A PRODUCT CLASSIFICATION AND PRODUCTION TRACEABILITY SYSTEM FOR WOMEN SILVER JEWELRY PRODUCTS

A PRODUCT CLASSIFICATION AND PRODUCTION TRACEABILITY SYSTEM FOR WOMEN SILVER JEWELRY PRODUCTS By Achara Satayapaisal SIU THE: SOM-MSM-2007-06

A PRODUCT CLASSIFICATION AND PRODUCTION TRACEABILITY SYSTEM FOR WOMEN SILVER JEWELRY PRODUCTS A Thesis Presented By Achara Satayapaisal Master of Science in Management School of Management Shinawatra University October 2007 Copyright of Shinawatra University

Acknowledgments The author is very grateful to Shinawatra University for the Master of Science in Management (MSM) degree scholarship and the Thailand Research Fund (TRF) for this thesis study funding. Throughout the period of performing this thesis, the author has been very grateful to many people. First of all, I would like to express my sincere gratitude to my advisor, Assoc. Prof. Dr. Chuvej Chansa-ngavej who advised and contributed me from the start till the completion of this thesis, always gave me valuable knowledge and guidance, and encouraged me to complete this thesis. I would like to express my gratitude to my committee members, Assoc. Prof. Dr. Supachok Wiriyacosol, Dr. Amporn Soongswang and Asst. Prof. Dr. Manop Reodecha who gave me valuable suggestions and corrections for my thesis. I would like to express my gratitude to the gemology experts, Asst. Prof. Siwaporn Sahavat and Arjarn Suree Likittachai who gave me some basic knowledge of gemology. I would like to express my gratitude to Dr. Robert John Kirkpatrick and Ms. Elizabeth Jane Reynolds who gave me the valuable English language consulting. Most importantly, I would like to give special gratitude to my parents, my husband and his parents for their love, understanding, and providing support for me to complete this thesis. Finally, I would like to express my gratitude to all the other people, who helped me to carry out this thesis, although their names are not stated here. i

Abstract Mass production of exported jewelry is a labor intensive industry that adds value to the Thai economy and increases employment. The Thai jewelry industry is characterized mainly by small- and medium-scale enterprises (SMEs). A common practice of jewelry SMEs is to have parts of the production process outsourced to nearby communities, therefore, making it crucial to have a quality control system in place. To be able to control the jewelry product quality of the company and outsourcers, a product classification and production traceability system was developed for tracing the process route of the jewelry product. The product classification and production traceability system in this thesis was developed in tandem with a case study company that manufactures fashionable sterling silver jewelry for girls and young women. The main products are earrings and nose jewelry. The product classification was developed by creating a coding system for the product and its parts (or materials), based on a mixed code (or hybrid structure) using the group technology classification and coding theory. The developed coding was alphanumeric and every digit(s) had a meaning that could explain the design attributes (such as shape, color, material and so on) and manufacturing attributes (such as major process, finishing surface) of a product and its parts (or materials). The production traceability system was developed according to the purposes of the case study company based on the company requirements and problems they were facing. The result of this thesis is a prototype product classification and production traceability system for mass producers of fashionable women s sterling silver jewelry that is beneficial to trace back to product historical data which leads to reduced extra costs and extra processes from recycling suspected products and improve product quality. This prototype could be used as a guideline for other jewelry businesses for adapting their manufacturing process. Keywords: Product classification Production traceability Women silver jewelry Thai jewelry ii

Table of Contents Title Acknowledgments Abstract Table of Contents List of Figures List of Tables Page i ii iii v vii Chapter 1 Introduction 1 1.1 General 1 1.2 Statement of the Problem 2 1.3 The Objectives of the Study 2 1.4 The Expected Outcome 2 1.5 Scope of Study 2 1.6 Research Methodology 2 1.7 Definitions of Terms 3 Chapter 2 Literature Review 4 2.1 Overview of Thai Jewelry Industry 4 2.2 Gems 8 2.3 Jewelry Production 9 2.4 The Case Study Company: Sterling Silver Jewelry 10 2.5 The Overview of Production Traceability 14 2.6 Product Classification 15 2.7 Product Classification of Jewelry 15 2.8 Method for Developing the Product Classification and Coding System 22 2.9 Method for Developing the Production Traceability System 30 Chapter 3 Research Methodology 31 3.1 Introduction 31 3.2 Data Collection for Studying Products and Processes in the Case Study Company 31 iii

