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Manufacturing planning within holistic strategic operations
Journal of Materials Processing Technology 107 (2000) 372±383
Manufacturing planning within holistic strategic operations C.E.R. Wainwright*, P.G. Lee The CIM Institute, Cran®eld University, Cran®eld, Bedford, MK43 OEA, UK
Abstract This paper presents an overview of the process requirements for a holistic strategic planning model of manufacturing operations and presents a reference model for a MTO environment. The use of GRAI structured analysis techniques is used in the modelling process. Limitations of the GRAI modelling process are observed and outlined. # 2000 Published by Elsevier Science B.V. Keywords: Strategy; Manufacturing; Planning; Modelling; GRAI analysis; IDEF0 analysis; Holistic
1. Introduction Manufacturing industry performs a vital role within the UK national economy, yet ®erce international competition has resulted in a decline in industry in the recent past. Preoccupation with short term operational issues as opposed to building long term competitive advantage has been identi®ed as a major reason for this failure [1]. Similarly, the global economy has intensi®ed pressure on manufacturers in both domestic and export markets. To remain competitive, particularly within an economic climate in which the future is uncertain and not extrapolable from the past, requires the adoption of strategic planning techniques. At a functional level, manufacturing systems, in UK, have evolved through periods of uncontrolled growth in response to increased competition and market changes [2]. This has resulted in the development of manufacturing systems in which goals are inconsistent with overall business strategy. To nurture a competitive effective manufacturing ability, responsive to the demands of the customer, requires the de®nition of policies to address manufacturing objectives consistent with overall business objectives [3]. To support manufacturing objectives, compromise decisions in key structural and infra-structural areas are required. This is achieved through systemic multi-variable optimisation within the complete economic entity of a business, in which manufacturing is an integral part. Thus, through a process of iteration, manufacturing strategy may be de®ned in conjunction with the overall business philosophy.
*
Corresponding author. Tel.: 44-1234-754073; fax: 44-1234-750852. E-mail address: [email protected] (C.E.R. Wainwright). 0924-0136/00/$ ± see front matter # 2000 Published by Elsevier Science B.V. PII: S 0 9 2 4 - 0 1 3 6 ( 0 0 ) 0 0 7 1 5 - 9
Currently, there is much confusion in relation to the de®nition of manufacturing strategy. A common error is to refer to strategic goals as a manufacturing strategy. For example, ``lead time reduction'' is often quoted as being a manufacturing strategy, with no consideration being given to the mechanism of achievement. Similarly, it is dif®cult to constrain the concept of manufacturing strategy to a level of detail common to all situations, as a decision of strategic importance to one company may only be of operational importance to another. Recent classi®cations and reviews of manufacturing strategy literature express the urgent need to develop planning models for use in practical engineering environments. However, to model the dynamic processes involved in a manufacturing system is extremely dif®cult due to the dominant involvement of people and the sheer number of activities. Similarly, to relate strategic objectives to manufacturing system design and function, requires a modelling technique to identify functional parts and interfaces; use appropriate descriptive techniques to describe both the information and material processing systems; identify time based elements of decisional activity. The requirement to identify the functional parts of a manufacturing system, and the interfaces between them is crucial. Functional parts provide the means of incorporating human activity in the operation of the system. The second requirement, the use of appropriate descriptive techniques, is necessary to illustrate the structure of the system and the transformational process. Thus, the model must be both hierarchical and ``top±down'' to illustrate structure, and functional ``bottom±up'' in that a sequence of activities must be included to depict transformation processes. The third requirement, to identify the timing of decisions, is
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necessary to differentiate between strategic, tactical and operational decisions, all of which will be included during the design or modi®cation of a manufacturing system. To suit these requirements there are a number of structured modelling techniques available [4], however, there is only one, the GRAI methodology, developed speci®cally for analysis of manufacturing systems [5]. The GRAI methodology has a concentration on the decision making process, which also makes it highly suitable for the development of strategic planning models [6]. 2. The GRAI approach GRAI was developed at the University of Bordeaux 1 [7] and has continued to evolve over the last decade. GRAI involves the development of a conceptual model of the management structure of a manufacturing company. It is pre-dominantly a graphical technique using a decomposition principle comprising a unique combination to de®ne decision centres and the information required to make a decision within these centres. Following the identi®cation of decision centres, a ``top±down'' analysis is performed to establish their structure and connectance to other functions. The ``top±down'' analysis is followed by a ``bottom±up'' analysis of the elements of each decision centre, to determine activities and decisions made at the decision centre, and the links between various centres. The ``bottom±up'' analysis is displayed via the GRAI nets which contain the following basic elements (Fig. 1): 1. Activity model where q is state, x1 is support and d : q0 ^ x1 ! q1 . 2. Activity model with OR and AND successions, where DT is the decision table. This model exhibits the analogue and logical chain multiplicity. 3. Parallel activity branch model where p1 is the result of the activity g1 (d1 being used as the support y1 of the activity). This model exhibits the analogue and logical branch additivity. On the basis of these elements, most of the complex activity within a system may be modelled. The GRAI method differs from previous systems modelling techniques in that it relates to the analysis and design of the decision system, rather than the information or physical systems. By concentrating on fundamental concepts the method avoids the pitfalls of the IDEF approach highlighted by Wang and Smith [8]. The GRAI approach is based upon three basic elements: A conceptual model. That is an abstract scheme which gives an invariant representation of a system for a problem solving class. Tools and representation rules. An application methodology to represent the practical aspects of the method (implementation steps of the concept, human intervention, etc.).
Fig. 1. GRAI network elements.
The conceptual model of GRAI was developed from theories on complex systems and organisations [9]. It comprises two parts, to outline the organisation of a manufacturing system and to detail the activities of a decision centre. Using the decision centre as a focal point, the GRAI conceptual model assumes that the structure of a manufacturing system is comprised of three sub-systems: The physical sub-system, comprising machines, materials, operators and techniques divided into work centres. This is the operational level, where the physical work of transforming raw material to finished goods occurs. The decision sub-system, representing a hierarchical structure with each level determined by a horizon (the time interval during which a decision is valid) and a period (the time interval at the end of which a decision has to be reviewed). This sub-system is divided into decision making levels, each one composed of one or several decision centres. Each decision centre, with the exception of the extreme layers, receives a decision frame from an upper level, and gives decision frames to the decision centre of the same or lower levels. The information sub-system, providing the decision subsystem with relevant information, to provide a link between decision and operating systems, and which permeates the entire structure.
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The decision making process is such that the decision maker identi®es a model representing the desired end state or goal. A decision is then taken which adjusts the system towards this end state (horizon). After a certain time interval (review period), the decision maker compares the real situation against that of the model and adjusts his actions accordingly. The structure of the decision centre therefore de®nes
the various activities of a decision centre; the decision frame (variables and decision limits); decisions made by the decision centre; information used by the decision centre.
