There are typically three kinds of manufacturing:
Make-to-Stock: This is traditional manufacturing, in which a company makes products based on past sales data. This can go awry when markets change and sales numbers shift. Examples are cars, refrigerators and other mass-produced, larger consumer goods.
Make-to-Order: These are more customized products that consumers order and are made to specifications. It means the customers get exactly what they want, in theory, but must wait before it arrives. A designer sofa is a great example, in which consumers can choose upholstery, then wait three weeks to receive it. This method reduces risk of overstock for manufacturers, but also can compromise sales potential.
Make-to-Assemble: This is almost a hybrid of the other methods. Using past sales data, the company manufactures individual product components, but awaits consumer orders for customizations before assembling the final product to ship. For example, a customer orders a laptop with several specifications, then the factory assembles one to those specs. Think of it like ordering a submarine sandwich where you can dictate exactly what ingredients you want, but all the ingredients are prepared in advance, allowing for quick assembly.
Intermittent Manufacturing Systems
The intermittent manufacturing system allows companies to make different types of goods using the same production line. Therefore, the manufacturing facility is designed to handle different product sizes and requirements. Generally, the goods are processed in lots to fulfill orders.
This system is commonly referred to as a “job shop” due to its popularity in countries with relatively cheap labor making products for multinationals based thousands of miles away. The goods made using this manufacturing method are produced in small quantities, so they may not be suitable for stock. Customization is typically done post-purchase.
This type of system is designed for production runs that happen intermittently, hence the name, or products that don’t require high volumes. It uses general purpose machines and requires highly skilled labor.
Continuous Manufacturing Systems
Continuous manufacturing systems are designed to enable the mass production of a single product. The product goes through an assembly line with different stations where parts are added or worked on a little further. This method first arose during the Industrial Revolution and is most closely associated with the Ford Company, which employed the system to produce Model Ts in the 1920s.
This type of production system is ideal when a company has very high volume targets since it reduces the unit cost of the product. It does, however, require a massive capital injection at startup due to the investment in equipment and labor required.
Flexible Manufacturing Systems
Flexible manufacturing is a modern manufacturing system that has become very popular. It involves a significant investment in machinery, although it reduces labor costs by implementing robots eschewing human labor altogether. These machines can easily be reconfigured to manufacture different products in different quantities, and the whole process is automatic.
This method is called flexible manufacturing due to the flexibility in the variety of high-volume goods it can produce. Due to the automated process, quality control is a lot easier, and unit costs are low.
Key Characteristics for Manufacturing
Manufacturing is essentially risky, because it presumes there is enough market for a product to make it on a large scale. Managing that risk is the most important part of manufacturing.
To manage that risk, manufacturing needs:
Productivity: Balancing efficiency with productivity translates to profit. Low productivity means higher costs, due to wasted manpower and overhead. Understanding and balancing the ideal ratio between costs of labor, overhead, materials and demand is critical for any manufacturer.
Quality Control: If products are not made with consistent quality, a company may not survive. Customer experiences must be positive across the all branded products, or the entire company could suffer. For example, Samsung’s Galaxy Note could have been a disaster for Samsung when its batteries famously caught fire, causing airlines to ban them from planes.
Good Design: Manufacturers must ensure their product is well-designed, so their product can beat out competitors. When designed with quality and innovation, a product stands out from the crowd. It is industry-changing, high-quality design and innovation that have made Apple into a global electronics powerhouse.
Cost Effectiveness: From labor allocation to robotic support through to material quality and price per unit, there is much that affects the cost effectiveness in manufacturing. Without being cost effective, a product will fail and jeopardize the entire company’s bottom line. The car industry makes production more cost-effective by creating different models of cars based on shared platforms. Chrysler-Daimler, for instance, has used the same platform for both the Jeep Cherokee and the Mercedes-Benz M-Class, meaning production costs are lower. That’s the benefit of smart design. These, among other waste-reducing, efficiency-increasing methods are products of a movement toward “lean” manufacturing, which Toyota’s efficient strategies have helped pioneer for over 40 years.
Manufacturing operations management (MOM) is a collection of systems for managing end-to-end manufacturing processes with a view to optimizing efficiency.
