Tag: Theory of Global Optimization

In their latest book “This Point Forward: The New Start the Marketplace Demands,” Dr. Joseph W. Webb and Richard Romano offer the following blunt words for printing company representatives: “There is nothing worse than a bald or gray-haired guy standing in front of a bunch of young executives talking about how exciting print is. You’re not a wise elder statesman. You risk being perceived as an old relic who has no clue.”

Webb and Romano are inveighing against print media romanticism, i.e. nostalgic talk about the love of print, how it smells and feels, that it doesn’t require batteries or tech support and that it doesn’t crash or steal your identity, etc. They write “an increasing number of today’s communications and advertising managers do not expect to use print. Why should they? It doesn’t serve their purpose. … Today’s marketing communications managers are highly skilled digital media experts, who are both creative and innovative, and who are fluent in the statistical nature of digital media analytics.”

These are fundamental truths; cultural changes are shaking up the media business and the printing industry is not the only one facing problems. Digital streaming and on-demand have forever disrupted traditional radio and TV broadcast advertising. Any media business that tries to remain some kind of analog island amid the digital ocean is going to be swept under by the next technology or economic tidal wave.

For printing companies, this means morphing away from a print-centric to a digital-centric strategy. Understood as one of many choices that media buyers use to achieve their objectives, print can play a valuable and even critical role. For example, targeted and personalized direct mail­ can be central to a campaign as long it is integrated with a web, email and social media presence where the results are measureable. In short, the future of print depends on its integration into data driven analytics; print needs to be tracked, measured and cost justified or budgets for it will dry up and dollars will be spent on other more effective media forms.

While Webb and Romano give an exhaustive review of the strategic reboot that printers require to be successful through 2020, they spend little time on the operational aspects of this transformation. Fortunately, there is someone in the printing industry that has developed a groundbreaking approach to production that makes print a competitive and attractive option for marketers and advertisers for decades to come. That person is Udi Arieli of EFI^® and his approach is the Theory of Global Optimization (TGO).

What is the Theory of Global Optimization?

The Theory of Global Optimization is an approach to operational management that responds to all external and internal challenges facing the printing industry today. Its goals are to:

• improve performance
• increase throughput
• accomplish more with diminishing resources
• increase profitability

It does these things, not with automated and digital equipment although these are critical assets of the printing company of the future, but as a proactive management philosophy. TGO educates the entire organization against the reactive and narrow thinking that predominated in an era when companies could achieve success with limited or no business theory at all.

The two basic concepts of the Theory of Global Optimization are:

1. Adopt the Global View
   Printing—as well as other custom or “pull” manufacturing businesses—is a chain of independent links. As the complexity of the production process increases and the company grows in size, the need for a global view of the business intensifies. A wider perspective beyond an individual project, client, cost center or machine must guide the decision making on a day-to-day and hour-by-hour basis. The profitability of the business is the result of the sum total of the performance of all jobs, customers, departments and equipment within the company; this is the global view.
2. Optimize the System
   All areas of the establishment must be synchronized and optimized. The weakest links in the chain—the few constraints within the company that have the most impact on throughput, on-time delivery and costs—must be identified and managed. It is not possible for any individual no matter how talented to comprehend the complex interaction of these variables within the operation. Advanced computerized data collection and scheduling software are required to integrate and automate the critical decision making process.

Evolution of manufacturing theory

For years Udi Arieli has pointed to the relationship of his theory to previous generations of scientific management theory. That the Theory of Global Optimization contains the accomplishments of manufacturing theory going back to the beginning of the industrial revolution—and is also the modern day continuation of those achievements in the digital age—is proven by the following historical review:

• 1801: Eli Whitney / Interchangeable Parts

  

  Whitney is known for two related contributions to industrialization: the mechanized of farming (invention of the cotton gin in 1793) and, although he did not originate it, the promulgation of interchangeable parts. Whitney’s name is associated with the concept of interchangeable parts—the production of identical components made to specifications such that one part can freely and easily replace another—because he demonstrated the principle by assembling ten guns from a pile of mixed parts in front of Congress in July 1801. In the later 1800s this method became known as the “American system of manufacturing” as it increasingly utilized machine tools and semi-skilled labor to produce the parts to specified tolerances instead of the manual labor of skilled craftsmen.

• 1911: Frederick Taylor / Scientific Management

  

  At the turn of the twentieth century, Frederick Taylor extended the ideas and methods of the American system of manufacturing by studying labor productivity and introducing advanced planning into the production process. What is now known as “Taylorism” introduced ideas of scientific management and process management onto the production floor. Concepts such as “workflow” and “automation” emerged later from Taylor’s breakthrough stopwatch time and motion studies and his analysis of the functions and stages of the manufacturing process.