To analyse a system's structure, GRAI uses two graphical tools The GRAI grid, which gives a hierarchical representation of the entire structure of decision centres within the system. The GRAI nets, to enable the representation of activities and decisions made at the level of a decision centre, and of links between various centres. System decomposition is achieved by means of the GRAI grid, which produces a hierarchical decision structure. Decision centres may be found on different levels within an organisation. According to the complexity of the system modelled, several GRAI grids may be produced, relating to an aggregate master grid. Following the identi®cation of decision centres, a ``top±down'' analysis is performed to establish their structure and integration to other functions. The GRAI grid is represented by a matrix of rows and columns and depicts the ``top±down'' analysis. The columns represent the various functions within a system, and the rows represent the hierarchical position of the decision centre, de®ned by the horizon and review periods. The relationship between decision centres is identi®ed by the use of double arrows. Single arrows represent information ¯ows. The ``top±down'' analysis is followed by a ``bottom±up'' analysis of the elements of each decision centre, to determine activities and decisions made at the decision centre, and the links between various centres. The ``bottom±up'' analysis is displayed via the GRAI nets to represent the detailed activities of each decision centre. These activities include an examination of all the management activities and information sources required to make a decision. Symbols are used to identify different activities, which ¯ow vertically to denote decisional activities, and horizontally to denote physical activities. Single boxes indicate decisional information support and double boxes the transfer of the decision frame. The GRAI application methodology is based upon a two phase process of analysis and design. Its application is structured within well de®ned procedures, commencing with the analysis phase to collate all information in relation to the system. The initial phase of the veri®cation process
requires the creation of two groupings to form the Analysis Group and the Synthesis Group. The Analysis Group comprises one or more analysts who interview the Synthesis Group, and who subsequently construct and analyse the GRAI model. The Synthesis Group comprises all the management team involved with the project. All members of the Synthesis Group are interviewed by the analyst, who utilises the graphical tools to analyse the structure of the organisation. To ensure no ambiguity or errors occur within the study, the Synthesis Group is continually consulted to validate the results of the interviews and their subsequent interpretation. With this process it is possible to determine the content of the grid, horizon and review periods, decision centres and the links between the decision centres. Subsequently, it is possible to begin the ``bottom±up'' analysis to de®ne, through the application of GRAI nets, the detailed activities at each decision centre, starting from the lower levels of the grid. This analysis produces one or several GRAI grids, depending on the complexity of the system under analysis, and several GRAI nets relating to a square in the grid which requires a decisional activity. 3. Generic planning model A generic model may be used to illustrate the iterative stages in the process of manufacturing system planning within the context of holistic strategic system operation. This model indicates the type of processes in a hierarchical manner, and the iterative inter-action required to provide comparison between the lower and higher hierarchical levels. These decisions will determine the performance of the manufacturing system, which must be compared with manufacturing objectives. Any lack of correlation must be resolved before the process can progress to the next level of detail. Within the model three distinct levels of activity may be discerned relating to strategic, tactical and operational levels, easily modelled through GRAI via the application of a hierarchical series of grids related to a single master aggregate grid (Fig. 2). Although these three distinct areas may be modelled, the dis-similarity between different manufacturing systems is such that a generic model would be so general as to be of little value in the analysis of a speci®c system. However, the incorporation of GRAI decisional activities within an overall framework based on the generic model, provides a means of accurately representing particular manufacturing systems through the application of a series of speci®c grids. The inclusion or omission of certain activities can then be shown to be the result of a particular series of decisions. Such an approach provides suf®cient ¯exibility to incorporate the idiosyncrasies associated with particular systems. From such a basic framework, GRAI may be used to provide a more detailed description of the strategy formulation process.
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Fig. 2. Holistic manufacturing operation model.
4. Case study With any generic model, criticisms arise that models are too general to be applied to speci®c situations. With the following model, based on a Make-to-Order (MTO) manufacturing environment, the intention was not to provide a totally rigid structure of rules which must be adhered to, but a framework which could be applied with some modi®cation by a large percentage of capital goods MTO operators. For example, whilst attempting to remain impartial in the model development, the capital expenditure nature of goods produced by the collaborative company during model development required that products were installed and made operational at the customers desired location, as may be observed within the delivery decision frame. This aspect of the decision frame relates to the collaborative organisation, and certain other capital goods MTO manufacturers, but is not indicative of all producers. The intention of developing this model, however, would provide bene®ts including:
To create standard operating procedures for MTO companies within the collaborating organisational Strategic Business Unit (SBU) structure. The ability to transfer research findings to UK industry and the academic community. To aid the transfer of the process model (particularly within MTO environments). To outline inconsistencies in the decision making process of MTO companies. To provide direct benefits to the collaborator by the possible improvement of their management decision making process. 4.1. Strategic activities GRAI element The initial aspect of the generic model construction was the identi®cation of strategic activities, which enabled development of the strategic element of the GRAI grid. In the construction of this element of the
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grid, three major activities were performed in a ``top±down'' manner identification of functions; identification of decision centres; identification of suitable horizon and review periods. The initial phase in the construction of the strategic GRAI grid related to the selection of functions. Only a single function was identi®ed as necessary to the operation of this model, although it was necessary to include a further 10 phantom functions to ease the integration of the sub-model with the holistic model (Fig. 2). To plan. This function represents the sole function of the grid. Decisions taken relate to the planning of the functional strategies in accordance with business objectives. In accordance with the rules of the GRAI methodology, the GRAI grid also contained the two columns to cater for the provision of information exchange between nominated functions and both the external environment and other internal company functions: External information. This represents the exchange of information external to the organisation, including information from the market in terms of competitors. Customer orders, both con®rmed and forecast, are also sources of external information. Internal information. This represents the transfer of information internal to the system. Formulated manufacturing and marketing strategies, conceptual product designs and ®nancial data are typical sources of internal information. Following the identi®cation of functions, the following phase in grid construction was to identify decision centres relevant to the management decision making process. Consequently, ®ve decision centres were identi®ed and included. Having identi®ed the functions and decision centres to be contained within the GRAI grid, it was necessary to identify the horizon and review periods for each decision centre. Two horizon and two review periods were identi®ed within a de®ned hierarchy. Horizon 5 years; review period 1 year. The 5 year horizon period represents a typical planning horizon, in which to establish competitive business objectives, which have signi®cant impact on the success of business. The associated 1 year review period represents an annual review meeting. At this meeting, the matters arising from the quarterly review meeting are analysed and, if problems arise, changes to the planning programme are implemented. The parameters arising at this meeting are time, physical progress, resources and ®nancial expenditure. These parameters are considered in a ``rough-cut'' context. Horizon 3 years; review period 1 year and horizon 3 years; review period 3 months. The three year horizon represents the typical planning horizon for the formulation of functional strategies in accordance with business objectives. Two review periods are associated with this horizon. The ®rst is 1 year, representing an annual
review meeting, and is associated with the formulation of a holistic functional strategy framework. At this meeting the matters arising from the quarterly review meeting are analysed and, if problems exist, changes to the planning programme are implemented. The second review period is 3 months, representing a quarterly review meeting, and is associated with the formulation of speci®c functional strategies. The parameters arising at both these meetings are as discussed above. 4.2. Tactical activities GRAI element The element of the model relating to tactical activities was constructed in an identical manner to that of strategic activities. The initial phase in the construction of the tactical GRAI grid related to the selection of functions. Five functions were identi®ed as necessary to the operation of the tactical activities model, although it was necessary to include a further six phantom functions to ease the integration of the sub-model with the holistic model grid framework (Fig. 2). To plan. This function represents the core of the grid, to which all other functions are related, either through decisional activities or information ¯ows. Decisions taken relate to the initial planning of the design infra-structure, and the manufacturing system structure and infra-structure in relation to design, marketing and manufacturing strategies. To design. This function is related to the conceptual design of new products and product families within the bounds of the design strategy. The function provides planning information in the form of nominal product speci®cations. To manage resources. This function is related to the selection and installation of design and manufacturing resources. It is sub-divided into three further functions Design infra-structure. This function involves the selection of the design support system and installation, in addition to the creation of organisational structures and design teams. Manufacturing structure. This function involves the selection of machine tools and their installation within appropriate guidelines and a specified plant layout. Manufacturing infra-structure. This function involves the selection of shop floor scheduling techniques and planning and control systems, and their subsequent installation in conjunction with organisational structure and labour requirements. Following the identi®cation of functions, the following phase in grid construction was to identify decision centres relevant to the management decision making process. During the selection of functions, the decision centres had been considered at a ``rough-cut'' level. However, at a more detailed level 10 decision centres were identi®ed, and included in the GRAI grid.
