Configure to Order: Different by Design

Estimated reading time: 11 minutes

An example of this is common in the automotive industry, where on the final assembly line, for each base model of car, there are defined model variants, each adding a set of upgraded components such as engine, multimedia, lights, navigation system, etc., as well as individual choices that the customer has made, such as the color of the car. Production of the Ford Model T is a famous example of a non-flexible, automated mass-production line that achieved success by reducing costs and increasing productivity.

Today’s final assembly lines boast that they can produce flexibly on a non-stop, fixed-tact, final assembly line capable of making any combination of models, variants and individual customer choices. While this implies 100% efficient production, it hides a great deal of associated waste, which is constantly having to be optimized behind the scenes. Without knowing what is to be made each day would require material availability to satisfy any quantity of any combination of any specification each day, representing a huge amount of material investment.

Many of the optional components, especially the more expensive components, are likely to be rarely needed as compared to options lower in the range. It is a waste of investment to have unnecessary stock at the line, so some logic and planning needs to be done to ensure that the materials are there only when needed. The suppliers of such optional materials, which today mostly feature complex electronics sub-assemblies, would bear the brunt of the randomness of customer demand, and so face the very high volatility of demand on individual product variants that they supply. This can make their business very inefficient. Some grouping therefore, especially for high-cost, rarely-used materials would reduce investment cost overheads, but only if the “random” production could also be grouped. The compromise of the flexible final assembly line then creates follow-on issues. The waiting list for a car to be manufactured after placing an order with options, is quite significant. It can now take between 12 and 20 weeks for a specified car model to be scheduled, made and delivered from placement of a customer order. Many customers will not wait that long, and could go to competitors. The time is required by the car maker to optimize the supply-chain to minimize the risk of shortage of key components without incurring the need for material storage.

By focusing on an efficient final assembly, the costs of variant manufacturing has not necessarily been avoided, but is more likely to have been shifted up the supply-chain. The challenge to produce on demand at a competitive price is spread among all the suppliers. The cost to the business for flexibility is still there, but accounted for in a different way. Though this example is related to a flexible final assembly production line, the concept and challenge applies equally to any factory where the factory output is controlled by the customer and needs to be flexible, including by the way, all the suppliers of sub-assemblies that support the automotive line.

The better the communication between manufacturing and the supply-chain, the “Leaner” the whole process of assembly with a high degree of variants, and high mix, will be. At the core, in engineering, is the product definition as described in the BOM. A configure to order BOM looks much the same as a regular BOM, except that certain part numbers refer to a choice of actual materials, representing options. These can be individual material choices or the choice of a set of material dependent features, or a combination of the two. Rather than having to create and select a unique BOM from literally thousands of potential variations, a single configure to order BOM will represent all feature and option combinations.

The configure to order BOM has all the various options defined through the use of the part number key-word, which is set up just once. It can then be simply used when planning and creating any and all of the different specific product configurations that are required, whether for a set group of products or even a single unit. As the configure to order BOM is processed during, for example, the creation of a work-order, the choices are offered to select the material, set of materials or sub-assemblies to reflect the specific variant need. This selection is stored as part of the work-order, ensuring that the correct engineering information is available at all work-stations and processes throughout manufacturing, and as a look-ahead for material preparation and supply-chain. All aspects of the MES software that works with configure to order BOMs will automatically follow the designated selected options without further manual overhead. The whole process of MES with the configure to order BOM is therefore several orders of magnitude simpler and more secure than handling multiple unique BOMs.

Systems supporting the configure to order BOM as an integral part of a singular MES solution provide the most efficient way to plan and execute in the high mix and volatile environments associated with the extreme flexibility that Industry 4.0 requires. No matter how the operation is planned, how work-orders are created, or how flexible production has to be moving products between configurations, the ability of the engineering team to remain in control of the product data across all of the variants is critical. The management of visual aids and documentation throughout the process is imperative. For those operations that are yet to see significant numbers of variants, it should be remembered that as the number of product options and variants increases, the number of unique BOM combinations increases exponentially. With the configure to order BOM this is not the case, each additional variant is simple to introduce. Any assembly factory that is aiming to become an Industry 4.0 operation, with flexibility to make products according to the real demand, without the use of expensive stock in the distribution chain should seriously consider the adoption of an MES solution that includes built-in configure to order capabilities.

• < Previous Page