The role as well as the operations played by Indian component manufacturing companies in the global supply chain have been evolving and gaining scale over the last two decades. The next few years, however, are expected to be tumultuous.
The cost of machines and equipment has been undergoing a lot of rationalizing; there is a little difference based on the location where it is purchased. It is now more a matter of services availability and its cost that will be a big differentiator. Identifying this distinguisher during machinery and equipment purchase and its effective use will be an important aspect that component manufacturers need to leverage.
Mindset shift required
The regular way of buying machines, creating and dedicating capacity based on part numbers will no longer work. The mindset of size scaling first and efficiency scaling next or vice versa needs to be addressed. A line of machines dedicated to manufacture a part family needs to be worked upon, for both process efficiencies and speedy changeover times, to meet a continuously moving productivity target.
So while the traditional “M’s” remain the same, the approach is in need of a complete reversal, how radical should be the move of component manufacturers in order to cope with such challenging times?
In my assessment, recognition, formation and empowerment of the leadership team of owners, managers and executors is the first thing to be overhauled. The belief that business is mainly about machines and equipment, with people as a necessary evil must alter.
The next important change is the conversion and creation of flexible capacity, which is building capability into the existing infrastructure to help the leadership team understand and read in the situation in the shop super imposed with the market.
Automation like gantry, robotics etc. is only part of such flexible capacity. This needs to be adequately supported with measuring, monitoring and scheduling software. They should be able to communicate their maintenance needs, predict failures and reroute their load in case of failure. The management and continuous improvement of this flexible capacity is what will give real-time returns and profitability.
The brave will reign
It is foreseen that companies will be forced to become highly aggressive in bidding for new jobs. They need to understand actual cost as against present methods of standard cost. This can only be done by evaluating and rating each individual operation and having intelligence and flexibility built in, rather than looking at the total manufacturing process which will hide the inefficient operations. Customers will no longer pay for overheads not used in their specific part production. Such bidding is not for the faint hearted though; it can only be done by those having flexible capacity, its management and absolute confidence in their intelligence data system.
Customers will no longer pay for overheads not used in their specific part production.
T K Ramesh
Whole time Director and CEO
Micromatic Machine Tools Pvt Ltd
The views expressed by the author are personal and he can be contacted at email@example.com