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To plan. Three decision centres, to plan the manufacturing system structure and infra-structure and design infra-structure. To design. One decision centre, relating to the conceptual design of products and product families. To manage resources. Six decision centres, relating to the selection and installation of the manufacturing system structure and infra-structure and design infra-structure. Having identi®ed the functions and decision centres to be contained within the GRAI grid, it was necessary to identify the horizon and review periods for each decision centre. Three horizon and three review periods were identi®ed within a de®ned hierarchy. Horizon 2 years; review period 3 months. The 2 year horizon period represents a typical planning horizon in which to establish resources within a structured manner. Also the horizon represents a typical period for conceptual design. The associated 3 months review period represents a quarterly review meeting. At this meeting, the matters arising from the monthly review meeting are analysed and if problems exist, changes to the planning program are implemented. The parameters arising at this meeting are time, physical progress, resources and ®nancial expenditure. These parameters are considered in a ``rough-cut'' context. Horizon 6 months; review period 1 month. The 6 months horizon represents the typical planning horizon for the selection of design and manufacturing resources. The review period associated with this horizon is 1 month, representing a monthly review meeting. At this meeting, the matters arising from the weekly review meeting are analysed and, if problems exist, changes to the planning programme are implemented. The parameters considered are as at the quarterly review meeting, however, more detailed information would be considered. Horizon 1 month review period 1 week. The 1 month horizon represents a typical planning horizon for the installation of design and manufacturing resources. The review period for this planning horizon is typically 1 week, representing a weekly review meeting. At this meeting, matters arising from day to day activities are analysed and, if problems exist, changes to the programme are implemented. The parameters considered are the same as at the monthly review meeting. 4.3. Operational activities GRAI element The element of the model relating to operational activities was constructed in an identical manner to that of tactical and strategic activities. The initial phase in the construction of the operational GRAI grid related to the selection of functions typically performed within a MTO environment. To plan. This function, to which all other functions are related, either through decisional activities or information ¯ows, is the core of the grid. Activities performed and
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decisions taken relate to planning and scheduling jobs throughout the manufacturing process, the planning of material procurement and the planning of product delivery and installation. To manage materials. This function relates to material management in terms of supply and build. It is sub-divided into two further functions (to purchase and to make) To purchase. This function is involved in ensuring that the correct materials are ordered at the appropriate time ready for physical manufacturing activities or assembly. The function is further sub-divided into two functions To negotiate. This function is related to an assessment of purchased item values, and to the selection of suitable supplier sources. To buy. This function is related to the direct purchase of materials, and ensures vendors supply materials on time to the speci®ed cost and quality. To make. This function is related to the manufacture of the product, ensuring completion within the prescribed delivery time frame, to the speci®ed level of quality and cost. The function is further sub-divided into two functions To manufacture. This function is related to the physical activities involved in the direct manufacture of component parts, within specified time periods, to the required technical specification. To assemble. This function is related to the physical activities involved in the process of building finished products from discrete component parts, within specified time periods, to the required technical specification. To sell. This function concerns the management of the tendering process having received a customer invitation to tender request. Activities undertaken relate to the estimation of product cost and delivery, and the subsequent creation of tender documentation. The sell function provides information for planning in the form of delivery dates in accordance with the MPS, and budget costs for manufacture. To design. This function concerns the design aspect of products. Activities and decisions undertaken relate to the product engineering design, and the modi®cations of products in accordance with customer requirements. The design function provides planning information in the form of drawing release in accordance with the MPS, and the provision of design documentation. To deliver. This function relates to the delivery of goods to speci®ed locations. Activities undertaken include the test procedures to ensure that the ®nished product complies to the customer requested technical speci®cation, and acceptable quality levels. Following the identi®cation of functions, the following phase in grid construction was to identify the decision centres relevant to the management decision making process. During the selection of functions, the decision centres had been considered at a ``rough-cut'' level. However, at a more detailed level 19 decision centres were identi®ed, and included in the GRAI grid.
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To plan. Five decision centres exist to plan long and short term manufacturing schedules, with consideration of suitable manufacturing capacity levels. To formulate shop ¯oor schedules and to provide speci®c manufacturing information, e.g., NC part programs, route cards, etc. To manage materials. Five decision centres. Three relate to the purchasing function in terms of negotiating price with suitable suppliers, ordering long lead time and standard items. The remaining two decision centres relate to the physical process of manufacturing components and the physical assembly of components into ®nished products. To sell. Three decision centres relating to the response to a customer invitation to tender, the production of tender documentation and the estimation process required. To design. Three decision centres to produce workable engineering designs, modi®cations to these designs in accordance with customer requirements and the detailed process to release design documentation. To deliver. Three decision centres relating to the delivery of the ®nished product to customer location, to include negotiation and the selection of haulage contractors, testing and packing of ®nished product, and delivery (with installation if required) of product to customer location. Having identi®ed the functions and decision centres to be contained within the GRAI grid, it was necessary to identify the horizon and review periods for each decision centre. Within the MTO environment, six horizon and four review periods were identi®ed within a de®ned hierarchy. Horizon 1 year; review period 1 month. The 1 year horizon period represents a typical planning horizon for MTO companies to enable forecast and con®rmed orders to be modelled. For example, within the collaborative company this horizon represents approximately twice the manufacturing lead time for a typical works order. This horizon is related solely to the planning function. The associated 1 month review period represents a monthly review meeting. At this meeting the matters arising from the weekly review meeting are analysed and, if problems exist, changes to the planning programme are implemented. The parameters arising at this meeting are time, physical progress, resources and ®nancial expenditure. These parameters are considered in a ``rough-cut'' context. Horizon 6 months; review period 1 month. The 6 months horizon represents the typical planning horizon for the engineering design of products, purchasing in terms of selecting suppliers and ordering long lead time items. This horizon is also typically associated with invitations to tender from customers. The review period associated with this horizon is 1 month, representing the monthly review meeting discussed above. Horizon 3 months; review period 1 week. The 3 months horizon represents a typical planning horizon for manufacturing to ensure that suf®cient capacity will be made available for the manufacture of products in accordance with the MPS. If the capacity is not available typical
capacity techniques are considered in accordance with possible deviation from the MPS. The review period for this planning horizon is typically 1 week, representing a weekly review meeting. At this meeting, matters arising from day to day activities are analysed and, if problems exist, changes to the programme are implemented. The parameters considered are as at the monthly review meeting, however, more detailed information would be considered. Horizon 1 month; review period 1 week. The 1 month horizon represents the typical planning horizon enabling a ®rm production programme to be issued. Other activities within this horizon are the modi®cation of designs to customer speci®cation, the purchase of standard items, and the production of tender documentation. The 1 week review period represents the weekly review meeting discussed above. Horizon 1 week; review period 1 day. The 1 week horizon represents the typical planning horizon for detailed scheduling of manufacturing requirements in accordance with the decisions taken at the weekly review meeting. The review period for this planning horizon is 1 day, representing a close monitoring of activities. If problems arise, changes to the programme are implemented at an operational level without recourse to management review meetings. The parameters considered during the review process are as at monthly and weekly review meetings, although they are speci®c to localised areas and relate to time, physical progress and resources. Horizon 1 day; review period real time. The 1 day planning horizon represents the day to day activities performed by personnel including physical processing, producing detail drawings, etc. The review period is immediate and is related to individual tasks. The parameters considered therefore are time, physical progress and resources. 4.4. GRAI grid construction Once the constituent elements of the GRAI grid had been identi®ed (Table 1) it became possible to integrate them to produce the GRAI grid (Fig. 3) This process required a degree of iteration to identify the inter-relationships between decision centres, and to incorporate the relationships on the grid (Fig. 3). To assist in the subsequent analysis of the model, when applied within a company environment, typical personnel involved in the decision making process at each decision centre were identi®ed. The ®nal element in the grid construction was the identi®cation of the (important) information ¯ows between decision centres in accordance with GRAI methodology. 4.5. GRAI network construction Following the initial construction of the GRAI grid, the subsequent phase in the development of the model related to the ``bottom±up'' analysis, in which a GRAI net was constructed for each decision centre. To analyse the identi®ed
Table 1 GRAI grid elements Decision centre
Level 1 function
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33
Formulate competitive business strategy Formulate functional strategy framework Marketing strategy Design strategy Manufacturing strategy Establish design infra-structure Establish manufacturing system structure Establish manufacturing system infra-structure Plan and control manufacture MPS deviation Short term production programme Shop floor schedule Work cell programming Material purchase Order long lead items Order standard items Manufacture Assembly Tender Produce quotation Estimate Conceptual design Engineering design Customer product specification Detail design Haulage Test and pack Delivery Selection of design support system Install design infra-structure Selection of plant Install manufacturing system structure Selection of manufacturing system infra-structure support system Install manufacturing system infra-structure
To To To To To To To To To To To To To To To To To To To To To To To To To To To To To To To To To
34
plan plan plan plan plan plan plan plan plan plan plan plan plan manage manage manage manage manage sell sell sell design design design design deliver deliver deliver manage manage manage manage manage
Level 2 function
Level 3 function
Horizon period
Review period 1 year 1 year 3 months 3 months 3 months 3 months 3 months 3 months 1 month 1 week 1 week 1 day Real time 1 month 1 month 1 week Real time Real time 1 month 1 week Real time 3 months 1 month 1 week Real time 1 week 1 day Real time 1 month 1 week 1 month 1 week 1 month
materials materials materials materials materials
To To To To To
resources resources resources resources resources
Design infra-structure Design infra-structure Manufacturing structure Manufacturing structure Manufacturing infra-structure
5 3 3 3 3 2 2 2 1 3 1 1 1 6 6 1 1 1 6 1 1 2 6 1 1 1 1 1 6 1 6 1 6
To manage resources
Manufacturing infra-structure
1 month
purchase purchase purchase make make
To To To To To
negotiate buy buy manufacture assemble
years years years years years years years years year months month week day months months month day day months month day years months month day month week day months month months month months
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Decision centre No.
