Transforming an Indian

Manufacturing Company:The Rane

Brake Linings Case
1. How do you consider the linkages of Operations Strategy to its Business
Strategy? What do you beliee are the key links?
!n organi"ation#s operations function is concerned with getting things done$ producing goods
and%or serices for custo&ers. Operations &anage&ent is i&portant because it is responsible
for &anaging &ost of the organi"ation#s resources. Howeer' &any people think that operations
&anage&ent is only concerned with short(ter&' day(to(day' tactical issues.
!ll business organi"ations are concerned with how they will surie and prosper in the future. !
business strategy is often thought of as a plan or set of intentions that will set the long(ter&
direction of the actions that are needed to ensure future organi"ational success. Howeer' no
&atter how grand the plan or how noble the intention' an Organi"ation#s strategy can only
beco&e a &eaningful reality' in practice' if it is operationally enacted. !n organi"ation#s
operations are strategically i&portant precisely because &ost organi"ational actiity co&prises
the day(to(day actiities within the operations function. )t is the &yriad of daily actions of
operations' when considered in their totality that constitute the organi"ation#s long(ter&
strategic direction.
*he relationship between operations and the other business functions is si&ilarly i&portant.
*he ob+ectie of the operations function is to produce the goods and serices re,uired by
custo&ers whilst &anaging resources as efficiently as possible.
-ane Brake .ining planned to transfor& it to co&pete with global players. !uto&atically it
would help the -B. to be successful in )ndian &arket also. )n this +ourney -B. has changed its
goal to create custo&er and ai&ed at &a/i&i"ing custo&er satisfaction. *he Business
Strategy of -B. reoled around one of the &ost i&portant and co&ple/ co&ponent of it'
0uality.
0uality is one of the &a+or para&eters on which the fir&s co&pete with each other. 1usto&ers
search for ,uality in all products and serices. Hence only ,uality can transfor& &arkets for
products and serices by delighting custo&ers' proiding profitability to fir&s and in turn
econo&ic growth of the country be influenced.
)n order to achiee its business goal of delighting custo&ers -B. decided to i&ple&ent *02.
!nd the tools it has used are 3olicy 4eploy&ent and 4aily -outine 2anage&ent. *he 4-2 has
been i&ple&ented with the concept of 5a6 7ach function will hae uni,ue purpose' 5b6 7ach
purpose will hae role' 5c6 7ach role will hae &anaging points to achiee the purpose' 5d6 !ll
&anaging points hae &easure of perfor&ance' 5e6 !ll &anaging points hae &etrics' 5f6 !ll
&anage&ent points hae either graphs or ital actiity &onitoring chart' 5g6 4eelop&ent of
&etrics or indices is i&portant' specifically for non(&anufacturing areas.
!nd this ensures the operations to &oe fro& its basic state to the strategic &ode. 7ery thing
in the organi"ation has inole&ent of people. *he redefined their processes of 8ew 3roduct
4eelop&ent Syste&' 2anufacturing 0uality' Supplier 0uality and 1usto&er 0uality. 7ery
effort in this strategic direction of creating custo&er and i&proing custo&er satisfaction is
substantiated by the daily &anage&ent of all the actiities be it internal or e/ternal' inoling
all stakeholders . *he role clarity' engage&ent of people' engaging potential buyers and
e/isting custo&ers in decision &aking processes in regard to new product i&pacted the ,uality
of not only the product it delier but also in effectie application of planning' organi"ing'
leading and controlling of resources of the organi"ation.
*he effect of this has been eident as -eduction in 332 of 1usto&er line re+ections fro& 19:::
pp& in #;; to 1<=: in #:>' -eduction in 3lant in process re+ections fro& ?.1 @ of total pieces to
:.A= @ of total pieces produced' increase Sales per e&ployee fro& B ??::: to B C::::' increase
in nu&ber of e&ployee suggestions fro& ?A: to <=:: during the period.
)n 2aterials 2anage&ent also -B.#s has i&ple&ented cost reductions and cost opti&i"ation
hints at &aintaining price co&petitieness without the need for repeated supplier changes.
)n other words' *02 represented a dra&atic and &easurable i&proe&ent across &any specific
&etrics that would i&pact the co&pany. Hence strong linkage of the operational strategy of
daily routine &anage&ent with its business strategy' of creating ,uality that is superior to the
co&petition in the custo&er#s eyes' is eident in al&ost eery facet of decision &aking at
-B. .
