TIME BASED MANAGEMENT I t was the mountain bike experience that led to the changes. Wheeler Bikes of Nottingham had been producing profitably until a flood of cheap Taiwanese bicycles saturated the market. The collapse in the market price of mountain bikes led to huge losses at Wheeler. During the worst period, four years ago, the company was close to liquidation. It survived due to ruthless cost- cutting and rationalisation. Since then, its finances have recovered to allow a new growth strategy. The first phase was to reorganize the factory into cells. The continuous production line was replaced by a system of 19 work groups, each responsible for a significant part of bicycle production or assembly. The cells represented 10 of the 12 links in the chain from raw material to customer (the other two being delivery and retail sale). Reinforced by flexible teamworking and just-in-time production, the company could regard its manufacturing as fully up to date. Now Ann Raymond, the new Managing Director (MD), wanted to go one stage further. The firm could produce quickly and flexibly within its existing model range, but new products were still taking at least 18 months to get to the market. That slow pace increased the cost of new product development and restricted the firm 's ability to respond to changing customer needs. A case in point was the new Wheeler 'City bicycle, launched carlier this month. Started 20 months ago, it. was conceived when the government Minister for Transport was offering subsidies to encourage local councils to create more bicycle lanes. Yet in this launch month for the Wheeler 'City', the company's main rival announced that its 'CommutaBike' had sold an impressive 50,000 in its first six months. Worse still, the government minister was being replaced by a car enthusiast. Ann had recently attended conferences on time based management and simultaneous engineering. She felt ready to implement change. Her first step was to call a meeting of the heads of Wheeler's six departments. Ann' explained that she wanted to set time based targets for future product development, such as 10 months from idea to retail sale. The head of engineering was concerned about the effect on design quality, but accepted the need for more speed. Ann assured him that she would finance the purchase of an advanced computer aided design (CAD) system, but urged everyone to think about how to coordinate better, rather than just to work faster: 'I'm sure that the key is simultaneous engineering. For the City bike, John worked for two months on the design before Christine even started thinking about the structure and materials. If they had spent a couple of days together at the outset, surely both could have been working at the same time." The MD showed what she meant by sketching a diagram of the stages they went through to produce a finished prototype of the City bike (see Diagram A). The head of engineering looked admiringly at the diagram, but was puzzled at the shorter times allowed in Diagram B for tooling and making the prototype. Ann explained that this should be possible if the teams responsible for both operations were involved in the Stage: Structure Design Material Mechanics Prototype Tooling 8 11 7 13 18 7 Weeks: Diagram A: Development of City bike (64 weeks) Design Material 8 7 Tooling Prototype Structure Mechanics 11 13 10 Diagram B: Development through simultaneous engineering (38 weeks) earlier stages. That would enable them to plan their work in advance. During the following weeks the department heads went on a series of training courses. They learned not only that their MD's summary was sound but also more about how to make time based management work. QUESTIONS: The course leaders emphasized the importance of communications. Different sections of the firm could work simultaneously only if each knew exactly what the other was doing. Otherwise, there would be considerable wastage of time, materials and money. 1. It is widely thought that product life cycles are becoming shorter. For what reasons may this be occurring in a market such as bicycles. (4 marks) 2. Examine two financial implications for Wheeler of shortening the development time for New Products from 64 weeks to 38 weeks. (6 marks) 3. As with other elements of lean production, time based management is about the elimination of waste. Evaluate the importance of this in improving a firm's international competitiveness. (8 marks)