News – Page 5 – Sustainable Innovation Management

RESEARCH BRIEF: Applying Lean Thinking to the Furniture Engineering Process

Wang Chao

MS Graduate Student

Virginia Tech

Introduction

Many furniture manufacturers do not have an efficient engineering process. As a result, problems are usually reflected as longer processing times for drawings that leads to production delays, high engineering errors rate affecting product quality, and excessive changes, higher costs and excessive waste. Presently, furniture manufacturers are trying to implement effective Lean Thinking methodologies for manufacturing process to reduce cost, improve quality, and shorten lead time in order to increase their competitiveness – This research utilizes value stream mapping (VSM) and simulation methods to implement a lean management application in the engineering process for wood furniture companies.

The application of Lean Thinking

Lean thinking principles encompass systematic approaches both on management level (Keyte & Locher 2004) as well as manufacturing level (Womack & Jones 1996). Lean management helps people to implement lean transformations in supporting processes such as accounting, engineering, customer service, and sales other than manufacturing. Lean Thinking, of course, can perform a lean transformation for a production process such as molding, fabricating, packaging, and finishing.

The role of engineering

Engineering takes into effect at an early stage of product life cycle, bridging the design and manufacturing transforming a design idea into a production reality. Thus, it plays an important role to reduce cost (either product development cost or manufacturing cost), ensure quality, and time-to-market. In Figure 1, we could see that, cost incurred in fixing mistakes increases from early stages to late stages of product life cycle while the amount of control decreases at the same period.

Figure 1 cost incurred to fix mistakes in product life cycle and the corresponding level of control (adopted from: Prasad 1996)

Value stream mapping (VSM)

Value stream mapping (VSM) is a useful lean implementation tool to help people identify both value-added and non-value-added activities in a process and eliminate wastes for process improvement. Figure 2 shows nine types of wastes in a furniture engineering process based on preliminary study. Figure 3 presents a simple furniture engineering process.

Figure 2. Engineering wastes in wood furniture industry adopted from (Ohno 1998; Prasad 1996; Keyte and Locher 2004)

Some furniture engineering processes, such as “create drawings”, always take a long lead time. Some reasons lead to this scenario could be due to the various interruptions to engineers when they create drawings, multiple approvals process, large batch sizes of tasks, or excessive engineering changes.

vsm — Figure 3. Current siimplified VSM for a furniture engineering process

These kinds of activities do not create value toward customer which should be eliminated or improved. Next step, we will focus on precisely measuring each value-added process and non-value-added process by mapping a complete current state VSM of the case study company, and then focus on how to eliminate the wastes in the process by applying appropriate lean tools. Specifically, we will follow Lean Think principles (Womack & Jones 1996) to incorporate the Lean Engineering process:

“Specification value” – specify the value that defined by the customer, but not by the engineers or any other people within the organization.
“Identify the value stream” – figure out all the processes involve in delivering engineering documents to internal customers. “Flow” – create continuous value-creating steps flow and reduce batch sizes for a single-task process.
“Pull” – pull the value from customer. Every process along the engineering value stream should be aligned with customer’s needs and satisfy these needs when it is needed.
“Pursue Perfection” – lean principles endlessly strive for perfection, avoiding unnecessary waste and errors in the processes and keep implementing continuous improvements.

RESEARCH BRIEF: US Pallet Industry Update in US Market

Leslie Scarlett Sanchez, MS Candidate

Department of Wood Science and Forest Products

Virginia Tech

Pallets in the U.S. Market

The growth of international trade in the last decades created the need to improve not only transportation infrastructure and technology, but also the elements used during transportation process such as handling, loading, unloading, warehousing. One of these elements is the pallet. Pallets and containers play an important role in the movement of goods from place to place. They are not only used in warehouses or commercial centers, but also in all those activities that require an efficient way of transportation. Pallets allow reducing time and cost in an efficient manner, facilitating handling and transportation of raw and in-process materials, or finished products from the supplier to the manufacturer, from the manufacturer to the wholesaler, and then to the retailer. About 450 million new pallets are manufactured in the US each year, 1.9 billion are in use in the U.S. each year, and 300 million pallets are recovered by pallet recyclers each year.

