Int. J.

Production Economics 8182 (2003) 95102

Agility and mixed-model furniture production

Andrew C. Yaoa,*, John G.H. Carlsonb
b a California State University, Northridge, CA, USA University of Southern California, Los Angeles, CA, USA

Abstract The manufacture of upholstered furniture provides an excellent opportunity to study the impact of lot size and a comprehensive communication system on classical production management functions. The objective of this paper was to study a production system that has implemented concepts inherent in MRP, JIT and TQM while recognizing the need for agility in a somewhat complex and demanding environment. For agile production it appears essential that an on-line, real-time data capture system provide the status and location of production lots, components, subassemblies for schedule control. Current status of all material inventories and work in process is required to develop and adhere to schedules subject to frequent changes. For the large variety of styles and fabrics customers may order, the exibility of small lots and a real-time, on-line communication system is required. Such a system can provide timely, accurate and comprehensive information for intelligent decisions with respect to the product mix, effective use of production resources and customer requirements. r 2002 Elsevier Science B.V. All rights reserved.
Keywords: Agile manufacturing; Lean manufacturing; Mass customization; Automatic data collection

1. Introduction The company studied is one of the largest producers of upholstered furniture in the world. The major products include chairs, recliners, sofas, love seats and modular seating groups sold through domestic and foreign furniture retailers. The image of most large mixed-model furniture manufacturing facilities is one of a hybrid owshop incorporating many concepts from JIT with the support of a comprehensive MRP system (Monden, 1993). Flexibility, however, is required
*Corresponding author. 512, Woodruff Avenue, Arcadia, CA 91007, USA. Tel.: +1-818-446-2845; fax: +1-818-6776079. E-mail address: cyao@csun.edu (A.C. Yao).

to accommodate the dynamic workload imbalances inherent in producing different furniture styles. Skilled, cross- trained employees ameliorate some of the imbalances inherent in mixed model production. The employees demonstrate a commitment to the objectives of continuous improvement, high individual and team performance and total quality management. They exhibit pride in their skills, attention to quality, work pace, teamwork and their years of service. This is a tribute to the companys dedication to high-performance practises that include effective recruitment, comprehensive selection procedures, extensive employeeinvolved training, plus quality and performance measurement programs and nally, incentive compensation. The theme is repeated many times.

0925-5273/02/$ - see front matter r 2002 Elsevier Science B.V. All rights reserved. PII: S 0 9 2 5 - 5 2 7 3 ( 0 2 ) 0 0 3 5 9 - 6

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High performance and high quality are not only compatible but also mutually benecial to the individual and to the company (Bayo-Moriones and Merino-Diaz de Cerio, 2001). To increase manufacturing responsiveness yet reduce costs incurred by frequent changeovers, the company transformed the factory several years ago into an agile manufacture facility. This agility copes with changes in customer requirements including price, quality, customization, and promised delivery dates (Christian and Zimmers, 1999). The lean production system works jointly with agile manufacturing to keep the units moving smoothly through the plant and to the customer. The lean system produces products with reduced lot sizes, exible equipment and skilled operators to quickly change from one small batch to the next thereby minimizing WIP. The shorter production cycles reduces delivery time. In addition, the higher throughput allows pricing to be more competitive that is leading to a higher market share (Narasimhan and Das, 1999). To remain agile in its competitive environment, the production system must be responsive to frequent changeovers in the production lots and frequent adjustments to the schedule. To meet the demands for a exible yet lean system, a computerbased communication system is required which links all departments including procurement and marketing. Extensive use of barcodes permits online tracking of work in process, output and quality control at every stage. Accurate transactions are also essential for successful operation of the individual and team incentive programs that are common in this industry. To aid and support both agility and leanness, recommended combinations of fabrics available in the many style families limit customization. In other words, there is a manageable limit of the combination of up to 900 fabrics going into approximately 50 styles (45,000 possibilities?). Furniture designers and stylists specify the fabrics that appear best with each style and these are published in catalogs. The limited variety allows generic bills of materials (BOMs) necessary for the MRP system to generate material requirements for the production batches. However, special orders

