Custom Order Management: Understanding QRM vs Lean Manufacturing

Dec 20, 2011 12:00:00 AM

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Building customized products for customers can be big business, but many manufacturers increase lead-time and decrease productivity when they create one-off products.

This isn’t a new problem, but one that needs a clearer path to higher productivity and more effective use of order management, as well as man-hours. Applying a lean manufacturing philosophy to custom production orders is hardly the answer: The concept often relies heavily on standardizing tasks to efficiently create items in quantity, while custom orders are by definition not a target of mass production. Quick response manufacturing (QRM), on the other hand, probably is the solution.

I’m not alone in this thinking. On Mbtmag.com, Mike Collins wrote why he thinks manufacturers should look at QRM and not lean manufacturing as the answer to produce custom products.

Collins writes:

“This does not mean that QRM is an alternative methodology that replaces Lean. Every manufacturer needs a good continuous improvement program regardless of the type of manufacturing. QRM simply complements Lean, Six Sigma and other popular methodologies. I just think that the QRM system is a better approach for custom product manufacturers who need to reduce lead times and labor hours.”

Building out custom products for your customers does require some rethinking beyond lean strategies. To this end, Collins goes on some key points about the differences between lean manufacturing vs. QRM:

  • Origin: Lean came from the Toyota Production System, for high-volume repetitive production. QRM was built from the ground up for custom products with low-volume.

  • Driver: The driver for lean manufacturing is the elimination of waste. The driver of QRM is the reduction of lead times, in part through better order management.

  • Organization Structure: This type of structure isn’t an objective of lean manufacturing, but it’s key to QRM. This helps the organization reduce lead times, as a different type of organizational structure can substantially reduce them.

To move on the path to success with QRM, Collins points out a few factors QRM could use for improved custom product development, manufacturing and order management:

  • Generalist vs. Specialist Employees – As Collins writes, in functional organizations, most employees specialize. What QRM needs is cross training for more employees to work on any machine or department.

  • Purchasing – Some customers may want specific materials for every process. This means new vendors and possible lead-time problems. Collins states how one company moved a buyer from one area to the division, there by purchasing could happen during the engineering process.

A main objective with custom development and production of specialized products is lead-time. To do this, efficiently, focus on a process that works with your current system – this is what QRM represents. When this is put into place, you not only experience shorter lead times, but increased profits and satisfied customers.

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About Author
Luciano Cunha

Luciano Cunha

Chief Executive Officer (CEO) For Luciano, being responsible for To-Increase’s global sales and marketing means unleashing the company’s insight, innovation, and creativity to tell our story and help customers achieve their goals. On the road much of the time, he travels the world to meet with customers, understand their challenges and ambitions, and find the most effective ways to help them advance. Luciano develops and mentors our marketing and sales team, and creates strategies to help the To-Increase worldwide partner channel thrive and grow.
Making Customer Needs the Main Business Driver Luciano and his team have daily conversations with the To-Increase research and development organization to bring customers’ requirements and concerns into the road maps and design of our solutions. Luciano brings his insight to the marketing group to make sure the company’s communications resonate with customers and speak directly to their experience.
“I’m awed by customers’ innovative spirit in taking business management technology past its limits and by their generosity in letting us participate and empower them. I hope to transform our organization to become even more customer-centric than we are today. That means making more resources available to spend productive time with both our customers and partners, so we can ensure that we place into customer businesses effective solutions that fit the evolutionary stage of their operation and the way their people and processes work.”
Empowering a Global Channel
Because To-Increase only sells through partners, readying the channel to be successful in helping customers is a business-critical effort. Luciano aims to meet partners where their interests are. Partners who consider the relationship with To-Increase strategic can rely on our industry specialists to work with them as they plan their growth and serve customers. If partners prefer a less collaborative relationship, they still receive the rich To-Increase expertise and resources to ensure they win the business, perform a successful deployment, and retain a satisfied customer. In working with partners and their customers, Luciano brings to bear his experience of many years of creating successful, customer-focused business development and marketing strategies in many of the world’s countries and regions.
Enabling Customer Success in Challenging Business Environments
Looking into the near future, Luciano expects that customers will continue to expect To-Increase to help them make business sense of unfolding trends and technologies. For example, the internet of things (IoT) will thoroughly revolutionize manufacturing, engineering, and supply chains. Big data will be meaningful and valuable when decision-makers can use technology solutions to transform it into actionable business intelligence that supports key roles and business processes. Mobility will help companies become digital enterprises and move business processes forward from any location, at any time. Team To-Increase harnesses innovation to help customers translate the promise of these technologies into business results.
Before his current role, Luciano for several years was one of To-Increase’s global industry directors, responsible for our industry solutions. His experience also spans more than 17 years in IT and manufacturing management roles. These positions took him into various areas at IBM Brazil, serving as product manager for several software development companies, and included working in senior management at a manufacturing organization in the U.S.
Luciano is married with two young children. Away from work, he enjoys participating in a soccer class together with his son and daughter as well as taking relaxing walks in natural environments with his family.

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