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Push-pull manufacturing is a type of manufacturing strategy that allows factories to balance production ahead of demand and also after (in response to) demand.
In push-pull manufacturing, production pushes orders toward inventory for future demand while also pulling current orders through production as soon as they have been received.
When these two forces are balanced, manufacturers have increased flexibility when it comes to meeting the challenges and demands posed by the greater supply chain.
“Push” production is made to stock inventory
“Pull” production is made to order (linked with JIT production)
Estimated volume to “push” done through forecasting
Put simply, manufacturers can “push” orders forward even when there is limited demand – in this case, the product will sit in inventory. Additionally, manufacturers can “pull” orders, which is just running production in direct response to new orders received.
Push-pull is most commonly used in the manufacturing industry and allows companies to reduce costs by alternating between different types of work. While push-pull manufacturing may sound complicated, it’s simple enough to grasp the basics – the real difficulty comes in the complex management involved in balancing the two strategies.
In the simplest terms, this strategy involves producing items in batches and then adjusting the production process to fill demand. By doing so, manufacturers can smooth out an uneven sales cycle, leading to more effective production and leaner results.
It also helps save money on inventory costs by reducing waste and increasing productivity through lean manufacturing techniques like kanban or JIT systems.
This is great news for business owners who have been struggling with losses due to inefficient production methods!
A manufacturing company doesn’t have a huge backlog of orders, but supply chain experts within management use predictive analytics to forecast an upcoming market trend over the next few months which should result in many more orders placed.
In response, the company prepares for this potential surge in demand by “pushing” orders ahead – orders that haven’t yet been filed – to sit in inventory.
This way, when the increase in orders arrives, workers aren’t flooded with unreasonable workloads, facing more quality and safety issues due to the stress of demand.
A different manufacturing company is dealing with excessive costs and is wondering where to cut expenses. There is a labor shortage, and all employees currently working are necessary for smooth workflow.
An astute manager realizes that excessive funds are being reserved for inventory space – thousands of items of product are simply sitting in a warehouse. The longer they sit, the less value the product holds for the company because it is offset by the costs of housing and storage for the future.
The manager suggests a new workflow system whereby factory employees are scheduled shifts during seasons of peak demand. In this way, products are made to order and kept mostly out of inventory. The company saves money on spent inventory maintenance, energy spent on excessive machine runtimes, and costs spent on mismanaged labor.
The main advantage of push-pull manufacturing is that it's an effective way to ensure a steady supply of inventory.
When customer orders are low, you can prepare for upcoming swells in demand by pushing product orders and stocking it in inventory.
When your customer orders are high, you can follow demand by pulling orders through production – this is similar to just-in-time production, another crucial element of lean manufacturing.
Another advantage of this type of manufacturing is that it helps you manage inventory costs effectively. In some cases, it might be cheaper for you to hold onto excess material than dispose of it after production has been completed — even if those materials are no longer needed for immediate use.
By using push-pull manufacturing techniques, you'll be able to accommodate for this by creating smaller runs that result in quick but efficient changes in capacity when necessary (such as during peak seasons).
Push-pull manufacturing is an effective tool for managing inventory by ensuring you have a steady supply of parts so as to avoid shortages. When your customer orders are high, this system allows you to quickly create more inventory as needed and meet customer demand.
A push-pull system might not benefit every manufacturer, however.
For example, it can be very expensive to implement given the resources required to convert equipment and processes in order to utilize this method. If a company already has its own facilities that are specifically designed for mass production, push-pull may not be necessary or beneficial because it could create unnecessary costs in terms of plant layout and equipment upgrades.
Moreover, the switchover time and effort incurred may add unwanted production waste to a manufacturing operation. This is not ideal for lean goals in production.
Push-pull also poses challenges related to scalability: if demand increases or decreases significantly over time (as is often the case with products like fashion apparel), then it may be difficult for companies using push-pull manufacturing to adjust their production levels accordingly without incurring significant extra costs associated with resuming production of finished goods from raw materials.
Take for example a product that undergoes extensive processing or assembly throughout a production cycle – don’t forget that inventory is not just for finished products but for necessary materials and components as well. Therefore, it may be excessively expensive to hold inventory of raw materials required for just-in-time production. In this case, a push-heavy strategy may be better than a pull-based one.
In addition, push-pull manufacturing can be challenging for companies that are new to the industry or have little experience with it.
For example, if a company has never used this method before and wants to implement it into its operations, then there is likely going to be a learning curve associated with familiarizing employees with the new process.
This could result in delays during initial production as workers learn how to switch between workflows with different levels of priority.
Push-pull manufacturing is a great way to help your business improve its bottom line. By combining push and pull strategies effectively, you can increase efficiency by ensuring that each product is produced with high quality materials in a timely manner.
This helps reduce waste while increasing productivity through lean manufacturing techniques. The overall theme of adopting push-pull practices is continuous improvement, or kaizen. Matching both push and pull techniques to best address the swells of supply and demand will point you towards the ultimate goal of continuous improvement.
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