What is agile manufacturing?

Production systems

The concept of agility within production systems is not recent: however, today it is becoming increasingly popular due to the enormous benefit that companies can derive from it by virtue of the greater reactivity and flexibility (therefore resilience) in response to the volatility and variability of raw materials and market demand.

In this post we will therefore provide some information and useful ideas for the implementation of agile production systems.

Agile manufacturing: a new paradigm

The concept of agility begins to make its way especially in the field of software development. In fact, in 2001 the “Manifesto for Agile Software Development” was born, whose founding principles are 12:

    1. Customer satisfaction with early and continuous delivery of valuable software
    2. Changing requirements are welcome, even in an advanced stage of development
    3. Provide software that runs frequently
    4. Close cooperation between managers and developers
    5. Projects are built around motivated people who can be trusted
    6. Face-to-face conversation is the best form of communication
    7. The software that works is the main progress metric
    8. Sustainable development, able to maintain a steady pace
    9. Continuous attention to technical excellence and good design
    10. Simplicity is essential
    11. The best architectures, requirements and designs emerge from self-managing teams
    12. Regularly, the team reflects on how to become more effective and adjusts accordingly

Clearly, the agile approach focuses on the following three main concepts:

  • Fast but raw is better than slow but perfect
  • Focus on what is customer value
  • The ongoing change in requirements must be accepted

Many of these concepts, as we shall see, are borrowed from Lean, to which the agile methodology is evidently inspired.

However, in the production field, the concept of agility makes its way following the changes that have taken place over the centuries and mainly due to:

  1. technological evolution: new technologies make it possible to reconfigure a system much more quickly
  2. evolution in the way of production: greater flexibility is required in the face of greater variability in demand in terms of volumes and production mix
  3. evolution in the needs of the customer, who asks for products that are more and more personalized and adapted to his specific needs (mass customization, the true goal of the fourth industrial revolution)

Reactivity VS Productive mix

Agile Companies
Figure 1: types of companies depending on Reactivity to Change VS Product Mix according to Esmail

To get a clearer idea of what Agile Manufacturing is, therefore, we refer to Figure 1, which illustrates the paradigm shift required within companies, as reported in the article “A changing paradigm”[1], in which the author identifies 4 evolutionary phases on the basis of 2 dimensions:

    1. Responsiveness based on surrounding changes
    2. Product variety (production mix)

Starting from the lower right quadrant, the dinosaur represents the production organization associated with the pre-industrial phase, characterized by a high variety of product, but by a rather low reactivity. The merchants worked on the basis of individual relationships and the production was essentially made to order, at low volumes and with delivery times typical of artisanal production (ie high).

Moving to the lower left quadrant, the mule instead represents the mass production typical of the second industrial revolution characterized by low product variety, high volumes, but the same poor reactivity of the previous system.

Moving to the upper left quadrant, thanks to the concepts of Lean, the reactivity of companies increases, however it remains a “ballast” associated with the still limited ability to evolve towards mass customization. This concept is represented by the horse with a jockey.

Finally, the last evolution represented by the lizard is shown in the upper right quadrant, capable of reacting quickly to surrounding changes. To reach the status of “Lizard”, Esmail indicates the way through 4 main concepts, identifiable by the acronym STOP:

  • Strategy
  • Technology
  • Organization
  • People

Agility therefore represents the natural evolution from an economy of scale to an economy of purpose, where the focus is on satisfying the tastes and needs of individual customers or end users rather than on the simple reduction of costs and improvement of characteristics of a standardized product.

Finally, Goldman [2] in his article “Agile Competitors and Virtual Organizations” summarizes a series of benefits associated with the concept of agility in manufacturing companies:

  • Quick response to variability in demand
  • Greater productivity
  • Improvement of product and service quality
  • Better use of capital and higher return on investment (ROI)
  • Greater knowledge of customer needs
  • Enabling the “single piece flow” concept
  • Integration of the supply chain within Product Development
  • Reduction of indirect costs
  • Increased time and opportunity for management to address and resolve problems
  • Greater robustness of industrial processes

How to enable agility in a production system?

