48 KVALITA INOVÁCIA PROSPERITA / QUALITY INNOVATION PROSPERITY XVII/1 – 2013

INTEGRATION OF LEAN AND AGILE

MANUFACTURING BASED ON PRINCIPLES FROM
WIKINOMICS
DOI: 10.12776/QIP.V17I1.63

TATIANA USTYUGOVÁ, DARJA NOSKIEVIČOVÁ

1 INTRODUCTION
Lean and agile manufacturing are production concepts, which become more and
more popular at the modern market. The success of companies depends on
customers’ satisfaction and the correct cost management. Nowadays we live at
the period of possible, global communication. Therefore the principles from
Wikinomics can be used like as integration method of lean and agile
manufacturing. The topicality of this paper is focused on the creation of a steady
and flexible production process and easier growth of company’s success. All of
these results are possible with help of involved people and global
communication. The opinion, that modern companies are not ready for this
collaboration, is existing. But from the theoretic side, the integration of lean and
agile manufacturing with Wikinomics principles is possible. That is why the
algorithm of integration of these concepts will be shown in this paper.

2 BASICS OF LEAN AND AGILE MANUFACTURING

Lean production was created at the Toyota Company in Japan. This production
concept is focused on the elimination of waste and creation of steady and cost-
saving production process. The seven main types of waste were defined as (Ray,
at al., 2006, pp. 4, 5):
• “unnecessary movement of employees – it is any movement of people or
machines that is viewed as a value added service toward the product or
service;
• waiting – this means idle time created while waiting for items that are not
immediately available;
• defects – it represents the product which does not meet customer
requirements;

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• unnecessary transportation movements – it is moving work over short or

long distances without adding value;
• overproduction – this means making more products earlier or faster than
it is required;
• inventory – it contains an inventory in excess of the minimum needs of the
next transforming step;
• unnecessary process steps – it means work processes or materials that
add no value to the product from the customer’s viewpoint.”

However the agility means an enterprise wide response to an increasingly

competitive and changing business environment, based on four cardinal
principles: customer satisfaction; rapid adaptation or changeover of equipment;
usage of human resources and cooperation for the competition (Gunasekaran,
2001). It was defined in the research (Yusuf et al., 1999, p. 36) that “the agile
manufacturing assimilates the full range of flexible production technologies,
along with the lessons learned from the total quality management, “just-in-time”
and lean production.”
The main features (Gunasekaran, 2001, p. 32) of the agile manufacturing can be
summarised as follows:
• “Products: They are solutions to customer’ individual problems. Agility is
centred on the satisfaction of customer’s individual needs and the quickly
changeover of equipment.
• Virtual organisation: Internal and external co-operation are the strategies
of choice. The aim is to bring agile products to market in minimum time
by leveraging resources through co-operation.
• Entrepreneurial organisation: Companies must “organize to thrive on
change”. Agile manufacturers must have personnel who can convert
change to the growth.
• Knowledge-based organisation: The key differentiators in tomorrow’s
world will be people and information. Thus, agility contains the
decentralization of authority and leverages the value of human and
information resources.”

In contemporary professional literature a lot of various authors tried to determine

the differences between the lean and agile manufacturing. For example, authors
like as (Jin-Hai et al., 2003) specify the fundamental difference that lean
company may be thought of as a very productive and cost-efficient producer of
goods and services. But, the agile company is primarily characterised as a very
fast and efficient learning organisation. The other difference is that lean is
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focused on low-mix, high-volume production, but agile is focused on high-mix,

low-volume production (Hammaduddin, 2012).
But in general, lean and agile can co-exist. Their integration can be called a
leagile company (leagile – portmanteau, it is a combination of words, such as
lean and agile). By opinion of author (Krishnamurthy &Yauch, 2007), leagile
company operate at different points in a manufacturing supply chain. A key
element of this model is a “decoupling point”. This point separates the lean
processes from the agile processes. The lean processes are on the upstream side
of the decoupling point, and the agile processes exist on the downstream side.
The new way of the lean and agile manufacturing integration with help of
Wikinomics will be shown in this paper.