using any product style and fabric available can be produced under special circumstances. A limited variety allows greater responsiveness to the market both in production time and procurement time. Small batches of the limited variety can be produced in less time than trying to recapitulate orders for a large variety of fabrics and styles into an economical production batch. Thus, Production Planners together with computer sort routines can more easily aggregate customer orders into batches and better serve the delivery commitments. The manufacture of upholstered furniture is similar to automobile manufacturing. For example, a chairs wood frame, analogous to an automobile frame, can be visualized starting down a line with the sub-assembled seats, backs and panels added at subsequent workstations. Similar to automobile production, the variety of styles (basic frames), fabrics, colors and special options, generate a huge number of possible combinations of end-item units. The product variations, scheduling options and shipment commitments, identify large scale, semi-custom furniture manufacturing as a very complex and demanding endeavor. The scheduling activity for this mixed model production mode must provide for exibility yet maintains synchronization among and between the producing departments (Christian and Zimmers, 1999).

2. Agile and lean manufacturing To be agile in this competitive environment, the company set objectives (as shown in Fig. 1) for the production system to be more responsive to customer demands, be able to adjust schedules more frequently, anticipate and avoid production delays and detect quality problems before they became disruptive (Katayama and Bennett, 1999). The keys to meeting these objectives was to drastically reduce the lot size and install an online, real-time communication system throughout the organization with special emphasis on the production oor. A semi-custom furniture plant can still be characterized as agile if it is exible and can

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Responsiveness, Customization, Competitive Pricing

Agile Furniture Production

Modern Tech, Skilled Workers, Efficient Facilities Small Lots, Quick Changeovers, Minimum WIP

and supervision to make easier and faster changeovers constantly review the changeover tooling. The schematic of production ow for an upholstered chair is shown in Fig. 3. As indicated, the cutting of the fabric signals when to start production of the frames and other subassemblies. The only WIP inventory is the amount of a batch or lot between operations. The batches are synchronized so they arrive simultaneously at the appropriate time and place along the nal assembly line.

3. An information system
Fig. 1. The objectives of agile production.

respond relatively quickly to customer orders, modest changes in production volume and schedule changes. The production lot size must be small in order to easily reschedule orders and provide better customer service. It must be able to switch to another style with little disruption given that the system shows the availability of materials. The changeover times must also be very short to minimize WIP at each stage of production. Production aids and xtures must be relatively simple and easily exchanged (Michel, 1997). Because the products themselves consume large amounts of space, upholstered furniture manufacturing must implement a lean manufacturing system to keep the product moving through the plant and to the customer. A lean system uses its skilled work force and exible equipment to quickly move from one small batch to the next thereby minimizing WIP. The skilled furniture workers can more easily accommodate product variety than mass production workers can. They are usually more involved in methods improvement, material handling, equipment maintenance, quality improvement and other activities involving teamwork. Limiting the variety of options available to customers can enhance agility and leanness. Limiting the options can assist in simplifying the Bills of Material and consequently the MRP processing and control. It also allows for more agility by reducing or maintaining small lot sizes and releasing them more frequently. The operators

A comprehensive computer-based communication system (as shown in Fig. 2) operates with a server (main frame) and numerous data collection terminals, PCs and printers. Extensive use of barcodes provides on-line tracking of work in process, output and quality at every stage. Accurate, valid transactions are essential for the success of a tracking system and the resultant output of reports and analyses. Once the production order has been released, the customer orders can be tracked throughout the production and distribution phases. The ADC system provides real-time status with respect to materials, work in process, and nished goods. The system tracks the schedule status and location of each batch of individual orders moves through the plant. The operators enter operation data via scanner terminals and have the primary responsible for the datas accuracy. In real time, the system updates MRP data such as planned orders, on hand, gross requirements, when, where, and quantities. Materials managers and suppliers can track the status of all fabric and component inventory. Production supervisors can monitor orders throughout the plant while customers can track the status of their orders as they are shipped. 3.1. Manufacturing decision support systems (MDSS) The purpose of an MDSS is to provide a realtime image of the factory oor, the products

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Interfactory Exchanges

Suppliers

Manufacturing Information System

(ADC, MRP, TQM, Designs)

Customers

Real Time Material INV Status

Real Time WIP Status

Real Time F/G INV Status

Production Schedules

Shipping Schedules

Fig. 2. The MDSS schematic.