There are many types of MOM software, including for production management, performance analysis, quality and compliance, and human machine interface (HMI). Production management software provides real-time information about jobs and orders, labor and materials, machine status, and product shipments. Performance analysis software displays metrics at the machine, line, plant and enterprise level for situational or historical analysis. Quality and compliance software is used to promote compliance with standards and specifications for operational processes and procedures. HMI software is a form of manufacturing operations management (MOM) software that enables operators to manage industrial and process control machinery using a computer-based interface.
Emerging Software Trends
Advancements in technology and market demands are enabling new capabilities in MOM software platforms, gradually closing gaps in end-user needs.
- Collaboration Capabilities: Collaboration and workflow services support people-to-people, people-to-systems, and systems-to-systems interactions, enforcing procedures and rules while flexibly adapting to real-time situations with alternate workflows and processes.
- Security Services: Future manufacturing platforms will leverage common security services that determine roles, responsibilities, authorities, and access across all systems and application functions while fitting into corporate IT security schemes.
- Asset & Production Model: Future manufacturing platforms will have a unified asset and production model that supports all of the interrelationships between physical production equipment, facilities, inventory/materials and people, as well as production definitions such as the manufacturing bill of materials, productions orders, etc. This contrasts with older systems that either had subsets of these interrelationships across multiple databases, or could not effectively deal with federating across multiple systems of record.
- Operations Database & Historians: Evolving from older systems that had separate historians and production databases that were difficult to correlate across, service-based platforms will have a unified operations database and historian. This will capture and aggregate all time-series and production event information surrounding everything involved in each product and production run with a full genealogy of components and materials, related performance information, and federation across other systems and devices of record.
- Visualization and Mobility: Today, different MOM applications support different graphical user interfaces, Web interfaces, specific mobile applications, etc. The future manufacturing platform will provide common visualization and mobility for a consistent user interface experience across different form factors, supporting dedicated and mobile workers that are orchestrated by consistent workflows and procedures.
- Smaller and Focused ‘Apps’: Today’s monolithic systems and applications have too many interdependencies of databases, operate inconsistently, and are not inherently integrated. Being able to take advantage of many of the common software platform services described above, modular apps will be significantly smaller, simpler, and focused. These apps will be much lighter weight in functionality, and, as a result, significantly easier and faster to develop.
Continuous Manufacturing System
This is the classic mass production system and the one laypeople most commonly think of when they think of manufacturing. In a continuous manufacturing system, a product moves along an assembly line, with various specialized workers performing actions to assemble the product at stations along the way.
Continuous manufacturing allows for higher output and lower unit costs, but requires a large capital investment due to the amount of labor and machinery you need, and so are more often found in larger operations.
Intermittent Manufacturing System
In an intermittent manufacturing system, the company produces multiple identical items at the same time. The nature of the system means the products must be standardized and there is little or no allowance for customization. This is an effective alternative to continuous manufacturing for companies that are not willing or able to make as large a capital investment but are usually most effective for low-volume or limited production runs.
Flexible Manufacturing System
Many modern companies have already implemented or are moving towards a flexible manufacturing system. For these systems, companies invest in several machines that they can easily reconfigure to make a lot of products in a short period of time. Characteristics of flexible systems usually include robots or other automated devices that replace or augment human labor.
Like continuous management systems, the initial cost of machines can be quite high — but these systems allow you to produce more goods with fewer labor requirements. They are also more adaptable to changing marketplace conditions.
Custom Manufacturing System
A custom manufacturing system is one that a company will use for a very specified product line. It is not appropriate for businesses where you need to mass-produce products. In a custom manufacturing system, each product is made by hand or by a single operator using a machine designed for this purpose.
This system does allow you to customize individual products for the customer, but because it is so time-consuming, it is really only suitable for companies producing finely-crafted, low volume, higher-priced items.
As you are first starting up a manufacturing business, you will want to give some thought to which of these systems will work best for your business and which you want to adopt. If you have an existing manufacturing system in place, you may want to ask yourself if it is the most effective system for what you are trying to accomplish.