Leagile Manufacturing Paradigm Integration


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Analyzing Canon Inc.'s case - helps us to understand the Leagile Concept and also about SEBI + Adaptive Supply Chain Partnerships.

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Leagile Manufacturing Paradigm Integration

  1. 1. Canon Inc.’s Progress to Pinnacle in Europe Last decade, the whole world witnessed an awe striking phenomenon when Canon – a leading name in the imaging industry topped the charts of growth and performance with a very significant boost in the Europe region. The facts mentioned in this study acts a reliable barometer to comprehend how theoretical knowledge is transformed to the real world implementation and attests Canon’s escalation in business.1 Case Study - Canon Europe 1/9/2013
  2. 2. Canon – A Brief Introduction  The corporate philosophy of Canon is kyosei.  Kyosei means „Living and working together for common good‟  A young gynecologist named Takeshi Mitarai with some technician friends formed the first teams of Canon.  They started developing cameras and then followed some major inventions and applications that ranged far beyond the medical field  By the early 1960s Canon had become the dominant Japanese producer of middle-priced cameras.2 Case Study - Canon Europe 1/9/2013
  3. 3. The Growth in Europe Regional Sales Contribution 2008 Europe Americas Others Japan3 Case Study - Canon Europe 1/9/2013
  4. 4. Change in the SCM of Canon – Europe  London, December 3rd, 2007 – Canon Europe, world leader in imaging solutions, appointed Perry Buenen as Chief of Supply Chain Management  In one of the press conferences in the late 2009, Perry said that Canon supply chain infrastructure in Europe followed a highly robust model with strategic hubs to support the network and key growth markets.  The creation of a new distribution hub in Dubai helped them to radically decrease delivery times by up to 26 days, via direct shipment from factories in Japan to Dubai.4 Case Study - Canon Europe 1/9/2013
  5. 5. Concerns in the Old Supply Chain Many Hand Duplication of Not Always Overs Activities Predictable This leads to a decrease There was a lot of Since the supply in the sales efficiency duplication of chain was effective which not only reduces activities throughout to just a considerate customer count but also the supply chain as extent but not fully affects the performance the different DCs optimized, it was of the organization were not linked unpredictable most properly of the times It was very clear that if the flaws would be left neglected, then the backwash would be impenetrable. The team then understood the importance about eliminating these discrepancies and hence, the modifications were implemented.5 Case Study - Canon Europe 1/9/2013
  6. 6. The Proposed Model – A Seamless Supply Chain Reliable & Predictable Cost Process Visibility Transparent Process Alignment Seamless Supply Chain Service & Efficiency •Minimum interference between Supplier and Customer Suppliers •Eliminate process steps - company - cost Canon •Align required process steps •Adoptable supply chain through shared resources Customers6 Case Study - Canon Europe 1/9/2013
  7. 7. Targeted Areas of Change Logistics Network Process & Organization Value Function Consolidated Added Single Ownership Integration Services Inventory Costs Shared Orders Mgmt. Integration Business Principles System & Visibility End to End Clear End to Measurement SLAs Transparency End Standard Premium Legibility Internal Balance External7 Case Study - Canon Europe 1/9/2013
  8. 8. The New Strategy  The two paradigms i.e. Lean Thinking and Agile Manufacturing maybe de distinctly different but they have been combined here for a successful design and a totally operated supply chain mechanism by Canon to stabilize their growth in the market.  Agility means utilizing the market knowledge and a virtual corporation to exploit profitable opportunities in a volatile market place.  Leanness means developing a value stream to eliminate all waste including time, and to ensure a level schedule.8 Case Study - Canon Europe 1/9/2013
  9. 9. The New Model Meeting Customer Requirements Customer Support Fitness for Use Product Service Process Integrity Product Support Elimination of Waste X Flexibility to meet Market Changes Continuous Improvement Flexibility to meet Customer DemandValue = Design Time to Market Quality Assurance - Concept to Delivery Distribution & Administration X - Order Entry to Delivery Inventory Response to Market Forces Materials Lead Time The above model can also be expressed as, Value = Quality x Service9 Case Study - Canon Europe Cost x Lead Time 1/9/2013
  10. 10. The Key Point in Leagility Push Plan Material Flow Pull Pull The Decoupling Execution Stockholding Point Here, the lean paradigm is applied to the supply chain upstream of the decoupling point. A number of value streams were used for the smooth flow of the standard products. The agile paradigm was applied downstream from the decoupling point as the demand was fluctuating and the product variety per value stream increased.10 Case Study - Canon Europe 1/9/2013
  11. 11. Adaptive Supply Chain Partnerships Information Exchange •Quality of Info. •Control Variables Exchange •Mutual Adaption •Privileged Info. •Support System Exchange •Parallel & Simultaneous Backup Cooperation & Use of SEBIs Relationship The use of Standard Electronic Business Interfaces refined the old model so well that this actually led the European distribution centres to meet their demand limits even at a point when the distribution centres used to fall short of stock. year.11 Case Study - Canon Europe 1/9/2013
  12. 12. Conclusion To summarize, the following points were given much attention,  Regional Structure  Limited number of hubs  Shared network for different channels  Limited port of entries  Pre-Installation combined in Distribution Centres  Management & Organization  Functional Inclusion  Order Management  Pre Delivery Installation  Transparency of the whole system (visibility)12 Case Study - Canon Europe 1/9/2013
  13. 13. Conclusion  The two concepts of Leagility and Adaptive Supply Chain Partnership with SEBIs helped the company to amplify the previous flaws that were present in their supply chain and to boost their performance and business by delivering the products on time with value of the product and services kept in mind.  Perry Buenen‟s vision of seeing the European sector giving out the maximum business and customer satisfaction came true when the company hit the charts with a thrilling 33% share of the regional contribution in the year 2008.13 Case Study - Canon Europe 1/9/2013
  14. 14. The famous quote from the Father of Lean Manufacturing – W. Edwards Deming, “Change is required. There is a process of change, just as there is a process of manufacturing, or for growing wheat. How to change is the problem!”14 Case Study - Canon Europe 1/9/2013