moving through it, the operations performed and possible bottlenecks. It also provides visibility to discover the location and amount of WIP staging. Most MDSS systems interface directly with the workers on the oor via the automatic data collection (ADC) terminals. With ADC, data is instantly available for management and operator decisions. It can also effect improvement in quality, productivity, customer satisfaction and protability (Knill, 1996). With an MDSS system in place, it is possible to research the impact of such a system on almost all production functions. These include product quality, delivery performance, employee relations, personnel training and performance, raw material and WIP inventories, order status and location, vendor performance and in-plant and interplant communications. Modeling and/or simulation of one or more aspects of this make-to-order environment can produce insight into the heuristics most helpful in coping with scheduling and other complexities. The comprehensive use of barcodes and ADC devices builds and maintains a database for tracking and monitoring production. With ADC, the database updating is performed with selfchecking, accurate data. The system provides immediate real-time status of orders with respect to the schedule and location of work in process of each order as it moves through the plant. Data capture via scanning is especially convenient for

operators, relieving them of clerical tasks and freeing them to concentrate on production. Instant signals of delays or other problems are available and periodic on-line data analysis can be performed to detect trends (Staneld and Watkins, 1996). For furniture production, the on-line database yields information on the availability of upholstery fabrics, piece parts and subassemblies such as wood frames. Signals of problems and quality control data can be retrieved. In addition, operator performance data is captured for the individual and group incentive program. In addition, Customer order status and shipping data is available for customer relations.

4. Production details As shown in Fig. 3, production begins with laying out fabrics into layers forming a lay. The fabrics are then cut into component pieces generated by a numerically controlled laser cutter with the patterns stored in its computer memory. From this point on, each fabric piece becomes an individual entity to be controlled and consumed in the upholstering process. After cutting, the individual sets are passed to sewing stations for joining and then distributed to upholstering departments for separate seats, backs, panels and body. The integrity of the lay sequence is to be

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Virtual Kanban

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MAKE PANELS

UPHOL PANELS

WOOD PARTS, HARDWARE INVENTORY

SEAT FRAME

SPRING SEAT

UPHOL. SEAT

BACK FRAME

SPRING BACK

OPHOL BACK

STUFF ST & BK FABRIC INVENTORY LAYUP 15 COVERS

N/CLASER CUTTING GATHER & SEW

Virtual Kanban

INSPECT PACK

PLYWOOD, MECHANISM INVENTORY

ARM FRAMES

ASSEM BODY

UPHOL. BODY

ASSEM CHAIR

SHIP
MECH. SUBASSY

ASSEM FINISH

BASE OR FEET

Fig. 3. Flow chart.

preserved so that all the sewn components of a unit arrive at their next operation in that same sequence. The obvious objective is that the specic sub-assemblies for a unit arrive together at nal assembly. The cutting operation thus commits subsequent production operations to process the individual orders in the same sequence. In garment and other soft goods manufacturing, manually cutting material with an electric knife requires highly skilled operators. Manufacturers using wood, fabrics and other raw material have known for centuries that the cutting operation can govern prots or losses. For manual cutting, the lines of a pattern placed on top of a lay have to be followed within millimeters or the pieces cannot be sewn correctly. N/C laser cutters yield very precise cuts in a matter of a minute or less. The wood frames are bulky and difcult to transport and store even temporarily. The oor space needed for frame assembly WIP is contingent on the cutting schedule. The frame

departments must therefore closely synchronize their production of the different style frames with the fabric cutting activity. 4.1. Scheduling Scheduling of production involves both pull system and push system objectives. The pull is derived from the economic need to pull items through the system in a sequence that attempts to allocate output to specied delivery routes. The push is derived from aggregating and scheduling due dates while attempting to produce in economic lots (Kubiac and Sethi, 1991). The complexities imposed on the production system by the variety of styles, colors and options requires a well conceived schedule and an on-line, real-time data communication system for control. A cost effective production schedule is contingent on consolidating the units ordered into batches or many common styles that also

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1. 2. 3. 4. 5. 6.

