Continuous Improvement: The Lessons of History

Continuous Improvement: The Lessons of History(or, There is nothing new under the sun)

SCM 352

Dr. Ron Lembke

Eli Whitney• introduced interchangeable

parts in large musket contract for U.S. Army

• Interchangeable parts the true secret of Ford’s success

• Made possible by advances in measurement and tool steel

Frederick W. Taylor

• Frederick W. Taylor:

• Father of “Scientific Management”

• Find ways to improve work environment and work processes

• Quantify, measure & track everything:

Time required to haul wheelbarrow:

B p aL

051 0 0048

27127. . .distance hauled

Factory Life

“Schmidt”

Taylor’s Factory

Frank and Lillian Gilbreth• Systematically study a work environment and find the

best way to achieve a particular task

• With Taylor, pioneered “industrial engineering” -- time and motion studies

• “Cheaper by the Dozen”

Motion Capture

• Lights illuminate key motion joints

• For Computer Generation, convert to 3D

Tim Lincecum

Chronocyclegraph light-1914

Typesetter

Bricklayer

Pencil Holder

• Color coded slots

• Groove for grabbing pencil

Ergonomics

Ergonomic chairs

Andrew Carnegie

• Telegraph operator to RR division superintendent

• Adopted latest technology, built first steel plant laid out to optimize flow

• Focused on knowing, lowering unit cost

• Raise prices with everyone else in booms, slash prices in recession

Andrew CarnegieProduction: US England

1868 8,500 111,000

1902 9,138,000 1,862,000

Steel Prices: (per ton)

1870 $100

1890 $12How? Continuous Process Improvement

The Richest Man in the World• Found out strike organizers, fired before

• 1886 “Triumphant Democracy”, Forum magazine-workers’ right to unionize

• 1889 “Gospel of Wealth:” rich need to help the poor ($25m annual income)

• 1892 Homestead strike: 12 hour gunfight, Pinkerton defeated (12 died), state militia called in, strike breakers hired

• 1901 sells out to J.P. Morgan: $480m

• Built 2,500 libraries. “The man who dies rich dies disgraced.”

• 1919 dies, having given away 90%

Skibo Castle

#2 Richest person EVER

Data from Forbes. Picture from BusinessIntelligence.com

Henry Ford

• Continuous Process Improvement

• Advances in metal cutting allowed him to cut pre-hardened steel, produce identical parts

• Standardized parts facilitated standardization of jobs, moving assembly line

• Model T: 1908 $850

1920’s: $250

Vertical Integration• Owned forests, iron mines, rubber plantation, coal mines, ships,

railroad lines• Dock facilities, blast furnaces, foundries, rolling mills, stamping

plants, an engine plant, glass manufacturing, a tire plant, its own power plant, and 90 miles of RR track

• 1927 Model A Production begins• 15,000,000 cars in 15 years• 120,000 employees in WWII

Details to the Max

In his autobiographies “My Life and Work” (1922), and “Today and Tomorrow” (1926), Ford gives great detail on innovations he and his company have made, including:

• Glass making, Artificial leather

• Steering wheels out of Fordite

• heat treating -- saved $36m in 4 years (1922)

• Forging parts, wiremaking

• Riveting, bronze bushings, springs

Kingsford Charcoal

Shigeo Shingo and Toyota

• Toyota’s quest for Quality

• Focused on allowing product to flow through the plant as evenly as possible.

• Kanban and JIT are two important ways to achieve this

• Continuous Process Improvement

1977 1989

The Lessons of History

• Continuously improving your products, your services is the only way you will survive

• Ignore your customers, and they’ll go away

• Those who do not learn from the past are doomed to repeat it.