Prefab High-Rise In New York

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MAY 5, 2014

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Inside a warehouse at the Brooklyn Navy Yard, steel beams and flat metal sheeting rest atop a workbench. A diagram–which looks an awful lot like furniture assembly instructions–spells out where each beam and metal screw belongs. On it someone has carefully checked off each component, one by one.

The metal may not look like much yet, but it’s on its way to becoming part of the world’s tallest modular residential high-rise. Workers will configure these beams into walls, which will become the scaffolding of rooms, which link together to form entire apartments. Then the “mods” are loaded onto a truck and driven 2.5 miles away, lifted by crane and snapped into position like Lincoln Logs. Time to load an apartment: 30 minutes. From the first cut of metal to placing a mod on its final site, the entire process takes about 20 days. “And we’ll get faster,” says the VP of Swedish construction giant, Skanska. “This is bringing the best of manufacturing and construction together.” The first 32-story tower is slated for completion in December.

Skanska is counting on the new factory approach to urban construction to save on costs and provide greater quality control, writes Forbes (May 5, 2014).  A 1,000-square-foot apartment in NY costs an estimated $330,000 to build; Skanska estimates it will knock 15% to 20% off that this go-round–and as much as 30% off with more experience.

“If they can show that here, I think it has potential to have a transformative effect,” says a Tulane architecture professor. “It’s of interest both to architecture and to developers who are interested in building affordably and fast.” The most important innovation is the construction method itself. The factory feels like the love child of Home Depot and a sterile surgical chamber. “We believe that in factory environments the productivity of the worker is greater,” says a project exec.

This post provided courtesy of Jay and Barry’s OM Blog at www.heizerrenderom.wordpress.com. Professors Jay Heizer and Barry Render are authors of Operations Management , the world’s top selling textbook in its field, published by Pearson.

 

Chipotle’s Burrito Velocity

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APRIL 27, 2014

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chipotle-service“Another year, another breakthrough in Chipotle’s blinding burrito-making speed,” writes Quartz (April 21, 2014). Over the first 3 months of 2014, the US Mexican-food chain saw an average increase of 7 transactions per hour at both peak lunch and dinner hours—12 to 1pm and 6 to 7pm. On Fridays, one of its busiest days of the week, Chipotle fielded 11 more customers per hour at lunchtime on average across its stores, a 10% increase.

“One important element of delivering great customer service is you’ve heard us say over and over is faster throughput,” says the CEO. “We’re excited that our teams are ready to break new throughput records.” Another way to think about throughput is to think about it as burrito-velocity—that is, the speed it can funnel a customer and the burrito being made for them from the beginning of its line to its end. The chain puts every part of its assembly line under a microscope to make sure it functions as efficiently as possible.
As far as the company is concerned, faster service is the same thing as better service. For that reason, the chain is finicky about things Chipotle-lovers likely hardly even notice. Credit cards, for instance, are better than cash, because they’re faster. And that person who wanders around cleaning off counters and re-filling empty meat, vegetable, rice, and bean containers is crucial. In fact, she even has a title: linebacker. Linebackers, who patrol countertops, replace serving-ware, and refill bins of food, are one of Chipotle’s four, Maoist-sounding pillars of effective lightning-speed service. The others, which together make up what the chain refers to as its “four pillars of great throughput,” include the extra person between the one who rolls your burrito and the one who rings up your order, a commitment to having every ingredient and utensil in its place, and finally, making sure its best servers are always working at peak hours. Some of Chipotle’s fastest restaurants currently run more than 350 transactions per hour at lunchtime, which equates to nearly 6 transactions per minute!

This post provided courtesy of Jay and Barry’s OM Blog at www.heizerrenderom.wordpress.com. Professors Jay Heizer and Barry Render are authors of Operations Management , the world’s top selling textbook in its field, published by Pearson.

Sharing the Same Production Process at Samsung and Globalfoundries

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APRIL 24, 2014

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Two Globalfoundries workers in Albany, NY

Samsung and Globalfoundries just announced (see The Wall Street Journal-April 18, 2014) that they have agreed to adopt the same production process as they upgrade their chip-manufacturing services, an unusual alliance with implications for many designers of computer chips and other devices, notably Apple. With the agreement, chips produced by Samsung and Globalfoundries will be essentially identical; companies that design chips could have their products produced in factories operated by either company with no extra effort.  Companies generally prefer to reduce their reliance on a single supplier for components. In this case, the pact between Globalfoundries and Samsung provides a new selling point as the two companies try to woo customers away from Taiwan Semiconductor, the biggest chip maker.

The new pact could allow Apple in the future to shift chip orders between Samsung’s Austin plant and a Globalfoundries factory near Albany, N.Y.  “The idea of doing business with multiple suppliers is built right into Apple’s DNA,”  says one industry expert.

The pact also reflects the intense financial pressures associated with pursuing Moore’s Law, Silicon Valley’s shorthand for shrinking semiconductor circuitry to improve chips’ speed and data storage capability. With individual production tools priced at tens of millions of dollars—and complete chip factories costing $5 billion or more—fewer and fewer companies still develop new production processes. In response, companies are now working together to share costs of developing new production recipes.

But the deal goes much further. Globalfoundries agreed to abandon a technology it had been developing for creating chips with circuitry measured at 14 nanometers, or billionths of a meter. It will instead license Samsung’s 14 nanometer process, which has technical benefits, and uses common production tools and materials.

This post provided courtesy of Jay and Barry’s OM Blog at www.heizerrenderom.wordpress.com. Professors Jay Heizer and Barry Render are authors of Operations Management , the world’s top selling textbook in its field, published by Pearson.