1 week
379
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Fig. 3. Generic GRAI grid for MTO environment.
decision centres, and therefore to construct their associated GRAI nets, it was necessary to identify the various activities performed and decisions taken at a given decision centre; the relationships between activities and decisions undertaken at a decision centre; the information required to make a specific decision or perform an activity. As with the construction of the GRAI grid, the nets were constructed in a generic manner, to be applied as a framework rather than a rigid ideal. For speci®c companies, if functions were omitted, the impact on associated nets must be considered. Generally, the implications may be observed by observation of the GRAI grid, illustrating decisional centres and major information ¯ows. Typical generic GRAI nets developed are illustrated by Figs. 4 and 5. 4.6. Case discussion The model, as described, forms an initial procedural step in manufacturing system development. It assists senior management to formulate manufacturing strategy through two areas
identification of the management decision making process; identification of informational requirements to support management decision making. De®ning the logic of manufacturing strategy formulation, through the model development, is only a part of the process. It is also necessary to determine how the model should be applied in practice by industry. Consequently, three main aspects of operationalising the process were identi®ed: procedure; participation; project management. 4.6.1. Procedure The procedure of the process model may be de®ned in three stages A well defined procedure to progress through the stages of: gathering information, analysing information, identifying opportunities. Simple and easily understood tools and techniques for use within the procedure. A written record of the results at each stage.
Fig. 4. GRAI net for decision centre plan and control manufacture.
Fig. 5. GRAI net for decision centre manufacture.
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4.6.2. Participation Participation in the application of the process model may be de®ned in three stages Individual and group participation to achieve enthusiasm and understanding. Workshop meetings to agree objectives, identify problems and develop improvements. A decision making forum leading to action. As the manufacturing strategy should be formulated in conjunction with the business and other functional strategies, it is essential that a multi-functional approach is adopted. Hence, there is the need for group working. The planning group approach within the GRAI methodology is amenable to this task, resulting in A forum where the generalisation of the process model could be removed at an early stage. The provision for multi-functional input and expertise from within the company. The close involvement of company personnel throughout the process, who subsequently ``own'' the developed strategy. 4.6.3. Project management The application of the process model requires project management, in which two major areas may be identi®ed adequate resourcing; an agreed time scale. Resourcing must comprise the company personnel, taking responsibility for ensuring that the project progresses, together with internal and external resources to provide the process ``expertise''. Similarly, it is essential that an initial time scale for application of the model is agreed and is worked to. 4.6.4. Limitations During the research it was observed that the construction and presentation of GRAI nets was very time consuming. Unlike the GRAI grid, which is very structured and must comply with a number of rigid rules, de®nitions relating to GRAI nets are much looser. Consequently, the nets constructed contained no logic in relationship to presentation or construction, often resulting in a complex diagram for which interpretation was dif®cult (Fig. 4). One constraint of SADT/IDEF0 is that no diagram should contain more than six boxes, so that the diagram can be easily interpreted [10]. Such a maxim in GRAI does not hold. However, so that the models developed are not super®cial, it is essential that the information presented is included, and this must be constrained to a single diagram via the horizon and review periods determined from the associated GRAI grid. Although there is no con¯ict in identifying the informational requirements at a speci®c decision centre, there is no means to identify the source of that information or to identify which
other decision centres the identical information ¯ows to, other than by inspection of the GRAI grid. At this level it is not possible to include all information ¯ows on the grid, in order to maintain its legibility. Within IDEF0, models are supported by a data dictionary. This is a list, in alphabetical order, of the information and objects which support activities throughout the model. This list provides an exhaustive exposure of the data within the system, and a means of easy access to the diagrams hierarchy. No such mechanism exists within GRAI methodology. The GRAI grid, presenting a hierarchical representation of the entire structure of decision centres within the system under observation, was an excellent medium for the purposes of this research. However, the GRAI nets were too constraining, and such complexity of approach also hindered the application of GRAI. Yet, unlike GRAI grids, a computer based model to construct the GRAI net will not signi®cantly aid application, as the problem of subsequent interpretation will remain. Thus, the need exists for a hybrid process to combine the best features in structured analysis modelling techniques. To avoid the pitfalls associated with an entirely new technique, including operational compromises and development time, the hybrid technique should harness the existing practices. It is envisaged that the technique would comprise GRAI grids, to provide structure, whilst the decision centres are represented using IDEF0. This would remove the dif®culty in interpretation of GRAI nets, and provide a means of structuring data in a suitable manner (Fig. 6). 4.7. Bene®ts This research enabled the creation of a novel GRAI model. The aim being to assist the decision making process surrounding the strategic activities relating to the formulation of functional strategies. The decision centres within the sphere of strategic, tactical and operational activities were identi®ed by the construction of a GRAI grid, and subsequently decomposed, using GRAI nets, to identify the informational requirements needed to support speci®c decisions and associated activities. The creation of such a model for capital goods MTO environments, based on constituent sub-models, was evolved. The operation of the process model in practice was similarly developed, including the desired procedures, participation and project management requirements. When applied within the collaborative company, from an internal perspective, limitations of the GRAI modelling process were identi®ed. However, from an external perspective, the process was deemed to be highly useful in aiding senior management identify and address the necessary areas to formulate a successful strategy. Within the collaborative organisation, during the case study analysis it was considered that implications of decisions were more easily observed through the GRAI grid, and this enabled communication throughout the organisation. Similarly, the explosion of the decision centres raised questions,
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Fig. 6. Hybrid GRAI IDEF0 conceptual model.
subsequently answered, regarding the correct informational requirements and supports necessary for ef®cient function. 5. Conclusions This paper has brie¯y outlined the need for the adoption of strategic techniques as an essential requirement for UK manufacturing industry and considered the need for holistic modelling of manufacturing systems. GRAI was considered to be the most appropriate modelling technique and consequently its advantages as both a modelling and communicating technique were described. Subsequently, the paper proposed a framework for a holistic model to assist manufacturing management to develop manufacturing systems in accord with the strategic objectives of the business, using a MTO environment as a case study. The fundamental concepts of the approach considered the application of hierarchical grids to provide ¯exibility within the con®nes of the overall model. The logic of each model is consistent within the global framework. Limitations of the GRAI network were observed and a hybrid structure proposed. A small pilot study investigation of this structure [11] has illustrated potential bene®ts of such an approach.
References [1] C.E. Wainwright, Considerations relating to the formulation of manufacturing strategies, Ph.D. Thesis, University of Manchester Institute of Science and Technology (UMIST), UK, 1993. [2] J. Parnaby, Creating a competitive manufacturing strategy, Prod. Eng. 67 (7) (1988) 24±28. [3] W. Skinner, Manufacturing Ð missing link in corporate strategy, Harvard Business Rev. 47 (3) (1969) 136±145. [4] D. Shorter, An evaluation of CIM modelling constructs, Comput. Ind. 24 (1994) 159±236. [5] G. Doumeingts, B. Vallespir, D. Chen, Methodologies for designing CIM systems, Comput. Ind. 25 (1995) 263±280. [6] K. Ridgway, S. Downey, A graphical technique for planning the introduction of AMT: the GRAI method, in: E.H. Robson, H.M. Ryan, D. Wilcock (Eds.), Integration and Management of Technology for Manufacturing, Peter Pereinus, IEE Management of Technology Series, 1991. [7] L. Pun, G. Doumeingts, A. Bourely, The GRAI approach to the structural design of ¯exible manufacturing systems, Int. J. Prod. Res. 23 (6) (1985) 1197±1215. [8] M. Wang, G.W. Smith, Modelling CIM Systems. Part 1: Methodologies, Comput. Integrated Manuf. Syst. 1 (1) (1988) 15±26. [9] G. Doumeingts, Systems analysis techniques, in: A. Rolstadas (Ed.), Computer Aided Production Management, Springer, Berlin, 1988. [10] D.T. Ross, Structured analysis (SA): a language for communicating ideas, IEEE Trans. Software Eng. 3 (1) (1977) 16±35. [11] C.E. Wainwright, Modelling approaches for manufacturing strategy formulation, in: Proceedings of the First International Conference on ME-SELA, Loughborough, UK, 1997.
