Focused factories - limited vertical integration, Strategic Management

Focused Factories - Limited Vertical Integration

Japanese companies prefer specialisation (derived from Adam Smith's theories on division of labour), with a limited or focused span of activity. They believe that with fewer activities to control, their abilities to master skills and improve productivity, are enhanced. There are some stark comparisons. The Singer Sewing Machine Company in Scotland, once had 14,000 employees working simultaneously on one site. Today IBM in Scotland who are engaged in the large-scale production of personal computers believe their plant has reached an 'optimum' size with 3,000 workers. Under no circumstances, would they allow their plant to approach the dinosaur proportions of the now extinct Singer plant. The issues of organisation and productivity are closely linked. Group technology (GT) This is a technique which is well documented by the British academic, J L Burbidge in his article 'The Future for Batch Production', 1985. Instead of laying out the plant by department specialism, it is considered more sensible to group product families together in cells. The purpose of their grouping is to improve material flow and span of control. For instance, less set up time is needed between parts requiring similar processing. More use can also be made of shared facilities. Group technology has been around for some time - it was widely used by the Soviet Union during World War II to produce tanks. After the war, it was imported to Europe. However, as the literal translation of the Russian is 'family planning' (which has other meanings!) it was altered to group technology.

Posted Date: 3/15/2013 1:07:34 AM | Location : United States

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