AGILE_MANUFACTURING.DOC

1. Agile Manufacturing Transitional Strategies
Presented By:
1. AMIT P. PATIL
(B.E.MECHANICAL, SEM VIII, Fr.C.R.I.T., Vashi.)
Email: amit9333@rediffmail.com
Contact: 9324259956
2. NILESH D.PATIL
(B.E.MECHANICAL, SEM VIII, Fr.C.R.I.T., Vashi.)
Email: nilnilu1@yahoo.co.in
Contact: 9819801127
Abstract
This paper provides an overview of the framework and tools developed at the Agile
Manufacturing and Enterprise Centre (AMEC) at the University of Liverpool to assist Merseyside
SME’s in embracing agility concepts. The framework is based on four main pillars; auditing of
company, auditing of the operating environment, benchmarking and learning from best practice.
This paper describes the overall structure of the framework, detailing the main elements of the
auditing pillars. The paper also describes an agility implementation.
Keywords: Agile manufacturing, Auditing Tools, Benchmarking, Best Practice.

2. 1. Introduction:
The idea of Agile Manufacturing (AM)
has now been around for nearly a
decade. AM is the first major
manufacturing theory that has a sense of
history built into it, in fact integral to it.
This historical perspective is tied to its
acceptance of, and basis on, the notions
of change, uncertainty and
unpredictability. Kidd (1994) shows how
much current manufacturing practice is
still based upon Taylorism and the
scientific management movement of the
late 19th century. He proceeds to explain
how the world today is very different
from the world of Taylor’s era, and yet
we still work to this paradigm. People
are more educated, customers more
sophisticated, and the business
environment much more complex. This
change in perspective, from economies
of scale to economies of scope, can be
seen in a variety of sources underlining
the importance of agility in
manufacturing in the modern business
environment. The AM paradigm
provides the necessary strategic and
tactical framework to allow companies
to behave in an adaptive and flexible
manner permitting continuous evolution
in an increasingly demanding and
competitive market. A number of
sources have already begun the process
of more rigidly defining this framework.
2. Definitions and Boundaries
The Agile Manufacturing can be defined
as:
“The ability of an organisation to thrive
in the competitive environment of
continuous and unanticipated change and
to respond quickly to rapidly changing
markets driven by customer based
valuing of products and services.”
This definition has been widely quoted
together with the Four Principal
Dimensions of Agility that are:
 Enriching customers with total
solution products.
 Mastering change and
uncertainty - Entrepreneurial
Organisation.
 Co-operating to enhance
competitiveness – Virtual
organisation.
 Knowledge-driven enterprise.
AMEC places practical manufacturing
requirements at the centre of agility
strategies. Considering the potential of
multiple business models, and the
potential for multiple manufacturing
strategies (especially within the same
organisation), manufacturing agility is

3. defined as a convenient vision and
starting point for AM strategy.
Manufacturing Agility is the ability to
respond to, and create new windows of
opportunities in a turbulent market
environment driven by individualising
customer requirements cost effectively,
rapidly and continuously.
Essentially the customer, and more
importantly the product requirements
that they represent, are central to
manufacturing profitability. These
requirements must be met at the right
price, to the right quality, and at the right
time. However these requirements are
not static, and the customers needs are in
a state of permanent flux, which has an
inevitable impact on a company, and
requires greater flexibility of that
company. However, due to changes in
the business environment the ability to
fulfil these requirements is under
permanent pressure from environmental
turbulence. AM is therefore the enabling
technologies that permit the drive
towards manufacturing agility as defined
above.
Agile Manufacturing sets out to identify
and apply practical tools,
methodologies, and best practices that
enable companies to achieve
manufacturing agility within a turbulent
business environment.
3. Business Case
The case for agility can be summarised
in the following key interrelated factors:
 Intensified Global Competition:
where companies are competing on
the international stage means that an
individual organisation now has to
compete across a wider array of
products and product features.
 Reduction in lead-time for product
development and the life expectancy
of a product as markets become
rapidly more saturated with products.
Shorter product life cycles require
different enterprise structures
focused on the customer, rapid
innovation, rapid response, and good
quality, all at the lowest cost.
 Diversification of demand for
customers means that rather than
simply greater choice of products,
customers want the products they
want.
 New technologies will always play a
role in increasing competitive
advantage, but technology alone is
no longer the prime mover for
improving competitiveness. The
focus must now be on good

