Impact of part proliferation on a high mix low volume manufacturing environment
Author(s)Youngerman, Paige Denise.
Massachusetts Institute of Technology. Department of Mechanical Engineering.
Sloan School of Management.
Leaders for Global Operations Program.
Warren Seering and Nikos Trichakis.
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This project set out to create a framework for conducting a cost benefit analysis of part proliferation looking into first, second and third order effects of part specialization within the entire Caterpillar enterprise. This project builds on previous internal efforts to reduce complexity by evaluating the impact of increasing part count on design, procurement, inventory, production and both internal and external quality. Part proliferation occurs as parts are designed or redesigned to increase safety, comply with changing regulatory rules, improve profitability, serve niche customer demands and increase percentage of industry sales (PINS). The main driver for creating unique parts instead of common components comes from the incentivization to optimize designs for individual models and applications with a relatively narrow perspective on the cost function underlying parts proliferation.Caterpillar factories assemble final products from unique components sourced from both internal and external suppliers. Part proliferation increases inventory and requires design and upkeep actions to create and produce the new product. Many of the challenges associated with proliferation are hidden or poorly understood as they involve factory and quality efficiencies which tend to be aggregated at a high level or dealt with as a one-time issue. Other benefits such as inventory reduction are clearer but were analyzed by this project to understand the total impact of a unique part to the system. This project focused on decreasing the proliferation of axle options within the Medium Wheel Loader (MWL) and Large Wheel Loader (LWL) product families, with the outcome of creating a generalized framework for use throughout the enterprise on any product family.The study found that the impact of including the areas of operational inefficiencies, internal quality, and external quality, when adding an axle configuration increased the costing analysis by 64%. The details of this analysis are presented in the following dissertation.
Thesis: S.M., Massachusetts Institute of Technology, Department of Mechanical Engineering, in conjunction with the Leaders for Global Operations Program at MIT, May, 2020Thesis: M.B.A., Massachusetts Institute of Technology, Sloan School of Management, in conjunction with the Leaders for Global Operations Program at MIT, May, 2020Cataloged from the official PDF of thesis.Includes bibliographical references (page 41).
DepartmentMassachusetts Institute of Technology. Department of Mechanical Engineering; Sloan School of Management; Leaders for Global Operations Program
Massachusetts Institute of Technology
Mechanical Engineering., Sloan School of Management., Leaders for Global Operations Program.