Pallets definition

Pallets are the interface between packaging and the unit load handling equipment (White & Hamner, 2005). Another simpler definition is that pallets are “portable platforms”, which facilitates the movement and storage of unitized goods (Kator, 2008).

Unit loads are also important to define, as the system comprised of pallets, packaging materials, and unit load stabilizers (stretch wrap, tie sheets, corner posts, load adhesives, and strapping). Figure 1-1 shows two examples of pallets and unit loads.

Figure 1-1. Pallets and Unit load

Wood Pallet and Containers Imports in the U.S. Market

According to the North American Industry Classification System (NAICS), the Wood Pallet and Container product class is represented by the following sub-classes which show percentages, representing the average share of each sub-class on the total value of shipments for years 2002 to 2006. Wood pallets and containers, and wood-metal combinations made up 62% of the total product class’ value of shipments.

Figure 1‑2. Share of Product Sub-Categories on Wood Pallet and Container Manufacturing Product Class (based on value of shipments, Census Bureau 2009)

U.S Domestic Production

The U.S. domestic production is showed in the figure 1-3 bellow. It is evident from Figure 1.3 that exists an increase over the years. In 2000 the domestic production was $ 4,8 billion and for 2007 was 7,2 billion representing a 49% of increase in 7 years.

Figure 1-3. U.S. Pallet Domestic Production (Census Bureau 2009)

U.S. Imports

Figure 1-4 shows the total imports and value of shipments (domestic production) of wood pallets and containers, and the share of imports over total domestic consumption. The later was obtained by adding imports and value of shipments. The value of product shipments (domestic production) has grown from about $5 billion to $7.2 billion over the 8-year period. Imports have stayed almost constant throughout those years. As a result, the share of imports on the domestic consumption of wood pallet and containers, has decreased, from 7.7% in year 2000 to 7.1% in year 2007; a drop of 8%.

Figure 1-4. Wood Pallets and Container Imports and Domestic Production (Census Bureau 2009)

Regarding countries of origin for imports, Figure 1-5 shows the ten major exporters of Wood pallets and containers to the U.S. from year 2000 to 2008.

Figure 1-5. Ten Major Country Exporters of Wood Pallets and Containers to the U.S. in the year 2008 (Census Bureau 2009)

RESEARCH BRIEF: Defining and Measuring Innovation

By Johanna Madrigal, PhD Candidate

Department of Wood Science and Forest Products

Virginia Tech

What is Innovation?

Innovation as a concept was first introduced in 1934 by Joseph Alois Schumpeter, a Harvard University professor of Economy, and since then has been defined as fundamental driver of wealth creation in the world, bringing value with economic importance to the market. The Oslo Manual, defines innovation as “the implementation of a new or significantly improved product (good or service), or process, a new marketing method, or a new organizational method in business practices, workplace organization or external relations”.

How is Innovation measured?

There is more than one indicator to measure innovation, however one of the most common indicators is to measure the contribution made by Reserach and Develpmetn (R&D) to Gross Domestic Product (GDP) of the country. Using this indicator the US Government, though the Census Bureau, ranks the states and its contribution. By 2008 the overall contribution of R&D to the GDP 2.6% and only the states shown in the following chart reached this value as its individual contribution.

nsf innovation — Ratio of Research and Development Expenses to total GDP by State

Which industries innovate?

According to National Science Foundation (NSF), the economic activities in the country are divided by sectors, where innovation is also measured based on the total investment performed by each sector. This chart shows a comparison of the Wood Industry to the largest industry sectors. It is observed that the major investment is done at the Computer and Electronic billion business sector ($56.8 billion), followed by Pharmaceutical and Medical business sector ($38.9). Meanwhile the lowest investments are done by Wood Industry ($2.365 billion), which ranks its business sectors at the bottom of the R&D measurement scale indicating a large gap to close in order to place Wood Industry as an innovative business sector.