4. technology, a good understanding of
the technology, and good
utilisation/integration of technology
with business needs.
4. The Transition to Agility
Transitional strategies are those
processes identified as best enabling
change within the wider context of an
organisation as a whole. In the world of
AM this is the process of understanding
the effects of change on the target
organisation, what are the capabilities of
the target organisation, and what are the
relevant best practices chosen from a
wide variety of industrial sectors.
Many companies are already employing
elements of agility because the realities
of the competitive environment dictate
these changes, but this is usually outside
of any strategic vision and is approached
in an ad hoc fashion. The lack of a
systematic approach to agility doesn’t
allow companies to develop the
necessary proficiency in change, a
prerequisite for manufacturing agility.
The proposed methodical approach to
agile manufacturing and agility
strategies is based on four sets of tools
(see in figure 1):
 Tools to explore the business
environment (Environment
Turbulence Indicator ETI).
 Tools to identify an organisations
current agility capability (Agility
Capability Index ACI).
 Tools to evaluate current
performance within the business
environment (Agility
Performance Index API).
 Tools for benchmarking and
identifying best practice.
The application of these tools to an
organisation highlights the main areas
for improvement and sets the main

5. performance targets through a Gap
Analysis. The second phase of the
approach is the development of an
agility road map. The agility road map is
based on an iterative process consisting
of five stages (figure 1). The first, which
is based on the result of the gap analysis,
is identifying the transitional strategy
required to meet the agility targets. The
second stage is to plan and implement
this strategy. The third stage is agility
maturity where the agility measures and
procedures adopted become an
established way in which the company
operates. Since an agility strategy by its
nature needs to be dynamic, the fourth
stage is the constant measurement of the
performance against changes in the
business environment. Stage four acts as
the driver for future changes through
identifying new areas for improvement.
Stage five, involves benchmarking
against new and emerging best practice
in the area.
5. Development and Implementation
The approach to designing the Agility
Strategic Framework has been
incremental and the initial research has
focused on identifying and developing
the measures for ETI, ACI and API.
The tools have been tested in a number
of organisations, both SME’s and LE’s.
These companies form the AMEC
steering committee and represent a
variety of industrial sectors including:
 Precision Engineering
 Telecommunications
 Food
 Health
 Chemical
 High Tech
 White goods
 General Engineering
The following sections provide an
overview of how the various tools are
grouped.
6. Turbulence in the Business
Environment and Current
Performance Indicators
The first important step in navigating the
turbulent road of competition is the need
for senses with which to explore the
environment, i.e. to assess change, and
how rapidly change occurs within the
business environment. This allows clear
comprehension of the scope, magnitude,
and intensity of the turbulence
confronting a company.

6. Four key areas have been established
that identify change, turbulence and
disturbance for an organisation:
 Social, technological,
environmental, economical, and
political changes (STEEP) that
affects the operation of all
companies in a region or a sector,
essentially macro-environment
measures;
 The intensity of competition
specific to an organisation;
 The dynamic changes in
customer requirements, which
affect an organisation; and
turbulence in the supply chain.
Turbulence analysis is about
understanding and measuring change.
The key attributes of change to be
calculated are trends, frequency,
frequency acceleration, and magnitude.
Comprehensive evaluation of these
features provides insight into how
violent is the change faced by a
company and the possible vulnerabilities
of a company. Coupled with each of
these turbulence indicators are
measurements which show how well a
company is responding to these
disturbance factors over time
(performance indicators). These two sets
of measurements can then be compared
for correlation, identifying the key
environmental drivers for a company,
and to what extent they influence the
company. These then provide decision
support mechanisms that allow an
organisation to more readily identify its
individual route to manufacturing
agility.
7. Agile Capability, Agility Attributes
and Agility Capability Indicators
The next stage in an organisations drive
to agility is the assessment of its existing
agile capabilities. Such capabilities arise
from what we believe are the key areas
or ‘pillars’ (those components that
support the ideal of agility) of agile
integrity. The model of the Agility
Capability Indicators tool is shown in
figure 3. This shows the key factors of
an organisation and the relationship
between these factors. It is intended that
this model should not slavishly follow
functional divisions, or processes, but
encapsulate the idea of generic
organisational relationships. As can be
seen from figure 3, none of these pillars
stands alone, and the crossover is crucial
to ensure that all perspectives are taken
into account, for example the processes
can be seen from a products point of