Manufacturing planning within holistic strategic operations C.E.R. Wainwright*, P.G. Lee The CIM Institute, Cran®eld University, Cran®eld, Bedford, MK43 OEA, UK
Abstract This paper presents an overview of the process requirements for a holistic strategic planning model of manufacturing operations and presents a reference model for a MTO environment. The use of GRAI structured analysis techniques is used in the modelling process. Limitations of the GRAI modelling process are observed and outlined. # 2000 Published by Elsevier Science B.V. Keywords: Strategy; Manufacturing; Planning; Modelling; GRAI analysis; IDEF0 analysis; Holistic
1. Introduction Manufacturing industry performs a vital role within the UK national economy, yet ®erce international competition has resulted in a decline in industry in the recent past. Preoccupation with short term operational issues as opposed to building long term competitive advantage has been identi®ed as a major reason for this failure [1]. Similarly, the global economy has intensi®ed pressure on manufacturers in both domestic and export markets. To remain competitive, particularly within an economic climate in which the future is uncertain and not extrapolable from the past, requires the adoption of strategic planning techniques. At a functional level, manufacturing systems, in UK, have evolved through periods of uncontrolled growth in response to increased competition and market changes [2]. This has resulted in the development of manufacturing systems in which goals are inconsistent with overall business strategy. To nurture a competitive effective manufacturing ability, responsive to the demands of the customer, requires the de®nition of policies to address manufacturing objectives consistent with overall business objectives [3]. To support manufacturing objectives, compromise decisions in key structural and infra-structural areas are required. This is achieved through systemic multi-variable optimisation within the complete economic entity of a business, in which manufacturing is an integral part. Thus, through a process of iteration, manufacturing strategy may be de®ned in conjunction with the overall business philosophy.
*
Corresponding author. Tel.: 44-1234-754073; fax: 44-1234-750852. E-mail address: [email protected] (C.E.R. Wainwright). 0924-0136/00/$ ± see front matter # 2000 Published by Elsevier Science B.V. PII: S 0 9 2 4 - 0 1 3 6 ( 0 0 ) 0 0 7 1 5 - 9
Currently, there is much confusion in relation to the de®nition of manufacturing strategy. A common error is to refer to strategic goals as a manufacturing strategy. For example, ``lead time reduction'' is often quoted as being a manufacturing strategy, with no consideration being given to the mechanism of achievement. Similarly, it is dif®cult to constrain the concept of manufacturing strategy to a level of detail common to all situations, as a decision of strategic importance to one company may only be of operational importance to another. Recent classi®cations and reviews of manufacturing strategy literature express the urgent need to develop planning models for use in practical engineering environments. However, to model the dynamic processes involved in a manufacturing system is extremely dif®cult due to the dominant involvement of people and the sheer number of activities. Similarly, to relate strategic objectives to manufacturing system design and function, requires a modelling technique to identify functional parts and interfaces; use appropriate descriptive techniques to describe both the information and material processing systems; identify time based elements of decisional activity. The requirement to identify the functional parts of a manufacturing system, and the interfaces between them is crucial. Functional parts provide the means of incorporating human activity in the operation of the system. The second requirement, the use of appropriate descriptive techniques, is necessary to illustrate the structure of the system and the transformational process. Thus, the model must be both hierarchical and ``top±down'' to illustrate structure, and functional ``bottom±up'' in that a sequence of activities must be included to depict transformation processes. The third requirement, to identify the timing of decisions, is
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necessary to differentiate between strategic, tactical and operational decisions, all of which will be included during the design or modi®cation of a manufacturing system. To suit these requirements there are a number of structured modelling techniques available [4], however, there is only one, the GRAI methodology, developed speci®cally for analysis of manufacturing systems [5]. The GRAI methodology has a concentration on the decision making process, which also makes it highly suitable for the development of strategic planning models [6]. 2. The GRAI approach GRAI was developed at the University of Bordeaux 1 [7] and has continued to evolve over the last decade. GRAI involves the development of a conceptual model of the management structure of a manufacturing company. It is pre-dominantly a graphical technique using a decomposition principle comprising a unique combination to de®ne decision centres and the information required to make a decision within these centres. Following the identi®cation of decision centres, a ``top±down'' analysis is performed to establish their structure and connectance to other functions. The ``top±down'' analysis is followed by a ``bottom±up'' analysis of the elements of each decision centre, to determine activities and decisions made at the decision centre, and the links between various centres. The ``bottom±up'' analysis is displayed via the GRAI nets which contain the following basic elements (Fig. 1): 1. Activity model where q is state, x1 is support and d : q0 ^ x1 ! q1 . 2. Activity model with OR and AND successions, where DT is the decision table. This model exhibits the analogue and logical chain multiplicity. 3. Parallel activity branch model where p1 is the result of the activity g1 (d1 being used as the support y1 of the activity). This model exhibits the analogue and logical branch additivity. On the basis of these elements, most of the complex activity within a system may be modelled. The GRAI method differs from previous systems modelling techniques in that it relates to the analysis and design of the decision system, rather than the information or physical systems. By concentrating on fundamental concepts the method avoids the pitfalls of the IDEF approach highlighted by Wang and Smith [8]. The GRAI approach is based upon three basic elements: A conceptual model. That is an abstract scheme which gives an invariant representation of a system for a problem solving class. Tools and representation rules. An application methodology to represent the practical aspects of the method (implementation steps of the concept, human intervention, etc.).
Fig. 1. GRAI network elements.
The conceptual model of GRAI was developed from theories on complex systems and organisations [9]. It comprises two parts, to outline the organisation of a manufacturing system and to detail the activities of a decision centre. Using the decision centre as a focal point, the GRAI conceptual model assumes that the structure of a manufacturing system is comprised of three sub-systems: The physical sub-system, comprising machines, materials, operators and techniques divided into work centres. This is the operational level, where the physical work of transforming raw material to finished goods occurs. The decision sub-system, representing a hierarchical structure with each level determined by a horizon (the time interval during which a decision is valid) and a period (the time interval at the end of which a decision has to be reviewed). This sub-system is divided into decision making levels, each one composed of one or several decision centres. Each decision centre, with the exception of the extreme layers, receives a decision frame from an upper level, and gives decision frames to the decision centre of the same or lower levels. The information sub-system, providing the decision subsystem with relevant information, to provide a link between decision and operating systems, and which permeates the entire structure.
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The decision making process is such that the decision maker identi®es a model representing the desired end state or goal. A decision is then taken which adjusts the system towards this end state (horizon). After a certain time interval (review period), the decision maker compares the real situation against that of the model and adjusts his actions accordingly. The structure of the decision centre therefore de®nes
the various activities of a decision centre; the decision frame (variables and decision limits); decisions made by the decision centre; information used by the decision centre.