3.3 System Development 33 3.4 Field-Test 33 3.5 System Adjustment 33 Chapter 4 Development and Application of the System 34 4.1 The Collected Data 34 4.2 Development of Product Classification and Coding 42 4.3 Development of Production Traceability System 66 4.4 Result of System Application and User s Satisfaction 76 4.5 Recommend Action for Further Software Development in the Case Study 78 Chapter 5 Conclusions and Recommendations 79 5.1 Summary and Conclusions 79 5.2 Research Difficulties and Limitations 79 5.3 Recommendations for Further Development 80 References 81 Appendics 84 Appendix A Interview Guidance: Company Management and Employees 84 Appendix B Interview Guidance: Gemology Expert 85 Appendix C Example of Rhinestone Color Code 86 Appendix D The Standard Rhinestone Size 87 Biography 89 iv

List of Figures Title Page Figure 2.1 The Top Five Ranking of Thai Jewelry Exports Value by Country 6 Figure 2.2 The Top Five Ranking of Thai Gold Jewelry Exports Value by Country 6 Figure 2.3 The Top Five Ranking of Thai Silver Jewelry Exports Value by Country 7 Figure 2.4 The Market Share of Silver Jewelry Import into the USA Market in 2002-2006 7 Figure 2.5 The Market Share of Jewelry Import into the USA Market in Year 2006 8 Figure 2.6 The Draft Organizational Chart of the Case Study Company 11 Figure 2.7 Silver Tubing Process in the Case Study Company 11 Figure 2.8 Silver Stamping Process in the Case Study Company 12 Figure 2.9 Silver Casting Process in the Case Study Company 13 Figure 2.10 Example of Monocode (Hierarchical Structure) 25 Figure 2.11 Model Structure of Mixed Code (Hybrid Structure) 26 Figure 2.12 The Basic Structure of Opitz Coding System 27 Figure 2.13 Form Code (Digits 1 to 5) for Rotational Parts in the Opitz Coding System 28 Figure 3 The Methodology used in this Thesis 31 Figure 4.1 Main Process Flow in the Case Study Company 39 Figure 4.2 Silver Tubing Process Flow in the Case Study Company 40 Figure 4.3 Silver Stamping Process Flow in the Case Study Company 40 Figure 4.4 Silver Casting Process Flow in the Case Study Company 41 Figure 4.5 Silver Pin Making Process Flow in the Case Study Company 42 Figure 4.6 The Structure of Product Families 43 Figure 4.7 The Developed General Coding Structure 43 Figure 4.8 Developed Finished Goods Coding Structure (Translated from Thai) 45 Figure 4.9 Developed Jewelry Coding Structure (Translated from Thai) 47 Figure 4.10 Developed Card Coding Structure (Translated from Thai) 50 v

Figure 4.11 Developed Semi-Jewelry Coding Structure (Translated from Thai) 52 Figure 4.12 Developed Accessory Coding Structure (Translated from Thai) 53 Figure 4.13 Developed Ornament Coding Structure (Translated from Thai) 56 Figure 4.14 Developed Material Coding Structure (Translated from Thai) 58 Figure 4.15 Developed Label and Sticker Coding Structure (Translated from Thai) 59 Figure 4.16 Developed Packing Material Coding Structure (Translated from Thai) 61 Figure 4.17 Products Coding Main Menu 62 Figure 4.18 Finished Goods (Family A ) Menu 62 Figure 4.19 Jewelry (Family B ) Menu 63 Figure 4.20 Card (Family C ) Menu 63 Figure 4.21 Semi-Jewelry (Family D ) Menu 64 Figure 4.22 Accessory (Family E ) Menu 64 Figure 4.23 Ornament (Family F ) Menu 65 Figure 4.24 Material (Family G ) Menu 65 Figure 4.25 Label and Sticker (Family L ) Menu 66 Figure 4.26 Packing Material (Family P ) Menu 66 Figure 4.27 Developed Traceability Recording Form (Main Process) (Translated from Thai) 69 Figure 4.28 Developed Traceability Recording Form (Tubing Process) (Translated from Thai) 70 Figure 4.29 Developed Traceability Recording Form (Stamping Process) (Translated from Thai) 71 Figure 4.30 Developed Traceability Recording Form (Casting Process) (Translated from Thai) 72 Figure 4.31 Developed Traceability Recording Form (Packing Process) (Translated from Thai) 73 Figure 4.32 Developed Traceability Recording Form (Pin Making Process) (Translated from Thai) 74 Figure 4.33 Data Storage Control Form (or Record Control Form) 76 Figure 4.34 The Company Executive Rating Score 77 vi

