The Search for Simplicity

Dec. 21, 2004
Meeting the challenge of increased complexity in manufacturing systems.

Today's manufacturing executives might easily be forgiven if, every now and then, they sit back, rub their temples, and long for a return to the simpler life of "the good old days." Engulfed by escalating marketplace demands, rapidly advancing information technology, increasing product and process complexity, and other challenges, many wonder how they -- and the organizations they lead -- will continue to cope. Thus, it's not surprising to find an emerging wave of interest in the subject of simplicity -- enough interest, in fact, that the group planning the annual conference of the Assn. for Manufacturing Excellence (AME) in Toronto this October chose the theme: "Simplicity: Mastering the Complex." "Simplicity has been in the back of our minds for some time," says David Hogg, president of HPM Consortium, a group of 18 companies in Ontario that have been exploring tools for world-class performance. "Now it is about time to put simplicity on the dashboard, in plain view, from the beginning -- so that we think about simplicity from the point where we begin thinking about customer needs." Hogg, who is program chairman for the AME event, points out that companies striving for world-class status must think in terms of global markets. "But when you do that, you invariably end up with Third World countries on your list. And if you haven't thought through the simplicity issue you aren't likely to be successful, because the parts-supply infrastructure or the maintenance-and-repair infrastructure in those countries may be inadequate. . . . If the country you're trying to do business in can't support the technology," he stresses, "you may just be shooting yourself in the knee." In such situations, he adds, manufacturers need to focus on simplicity in product design, use of the product, and support requirements. Computer-industry gurus such as Microsoft Corp. CEO Bill Gates are aware of the yearning for simplicity. In fact, for the last year or more, Gates has been emphasizing a "simplicity initiative" intended to make life easier for users of the software company's products. "We're always trying to simplify the way our products work," says Marcus Schmidt, Microsoft marketing manager for the manufacturing sector. "We're trying to cut down on the learning curve and make our systems a little more intuitive." But product complexity isn't the only issue. In large, globally dispersed companies, organization structures, convoluted supply chains, and distribution networks present complex management challenges. And policies dictating the design of organizational processes and production systems can compound the problems. Many companies have sought to manage complexity by installing expensive enterprise-wide computer systems to track, digest, and manipulate all of the data generated by their far-flung operations. Ironically, the installation and management of sophisticated information systems adds yet another dimension to the web of complexity. The search for simplicity, it turns out, is a rather complicated challenge. For one thing, certain external factors aren't likely to go away -- such as government regulation or rising customer expectations in an internetworked world. "We're now in the world of the cyber customer," says Michael Fradette, global director of Deloitte Consulting's manufacturing industry practice. "Their tastes and preferences can be expressed in nanoseconds with a click of a mouse. You can have a customer one minute and not have that customer the next minute." Because customers are demanding more and more -- including a wider array of choices and fast response on small, customized orders -- manufacturers must "find a way to deal effectively with a different set of customer expectations -- expectations that change constantly," Fradette asserts. "The market is in the hands of the cyber customers, and they are driving everything. The PC phenomenon -- and the connectivity phenomenon -- are creating a global, internetworked world where the power of the customer will be doubled and quadrupled in the future. "The drivers are working in favor of giving customers more choice and making those choices at hyper speed. So simpler times are not around the corner. The world is going to get even more complex." Internally, manufacturing processes have become more complicated because many products are now more complex -- particularly those that incorporate electronic components, notes Robert W. Hall, professor of operations management at Indiana University's (IU) Indianapolis campus. In the automotive industry, for example, greater use of electronics has increased the number of assembly stations in an assembly plant. "More parts mean more steps in the process," Hall observes. "So the process diagram becomes more dense, along with the product." In the early days of the automotive industry, Henry Ford reportedly was able to produce a Model T Ford in less than 56 hours -- from the conversion of iron ore into steel and through final assembly operations, Hall notes. "If today's designs were as simple as the design