3 WIKINOMICS PRINCIPLES
Wikinomics is the new way of modern science, which composes from two words
such as Wikipedia and Economics. We can execute the integration of lean and
agile manufacturing with the help of Wikinomics principles.
The main principles of this modern science are parameters of the second
generation enterprise (Enterprise 2.0). These parameters are openness, peering,
sharing, and acting globally. According to Wikinomics (Tapscott and Williams,
2008, pp. 21, 25, 27, 29), these principles can be explained as follows:
1) “Openness: it is associated with the words, such as transparency,
freedom, flexibility. The openness means for the companies to make their
boundaries porous to external ideas and human capital. It involves the
transparency of pertinent information to partners, employees, customers,
and others.
2) Peering: it leverages self-organization, a style of production that works
more effectively than hierarchical management for certain tasks.
Participants in peer production communities have many different
motivations for jumping in, from altruism to achieving something that is of
direct value of them.
3) Sharing: the power of this principle is not limited to the intellectual
property. It is extended to other resources such as computing power,
bandwidth, content, and scientific knowledge. Also, companies need to
protect critical intellectual property.
4) Acting globally: global alliances, human capital, marketplaces, and peer
production communities will provide access to new markets, ideas, and
technologies.”

By opinion of authors (Dijck and Nieborg, 2009), the companies can not rely to
the collaboration with people, because only 13% of people are actual creators
according to statistics and some of them wouldn’t have creativity or motivation.
In this paper, we do not suppose that 100% of people will take part in

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collaboration, but enterprises need to create the better conditions for actual
creators, for all people who want to be involved in collaboration.
The researched algorithm of lean and agile integration will be based on the
principles from Wikinomics.

4 THE INTEGRATION ALGORITHM OF LEAN AND AGILE

MANUFACTURING BASED ON PRINCIPLES FROM
WIKINOMICS
The application of Wikinomics principles has been already described in the
modern articles. For example, such parameters as “Communication media to
collect the customers’ responses”, “Efficient information systems”, “Rapid
evaluation and implementation of employee suggestions” are the part of the
conceptual model of the agility evaluation (Vindoh and Devadasan, 2010, p.
1222). In the other agile model (Ramesh and Devadasan, 2007, pp. 185, 186), the
parameters like as “Devolution of authority”, “Employee involvement” or “IT
integration” are described. In the source (Zhang and Sharifi, 2000, p. 509), the
list of agility providers includes: “Close relationship with suppliers/customers,
and involving them in planning and product development”, “Using Internet and
related information tools as a means of communication with outside”.
“Networking” is the parameter of the agile manufacturing, which includes the
communication capabilities of an enterprise defined through ability to exchange
information (Tsourveloudis and Valavanis, 2002, p. 338). These parameters
respond to parameters of Wikinomics such as peering, openness, sharing and
acting globally. The foundation of “the agile enterprise is the integration of
information system/technologies, people, business process and facilities into the
harmonious and flexible organization so as to respond quickly to changing
circumstances” (Lin et al., 2005, p. 354). This overview of the modern enterprise
model of the agile manufacturing shows that the agile production is partly
including openness, peering, sharing and acting globally; the problem is in their
correct application. The analysed sources of the literature don´t solve the
problem of the lean and agile manufacturing practical application based on the
principles from Wikinomics. That is why, the basic structure of the methodology
of these concepts integration with principles from Wikinomics was proposed in
this paper.
As it was said before the application of these principles will lead to the agile
manufacturing because the company can faster satisfy customers’ individual
needs with the help of employees or outsourcing and communication through IT
technologies. Application of these principles will be cheaper for company, when
the enterprise has the lean production already. The connection between four
principles from Wikinomics, lean production and agile manufacturing is shown
in Figure 1.
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Figure 1 – The connection between principles from Wikinomics, lean and agile
manufacturing (own processing)

The developed algorithm of the lean and agile manufacturing integration based
on the principles from Wikinomics will include eleven stages.
First stage is the decision-making stage. The top management will need to
decide, if these principles from Wikinomics will be useful for the company. The
company will need to change the current situation or not. If yes, then the top
management will need to define what kind of changes at the company will be
made. For example, company needs to be more open, start share the information
or more collaborate with personal etc.
The second stage is focused on the provision of training courses for employees.
During this training, the reasons of selected changes will be explained to the
employees. They will also understand how changes will be provided and what
result will bring for the company. If they do not have this training, then they
would not understand why they need to take part in company’s transformation.
Top management or specialized employees (from another company) are
responsible for this stage.
The next phase is the creation of the team, which will be responsible for this
project and changes at the company.
During the fourth phase, the research of the company should be conducted. This
research will be executed with help of the questionnaire survey. These questions
will identify if people have an interest in selected changes or not. The
modification of the enterprise is impossible without interest of employees. The
questionnaire will be based on the current situation at the enterprise.
Then the responsible team will analyse this questionnaire. This team will
announce the report if the company is ready for these changes or not. Also, the
index of the weight for each question can be added for the estimation of the
company preparedness for the changes.

