1. Manufacturing Enterprise
Computer Integrated Manufacturing
© 2013 Project Lead The Way, Inc.

2. Manufacturing Enterprise
History of Manufacturing
CIM
Principles of Manufacturing
Manufacturing Enterprise
This presentation discusses
Manufacturing enterprise concept
Components of enterprise wheel
Significance of wheel components
Reaching far beyond the 75,000 members of the Society of Manufacturing Engineers (SME), the "Wheel" was enthusiastically received. It demonstrated that manufacturing had entered a new age, an information age, where computer technology helps us manage the manufacturing enterprise. It provided an architecture for continuous improvement.
Our understanding of enterprise integration has also continued to improve. In the mid-1980s we understood the need to break down the walls between design and manufacturing. We did not articulate other issues so well, such as the importance of simplifying processes before automation and the interaction of the enterprise with its customers and suppliers.
New insight brings us to the new Manufacturing Enterprise Wheel. This updated vision preserves the understanding gained from the previous CIM Enterprise Wheel. The old Wheel looked primarily at automation and integration inside the enterprise. The new Wheel looks outside as well. It adds understanding in these six areas:
The central role of a customer-oriented mission and vision to strive for continuous improvement.
The importance of teams and human networking in the new manufacturing environment.
The continuing importance of computer tools, now increasingly distributed and networked. This includes tools to support networking and concurrent engineering.
A focus on key processes and best practices throughout the enterprise, from marketing through design, manufacturing, and customer support.
Recognition of the move away from bureaucratic structures, to leaner and more agile organizations.
The need to integrate an understanding of the external environment, including customers, competitors, suppliers, and the global manufacturing infrastructure.

3. Manufacturing Enterprise Wheel
History of Manufacturing
CIM
Principles of Manufacturing
Manufacturing Enterprise Wheel
This Manufacturing enterprise wheel represents the components and interrelationship of a manufacturing system as described by the Society of Manufacturing Engineers, SME.
Source: The New Manufacturing Enterprise Wheel; Copyright© 1993, Society of Manufacturing Engineers

4. Manufacturing Enterprise Wheel
History of Manufacturing
CIM
Principles of Manufacturing
Manufacturing Enterprise Wheel
Six Perspectives
Customer-Centered
People and Teamwork
Shared Knowledge
Key Processes
Resources and Responsibilities
Infrastructure
The new Manufacturing Enterprise Wheel describes six fundamental elements for competitive manufacturing:
The central role of the customer and evolving customer needs. A clear understanding of the marketplace and customer desires is the key to success. Marketing, design, manufacturing, and support must be aligned to meet customer needs. This is the bull's-eye, the hub of the Wheel, the vision and mission of the enterprise.
The role of people and teamwork in the organization. Included here are the means of organizing, hiring, training, motivating, measuring, and communicating to ensure teamwork and cooperation. This side of the enterprise is captured in ideas such as self-directed teams, teams of teams, the learning organization, leadership, metrics, rewards, quality circles, and corporate culture.
The revolutionary impact of shared knowledge and systems to support people and processes. Included here are both manual and computer tools to aid research, analysis, innovation, documentation, decision-making, and control of every process in the enterprise.
Key processes from product definition through manufacturing and customer support. There are three main categories of processes: product/process definition; manufacturing; and customer support. Within these categories 15 key processes complete the product life cycle.
Enterprise resources (inputs) and responsibilities (outputs). Resources include capital, people, materials, management, information, technology, and suppliers. Reciprocal responsibilities include employee, investor, and community relations, as well as regulatory, ethical, and environmental obligations. In the new manufacturing enterprise, administrative functions are a thin layer around the periphery. They bring new resources into the enterprise and sustain key processes.
The manufacturing infrastructure. While a company may see itself as self-contained, its success depends on customers, competitors, suppliers, and other factors in the environment. The manufacturing infrastructure includes: customers and their needs, suppliers, competitors, prospective workers, distributors, natural resources, financial markets, communities, governments, and educational and research institutions.