Promise Dates (Maintaining Customer Relations) 400 Units Per Day (Required Production Rate) 15 Units Per Batch (Standard Lot Size) Fully Loaded Delivery Trucks by Route Fabric & Component Inventory Availability Potential Production Problems or Bottlenecks

Fig. 4. Scheduling constraints.

recognize shipping routes. The schedule synchronizes all activities with the cutting operation. The ADC system maintains complete on-line visibility of the factory oor in terms of the schedule. With this information, some exibility in the schedule can be tolerated when encountering problems requiring immediate attention. Scheduling production (as shown in Fig. 4) is constrained by several major and perhaps conicting objectives. Grouping the orders by Style and Promise Date subject to providing full truckloads by delivery route is a major goal. A rough-cut grouping of the orders by styles and due dates and then by truck route can be performed using computer sort routines. The preliminary schedule can then be adjusted manually to include other orders to help ll a truckload and/or ll a batch (15 units) or avoid potential production bottlenecks (Pleschberger and Hitomi, 1993). 4.2. Pull vs. push systems Regardless of whether a manufacturing system is an MRP push-type or JIT pull-type or a hybrid, the lot size has a major impact on performance, productivity, cost, exibility and quality. Prior to the installation of a numerically controlled, lasercutting machine, variable batch sizes of 50 or more were launched. Using chalk patterns, skilled workers and a manually controlled knife, the layers of fabric were cut into the many pieces required for the chair components. Coping with pattern changes, schedule changes, time to layout and cut the lay, the material handling, labor time, space and changeover complexities of the downstream operations, negate the benets of a large lot. By installing an NC laser cutter, the changeover time was in seconds. Using any

economic lot-sizing model, the lot size could be signicantly reduced. A standard lot size of 15 units per batch was selected in recognition of the changeovers required in the parallel and downstream operations. It took planning and experimenting before the lot size of 15 became comfortable for the operators. Initially there were several problems to overcome. The lot size could have been reduced incrementally and the production system tested for each quantity but common sense prevailed. Some companies that have implemented the small-lot JIT principle discovered the pragmatic way to implement smaller lot production is to put the system under the stress of more frequent small lots and observe the results. One JIT oriented company, for example, continually tests the production system with smaller lot sizes per kanban and fewer kanbans cycling through the operations. This drives the WIP inventories down, reduces the oor space required and encourages continuous improvement in the processing, movement and quality of the products (Sianesi, 1998). In an agile system, operators must be able to quickly and easily changeover an operation or subsystem to a new product or variation of an existing product. When the lot size was reduced to 15, the impact of smaller lots on the operators was anticipated and the company invested signicantly in improved xtures and other tooling. Without better methods and tooling, the time lost from frequent changeovers could have led to increases in WIP and lower operator productivity and earnings. To illustrate, an output of 400 units per 8-hour shift is about one unit every minute. With a lot size of 15 units, approximately 25 lots are processed per shift. This approximates a changeover every 16 minutes at several of the stations. With an item cycling through an operation every minute, any interruption can cause signicant problems in space utilization, handling, lost production and possibly quality as workers strive to catch up to the schedule. The small lot size and space restrictions require close control of quality. If a problem does occur, the low WIP inventory demands quick resolution. Of the few problems that the company may

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experience in production, workmanship exemplied by tailoring cosmetics in the upholstering operations is always the primary area of concern. 4.3. Day to day operations Easy access to manufacturing data is essential to production, quality control, material control and perhaps every function in an organization. Data collected in real-time ensures data accuracy and reliability. Having accurate and current data aids communication among the supervisors, operators and other functions such as quality, accounting, sales, engineering, maintenance, etc. With ADC and the software programs, the status and location can be known instantly and an accurate, valid shipping date veried. Inquiries regarding orders in process can be answered in a matter of seconds. Real-time information allows everyone the ability to make better decisions. It provides condence about the accuracy and validity of the information and eliminates guesswork. The faster that data is collected; the faster it can be acted upon. The visibility available helps identify opportunities for maintaining synchronization on the production oor. The most signicant change implemented in the production system was the reduction in lot size. In upholstered furniture manufacturing, the number of layers in the lay represents the lot size. Cutting 50 at a time would appear to be far more economical than 15 or 10. However, schedule changes, materials variations or shortages or any other problems in processing a lot, the whole lot of units may be affected. Stopping production would affect the other lots, interrupt ow and increase WIP. To borrow the adage from JIT, the decision to stop the line to keep it moving can be invoked when found necessary. In this case, only a maximum of 15 minutes of lost production a work station would be incurred and this can easily be made-up by rescheduling or re-balancing using labor or other resources. The constant work in process or CONWIP method initially appeared to offer an approach to the re-balancing of operations that is frequently needed (Nicholas, 1998). The re-balancing is done at present with the intervention of the experience