To analyse a system's structure, GRAI uses two graphical tools The GRAI grid, which gives a hierarchical representation of the entire structure of decision centres within the system. The GRAI nets, to enable the representation of activities and decisions made at the level of a decision centre, and of links between various centres. System decomposition is achieved by means of the GRAI grid, which produces a hierarchical decision structure. Decision centres may be found on different levels within an organisation. According to the complexity of the system modelled, several GRAI grids may be produced, relating to an aggregate master grid. Following the identi®cation of decision centres, a ``top±down'' analysis is performed to establish their structure and integration to other functions. The GRAI grid is represented by a matrix of rows and columns and depicts the ``top±down'' analysis. The columns represent the various functions within a system, and the rows represent the hierarchical position of the decision centre, de®ned by the horizon and review periods. The relationship between decision centres is identi®ed by the use of double arrows. Single arrows represent information ¯ows. The ``top±down'' analysis is followed by a ``bottom±up'' analysis of the elements of each decision centre, to determine activities and decisions made at the decision centre, and the links between various centres. The ``bottom±up'' analysis is displayed via the GRAI nets to represent the detailed activities of each decision centre. These activities include an examination of all the management activities and information sources required to make a decision. Symbols are used to identify different activities, which ¯ow vertically to denote decisional activities, and horizontally to denote physical activities. Single boxes indicate decisional information support and double boxes the transfer of the decision frame. The GRAI application methodology is based upon a two phase process of analysis and design. Its application is structured within well de®ned procedures, commencing with the analysis phase to collate all information in relation to the system. The initial phase of the veri®cation process
requires the creation of two groupings to form the Analysis Group and the Synthesis Group. The Analysis Group comprises one or more analysts who interview the Synthesis Group, and who subsequently construct and analyse the GRAI model. The Synthesis Group comprises all the management team involved with the project. All members of the Synthesis Group are interviewed by the analyst, who utilises the graphical tools to analyse the structure of the organisation. To ensure no ambiguity or errors occur within the study, the Synthesis Group is continually consulted to validate the results of the interviews and their subsequent interpretation. With this process it is possible to determine the content of the grid, horizon and review periods, decision centres and the links between the decision centres. Subsequently, it is possible to begin the ``bottom±up'' analysis to de®ne, through the application of GRAI nets, the detailed activities at each decision centre, starting from the lower levels of the grid. This analysis produces one or several GRAI grids, depending on the complexity of the system under analysis, and several GRAI nets relating to a square in the grid which requires a decisional activity. 3. Generic planning model A generic model may be used to illustrate the iterative stages in the process of manufacturing system planning within the context of holistic strategic system operation. This model indicates the type of processes in a hierarchical manner, and the iterative inter-action required to provide comparison between the lower and higher hierarchical levels. These decisions will determine the performance of the manufacturing system, which must be compared with manufacturing objectives. Any lack of correlation must be resolved before the process can progress to the next level of detail. Within the model three distinct levels of activity may be discerned relating to strategic, tactical and operational levels, easily modelled through GRAI via the application of a hierarchical series of grids related to a single master aggregate grid (Fig. 2). Although these three distinct areas may be modelled, the dis-similarity between different manufacturing systems is such that a generic model would be so general as to be of little value in the analysis of a speci®c system. However, the incorporation of GRAI decisional activities within an overall framework based on the generic model, provides a means of accurately representing particular manufacturing systems through the application of a series of speci®c grids. The inclusion or omission of certain activities can then be shown to be the result of a particular series of decisions. Such an approach provides suf®cient ¯exibility to incorporate the idiosyncrasies associated with particular systems. From such a basic framework, GRAI may be used to provide a more detailed description of the strategy formulation process.
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Fig. 2. Holistic manufacturing operation model.
4. Case study With any generic model, criticisms arise that models are too general to be applied to speci®c situations. With the following model, based on a Make-to-Order (MTO) manufacturing environment, the intention was not to provide a totally rigid structure of rules which must be adhered to, but a framework which could be applied with some modi®cation by a large percentage of capital goods MTO operators. For example, whilst attempting to remain impartial in the model development, the capital expenditure nature of goods produced by the collaborative company during model development required that products were installed and made operational at the customers desired location, as may be observed within the delivery decision frame. This aspect of the decision frame relates to the collaborative organisation, and certain other capital goods MTO manufacturers, but is not indicative of all producers. The intention of developing this model, however, would provide bene®ts including:
To create standard operating procedures for MTO companies within the collaborating organisational Strategic Business Unit (SBU) structure. The ability to transfer research findings to UK industry and the academic community. To aid the transfer of the process model (particularly within MTO environments). To outline inconsistencies in the decision making process of MTO companies. To provide direct benefits to the collaborator by the possible improvement of their management decision making process. 4.1. Strategic activities GRAI element The initial aspect of the generic model construction was the identi®cation of strategic activities, which enabled development of the strategic element of the GRAI grid. In the construction of this element of the
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grid, three major activities were performed in a ``top±down'' manner identification of functions; identification of decision centres; identification of suitable horizon and review periods. The initial phase in the construction of the strategic GRAI grid related to the selection of functions. Only a single function was identi®ed as necessary to the operation of this model, although it was necessary to include a further 10 phantom functions to ease the integration of the sub-model with the holistic model (Fig. 2). To plan. This function represents the sole function of the grid. Decisions taken relate to the planning of the functional strategies in accordance with business objectives. In accordance with the rules of the GRAI methodology, the GRAI grid also contained the two columns to cater for the provision of information exchange between nominated functions and both the external environment and other internal company functions: External information. This represents the exchange of information external to the organisation, including information from the market in terms of competitors. Customer orders, both con®rmed and forecast, are also sources of external information. Internal information. This represents the transfer of information internal to the system. Formulated manufacturing and marketing strategies, conceptual product designs and ®nancial data are typical sources of internal information. Following the identi®cation of functions, the following phase in grid construction was to identify decision centres relevant to the management decision making process. Consequently, ®ve decision centres were identi®ed and included. Having identi®ed the functions and decision centres to be contained within the GRAI grid, it was necessary to identify the horizon and review periods for each decision centre. Two horizon and two review periods were identi®ed within a de®ned hierarchy. Horizon 5 years; review period 1 year. The 5 year horizon period represents a typical planning horizon, in which to establish competitive business objectives, which have signi®cant impact on the success of business. The associated 1 year review period represents an annual review meeting. At this meeting, the matters arising from the quarterly review meeting are analysed and, if problems arise, changes to the planning programme are implemented. The parameters arising at this meeting are time, physical progress, resources and ®nancial expenditure. These parameters are considered in a ``rough-cut'' context. Horizon 3 years; review period 1 year and horizon 3 years; review period 3 months. The three year horizon represents the typical planning horizon for the formulation of functional strategies in accordance with business objectives. Two review periods are associated with this horizon. The ®rst is 1 year, representing an annual
review meeting, and is associated with the formulation of a holistic functional strategy framework. At this meeting the matters arising from the quarterly review meeting are analysed and, if problems exist, changes to the planning programme are implemented. The second review period is 3 months, representing a quarterly review meeting, and is associated with the formulation of speci®c functional strategies. The parameters arising at both these meetings are as discussed above. 4.2. Tactical activities GRAI element The element of the model relating to tactical activities was constructed in an identical manner to that of strategic activities. The initial phase in the construction of the tactical GRAI grid related to the selection of functions. Five functions were identi®ed as necessary to the operation of the tactical activities model, although it was necessary to include a further six phantom functions to ease the integration of the sub-model with the holistic model grid framework (Fig. 2). To plan. This function represents the core of the grid, to which all other functions are related, either through decisional activities or information ¯ows. Decisions taken relate to the initial planning of the design infra-structure, and the manufacturing system structure and infra-structure in relation to design, marketing and manufacturing strategies. To design. This function is related to the conceptual design of new products and product families within the bounds of the design strategy. The function provides planning information in the form of nominal product speci®cations. To manage resources. This function is related to the selection and installation of design and manufacturing resources. It is sub-divided into three further functions Design infra-structure. This function involves the selection of the design support system and installation, in addition to the creation of organisational structures and design teams. Manufacturing structure. This function involves the selection of machine tools and their installation within appropriate guidelines and a specified plant layout. Manufacturing infra-structure. This function involves the selection of shop floor scheduling techniques and planning and control systems, and their subsequent installation in conjunction with organisational structure and labour requirements. Following the identi®cation of functions, the following phase in grid construction was to identify decision centres relevant to the management decision making process. During the selection of functions, the decision centres had been considered at a ``rough-cut'' level. However, at a more detailed level 10 decision centres were identi®ed, and included in the GRAI grid.