• 1913: Henry Ford / Assembly Line

  

  Both interchangeable parts and scientific management methods were employed by Henry Ford in the startup of assembly line production of the Model T on December 1, 1913 in the Highland Park, Michigan. Also known as progressive assembly, the breakthrough of the assembly line was described by one of Ford’s top executives and engineers, Charles E. Sorenson, as “the practice of moving the work from one worker to another until it became a complete unit, then arranging the flow of these units at the right time and the right place to a moving final assembly line from which came a finished product.” Although this method had been pioneered by Ransom Olds in 1901, Henry Ford is credited with perfecting and sponsoring it by agreeing to the installation of a motorized conveyor belt that enabled a Model T to be assembled in 93 minutes.

• 1950: W. Edwards Deming / Process Control

  

  Following World War II, W. Edwards Deming further advanced scientific management theory by demonstrating that organizational cooperation and learning can improve manufactured product quality and reduce costs; that effective process control requires data gathering and measurement; that every process has a range and causes of variation in quality; that production workers should participate in continuous improvement initiatives. Deming gained worldwide notoriety for his pioneering work with the leaders of Japanese industry during what became known as the “Japanese post-war economic miracle” of 1950-1960. At first, Deming’s ideas were eschewed in the US for a host of cultural reasons. But by the 1980s, he was working directly with Ford Motor Company on a top to bottom quality manufacturing initiative and he would go on the become one of the most sought after experts on business management.

• 1984: Eliyahu Goldratt / Theory of Constraints (TOC)

  

  In 1984, Eliyahu Goldratt wrote a novel called “The Goal,” which tells the story of Alex Rogo the manager of a production plant owned by UniCo Manufacturing. Rogo’s dilemma is that the plant is always running behind schedule and his job is on the line with upper management if he proves incapable of fixing the problems. The book was a clever method for Goldratt to explain his Theory of Constraints. TOC involves the successful management of constraints in the manufacturing process, i.e. focusing on those links in the chain—equipment, people and/or policies—that are preventing the organization from achieving its goal. Much of Goldratt’s TOC approach is derived from Deming’s notion that organizational cooperation and learning are keys to achieving agreed upon objectives; that measurement of indicators is required to gauge the impact of continuous improvement decisions.

• 1984: Udi Arieli / Theory of Global Optimization (TGO)
  

  

  In the 1970s, as the third generation owner/operator of his family printing company in Israel, Udi Arieli realized that printing companies needed two things: a more advance business theory and smart software tools to manage the complex challenges they faced. In 1984, Arieli founded a company dedicated to developing intelligent production management solutions for the printing industry. While working on software, he established the elements of the Theory of Global Optimization. Arieli saw that the modern printing establishment (like many manufacturing businesses) had multiple interdependent processes—some were serial and some were parallel—that made manual- or analog-based decision making nearly impossible. Extending Goldratt’s theories, Arieli recognized that managing constraints in this dynamic environment required that production processes be replicated in a computerized scheduling model such that they could be globally synchronized and optimized. TGO is also derived from Deming’s teachings in that it educates and changes the thought process and culture of the entire business organization.

The future of print production management systems

Today TGO is more than a theory; it has become the foundation science on which EFI builds its management solutions. PrintFlow Dynamic Scheduling, for example, was the first software developed by Udi Arieli and his team based on the Theory of Global Optimization. PrintFlow acts as an operational umbrella for the business, gathering information about jobs, delivery commitments, production plans, resource availability and raw materials—generating run lists based on the best plan, not for an individual job, but for the business as a whole.

PrintFlow uses sequencing and optimization algorithms to maximize throughput while, at the same time, offering “what-if” and “weak-link” analytics to address real-world situations in real-time. PrintFlow is smart software that works with literally thousands of pieces of information to deliver a globally optimized plan that evolves with every new job and every new situation a printing business encounters.

TGO has evolved to become the foundation of EFI’s Automated Intelligent Workflow, bringing the printing industry to new levels of efficiency and savings. Recognizing the value of the Theory of Global Optimization, EFI continues to invest significant resources into its product suite—Digital StoreFront^®, its MIS/ERP solutions, PrintFlow, Fiery^®, VUTEk^® and Jetrion^®—so that they operate according to TGO principles.

It is not accidental that Udi Arieli developed the Theory of Global Optimization as a solution to the problems of the printing industry, one of the most complex and largest custom manufacturing sectors of the economy. The great value of Theory of Global Optimization is that it provides a framework for printing company executives to make their way out of the analog world of landline phone call status updates and into the digital world of client dashboard apps, automated text communications and email tracking information. By utilizing TGO, the printing firm of today can begin the practical transition of becoming the integrated media supplier of tomorrow.

By employing sophisticated digital operations management tools, print media suppliers can interact with the young advertising and marketing clients—that Webb and Romano write about—in a manner that fits their lifestyle and habits, i.e. more like their digital media suppliers. If print is going to survive in the digital age, it has to become easier to order, easier to produce, easier to track and easier to cost justify. Now that is the new start that the marketplace demands.