• Concurrent TechnologyTransfer

• Sequential Technology Transfer

• Design Modification

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New Design

• Subsumes Projects starting to develop a platform from scratch

• No technology transfer between projects

• Most appropriate for project that requires latest technology or totally new design

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Concurrent Technology Transfer

• Targeted towards technology sharing between projects

• Sharing of platforms between projects before completion of the preceding or base project

• Encourages Collaboration, Coordination and Communication in design phase

• Cost effective and flexible

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Sequential Technology Transfer

• Reuse base platforms but not concurrently

• Inherit the relatively old platforms of completed projects

• Risk of too many design compromise and poor integration of product features and subsystems

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Design Modification

• Takes over the base platform of the existing product

• Platform is not inherited from another product but from its predecessor

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Concurrent Technology Transfer and Knowledge Transfer

• Most efficient – Engineering Hours

• Reuse of technology• Mutual Adjustments• Conduct Joint design work

– Shorter Time lag

• Feasibility and Efficiency of Communication depends on several factors

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• These Factors can be broken down into 5 different area:– Advance Planning– Mutual Adjustment, task sharing, and joint

design– Transfer of fresh vs dated design– Problems of anonymous designs– Role of a General Manager for Multi-project

management

Concurrent Technology Transfer and Knowledge Transfer(II)

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Advance Planning for Technology Transfer

• Platform transfer requires base platform’s design adjustment to fit the new architecture and specifications

• Factors responsible for changes in platform design includes:– Target Market– Performance requirement– Changes in Fashion

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• The other two strategies has a long time lags bewteen base projects– Due to lack of planning to transfer it to future

projects

• Difficulty in problem of predicting when there is a long time lag bewteen two projects

Advance Planning for Technology Transfer(II)

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Multi-Project Strategies and Average Lead Time

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Mutual Adjustment, Task Sharing, and Joint Design

• Adjustment processes are complicated– Requires multiple iterations of feedback

between two projects– Advance planning has no effect – Possible in Concurrent technology transfer

• Task Sharing

• Joint Design

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Mutual Adjustment, Task Sharing, and Joint Design(II)

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Transfer of Fresh Designs vs Dated Designs

• Dated Design used in Sequential technology transfer and design modification

• Problem with linking the old platform with new components

• Design changes causes increase in Engineering hours

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Problem of Anonymous Designs

• Problem of continuity in transfering the design from base projects– Engineer movements

• Drawings and Written specification

• It is difficult to transfer intangible or tacit understanding without chronological overlap and direct interactions

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Role of GM for Multi-Project Management

• Executives can take quick decision on resources allocation that will enable a product to be reusable for more than one projects

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Center Organisation

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Center Organisation

• Center Organsation– Clusters of similar projects– Duplication of some funtional departments for groups of

similar projects

• Semi Center– Clusters of similar projects– Centralised Functional departments

• Largest firms use Centers or Semi Center structure while smaller firms use Matrix Organisation

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• It simplify project management and promote component sharing

• Encourages frequent development of quick products with lower costs

• Ideal organisation that supports knowledge transfer

Center Organisation(II)

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Functional vs Project-Centered Organisations

• Project-centered – Breaks wall between functional departments.– Engineers gain from cross-group meetings and

interactions with other engineers

• Functional organisations – Engineers up-to-date– Better position to produce radical innovation

• Project Centered vs Functional Organisation– Rate of technical Changes– Length of Development project– Degree of Interdependency

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Organisational Requirements for Multiple Projects

• Communication and Coordination Mechanisms– Engineers has to communicate well and coordinate

their work properly• Component transfer is related to its interdependency on

other components

• Knowledge Retention and Transfer Mechanisms– Local Knowledge– System or Integrative Knowledge

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Conclusion

• Changes in project organisational structures affects product development processes

• Concurrent technology transfer is the best strategy that supports Knowledge transfer and sharing

• Organisation form and Business processes as elements of organisation when adjusted has effect on the performance of the organisation.

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References

• Cusumano et al(1998) “Thinking Beyond Lean- How Multi-Project Management Is Transforming Product Development at Toyota and Other Companies” New York The Free Press

•  • El Sawy Omar (2000) “Redesigning Enterprise

Processes for e-Business” McGraw-Hill•  • Nonaka, I(1994) “Dynamic Theory of

Organisational Knowledge Creation” Organisation Sceince/ Vol. 5 No 1 ,14-37