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To plan. Three decision centres, to plan the manufacturing system structure and infra-structure and design infra-structure. To design. One decision centre, relating to the conceptual design of products and product families. To manage resources. Six decision centres, relating to the selection and installation of the manufacturing system structure and infra-structure and design infra-structure. Having identi®ed the functions and decision centres to be contained within the GRAI grid, it was necessary to identify the horizon and review periods for each decision centre. Three horizon and three review periods were identi®ed within a de®ned hierarchy. Horizon 2 years; review period 3 months. The 2 year horizon period represents a typical planning horizon in which to establish resources within a structured manner. Also the horizon represents a typical period for conceptual design. The associated 3 months review period represents a quarterly review meeting. At this meeting, the matters arising from the monthly review meeting are analysed and if problems exist, changes to the planning program are implemented. The parameters arising at this meeting are time, physical progress, resources and ®nancial expenditure. These parameters are considered in a ``rough-cut'' context. Horizon 6 months; review period 1 month. The 6 months horizon represents the typical planning horizon for the selection of design and manufacturing resources. The review period associated with this horizon is 1 month, representing a monthly review meeting. At this meeting, the matters arising from the weekly review meeting are analysed and, if problems exist, changes to the planning programme are implemented. The parameters considered are as at the quarterly review meeting, however, more detailed information would be considered. Horizon 1 month review period 1 week. The 1 month horizon represents a typical planning horizon for the installation of design and manufacturing resources. The review period for this planning horizon is typically 1 week, representing a weekly review meeting. At this meeting, matters arising from day to day activities are analysed and, if problems exist, changes to the programme are implemented. The parameters considered are the same as at the monthly review meeting. 4.3. Operational activities GRAI element The element of the model relating to operational activities was constructed in an identical manner to that of tactical and strategic activities. The initial phase in the construction of the operational GRAI grid related to the selection of functions typically performed within a MTO environment. To plan. This function, to which all other functions are related, either through decisional activities or information ¯ows, is the core of the grid. Activities performed and
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decisions taken relate to planning and scheduling jobs throughout the manufacturing process, the planning of material procurement and the planning of product delivery and installation. To manage materials. This function relates to material management in terms of supply and build. It is sub-divided into two further functions (to purchase and to make) To purchase. This function is involved in ensuring that the correct materials are ordered at the appropriate time ready for physical manufacturing activities or assembly. The function is further sub-divided into two functions To negotiate. This function is related to an assessment of purchased item values, and to the selection of suitable supplier sources. To buy. This function is related to the direct purchase of materials, and ensures vendors supply materials on time to the speci®ed cost and quality. To make. This function is related to the manufacture of the product, ensuring completion within the prescribed delivery time frame, to the speci®ed level of quality and cost. The function is further sub-divided into two functions To manufacture. This function is related to the physical activities involved in the direct manufacture of component parts, within specified time periods, to the required technical specification. To assemble. This function is related to the physical activities involved in the process of building finished products from discrete component parts, within specified time periods, to the required technical specification. To sell. This function concerns the management of the tendering process having received a customer invitation to tender request. Activities undertaken relate to the estimation of product cost and delivery, and the subsequent creation of tender documentation. The sell function provides information for planning in the form of delivery dates in accordance with the MPS, and budget costs for manufacture. To design. This function concerns the design aspect of products. Activities and decisions undertaken relate to the product engineering design, and the modi®cations of products in accordance with customer requirements. The design function provides planning information in the form of drawing release in accordance with the MPS, and the provision of design documentation. To deliver. This function relates to the delivery of goods to speci®ed locations. Activities undertaken include the test procedures to ensure that the ®nished product complies to the customer requested technical speci®cation, and acceptable quality levels. Following the identi®cation of functions, the following phase in grid construction was to identify the decision centres relevant to the management decision making process. During the selection of functions, the decision centres had been considered at a ``rough-cut'' level. However, at a more detailed level 19 decision centres were identi®ed, and included in the GRAI grid.
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To plan. Five decision centres exist to plan long and short term manufacturing schedules, with consideration of suitable manufacturing capacity levels. To formulate shop ¯oor schedules and to provide speci®c manufacturing information, e.g., NC part programs, route cards, etc. To manage materials. Five decision centres. Three relate to the purchasing function in terms of negotiating price with suitable suppliers, ordering long lead time and standard items. The remaining two decision centres relate to the physical process of manufacturing components and the physical assembly of components into ®nished products. To sell. Three decision centres relating to the response to a customer invitation to tender, the production of tender documentation and the estimation process required. To design. Three decision centres to produce workable engineering designs, modi®cations to these designs in accordance with customer requirements and the detailed process to release design documentation. To deliver. Three decision centres relating to the delivery of the ®nished product to customer location, to include negotiation and the selection of haulage contractors, testing and packing of ®nished product, and delivery (with installation if required) of product to customer location. Having identi®ed the functions and decision centres to be contained within the GRAI grid, it was necessary to identify the horizon and review periods for each decision centre. Within the MTO environment, six horizon and four review periods were identi®ed within a de®ned hierarchy. Horizon 1 year; review period 1 month. The 1 year horizon period represents a typical planning horizon for MTO companies to enable forecast and con®rmed orders to be modelled. For example, within the collaborative company this horizon represents approximately twice the manufacturing lead time for a typical works order. This horizon is related solely to the planning function. The associated 1 month review period represents a monthly review meeting. At this meeting the matters arising from the weekly review meeting are analysed and, if problems exist, changes to the planning programme are implemented. The parameters arising at this meeting are time, physical progress, resources and ®nancial expenditure. These parameters are considered in a ``rough-cut'' context. Horizon 6 months; review period 1 month. The 6 months horizon represents the typical planning horizon for the engineering design of products, purchasing in terms of selecting suppliers and ordering long lead time items. This horizon is also typically associated with invitations to tender from customers. The review period associated with this horizon is 1 month, representing the monthly review meeting discussed above. Horizon 3 months; review period 1 week. The 3 months horizon represents a typical planning horizon for manufacturing to ensure that suf®cient capacity will be made available for the manufacture of products in accordance with the MPS. If the capacity is not available typical
capacity techniques are considered in accordance with possible deviation from the MPS. The review period for this planning horizon is typically 1 week, representing a weekly review meeting. At this meeting, matters arising from day to day activities are analysed and, if problems exist, changes to the programme are implemented. The parameters considered are as at the monthly review meeting, however, more detailed information would be considered. Horizon 1 month; review period 1 week. The 1 month horizon represents the typical planning horizon enabling a ®rm production programme to be issued. Other activities within this horizon are the modi®cation of designs to customer speci®cation, the purchase of standard items, and the production of tender documentation. The 1 week review period represents the weekly review meeting discussed above. Horizon 1 week; review period 1 day. The 1 week horizon represents the typical planning horizon for detailed scheduling of manufacturing requirements in accordance with the decisions taken at the weekly review meeting. The review period for this planning horizon is 1 day, representing a close monitoring of activities. If problems arise, changes to the programme are implemented at an operational level without recourse to management review meetings. The parameters considered during the review process are as at monthly and weekly review meetings, although they are speci®c to localised areas and relate to time, physical progress and resources. Horizon 1 day; review period real time. The 1 day planning horizon represents the day to day activities performed by personnel including physical processing, producing detail drawings, etc. The review period is immediate and is related to individual tasks. The parameters considered therefore are time, physical progress and resources. 4.4. GRAI grid construction Once the constituent elements of the GRAI grid had been identi®ed (Table 1) it became possible to integrate them to produce the GRAI grid (Fig. 3) This process required a degree of iteration to identify the inter-relationships between decision centres, and to incorporate the relationships on the grid (Fig. 3). To assist in the subsequent analysis of the model, when applied within a company environment, typical personnel involved in the decision making process at each decision centre were identi®ed. The ®nal element in the grid construction was the identi®cation of the (important) information ¯ows between decision centres in accordance with GRAI methodology. 4.5. GRAI network construction Following the initial construction of the GRAI grid, the subsequent phase in the development of the model related to the ``bottom±up'' analysis, in which a GRAI net was constructed for each decision centre. To analyse the identi®ed
Table 1 GRAI grid elements Decision centre
Level 1 function
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33
Formulate competitive business strategy Formulate functional strategy framework Marketing strategy Design strategy Manufacturing strategy Establish design infra-structure Establish manufacturing system structure Establish manufacturing system infra-structure Plan and control manufacture MPS deviation Short term production programme Shop floor schedule Work cell programming Material purchase Order long lead items Order standard items Manufacture Assembly Tender Produce quotation Estimate Conceptual design Engineering design Customer product specification Detail design Haulage Test and pack Delivery Selection of design support system Install design infra-structure Selection of plant Install manufacturing system structure Selection of manufacturing system infra-structure support system Install manufacturing system infra-structure
To To To To To To To To To To To To To To To To To To To To To To To To To To To To To To To To To
34
plan plan plan plan plan plan plan plan plan plan plan plan plan manage manage manage manage manage sell sell sell design design design design deliver deliver deliver manage manage manage manage manage
Level 2 function
Level 3 function
Horizon period
Review period 1 year 1 year 3 months 3 months 3 months 3 months 3 months 3 months 1 month 1 week 1 week 1 day Real time 1 month 1 month 1 week Real time Real time 1 month 1 week Real time 3 months 1 month 1 week Real time 1 week 1 day Real time 1 month 1 week 1 month 1 week 1 month
materials materials materials materials materials
To To To To To
resources resources resources resources resources
Design infra-structure Design infra-structure Manufacturing structure Manufacturing structure Manufacturing infra-structure
5 3 3 3 3 2 2 2 1 3 1 1 1 6 6 1 1 1 6 1 1 2 6 1 1 1 1 1 6 1 6 1 6
To manage resources
Manufacturing infra-structure
1 month
purchase purchase purchase make make
To To To To To
negotiate buy buy manufacture assemble
years years years years years years years years year months month week day months months month day day months month day years months month day month week day months month months month months
C.E.R. Wainwright, P.G. Lee / Journal of Materials Processing Technology 107 (2000) 372±383
Decision centre No.