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The next step is an analysis of a current situation at the enterprise. This stage will
include the analysis of business processes, the rate of implementation of the lean
principles, organizational structure, or in what measure the principles from
Wikinomics are currently used or will be used, how these principles could be
integrated into the company’s business system, etc. At this stage, the responsible
team will make a decision what kind of information (process models, problems
of company, technology of the production process etc.) will be published for the
public use.
The sixth step is the creation of the system of employees’ motivation. Employees
are the knowledge power of the company. If they have motivation, they will take
part in the company’s modification and share their ideas. It is also important to
create a system for the education of employees at this stage.
The next stage is the application of the lean production if the company does not
have it. Lean production will lead to the elimination of wastes and to building of
a steady business process. The application of the lean production is easy to start
with simple methods such as “5S” or “poka-yoke” and then to apply the other
methods.
The re-engineering is the eighth step. At this stage, it is important to modify the
production system into the modular production for the quick changeover of
equipment according to customers’ requirements.
The next stage is outsourcing. The company needs to decide if some processes
have to be outsourced for simplifying the production processes and for global
partnership or not. It is easy to start from collaboration with locals companies.
Then it is important to expand collaboration and find new partnership abroad.
The tenth step is the creation of the company web page, where information about
the company, which was selected at the fifth stage, will be published. For
example, the company’s research problems will be published at this web page.
The person, who can solve this problem, can be anybody from around the world.
The last stage is the creation an award for help and research. The reward should
not be expensive, but it is important to motivate people with something. For
instance (Tapscott and Williams, 2008), the P&G company has this kind of
reward, and it helps to save the budget of the company and find new solutions for
their problems every year.
It is relevant to build a responsibility matrix, where the responsibility roles of the
main groups of personal will be shown. Almost all processes are made with
support of company employees or IT employees. The aim of this matrix is to
show that the regular employees must be part of the most phases of this
integration. The regular employees must join to the company changes. When the
reward will be applied, or the web page will be made, then anybody (customers,
investors, employees, people who do not belong to this organisation etc.) will
join the company transformation, too. All of these groups of people will help to
solve problems at the company. Responsibility matrix is shown in Table 1.
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Table 1 – Responsibility matrix

Number Top Responsible Employees IT Outsourcing Customers
of stages management team staff companies or others
1 A, R - - - - -
2 A, R I I I - -
3 A, R I I I - -
4 A R S S - -
5 A R S S - -
6 A R S S - -
7 A R S S - -
8 A R S S - -
9 A R I S S -
10 A S S R I I
11 A R I S I I

Legend: R-Responsible, A-Approve, I-Inform, S-Support/Assist.

The principles from Wikinomics can direct to the agile manufacturing, by their
possibility to involve people to business processes of company using global
communications. If company applies the lean production at the fifth stage, it will
help to develop integration between two these concepts.

4 CONCLUSION
Integration of the lean and agile manufacturing principles should result in the
creation of a steady and flexible production process, rapid customer satisfaction,
increasing in openness of the company and collaboration with customers,
investors, employees. This method will be developed in more detail as a part of
the future research, which will be focused on the creation of the methodology for
rapid adaptation of customers’ requirements at the modern market. The other
parts of the future research will be:
• Analysis of the possibility of the lean and agile manufacturing integration
based on the principles from Wikinomics at the Czech market.
• Application of this methodology on the selected enterprise, which will
help to stabilize their situation at the market.
Also, this method will help to evaluate the measure of the integration between
the lean and agile manufacturing based on the fuzzy logic.

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ACKNOWLEDGEMENT
This paper was elaborated in the frame of the specific research project
SP2013/49, which has been solved at the Faculty of Metallurgy and Materials
Engineering, VŠB-TU Ostrava with the support of Ministry of Education, Youth
and Sports, Czech Republic.

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ABOUT THE AUTHORS

Ing. Tatiana Ustyugová, VŠB – Technical University of Ostrava, Faculty of
Metallurgy and Materials Engineering, Department of Quality Management, 17.
listopadu, Ostrava-Poruba 708 33, Czech Republic, e-mail:
[email protected].
Prof. Ing. Darja Noskievičová, CSc., VŠB – Technical University of Ostrava,
Faculty of Metallurgy and Materials Engineering, Department of Quality
Management, 17. listopadu, Ostrava-Poruba 708 33, Czech Republic, e-mail:
[email protected].

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