Successful to 99%. Due to above advantages, ·

Successful
companies heavily invested on structural prerequisites to enhance their
operation. Based on nature, these investments can be categorized under o4
areas. Such as,

 

·        
An emphasis on continuous improvement
throughout the organization

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·        
Investment in research and development

·        
The adoption of advanced product,
process, and organizational / managerial technology

·        
The integration and coordination of
activities through the value chain

 

According
to the given scenario can be summarized details as follows.

 

An emphasis on
continuous improvement throughout the organization

 

Continuous
improvements mean that continually makes small changes within an organization.
Small changes provide a road map to massive changes. This concept is
universally known as Kaizen. Kaizen is the secret behind the success of
Japanese firms.

 

Milliken
management had introduced Kaizen principles to all levels of the firm. They
arranged corrective- action groups to deal with numerous interior issues with
quality. These groups consist with lower level employees, a process improvement
specialist and managers. And also 200 suppliers and 500 customer action groups
were created in that period. As a result of the above changes, Milliken able to
achieved 60% drop in the cost of nonconformance. And also reduce the percentage
of the number of off-quality discounts and customer returns. As well as on time
deliveries improved from 75% to 99%.

 

Due
to above advantages,

·        
Milliken achieved a high market share

·        
Retain customer for long periods of
times

·        
Increased customer loyalty

·        
Generated competitive advantages through
low price and high quality

Investment in research
and development

 

In
current practice Milliken allocated 2% of sales revenue, for research and
development (R&D) activities. R&D is the best way to achieve
innovations.  Milliken is developing
their own machineries to save proprietary technology within the firm. Research
and development activities provide a lot of advantages for Milliken. Such as,

 

·        
Can generate competitive advantages over
market rivalry

·        
Can enter new markets with new products

·        
Can stimulate employees

·        
Can enhance product quality while
minimizing production cost

 

The adoption of
advanced product, process, and organizational / managerial technology

 

Machine
operators faced a lot of unexpected downtime on the machine. In previously Milliken
used mechanic staff to repair breakdowns. Problem was they have taken long
hours to repair machines. As a result of that increased ideal time of machine
operators. To overcome this issue introduced an automated system to repair and
maintenance. Through this system they obtained below mentioned advantages.

 

·        
Speed up their production process while
minimizing human intervention

·        
Decreased ideal time of machine
operators

·        
Respond  and deliver customer orders on time

 

 Milliken had adapted to the advanced
technologies to survive in the market. Management introduced new looms to the
decorative fabrics business unit. That looms can run at a high cycle rates.
This is caused to improved amount of lineal feet of fabric woven per loom hour.
As a result of that Milliken has enabled to cut the minimum efficient length of
run. Milliken can function beneficially on short run due to high cycle rate.
And also it was caused to increase operational flexibility and responsiveness.
Now Milliken can carry out production run in a shorter period of time than
pass.

 

 

Decorative
fabric business unit waste time can be minimized by reducing the design cycle
time. To achieve above target management introduced a computer aided design
system (CAD) to the decorative fabrics business unit. It generated following
advantages,

 

·        
It saves time of designers

·        
Incurred low cost to design process

·        
Eliminated manual drafting

·        
Product can be designed quickly

·        
Provided high accuracy

·        
Reduced cycle time

·        
Can easily carry out modifications and
enlargements

 

The integration and
coordination of activities through the value chain

 

There
are two methods to save customers and create value through the value chain.
Such as,

·        
Push system

Conduct
promotion campaign to attract customers
 

 

Tries
to sell firm’s product to customer
 
 

 

 

 

 

 

This
is the traditional method of manufacturing products. In here did not concern
about needs and want of customer. Firms produce products based on their
preference.

 

·        
Pull system

 

Pull
system differs from push system. It has many steps. Such as,

Ø  Conduct
market survives to determine customer need and wants

Ø  Based
on that design product

Ø  Forecast
demand for the product

Ø  Identify
material and labour requirements for production

Ø  Start
production process

 

This
is the newest way of manufacturing products. Under this method manufacture do
not allocate more money on promotions. There is no risk in the market.
Manufacture can sell their product easily without any extra effort. Milliken
moved from a push system to pull system. It generated more value to Milliken.
Such as,

 

·        
Increased employee involvement on both
product design and manufacturing

·        
Reduced the work in progress in inventory

·        
Provide a basis for continuous
improvements

·        
Generated more cash flows

In
addition to management taken action to eliminate limited value added activities
in the value chain. Example: removed management position of the organizational
structure.

 

Milliken
got support from their key suppliers and customers for new product development.
Suppliers know how to minimize costs through material handling. Customers know
what type of product features satisfy their needs and wants.  Suppliers and customers ideas helpful to the generate
more value.