5. Manufacturing Enterprise Wheel Customer-Centered
History of Manufacturing
CIM
Principles of Manufacturing
Manufacturing Enterprise Wheel Customer-Centered
Customer at center
Shows where the focus should be
End results should contribute something of value to the customer
In the end, every activity in the manufacturing enterprise should contribute something of value to the customer. Providing superior value to the customer generates growth and profits.
The role of an enterprise mission and vision is to align all work toward meeting--and surpassing--customer expectations. This is the bull's-eye, the hub, and the center of the new Manufacturing Enterprise Wheel.
A customer-centered mission provides a clear direction to align activities and empowers the work of teams in the new manufacturing enterprise.
Recent years have seen unprecedented experimentation in the organization of manufacturing enterprises. Start-up companies grew and became giants. Huge conglomerates formed from other companies. Giant companies faltered, with some regaining their competitive edge. Others are gone. The globalization of manufacturing continued at a dizzying pace, from small niche producers to the largest international firms.
These successes--and failures--have proven the need for a clear mission and vision, focused on the customer needs. Profits and growth can only be sustained when customer needs are met or exceeded.

6. History of Manufacturing
CIM
Principles of Manufacturing
Manufacturing Enterprise Wheel People and Teamwork in Organization (P-T-O)
Members contribute to customer value
Enterprise strength is based on people, organization, and culture
All members of the organization stake their futures on their ability to deliver value to the customer, and earn profits in return. The central role of people in the organization forms the inner circle of the Wheel. The enterprise is only as strong as its people, organization, and culture. Today's highly competitive worldwide markets require a new approach to managing, organizing, and applying the knowledge and skills of people.
When venture capitalists consider funding a new company, their first consideration is people--their knowledge, their experience, their motivation. When successful companies explain their success, the answer is much the same: it is "our people and our organization." When Japanese or German business leaders explain the manufacturing success of their nations, with fewer natural resources than many, they again point to people. Manufacturing success builds on the education, skills, drive, cooperation, and leadership of people.

7. Manufacturing Enterprise Wheel Shared Knowledge and Systems
History of Manufacturing
CIM
Principles of Manufacturing
Manufacturing Enterprise Wheel Shared Knowledge and Systems
Information is the dominant material today
Computer systems and intelligent machines support people and processes
In the past, epochs were named by the dominant materials and tools of the age: the Stone Age, the Bronze Age, the Iron Age. Materials and processes are still evolving. Yet, today, the dominant material of civilization is information; and the dominant tool is electronic interchange. In this age of shared knowledge, people and systems transform information into better products and services.
Nearly every job in every company is changing in some way as a result of shared knowledge in the information age. Computer systems and intelligent machines are as much an influence today as were the stone, bronze, or iron tools of the past.
The unique expertise of CASA/SME is understanding information technology and the ways this technology can empower people in the manufacturing enterprise. Indeed, a key function of the Wheel is to illustrate ways in which computer systems support people and processes in the enterprise.