?. What were the key tools for i&ple&enting *02 at -ane Brake .inings ? 7/plain
the key tools used by -ane with any functional e/a&ple at *ata 2otors ?
Part A
*02 is a leadership philosophy and strategy that is based on 1ontinuous i&proe&ent of eery
process' e&power&ent of people' 1ontinuous learning' all creating transfor&ations towards an
organi"ation that is proiding e/cellent products and serices. )n *02' all e&ployees in each
and eery function and eery leel of organi"ation hae to pursue ,uality in the organi"ation.
*his is what is &eant by Total. 'Quality' &eans striving for excellence' superiority and
value in every action in the organization. !nd the ter& D2anage&entD refers to achieing
,uality through the effectie application of planning' organi"ing' leading and controlling of
resources of the organi"ation.
-B. decided to focus on 3olicy 4eploy&ent and 4aily -outine 2anage&ent 54-26 to achiee
their *02 i&ple&entation. !s a result' -B. redefined its &anage&ent of processes for 8ew
3roduct 4eelop&ent Syste&' 2anufacturing 0uality' Supplier 0uality and 1usto&er 0uality.
*02 i&ple&entation created tangible and intangible benefits for -B.. )ntangible benefits
included role clarity so that each person understood their role in the organi"ation' their
suppliers and custo&ers' and their &etrics. 3lant in process re+ections at -B. decreased fro&
?.1 per cent of total pieces to :.A= per cent of total pieces produced. Sales per e&ployee went
up fro& B??::: to BC::::. 8u&ber of e&ployee suggestions went fro& ?A: to <=:: during the
period. )n other words' *02 represented a dra&atic and &easurable i&proe&ent across &any
specific &etrics that would i&pact the co&pany.
Key tools & techinques used in TQM in Rane Brake Lining
Techniques used in TQM
= S
seiri
seiton
seiso
seiketsu
soitsuke
Eai"en
3oka(yoke
Eanban
Standard Operating 3rocedures 5SO3s6
Executing TQM
3olicy 4eploy&ent and 4aily -outine 2anage&ent 54-26
7ach &anager was re,uired to define his role' his &etrics' his &easure&ent of
perfor&ance to date and the steps being taken to i&proe perfor&ance
Focus on co&petency.
Syste&atic analysis of the proble&' steps taken to resole it' i&pact of the steps and
learning fro& each obseration.
Deployment of DRM meant that
5a6 7ach function will hae uni,ue purpose'
5b6 7ach purpose will hae role'
5c6 7ach role will hae &anaging points to achiee the purpose'
5d6 !ll &anaging points hae &easure of perfor&ance
5e6 !ll &anaging points hae &etrics'
5f6 !ll &anage&ent points hae either graphs or ital actiity &onitoring chart'
5g6 4eelop&ent of &etrics or indices is i&portant' specifically for non(&anufacturing
areas.
Process Manageent is also an i&portant tool for *02. -B. redefined its 2anage&ent
of processes for 8ew 3roduct 4eelop&ent Syste&' 2anufacturing 0uality' Supplier
0uality and 1usto&er 0uality.
!nd following these principles 2anage&ent of -B. beliee that they are selling their
process &anage&ent capability in addition to their products.
!ustoer involveent is another tool used by -B. in i&ple&enting *02 .
-ane Brake .ining encouraged the closeness with its custo&ers and iewed it as an
opportunity for i&proe&ent. *hat#s the reason -B. started focussing on relationship
,uality with the introduction of 5a6 custo&er satisfaction inde/ 51S)6 and custo&er
relationship inde/ 51-)6 and 5b6 direct contact between new product deelop&ent and
,uality assurance and the custo&er.
!oitte" #ea"ership focused on the strategic planning and uses cross functional
interfaces at all the leels of the organi"ation.
*he 4-2 &ade $ployee involveent ery effectie which is eident by drastic
i&proe&ent in the getting aluable suggestion for the e&ployees. -ole clarity of eery
e&ployee ' its suppliers ' custo&ers ' partners are strengthened through the
i&ple&entation of the 4-2.
Part B
World 1lass 0uality 5W106 initiatie in *ata 2otors and *2. drielines is a classic
e/a&ple where si&ilar tools are used .W10 is an integrated approach towards
i&proing ,uality by not accepting defect ' not building defect and not shipping the
defect to custo&ers.
*he )nitiatie includes = principles.
).3eople )nole&ent G 7ery one in the orgni"ation is responsible for ,uality.