7. view, but similarly the products can be
viewed from a process perspective.
Product: What is required by a customer
to fulfil specific needs.
Process: This is how the product (a
solution for customer needs) is made.
People: This is the personnel factor
involved in fulfilling customer
requirements.
Operation: This is how an organisation
manages their response to customer
demand.
Organisation: This is the functional
boundary which provides context to all
of the above.
Within each ‘pillar’, there are sets of
attributes that further define the pillar
and shape its focus in terms of
manufacturing agility. From these
attributes, agility metrics may be
derived, and an agility index established.
i) Product Flexibility
This section measures the ability of a
product/product range to be configured
to produce a maximum number of
variations with a minimum number of
component types and the ability to use
alternative component parts in case of
unforeseen manufacturing/supply
problems. It also covers the ability to
source/manufacture the component from
alternative suppliers/processes and the
ability of the product to be adapted to
achieve new goals such that individual
customer requirements. This is measured
within the framework of the most cost
effective and efficient manner.
ii) Process Flexibility
This section measures the ability of the
available processes to be configured to
meet demand and product variations, to
cope with unexpected problems, as well
as to facilitate new product introduction
in the most cost effective and efficient
manner.

8. iii) Operational Responsiveness
This section measures the ability of a
company and its supply/distribution
network to respond to and take
advantages of market opportunities in
the shortest possible time and in the
most cost effective and efficient manner.
iv) People Flexibility
This section covers the ability of the
workforce to be multi skilled, to
demonstrate high levels of motivation
and exhibit a conscientious approach in
terms of changes in roles
responsibilities, time constraints, etc.
The components of this measure are
shown in figure 7.
v) Organisational Agility
This is the ability of a company to
make/implement effective strategies,
communicate efficiently within its
hierarchy, to be innovative, to create
partnerships with customers and
suppliers, and the ability to work with
others to exploit/create market
opportunities. The components of this
measure are shown in figure 8.
8. Conclusion
From the above we may recognise
aspects that may be shared by other
manufacturing paradigms (e.g. World
Class Manufacturing). It is not perceived
that AM stands opposed to other
manufacturing concepts. Elements and
extensions of best practices documented
in other manufacturing concepts may be
incorporated to support AM, so long as
they are integrated to achieve agility
collectively. Concepts such as mass
customisation, cellular manufacturing,
lean principle etc. can be utilised as
components of an AM strategy together
with methodologies specific to agility,
but individual elements should not be
confused with AM. From evaluating an
organisation’s agile capabilities, the
organisation’s agility mix, i.e., a mixture

9. of areas and metrics that best suit a
specific organisations agility
requirements at a specific time in a
specific industrial sector and market, can
be defined and continually used to
monitor its agile status and guide agility
transition strategies. If, at a later stage,
aspects of the organisations business
activities change, the organisations
agility mix can be altered to match the
new requirements. For example certain
manufacturing organisations will have
few design capability’s in-house, they
may have their designs specified by the
customer. These companies will have a
limited interest in Product Flexibility,
and would be primarily concerned with
Process Flexibility. AMEC perceives
companies as individuals, and a ‘one
size fits all’ approach will not work;
customisation is the fundamental guiding
principle in the strategic framework
outlined in this paper. From the data
collected a number of inferences have
been drawn. Identification of exposure to
disturbance is a key factor, and these
weaknesses can be due to bottlenecks in
the manufacturing process, vulnerability
of key skills within manufacturing
processes, or the limitations of suppliers
of core raw materials. From the
detection of these susceptibilities,
recommendations and priorities have
been drawn up in terms of agility
strategies to build greater robustness into
the individual companies. Other areas
that have been identified have been
within the design process, including
standardisation of parts, and re-use as a
method of reducing design time and
therefore time to market. This
framework and set of tools have proven
invaluable in focusing a business on the
market environment, how change can be
built into the fabric of the business, and
how behaviour of the organisation can
be channelled in an agile direction.

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