Supply Chain Introduction to Quality Xerox Discussion

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Benchmarking at Xerox

By the late 1970s, Xerox was losing significant market share to its Japanese competitors. Not only were the Japanese products ex-cellent but also, to Xerox’s dismay, they were sold for less than Xerox could manufacture them. Xerox found that it had nine times as many suppliers as the Japanese companies and made seven times as many manufacturing defects. Lead times for new products were twice as long, and production setup times were five times as long as the competitors’.

Xerox introduced benchmarking in 1980. Its processes and practices were benchmarked against the best in and out of its indus-try. As a result of these efforts, Xerox saved itself. Today, Xerox is a world-class competitor, capable of holding its own in terms of technology, price, service, and customer satisfaction against any competition. Benchmarking at Xerox has reached into every facet of the company and remains a primary feature of the corporation.

Discussion Question

Discuss the following question in class or outside of class with your fellow students: 1. Using public domain information, such as that available on the Internet, determine where Xerox stands relative to its competi-tors today.

Taiichi Ohno’s JIT/Lean system, with the elimination of practically all inventories, and using demand pull (kanban) to coordinate the flow of materials and assemblies through the production process, has been resisted by some on the basis that if even the smallest part in the system failed to appear or perform when needed, the entire process must come to a halt. Ohno proclaimed that this “weakness” of JIT/Lean was in fact its power since it removed all safety nets, and, with the production line stopped, forced the entire organiza-tion to focus on resolving the root cause of the problem so that it never recurs.

CourseKar Industries manufactures golf carts. Their product is reasonably successful, but competing manufacturers sell their carts for less than CourseKar can, and yet have fewer product war-ranty and reliability problems. As a result, CourseKar’s market share has been slipping, and the Board of Directors is calling for action. Management knows that its competition has been using JIT/ Lean production techniques for several years. But while they find JIT/Lean appealing for eliminating waste and improving quality and productivity, they are concerned that conversion to JIT/Lean, with its precariousness of having little or no inventory of materi-als on hand would be too great a risk. In order to lower production costs and improve quality, management is leaning toward a hybrid JIT/Lean system instead. This system will employ the principles and methodology of JIT/Lean, but will maintain buffer stocks of materials and assemblies to prevent every part delivery problem or malfunction on the line from shutting down the production process.

Discussion Questions Discuss the following questions in class or outside of class with your fellow students:

1. If something as trivial as a missing screw or a broken tool can stop a JIT/Lean production line, how could Ohno consider that to be a power of the concept?

2. Discuss what would likely happen if a needed screw or a work-ing tool is missing from a traditional mass production line.

3. Discuss the implications of a JIT/Lean production system that employs buffer stocks or materials and parts.

4. Discuss the potential for a nonmanufacturing organization to benefit from employment of JIT/Lean.