Abstract— In spite of advancements in technology, the manufacturing of many small products and components continues to be labor intensive, and their assembly processes still rely on skill and craftsmanship. This paper describes operational problem solving through consultant-led intervention at one such manufacturer of watch dials, involving a combination of incremental and breakthrough improvements leading to significant performance gains in terms of cost, quality and delivery. Selected technical innovations in some significant areas are presented, along with an integrated approach for structuring and solving such process improvement problems systematically. Index Terms— Manufacturing Processes & Methods, Process Improvement Approaches, Productivity & Quality Management I. INTRODUCTION AND PROBLEM CONTEXT There have been considerable advancements in the use of technology and automation in the last few decades. However, the manufacturing operations of certain products and components like watch dials continue to be labor intensive, and their assembly processes still rely on painstaking skill and craftsmanship. Such items are characterized by miniature and irregular geometries, and are therefore not easily amenable to automation. Although computer controlled tools are used to carry out some of the production tasks, the watch dials are printed manually, and the markings and rings are still set by hand in a manner similar to jewelry manufacturing. Thus while the product category itself has matured a long time ago, the processes have remained entrenched in human skills and traditional work practices. As a consequence, several inefficiencies and variabilities have crept into the operations over time. The industry as a whole seems to be in the Systemic stage [1], with relatively marginal scope for major innovation in the core manufacturing technologies. In particular, Research and Development on assembly processes of watches and dials has been limited. Though some process innovations do happen through the makers of the manufacturing equipment, such developments are not quite directed or controlled by the dial manufacturers themselves. Manuscript received November 1, 2010 Rajiv K. Srivastava is a Professor at the Indian Institute of Management Lucknow, Lucknow 226013 India (Phone: 91-522-2736613, Fax 91-522- 2734025, e-mail: rks@iiml.ac.in, rksrivastava@gmail.com). Debashish Jena is a doctoral candidate at the Indian Institute of Management Lucknow, Lucknow 226013 India (e-mail: debashish.jena@iiml.ac.in). This case study is based on MDDL, one of the few organized sector manufacturers of watch dials in India, with a client list which includes almost all domestic watch makers as well as some of the most prestigious international watch brands. The company was started in 1983, and now has an annual production capacity of 12 million dials across three production facilities in different parts of the country. It is also one of the only four companies in the world that manufacture high-precision watch hands, which now constitute about 15% of its turnover with 75-80% share of the domestic organized market, with exports growing at around 30% each year. The watch dial industry is characterized by high product variety and fluctuations in product mix. Order sizes at the company vary from as low as 50 for some international brands, up to 10000 for more regular Indian brands. The number of models being manufactured at the factory could vary from 50 to 200 in a month, adding up to about 1000 over a year. Among these orders as many as 30% could be all-new models requiring fresh tooling, dies, fixtures, and process adjustments. The company relies on customer responsiveness, fast delivery, and innovative product development to drive its competitive strategy in domestic and overseas markets. Dial manufacturing broadly consists of three stages:  Blanking – the dial ‘blanks’ are first produced using Press and Welding operations  Base Finish – various textures and effects are generated on dial faces using different finishing machines  Assembly – this stage consists of pad/ screen printing, re-punching, index fixing, electro- deposited index fixing, gluing, backside cleaning, drop test, wrapping, and packaging. Most assembly is manual tweezers-based activity, with dials held in place by vacuum fixtures. Printing operations are performed on pad or screen printing machines, whereas gluing is done on gluing machines. Large orders are split into smaller batches for production depending on monthly targets, which makes planning and control of production and manpower quite difficult. Further complications arise due to long setups of certain critical operations like Printing (30-45 minutes inline) and Electroplating. There were as many as 350-500 such setups in a month at one of the three factories studied. These complexities cause inefficiencies due to small lot production, line stoppages, starving, low resource utilization, and high WIP. In-process rejection levels used to be very high, up to as much as 50% in appliqués for luxury Process Improvement in Precision Component Manufacturing: A Case Based Approach Rajiv K. Srivastava and Debashish Jena Proceedings of the International MultiConference of Engineers and Computer Scientists 2011 Vol II, IMECS 2011, March 16 - 18, 2011, Hong Kong ISBN: 978-988-19251-2-1 ISSN: 2078-0958 (Print); ISSN: 2078-0966 (Online) IMECS 2011