4. Circle the correct word or phrase.

1. Production /Direct cost is a cost incurred by a business when manufacturing a good or producing a service. These costs combine raw material and labor.

2. Manufacturing /Direct cost is an expense that can be traced directly to (or identified with) a specific cost center or cost object such as a department, process, or product.

3. It is well-known that Continuous /Flaw production means the manufacture of products requiring the sequential performance of different processes on a series of multiple machines receiving the material for manufacture through a closed channel.

4. Flow /Continuous production is an activity that involves a continuous movement of items through the production process. This means that when one task is complete the next task must start immediately.

5. Work in progress/Semi-finished products is material that has entered the production process but is not yet a finished product. Therefore, it refers to all materials and partly finished products that are at various stages of the production process.

6. Production overheads/productivity - indirect expenses associated with processes used to produce a good or service.

7. Make on/ Assemble-to-order means manufacturing or assembly process geared to satisfy customer-requirements only upon receiving a customer's order.

8. An assembly line/Continuous production is a manufacturing process in which parts are added as the semi-finished assembly moves from workstation to workstation where the parts are added in sequence until the final assembly is produced.

5. Match the words from two columns to form a phrase.

Industrial	production
Production	control
Mass	stock
Semi-finished	range
Quality	espionage
Finished	product
Product	goods
Safety	lead-time

Reading 1

1. Read the text and discuss the questions:

1. Why does the author criticize mass production?

2. How does the author suggest to improve manufacturing process?

3. What is the idea of lean manufacturing?

4. According to the author, what are the drawbacks of outsourcing?

5. How did Duclos’ background help him change the manufacturing process in his factory?

2. Complete the text with sentences:

1. They reached a productivity plateau.

2. Ten years ago he started thinking about why biological systems were so efficient compared to factories.

3. There was no material waste, and the whole process required 20% less floor space in the factory.

4. As you scale up with this approach, it drives efficiency all the way through the supply chain, saving money.

5. Having obsessively thought for years about how to improve manufacturing processes, he’s convinced he’s on to something big.

Rethinking Mass Production: Why Making Things One at a Time is More Efficient¹⁶

It’s a basic tenet of mass production: Making things in batches is the most efficient way to manufacture anything. So why, then, is lean manufacturing evangelist Ted Duclos arguing that America can revitalize its manufacturing base by making things one at a time?

“It’s counterintuitive in the minds of many,” admits Duclos, president of Michigan-based Freudenberg-NOK Sealing Technologies (a joint venture between Germany’s Freudenberg and Japan’s NOK). 1.__

Instead of using a massive injection-molding machine to shape a bunch of thermoplastic pieces simultaneously (sometimes with inconsistent results), he’s promoting a system of small, single-cavity presses that squeeze out one flawless part at a time.

It sounds arcane, but it could be revolutionary. One two-year study of seals made using the single-cavity process found a 20% improvement in quality with similar cost savings. And since molded parts are inside nearly every consumer product on earth, Duclos’ ideas could affect manufacturers everywhere, especially in precision industries like automotive, construction and agriculture, where consistency and quality matter most.

Early results are promising. Chrysler, for instance, was looking to replace a piston in its automatic transmissions with a more cost-effective and lightweight alternative. Working with plastic supplier Chevron Phillips Chemical, Freudenberg-NOK used the single-cavity injection-molding process to produce a piston as durable as the aluminum one it replaced but was 30% lighter and had six times better quality. 2.__Chrysler wouldn’t say how much it saved overall, but the project earned an award for innovation from the Society of Plastics Engineers.

“It’s a very big deal,” says John Shook, a Toyota Motor veteran who now runs the Lean Enterprise Institute in Cambridge, Mass. “Go back to what Henry Ford did 100 years ago,” he says. “He got single-piece flow on the assembly line. Now how do you extend that all the way up the supply stream? That’s what we’ve been working on for 100 years. Some of the industry is still stuck in an old mind-set.”

Single-shot molding, which has been experimented with but never widely adapted, could be the next wave in lean manufacturing. Made popular in the 1980s by Toyota Motor, lean manufacturing is based on the Japanese principle of kaizen, or continuous improvement. Toyota’s objective was to eliminate all waste by emphasizing just-in-time inventory management and fixing problems as they occur, so quality would be built into the manufacturing process. Like lots of manufacturers, Freudenberg-NOK tried to duplicate Toyota’s system by keeping inventories low and producing only what was needed by the next process in a continual flow of work. The problem was that manufacturers were merely reorganizing work around existing capital; in the case of Freudenberg-NOK, that meant trying to run its large, multicavity machines more efficiently. Before long Freudenberg-NOK, like most companies, had squeezed all the improvements possible out of their systems using existing equipment. 3.__

So in the late 1990s and early 2000s manufacturers around the world began moving operations to low-cost countries like China. Productivity improved, mostly through lower wages. But outsourcing had hidden costs: poor quality (and the associated warranty expenses), increased shipping and higher inventory levels. Some companies shifted back to the U.S. but found themselves stuck with the problem that drove them offshore in the first place: an inability to keep improving because of the limitations of the technology itself. “You just can’t do enough kaizens to get around the limits of the capital you are using,” says Duclos.

His insight on single-cavity production stems from his unusual background: He’s a biomedical engineer with a master’s and Ph.D. from Duke and a mechanical engineering degree from Stanford. He joined Freudenberg-NOK in 1996 as director of technology, then added responsibility for engineering and operations, where his obsession with lean manufacturing took off. 4.__ “If you think about it, biological systems are incredibly efficient,” he says. “Everything is created with tiny one-piece flow factories called cells. These cells work in parallel to become systems that support life. Everything that exists–plants, animals, rubber seals–are based upon these single little building blocks that work together.”

Single-cavity molding, he says, is more like biology–you have many small machines working together in a highly efficient, effective manner. 5.__

Duclos’ biggest challenge now would be familiar to Henry Ford: getting other people, even inside his own company, to break with tradition and see the logic of what he proposes. “We’re still debating this internally,” says Duclos. “Customers aren’t necessarily asking us for this, but we think they will.”