1 week
379
380
C.E.R. Wainwright, P.G. Lee / Journal of Materials Processing Technology 107 (2000) 372±383
Fig. 3. Generic GRAI grid for MTO environment.
decision centres, and therefore to construct their associated GRAI nets, it was necessary to identify the various activities performed and decisions taken at a given decision centre; the relationships between activities and decisions undertaken at a decision centre; the information required to make a specific decision or perform an activity. As with the construction of the GRAI grid, the nets were constructed in a generic manner, to be applied as a framework rather than a rigid ideal. For speci®c companies, if functions were omitted, the impact on associated nets must be considered. Generally, the implications may be observed by observation of the GRAI grid, illustrating decisional centres and major information ¯ows. Typical generic GRAI nets developed are illustrated by Figs. 4 and 5. 4.6. Case discussion The model, as described, forms an initial procedural step in manufacturing system development. It assists senior management to formulate manufacturing strategy through two areas
identification of the management decision making process; identification of informational requirements to support management decision making. De®ning the logic of manufacturing strategy formulation, through the model development, is only a part of the process. It is also necessary to determine how the model should be applied in practice by industry. Consequently, three main aspects of operationalising the process were identi®ed: procedure; participation; project management. 4.6.1. Procedure The procedure of the process model may be de®ned in three stages A well defined procedure to progress through the stages of: gathering information, analysing information, identifying opportunities. Simple and easily understood tools and techniques for use within the procedure. A written record of the results at each stage.
Fig. 4. GRAI net for decision centre plan and control manufacture.
Fig. 5. GRAI net for decision centre manufacture.
382
C.E.R. Wainwright, P.G. Lee / Journal of Materials Processing Technology 107 (2000) 372±383
4.6.2. Participation Participation in the application of the process model may be de®ned in three stages Individual and group participation to achieve enthusiasm and understanding. Workshop meetings to agree objectives, identify problems and develop improvements. A decision making forum leading to action. As the manufacturing strategy should be formulated in conjunction with the business and other functional strategies, it is essential that a multi-functional approach is adopted. Hence, there is the need for group working. The planning group approach within the GRAI methodology is amenable to this task, resulting in A forum where the generalisation of the process model could be removed at an early stage. The provision for multi-functional input and expertise from within the company. The close involvement of company personnel throughout the process, who subsequently ``own'' the developed strategy. 4.6.3. Project management The application of the process model requires project management, in which two major areas may be identi®ed adequate resourcing; an agreed time scale. Resourcing must comprise the company personnel, taking responsibility for ensuring that the project progresses, together with internal and external resources to provide the process ``expertise''. Similarly, it is essential that an initial time scale for application of the model is agreed and is worked to. 4.6.4. Limitations During the research it was observed that the construction and presentation of GRAI nets was very time consuming. Unlike the GRAI grid, which is very structured and must comply with a number of rigid rules, de®nitions relating to GRAI nets are much looser. Consequently, the nets constructed contained no logic in relationship to presentation or construction, often resulting in a complex diagram for which interpretation was dif®cult (Fig. 4). One constraint of SADT/IDEF0 is that no diagram should contain more than six boxes, so that the diagram can be easily interpreted [10]. Such a maxim in GRAI does not hold. However, so that the models developed are not super®cial, it is essential that the information presented is included, and this must be constrained to a single diagram via the horizon and review periods determined from the associated GRAI grid. Although there is no con¯ict in identifying the informational requirements at a speci®c decision centre, there is no means to identify the source of that information or to identify which
other decision centres the identical information ¯ows to, other than by inspection of the GRAI grid. At this level it is not possible to include all information ¯ows on the grid, in order to maintain its legibility. Within IDEF0, models are supported by a data dictionary. This is a list, in alphabetical order, of the information and objects which support activities throughout the model. This list provides an exhaustive exposure of the data within the system, and a means of easy access to the diagrams hierarchy. No such mechanism exists within GRAI methodology. The GRAI grid, presenting a hierarchical representation of the entire structure of decision centres within the system under observation, was an excellent medium for the purposes of this research. However, the GRAI nets were too constraining, and such complexity of approach also hindered the application of GRAI. Yet, unlike GRAI grids, a computer based model to construct the GRAI net will not signi®cantly aid application, as the problem of subsequent interpretation will remain. Thus, the need exists for a hybrid process to combine the best features in structured analysis modelling techniques. To avoid the pitfalls associated with an entirely new technique, including operational compromises and development time, the hybrid technique should harness the existing practices. It is envisaged that the technique would comprise GRAI grids, to provide structure, whilst the decision centres are represented using IDEF0. This would remove the dif®culty in interpretation of GRAI nets, and provide a means of structuring data in a suitable manner (Fig. 6). 4.7. Bene®ts This research enabled the creation of a novel GRAI model. The aim being to assist the decision making process surrounding the strategic activities relating to the formulation of functional strategies. The decision centres within the sphere of strategic, tactical and operational activities were identi®ed by the construction of a GRAI grid, and subsequently decomposed, using GRAI nets, to identify the informational requirements needed to support speci®c decisions and associated activities. The creation of such a model for capital goods MTO environments, based on constituent sub-models, was evolved. The operation of the process model in practice was similarly developed, including the desired procedures, participation and project management requirements. When applied within the collaborative company, from an internal perspective, limitations of the GRAI modelling process were identi®ed. However, from an external perspective, the process was deemed to be highly useful in aiding senior management identify and address the necessary areas to formulate a successful strategy. Within the collaborative organisation, during the case study analysis it was considered that implications of decisions were more easily observed through the GRAI grid, and this enabled communication throughout the organisation. Similarly, the explosion of the decision centres raised questions,
C.E.R. Wainwright, P.G. Lee / Journal of Materials Processing Technology 107 (2000) 372±383
383
Fig. 6. Hybrid GRAI IDEF0 conceptual model.
subsequently answered, regarding the correct informational requirements and supports necessary for ef®cient function. 5. Conclusions This paper has brie¯y outlined the need for the adoption of strategic techniques as an essential requirement for UK manufacturing industry and considered the need for holistic modelling of manufacturing systems. GRAI was considered to be the most appropriate modelling technique and consequently its advantages as both a modelling and communicating technique were described. Subsequently, the paper proposed a framework for a holistic model to assist manufacturing management to develop manufacturing systems in accord with the strategic objectives of the business, using a MTO environment as a case study. The fundamental concepts of the approach considered the application of hierarchical grids to provide ¯exibility within the con®nes of the overall model. The logic of each model is consistent within the global framework. Limitations of the GRAI network were observed and a hybrid structure proposed. A small pilot study investigation of this structure [11] has illustrated potential bene®ts of such an approach.
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