The Ford Production System

            
 
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Case Details:

Case Code : OPER040
Case Length : 15 Pages
Period : 1991 - 2004
Organization : Ford Motor Company
Pub Date : 2004
Teaching Note :Not Available
Countries : USA
Industry : Automobile

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This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.



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"The crux of the change is the way people work and the way machinery is organized. Lean manufacturing is all about people and the way they use technology to eliminate waste."1

- Anne Stevens, Vice-president, North America Vehicle Operations, Ford Motor Company.

"With increasing market segmentation, Ford's new flexible assembly system means the company can react more quickly to shifting customer demand. The company will be able to produce a wider variety of vehicles, change the mix of products and options, and change volumes - all with minimal investment and changeover loss."2

- Al Ver, Vice-president, Ford Advanced and Manufacturing Engineering.

Introduction

In 2002, 17 manufacturing plants across the world received the Shingo Price for Excellence in Manufacturing3, termed by BusinessWeek as the 'Nobel Prize of Manufacturing.' Three plants of Ford Motor Company (Ford) found a place in the list. The plants included Ford Assembly Plant, Chicago III; Ford Engine Plant, Romeo, Michigan and Ford Engine Plant, Chihuahua, Mexico (Refer Exhibit I).

The award was given in recognition of Ford's efforts to streamline its manufacturing operations. By using lean manufacturing principles, Ford had significantly improved the quality of automobiles it produced.

Operations Management Case Studies | Case Study in Management, Operations, Strategies, Marketing Management, Case Studies

Jim Padilla, Ford's group Vice-president of Global Manufacturing said, "Ford is aggressively implementing lean manufacturing principles through the Ford Production System at all of its manufacturing operations. This is key to our success in an increasing competitive vehicle market."4

Ever since it began operations in 1903, Ford has been recognized as a manufacturing process innovator in the automobile industry. For instance, in 1907, Ford introduced the mass production system, which produced cars of uniform quality and features in bulk, and sold them at an affordable price to customers. In 1913, Ford introduced assembly line manufacturing, a totally new approach in automobile making (Refer Exhibit II). Ford also became the first automobile maker to adopt 3D visualization tools like CAD, CAM in its manufacturing operations in the 1970s. In the mid-1990s, Ford revamped its operations, to induce greater flexibility and enhance the efficiency of its manufacturing processes.

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1]  "Dearborn Truck Plant to Showcase Lean, Flexible Manufacturing In Best-in-class Facility," www.fordtrucks.com.

2] "Ford's New Flexible Assembly System Will Save Up To $2 bn Over 10 Years," www.ford-trucks.com, December 3, 2002.

3] Established in 1988 by Utah State University (USU), the Shingo Prize is named in honor of Shigeo Shingo, the creator of the original lean production system. The award criteria include customer satisfaction, quality, profitability, cost and delivery, lean core operations, leadership and empowerment enablers.

4] "Ford Ohio Assembly Plant Wins Shingo Prize for Lean Manufacturing," www.ford.com, April 25, 2001.

 

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