and knowledge of production planners, workers and supervision. For example, there may be several lots waiting to be released to cutting. Rules or heuristics could be invoked that suggest which lot or batch to be processed next. This next lot may have a workload balancing effect that would try to compensate for an apparent or detected unbalance in the production ow within any of the parallel subassembly departments. For example, if the sewing department is overloaded, the next lot to be released should attempt to reduce the load in sewing relative to the other functions such as frame building. If this rebalancing can be done continuously, the WIP would remain fairly constant. Information regarding the workloads is available on-line at present. For the re-balancing, production has many options including reassigning personnel or rescheduling orders to be released. With small lots, the number of options is larger but the consequences of local, temporary imbalances are less severe.

5. Summary The key to balanced and synchronized production in this company is the lot size. Small lots can better accommodate changes in schedules, changes in methods, changes in materials handling and changes in product design. A cost effective production schedule is contingent on consolidating the units ordered into styles, developing batches (lays) that recognize shipping routes, synchronizing all activities with the cutting operation, maintaining complete on-line visibility of the factory oor plus giving immediate attention to problems. Cross-trained, skilled operators perform short-term balancing. Long-term balancing requires review of the physical facilities, technologies, capital requirements, education and training programs. Through its emphasis on personnel relations, training, communications and applications of fundamentals of MRP, plant layout, materials handling and JIT, the company continues to be a showcase of modern production management. It thrives by producing products of better quality, with on-time delivery and at lower costs in its

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A.C. Yao, J.G.H. Carlson / Int. J. Production Economics 8182 (2003) 95102 Christian, P.H., Zimmers Jr., E.W., 1999. Age of agile manufacturing puts quality to the test. Quality Progress 32 (5), 4551. Katayama, H., Bennett, D., 1999. Agility, adaptability and leanness: a comparison of concepts and a study of practice. International Journal of Production Economics 60, 4351. Knill, B., 1996. Applications of management execution systems. Industry week 245 (9), 8. Kubiac, W., Sethi, S., 1991. A note on level schedules for mixed model assembly lines in a JIT production system. Management Science 37 (1), 121122. Michel, R., 1997. Capture the action. Manufacturing Systems 15 (1), 30. Monden, Y., 1993. Toyota Production System, 2nd Edition. Institute of Industrial Engineers, Norcross, GA. Narasimhan, R., Das, A., 1999. Manufacturing agility and supply chain management practices. Production & Inventory Management Journal 40 (1), 410. Nicholas, J.M., 1998. Competitive Manufacturing Management. Irwin, Homewood, IL, McGraw-Hill, New York, pp. 284289. Pleschberger, T.E., Hitomi, K., 1993. Flexible nal assembly sequencing for a JIT manufacturing environment. International Journal of Production Research 31 (5), 913. Sianesi, A., 1998. An analysis of the impact of plant and management variables in a multi-stage, mixed model production system. International Journal of Production Economics 56/57, 575579. Staneld, P., Watkins, M., 1996. Achieving success with production monitoring. Industrial Management 38 (5), 18.

competitive market. They have agile operations through its exibility in responding to the market and schedule changes. They have also a lean operation by focusing on minimizing waste of materials, space, manpower, rework, WIP and lead time while increasing its ability to meet customer demands. There are a large number of potential research projects in this comprehensive environment. For example, the economic and behavioral impact of further reduction in the lot sizes. This would include studies of within-lot learning, applicable new technologies, etc. A mixed-model production algorithm could possibly be adapted or another developed to assist in the dynamic decisionmaking in this hybrid environment. Simulation using company data may also assist in developing dynamic re-scheduling heuristics.

References
Bayo-Moriones, A., Merino-Diaz de Cerio, J., 2001. Quality management and high performance work practices: do they coexist? International Journal of Production Economics 73 (3), 251254.