List of Tables Title Page Table 2.1 Export Value of Thai Industrial Goods, Year 2004 to 2007 (January - May) 5 Table 2.2 Examples of Design Classification for Jewelry 16 Table 2.3 Examples of Design and Manufacturing Attributes included in a Classification and Coding System 23 Table 4.1 The Case Study s Documentary Information 34 Table 4.2 Example of Finished Goods Code: A-B001-00001 44 Table 4.3 Example of Jewelry Code: B-BA-Z001-BO-CA1COO 46 Table 4.4 Example of Card: C-BOOB01-010 49 Table 4.5 Example of Semi-Jewelry: D-AB-Z001 51 Table 4.6 Example of Accessory: E-BBA-020 53 Table 4.7 Example of Ornament: F-BA1P04-A01-002 55 Table 4.8 Example of Material: G-AAO-030 57 Table 4.9 Example of Label and Sticker: L-A073528-040 59 Table 4.10 Example of Packing Material: P-FB-010 60 vii

Chapter 1 Introduction 1.1 General Mass production of jewelry for export has become an important source of income for Thailand. The jewelry industry is one of the top ten ranking industries that produces added value to the Thai economy and increases employment. It is essential for the industry to be cost-competitive against competitors such as Hong Kong, China, and India. The jewelry industry is a labor intensive industry, and relies heavily on the craftsmanship and skills of workers that may not be substituted by machines. However, some competitors, such as China and India, have lower labor costs, thus it is difficult for Thai jewelry to be cost competitive by reducing labor costs. The highest value market that Thai jewelry exports to is the USA. Previously Thai jewelry costs could compete with low labor cost countries that export to the USA market because Thailand had eligibility under the GSP (Generalized System of Preferences) that allowed tariff exemptions. Nowadays Thai jewelry exporters face a huge problem as the USA GSP will be cut. Losing GSP benefits will produce a significant effect on Thai jewelry competitiveness. Having a competitive advantage in terms of time-tomarket and attractive design of the products is also a necessity. At present, such industry in Thailand is characterized mainly by small- and medium-scale enterprises (SMEs) often operated by traders turned designers and manufacturers. To ensure shorter time-to-market, it would be desirable to have shorter design turnaround time, while having a larger variety of product designs for customers to choose from. To keep the costs down, a common practice is to have parts of the manufacturing process outsourced to nearby communities, thus making it crucial to have a quality control system in place. To be able to control product quality of the company and outsourcing, it is necessary to track the process route of the jewelry product, and hence a product classification and production traceability system should be developed. 1

1.2 Statement of the Problem This thesis aims to develop a product classification and production traceability system of a case study company. The company is a small sterling silver jewelry enterprise that many manufacturing processes parts are outsourced. 1.3 The Objectives of the Study 1) To develop a system of coding for product design classification. 2) To use the developed coding system in the manufacturing processes such that the product lots can be traced back by their historical data, so that the company can take appropriate control measures. The company will then benefit from reduced costs, shorter time-to-market, or higher product quality. 1.4 The Expected Outcome 1) A prototype of a product design classification and production traceability for mass producers of inexpensive jewelry, especially silver jewelry, for export will be established. 2) The developed product classification and production traceability system could be used as a guideline for others jewelry businesses. 1.5 Scope of Study This thesis will concentrate on a women s silver jewelry manufacturer that produces silver jewelry products, which may be decorated with synthetic gems, paint, crystal and others. Traceability within the scope of this thesis is the production traceability. No material testing will be carried out. 1.6 Research Methodology The case study company s products and production processes have been collected and analyzed by visiting the factory and interviewing the people concerned. The product classification system is developed in the form of a product coding system. The information needed for production traceability is identified and recorded for product historical data searches. The developed system is field tested for practical use. 2