8. History of Manufacturing
CIM
Principles of Manufacturing
Manufacturing Enterprise Wheel Key Processes
Three process groups
Product/process definition: How
Manufacturing: Planning reality
Customer Support: Meeting customer needs
The manufacturing enterprise combines people and tools, in processes, to add value to purchased materials and components. Processes are the life of the manufacturing enterprise.
The real manufacturing enterprise might have hundreds or thousands of processes, depending upon the level of detail. In the new Wheel, there are three main groups of processes, a trinity of actions focused on customer satisfaction. These are product/process definition, manufacturing, and customer support.
First is product/process definition. It defines what is to be built and how it is to be built. While product/process definition may consume only 5 to 20 percent of the manufacturing enterprise's total resources, it casts a long shadow. When product and process definition is complete, the ultimate performance and value of the product, as well as most manufacturing expenses, have already been determined.
Second is the lower segment of the wheel, manufacturing. For products like automobiles, industrial equipment, office equipment, and appliances, manufacturing requires the largest investment of resources.
Third are processes which, combined with the manufactured product, make it available and useful to the customer. These customer support processes include global support, distribution, sales and promotion, and customer service throughout the product life cycle.
The three main process groups are further divided. Together, all 15 processes form a Manufacturing Enterprise value chain:
PRODUCT/PROCESS DEFINITION
1) Business Definition
2) System Design
3) Component Design
4) Continuous Improvement
5) Documentation and Release
MANUFACTURING (/Service)
6) Resource Planning
7) Operations Planning
8) Component Fabrication
9) Assembly and Test
10) Material Management
CUSTOMER SUPPORT
11) Global Organization
12) Distribution
13) Sales and Promotion
14) Customer Services
15) Life-Cycle Transitions
This definition of 15 key processes is based on input from scores of leading manufacturing organizations and on research about human problem-solving skills. For more information, readers are referred to the related CASA/SME Blue Book.
The distinction between products and services continues to blur. Products become services as they are leased, made available in service centers, or bundled with implementation services. Services, in turn, become productized. Ultimately, our enterprises deliver capabilities, often as hybrid products/services, to help customers realize their visions. Thus, many best practices in product definition and process reengineering are as applicable to services as to products.
While these key business processes flow from one to another around the Wheel, one point must be clear. The old sequential step-by-step process is no longer sufficient. Indeed, each key process must be started at the earliest point in time. The key processes overlap so that as many activities as possible are performed in parallel. Only in this way can superior products be brought quickly to market.

9. History of Manufacturing
CIM
Principles of Manufacturing
Manufacturing Enterprise Wheel Concurrent Engineering
Team and communications across wheel
Computer and human networks
Information must be shared
Teaming and communication are required across the Wheel among all processes to make "concurrent engineering" a reality. Both computer and human networking are keys to success. The diagram illustrates a subset of the many possible relationships in concurrent engineering. Each company--and its partners--must define their own uniquely effective ways of information sharing.
A related trend is toward the "virtual enterprise," with key processes subcontracted to other suppliers. For example, some computer companies design their products (processes 1-5), but outsource manufacturing (processes 6-10), and rely upon value- added resellers for customer support (processes 11-15). Strong companies can exist with core competencies in design, or manufacturing, or customer support only.

10. History of Manufacturing
CIM
Principles of Manufacturing
Manufacturing Enterprise Wheel Virtual Enterprise
Enterprise outside of one company
Subcontract processes
Global economy of scale
Effective communication crucial
The new Manufacturing Enterprise strives for worldwide economies of scale and scope, by networking business units, partners, and suppliers. These trends range from virtual co-location of project teams to virtual enterprises spanning the globe.
The practice of concurrent engineering is the simultaneous consideration of all 15 of the key processes in design, manufacturing, and customer support. Today's best practices involve cross-functional and self-directed teams linking these key processes:
Product/Process Definition Manufacturing Customer Support
1 Business Definition 6 Resource Planning 11 Global Organization
2 System Design 7 Operations Planning 12 Distribution
3 Component Design 8 Component Fabrication 13 Sales and Promotion
4 Continuous Improvement 9 Assembly and Test 14 Customer Services
5 Documentation and Release 10 Material Management 15 Life-Cycle Transitions
In the end, how well matters more than who performs each of the activities of the processes. It may be harder to communicate with outside suppliers, especially globally dispersed suppliers, but new communication tools reduce transmission errors, speed up the process, and lessen the costs. Today's teams and their processes are supported by computer systems and communications, from electronic mail, to databases of best practices and computer visualizations of products "to be."
The 15 key processes also give companies a way of comparing best practices. Reference to the SME model is a good starting point for work in process mapping, process audits, and competitive benchmarking.
Understanding the 15 processes, from business concept to satisfied customer, helps members of cross-functional teams place a higher value on the unique skills each can bring to the manufacturing enterprise. We know that agile manufacturing requires better communication among functions like design and manufacturing and sales. The 15 key processes serve as a framework for this improved understanding and communication.

