Last update: December 26th, 2008
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Reconciling diversity and productivity

The challenge for production and manufacturing firms is to reconcile a growing request for diversity and the necessity to master productivity, in order to keep on with competition.
By essence, those two objectives are contradictory, as diversity means fragmentation of production batches, multiplying changeovers, adjustments and more raw material wastes nagging on productivity.

For reconciling these opposite objectives, a decoupling point is built into the line, a point from which production will customize while ahead of this point, the economies of scale are kept.


Let's imagine a filling line for DOGGYDOG petfood.

In case 1 (figure below), the line fills sequencially cans with "DOGGYDOG vegetables" then "DOGGYDOG vitamines", because the initial mixture holds all ingredients for each recipe.


Analyzing the process, the production manager discovers DOGGYDOG recipes have a common base, the "DOGGYDOG neutral". From now on it is possible to split the specific ingredients for different recipes (case 2 in figure above) and add those ingredients the latest possible (postponing).


Advantages of postponement is to keep the benefits of mass production of the first part of the line (common base) AND the flexibility to allocate the base to one or the other recipe, without the necessity of a lengthy changeover from process start.

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Postponement is a response to opposite needs of flexibility (respond to diversity) and productivity (necessity to use resources efficiently).


Author Chris HOHMANN, is managing partner and head of the "Lean et Supply Chain" practice of an international consulting firm.





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