*he attributes of 3eople )nole&ent are as followsG
1.Vision & Mission tate!ent
".Values
#.$ealth & a%ety &riority
'.Tea! (once)t
*.&eo)le +n,ol,e!ent
-..)en (o!!unication &rocess
/.ho) 0loor Manage!ent
1.Quali%ied &eo)le
Fulfilling the core re,uire&ents of the attributes &entioned aboe will ensure
Tea! Building 2 E%%ecti,e Training and clear co!!unications across organi3ation.
)).Standardi"ationG Standardi"ation is the pre re,uisite for achieing built in
,uality. *he below are the attributes of standardi"ationG
4. 5ork &lace .rgani3ation
16. Manage!ent By Takt Ti!e
11. tandardi3ed 5ork
1". Visual Manage!ent
*he attributes help organi"ations through Layered 7udit o% )rocesses 8y all le,els
starting %ro! 1
st
line su)er,isors to the di,isional heads aided 8y tandardi3ed
5ork and Visual Manage!ent
))).Built in 0ualityG *his is the i&portant pillar of the W10 which &eans %o not
accept & 'uil"& ship "efect.*he attributes to be taken care of for achieing the
re,uired leel are '
1#. &roduct Quality tandards
1'. Manu%acturing &rocess Validation
1*. +n9)rocess (ontrol & Veri%ication
1-. Quality 0eed8ack : 0eed0or;ard
1/. Quality yste! Manage!ent
*he core re,uire&ents of the attributes are fulfilled by &aintaining Buyo%% <ates 2 * 0
8oards =Quality %eed %or;ard & 0eed 8ack;ard > and 7lar! Escalation )rocess.
7ery section of the depart&ent has buyer supplier relationship with one another.7nd of eery
section displays what are the top internal issues of the section and what are its custo&er
co&plaints.*he )&&ediate correctie action' root cause and the 3reentie correctie !ctions
planned for each defect and &onitored with P%!A cycle. Based on its seerity of the defect
alar& is escaled to certain leels ..ike &ore than 1= &inutes stoppage of production to be
escalated to the 17O%3lant Head. 3roper reiew and follow up of the actions will definitely
i&proe the syste& to achiee the Built in 0uality.
)H.Short .ead *i&e G *here is always a need to 4rie first ti&e ,uality thereby
enabling shorter lead ti&e to delier ehicles to custo&er.)t will also reduce the proble&
soling ti&e for all proble&s.*he attributes for the principle of Short .ead *i&e are
11. i!)le &rocess 0lo;
14. !all Lot &ackaging
"6. 0ixed )eriod .rdering yste!
"1. (ontrolled External Trans)ortation
"". cheduled hi))ing : Recei,ing
"#. Te!)orary Material torage
"'. +nternal &ull: ?eli,ery
"*. Le,el Vehicle order schedule
"-. u))ly (hain Manage!ent
uccess%ully %ul%illing the core require !ents o% the a8o,e !entioned attri8utes ;ill
i!)ro,e the Logistics 2 0+0. and drastically i!)ro,e the )er%or!ance o% su))ly
chain !anage!ent.
H.1ontinuous )&proe&entG )f organi"ation &aintains its perfor&ance with the
aboe C principles ' to sustain the co&petitie adantage ' 1ontinuous )&proe&ent is ery
&uch essential. Stabili"ing the process with the help of following tools facilitate continuous
i&proe&ent to take place in the organi"ation.
"/.&ro8le! ol,ing
"1. Business &lan ?e)loy!ent
"4. 7ndon (once)t
#6. Lean ?esign o% 0acilities Equi)!ent2 Tooling2 Layout
#1. Early Manu%acturing and ?esign +ntegration
#". Total Maintenance yste!
##. (ontinuous +!)ro,e!ent
*he &ain tools used in the principle are 7ndon analysis2(ra%ts!anshi) 7udit2&rocess
7udits2&ro8le! sol,ing 2(usto!er 7cce)tance audit =(77> etc
)t is eident that there are >> attribute in this = principles and all >> core re,uiree&ents are
fullfilled by taking actions on ?;= core re,uire&ent in the leel ) . *he leel ) denotes that no
defect will go out of the plant to the custo&er through 4aily 2anage&ent and inole&ent of
eerybody in the organisation.
*here are C further steps continually &oing thru stages of defects not go out of Shop 5.eel ))6
' 4efects will not leae the cell 5 .eel )))6 ' 4efects will not leae the &achine% station 5.eel
)H6 and finally to stage where defect will not get generated 5.eel H6.
!t end *2. 4rielins belie that 0uality is a Iourney and is not a goal.