11. History of Manufacturing
CIM
Principles of Manufacturing
Manufacturing Enterprise Wheel Resources
Manufacturing transforms resources
Inputs: Capital, knowledge, materials
Outputs: Finished goods
Biology cell analogy
Manufacturing transforms resources and adds value. Inputs include capital, knowledge, skills, and leadership of people, as well as materials, information, technology, and other supplies. Outputs are finished goods.
This administrative layer manages the flow of inputs from the manufacturing environment. Capital is transformed to:
- People and their skills (human resources, leadership) - Materials (purchasing, inventories, storing, distributing) - Tools (equipment, machinery, facilities) - Information (on customers, markets, trends . . .) - Technology (internal and external R&D, tools, processes) - Suppliers (components, special knowledge, services, lead times)
As resources flow into the enterprise, value is added, and finished goods and services flow out to customers. In addition to its customers, the management of the enterprise has responsibilities to maintain its infrastructure. These responsibilities include:
- Employee (wages, benefits, security, worthwhile jobs) - Investor (return on investment, stability, market share) - Community (support of infrastructure) - Regulatory (government regulations and regulatory trends) - Ethical (moral responsibilities) - Environmental (minimum wastes, sustainable ecology)
In the field of biology every living cell has a membrane that insulates internal processes from the environment. This outer layer must readily transport vital resources into the cell, and transport by-products outside the cell. The paradox of the cell membrane is that it is simultaneously resilient and tough, yet thin and permeable.
Why the analogy? Why not just call this layer by department names like personnel, purchasing, and finance, and be done with it? The new Manufacturing Enterprise, aided by computer systems, is finding ways to cut overhead, flatten the organization, and allow internal teams to interact more directly with customers and the environment. Control comes as much from a nucleus of shared value, as from administrative mandates from the top.
We envision that input/output functions will become more like the membrane--stretched thin, but tough and permeable. The old pyramid organization, with management, overhead, headquarters, and administrative functions taking the top three or four layers, is evolving to a leaner and more responsive organization.

12. History of Manufacturing
CIM
Principles of Manufacturing
Manufacturing Enterprise Wheel Infrastructure
External Environment
Global competition
Raw materials, energy, transportation, research institutions, workforce, etc.
Outside the nominal bounds of the enterprise is its environment. Some huge bureaucracies may steer themselves like the ocean liner Lusitania, dimly aware of their environment and slow to react. Yet, every enterprise must eventually adapt to the realities of customers, competitors, and other external influences, or sink into oblivion.
Key elements of the external environment are:
Prospective customers
Customers and their needs
Purchasing influences
Raw materials
Energy
Suppliers
Distributors
Transportation systems
Communications
Educational institutions
Research institutions
Prospective workforce
Community
Governments
Financial markets
Competitors
Demographic changes
Political environment changes
Infrastructure (workforce, investment, transportation, communication, suppliers, schools, research, and government support) separates top manufacturing regions and countries from others. The old pattern was that the Manufacturing Enterprise competed regionally. Even large companies often had little reason to compete beyond the borders of their country. Now, every Manufacturing Enterprise faces broader regional, national, or global competition. By the same token, considerations of customers, resources, and regulation have expanded to the new global infrastructure.

13. History of Manufacturing
CIM
Principles of Manufacturing
Manufacturing Enterprise Wheel

14. History of Manufacturing
CIM
Principles of Manufacturing
References
Computer and Automated Systems Association of the Society of Manufacturing Engineers (3rd ed.). (1993). The new manufacturing enterprise wheel. Dearborn, Michigan: Author.