An Agile Production System is made possible thanks to the Smart Factory concept. Padhi [3] provides a definition of Smart Factory that substantially replicates the benefits of the agile systems indicated above, while introducing the use of so-called “smart” technologies:

an optimized production facility capable of

  • facilitate the launch of new products according to market dynamics,
  • is scalable enough to meet the changing demand for existing products,
  • is able to produce finished products at the minimum cost,
  • has intelligent machines, sensors and robots perfectly integrated with the information system architecture to allow a high level of automation in transaction processing and
  • has real-time analytics that help minimize downtime and improve efficiency.

A smart factory creates an ecosystem where there is strong collaboration between all major players, e.g. Suppliers, operations team, IT team, planning team, sales and marketing team, and customers. Create a single platform where multiple business functions such as Procurement, Planning, Manufacturing, Sales and Distribution, Finance and Accounting work together to achieve overall business goals”.

The first part of this definition has to do with the aim: to facilitate the production mix, compensate for the variation in market demand and minimize costs. The second part, on the other hand, explains how to obtain it, that is, by introducing integrated and smart automatic systems capable of re-adapting the production system automatically and autonomously (thanks to the real-time analysis of so-called big data). This system is also characterized by a high level of collaboration between all corporate bodies in the system design phase (Concurrent Engineering) and by a high level of integration at the level of IT systems.

The technical basis of a Smart Factory is represented by the so-called cyber-physical systems (CPS) capable of communicating with each other with the help of the Internet of Things (IoT). Part of this future scenario continues to be the communication between the product (eg workpiece) and the manufacturing plant: the product itself carries its production information in machine readable form [4]. This data is used to control the product’s journey through the manufacturing facility and individual production steps.

Technology is not enough, we must first eliminate waste

A smart, flexible and reconfigurable production system in minimal time requires the elimination of all those unnecessary operations that only increase the inefficiency of the system and therefore slow it down. For this reason, it becomes essential to eliminate these inefficiencies, or waste.

In the Lean vision, waste, indicated by the Japanese term Muda, is an activity that does not add any value to the good produced or to the service. Traditionally, 8 types of Muda can be identified, which, using the English terminology, we can memorize thanks to the acronym TIMWOODS. This acronym lists the 8 main wastes according to the principles of Lean Manufacturing:

  1. Transportation – are the recurring costs related to the excessive transport of material / semi-finished products with related associated equipment (non-recurring costs), such as lifting equipment, trolleys, cranes, etc.
  2. Inventory – costs associated with excessive storage of material, from space to unused costs of raw materials
  3. Motion – similar to transport, it represents the costs associated with the unsolicited handling of the material, for example during an assembly operation
  4. Waiting – are the costs associated with the waiting times, for example of a semi-finished product waiting to be processed
  5. Overprocessing – are the costs associated with unsolicited processing, i.e. that does not add value to the product or that can be eliminated through optimization activities
  6. Overproduction – are all those costs associated with a PUSH rather than PULL production system, with greater WIP, therefore material in work, space required, storage, which in reality is not requested by the customer
  7. Defects – non-quality costs, in particular related to management and rework
  8. Skills (Lack of) – the eighth waste refers to the costs associated with the lack of associated skills to perform a job correctly
the 8 wastes
Figure 2: the 8 wastes according to Lean Manufacturing


In this post we have seen how the concept of Agile Manufacturing was born in the field of software development, where speed and flexibility become decisive factors for the success of a development team. Similarly, in the production field, flexibility and speed become fundamental concepts for improving quality, reducing costs and development times in the presence of high volumes and production mix.

To develop agile production systems, it is necessary to follow 2 ways:

    1. Use the technology at our disposal, in particular of a digital nature and linked to automation, but not only
    2. Eliminate all waste upstream in order to avoid automating it

In this sense, Accialini Training & Consulting can give you a big hand! For more info, contact us!  


[1] Esmail, K., and Saggu, J., 1996, “A changing paradigm”. Manufacturing Engineer, December 1996, p285-288.

[2] Goldman, S., Nagel, R., and Preiss, K., 1995, “Agile Competitors and Virtual Organisations”. New York: Van Nostrand Reinhold.

[3] Padhi N, Setting up a Smart Factory (Industry 4.0)-A Practical Approach, Nov, 2018

[4] Nicola Accialini, “Introduction to the Smart Factory and practical tips for its implementation”, Independently Published, 2020

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