for the Model T, we could duplicate what Ford claimed to have achieved. But today's Taurus and Sable are definitely not Model Ts. Not even the Escort comes close to being a Model T." Moreover, every Model T was identical. But when a manufacturing organization bases its competitive strategy on offering customers greater product variety, that elevates the level of product and process complexity considerably. "Supporting an endless flow of new products can trigger a chain of effects inside the organization that can burden it to the breaking point," observes consultant Gwendolyn Galsworth. Among the approaches that companies have taken to simplify -- and streamline -- production operations has been the implementation of "lean" just-in-time (JIT) systems that minimize or eliminate non-value-added (NVA) steps. Typically, the methodology includes a process-flow analysis to identify NVA activity. On the plant floor, the results have included dramatic reductions in travel distances, work-in-process inventory, and manufacturing cycle times. Similar efforts have streamlined the flow of paperwork and reduced process cycle time in office environments. Concepts drawn from the Toyota Production System -- the widely acknowledged model for lean production -- helped many manufacturing organizations to introduce a measure of simplification. But it's not a one-shot solution, Hall stresses. "You have to continue to pay attention to keeping things simple, or they will get out of hand. Today Toyota has more variety in its processes, so it has to keep working at simplicity just to tread water in its performance level." Toyota, he notes, holds periodic kaizen improvement activities, rethinking and tweaking the process on a monthly basis, to wring out NVA activity. "Tweaking the process every month is sort of foreign to the U.S. approach," Hall says. "But I think that is the direction people are headed -- toward continuous simplification." Total Quality Management, with its emphasis on root-cause analysis, can be an "antidote" to complexity, suggests Hank Rogers, a former Dana Corp. manufacturing executive who now heads his own Ashland, Oreg.-based consulting business. "One reason that things become so complex," he says, "is that any time people encounter a problem, instead of identifying and removing the root cause of the problem, they tend to cover it with a shotgun approach. They adopt a plethora of solutions instead of finding out what caused the problem in the first place." Too few companies, he contends, have trained people to identify cause-and-effect relationships. "Most good organizations have problem-solvers," Rogers notes, "but we're not very good problem-avoiders." However, a good total quality system will lead to simplicity by fixing "the right things," rather than adding layers of solutions that address the symptoms. Today's advanced information systems enable companies to deal with a greater level of complexity by giving employees the information they need "at the right time and in the form that they need it," observes IU's Hall. But it's important to avoid "information overkill," he says. "If someone wants to know the time of day, they don't need instructions on how to build a watch." In many cases, good communication methods, or visual systems such as kanban squares to trigger work-in-process movement, can be improvements over a complex computer system, he adds. "Having a computer system that is more complicated than you need doesn't help you." Although computer systems may be valuable planning tools, Rogers concurs that kanban "pull" signals and other JIT methods can be a simpler -- and superior -- way to execute production plans. In their efforts to purge unnecessary complexity from various operations, companies need to be aware that "the level of necessary complexity may be going up," advises Fradette at Deloitte Consulting. In a world where the business equation is constantly shifting, information technology -- such as advanced planning and scheduling systems and inter-company networks to speed two-way information flow -- can be a critical "enabler" for coping with unavoidable complexity. "Advanced information technology can make things more manageable, but that doesn't mean it is simple," Fradette says. Perhaps equally important, he suggests, will be a growing reliance on "knowledge workers" -- multiskilled employees who understand customer needs, and are able to talk to customers. "Customers will demand real-time solutions. If you don't know in advance what they are going to want, you can't preplan everything to simplify the execution. You have to rely more on the knowledge worker to respond -- people who have the ability to rapidly adjust to changing circumstances. "We are going to have to rely on knowledge workers to make the difference," Fradette asserts. "I don't think the work will get simpler, but we'll design the business to be operated by people who have more skills and a greater ability to learn." Hall concurs that the demands on manufacturing companies aren't likely to abate. "Simplification," he says, "really means: How do we manage this mess?"

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