Modular manufacturing - use scorecard to measure and improve performance

These days almost all companies are implementing variety of strategies to meet the very much prevailing competition in the business market. In lieu of this changing scenario, manufacturing companies are adopting a latest concept called modular manufacturing.

Team work, increased responsibility, and better interaction among the team members and various departments are the three most sought out advantages of modular manufacturing. Employees get rid of their daily routine, as this concept allows them to perform a variety of work, thus, breaking their monotonous schedule. Just-in-time is a complementary tool that the companies use along with this modular approach. Being a new concept, modular manufacturing requires a proper analysis of every aspect and objectives of the organization, thereby demanding a performance measurement tool. In this milieu, Key Performance Indicators (KPIs) are a best approach.

KPIs are metrics that help an organization to define viable objectives and to merge them with the prevailing scenario. When put on a balanced scorecard, these indicators are usually categorized into four perspectives. In context of the modular manufacturing, there can be four perspectives. Financial perspective includes such indicators as % savings in inventory costs, and % savings in transportation costs. Machines modules reutilization, % decrease in production-to-market lead time, and many such indicators together form the operational perspective. Internal processes perspective includes % reduction in down time, integration capabilities, etc. as its indicators. Fourth perspective, i.e. efficiency, deals with such indicators as % decrease in standard production hours, % reduction in defect rates, % reduction in inventory levels and waste ratio reduction. With all these perspectives, it can be easy for an organization to examine the effectiveness and benefits delivered by modular manufacturing approach.

A particular manufacturing company usually deals with the similar kind of products. More often, the employees get fed up with the monotony of their work, and the result being unmotivated employees, atrocious employee turnover rate, and finally an intense loss to the organization. In order to control this dreadful situation, these organizations are employing a new concept called modular manufacturing. But this system alone is not sufficient to manage the situation. An additional approach is required. In this regard, KPIs can act as the best solution an organization can ever get.

KPIs help an organization to measure its performance and progress after a new technology or strategy has been implemented. These are quantifiable measurements that reflect the vital and decisive factors of an organization, thereby making it goal-oriented. KPIs act as high level snapshots that are based on the pre-defined objectives of the organization.

Although modular manufacturing can help the organization in meeting its objectives while at the same considering each and every aspect of it, but its proper implementation is based on continuous monitoring. For a modular manufacturing approach, KPIs can act as supportive tool, thereby helping the organization to focus not only on the working style but also on the results. Apt and effective synchronization of these two concepts can act in the favor of the organization, if implemented properly.

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BSC Designer helps to measure and control business performance using Scorecard and KPI tools.

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