When the engineers and the accountants put their heads together

Started 4 months ago | Discussions thread
OP MOD Tom Caldwell Forum Pro • Posts: 42,126
Re: When the engineers and the accountants put their heads together

I am not sure if the general response had quite figured out what I was on about.

I am not an engineer, nor am I aware of the precise details of current just in time repetitive bulk manufacturing processes. But I get the gist of nothing works without money oiling it.

My small level of production of very expensive lenses could be automated and approach the just in time theory even if it were very small scale - there is no way any company could afford to make a significant number of this type of lens into stock and then try to sell it down. I did put forward the idea that the specific parts for a design that would need such things as special injection moulding dies might be made as a cheaper bulk run into pre-stock but the more commonly sourced parts might be sourced as the small stocks were replaced. This would keep the cost of stocking down and keep the system flexible.

This would be a rigorous proposal from the engineers and the bean counters would have to decide if the financing could work.

There is already the precedent of the range of exotic lenses for the 4/3 mount that was kept available for some years after the 4/3 mount was decidedly dead. This is not a change of heart but might be a common sense way by which Olympus Inc could keep its hand dealt into lens manufacture for relatively low investment in the future. As JIP now has the future business then no doubt the same lenses would be continue to be sold via JIP-futurecorp.

Olympus Inc has had a long tilt at being a major manufacturer of retail camera gear and obviously failed. It is now been given over to JIP to see if their “agile” corporate structure can handle it.

No matter how we see the future for Olympus camera products there is no doubt that there is a change in the wind.

My argument is that any firm trying to sell very large amounts of technically complex manufactured product need to automate the procedure. In just which way is an engineering thing and I bow to those who are better versed in knowing how this can be done.

But I think that I am correct that such a high volume production facility would be very complex and expensive to set up. It would also need a continuing volume of product to feed it. This would need vibrant markets and continuing R&D. Despite all this it would have to be affordable. Venus and Mars were obviously not in conjunction with Olympus bankers to continue to make it happen. Maybe JIP has a solution, I wish them luck. Maybe they will contract much of it out to others (including Olympus?) with spare manufacturing capacity - that would seem much more sensibly do-able than trying to be a manufacturer of all things.

Where I am at is that Olympus apparently failed at the “make lots of stuff ourselves and hope we can sell it all” scenario. Even if a production line is very agile in what it can churn out - if product ain’t selling it has to go into stock. If excited buyers have to wait for stuff to be made they are not that impressed. Production lines that are in a stop-go-stop routine are not very efficient.

They work better if at turn-key they are set to make “20,000 units” (guess) give or take some thousands depending upon demand.

So there is some business sense in keeping a little earner of an exotic line of expensive lenses going in a back shed if the JIP idea keeps the affordable side rolling. I am sure that if the affordables stopped then it would only a matter of time before the exotic lenses stopped as well.

As usual nobody is forced to buy such expensive lenses (it is not a stupid idea) but surely those that do will keep the Olympus legend alive and well - if only the affordables are still there to wallow in that legend.

Making only cheap affordable stuff will surely kill Olympus off for good.

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Tom Caldwell

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