1.7 Definitions of Terms Classification: the division of parts into classes based on their differences or the combining of parts into classes based on their similarities. Classes should be exhaustive (cover all parts) and exclusive (each part assigned to one and only one class) (Britton, 2000). Coding: the process to assign symbols to the parts or products. Form of symbols can be numeric, alphabetical or alphanumeric (Anlağan, 1996; Britton, 2000). Generalized System of Preferences (GSP): a program designed to promote economic growth in the developing world, provides preferential duty-free treatment for products from designated beneficiary countries and territories, including leastdeveloped beneficiary developing countries (Office of the United States Trade Representative [OUSTR], 2007). Part Family: a collection of similar parts that share specific design and/or manufacturing characteristics (Tatikonda & Wemmerlöv, 1992). Production Traceability: the ability to uniquely identify (such as product details, information on location) and find the route that a product was processed in the particular points or stages in production that consists of a chain of interrelated events (Juran & Gryna, 1988; Traceability, 2007). Rhinestone: rhinestones are colorless or colored artificial gemstones that simulate diamonds and other gems. They can be made of glass or paste, but the best rhinestones are cut from quartz crystal. Rhinestones have a fused, metallic backing that reflects the light and gives the stones fire (Wickell, 2007). Synthetic gems: synthetic gems are man-made gem products that can be exact copies of natural gems, or unique materials which are not found in nature. One type of synthetics is artificial gems which are manufactured to imitate the other gems (Gemstone, 2007; Smigel, 2007). The term synthetic gems used in the case study was the artificial gems. 3

Chapter 2 Literature Review This chapter includes a review of the case study s production processes and products that are relevant to this research as well as a review of relevant literature, especially addressing the Thai jewelry industry, classification and coding, production traceability. 2.1 Overview of Thai Jewelry Industry In the past, Thailand was one of the world s leading countries in gemstone resources, especially rubies and sapphires. The traditional knowledge and high skill about cutting and processing gemstones turned Thailand into a place for jewelry trade. The downstream jewelry industry that supports the gem industry has also grown and Thailand is the world s leader in jewelry products. The Thai gems and jewelry industry has been ranked one of the top ten export products as shown in Table 2.1 (Information and Communication Technology Center [ICTC], 2007). 4

Table 2.1 Export Value of Thai Industrial Goods, Year 2004 to 2007 (January - May) Source: ICTC (2007) Note: Value in million baht 5

The main markets for Thai jewelry export products are shown in Figures 2.1 to Figure 2.3. The United States of America (USA) is the biggest market for both gold and silver jewelry; Thailand is dominant in silver jewelry and the value is increasing each year. 35,000.00 30,000.00 25,000.00 20,000.00 15,000.00 10,000.00 5,000.00 0.00 USA UK Germany Japan France 2002 2003 2004 2005 2006 Figure 2.1 The Top Five Ranking of Thai Jewelry Exports Value by Country Source: The Gem and Jewelry Institute of Thailand (Public Organization) [GJIT] (2007) Note: Value in million baht 30,000.00 25,000.00 20,000.00 15,000.00 10,000.00 5,000.00 0.00 USA UK Hong Kong Israel Germany 2002 2003 2004 2005 2006 Figure 2.2 The Top Five Ranking of Thai Gold Jewelry Exports Value by Country Source: GJIT (2007) Note: Value in million baht 6

10,000.00 8,000.00 6,000.00 4,000.00 2,000.00 0.00 USA UK Germany Japan France 2002 2003 2004 2005 2006 Figure 2.3 The Top Five Ranking of Thai Silver Jewelry Exports Value by Country Source: GJIT (2007) Note: Value in million baht Before 2005, the Thai silver jewelry held the first place in the market share in the USA, but lost share to China in 2005, because Chinese silver jewelry is rapidly rising at a growth rate of around 20 percent every year, whereas Thai is 12 percent (Figure 2.4). (GJIT, 2007) 400 300 200 100 0 China Thailand Italy India Mexico 2002 2003 2004 2005 2006 Figure 2.4 The Market Share of Silver Jewelry Import into the USA Market in 2002-2006 Source: GJIT (2007) Note: Value in million US dollars 7

Others, 17% Mexico, 5% China, 30% India, 8% Italy, 15% Thailand, 25% Figure 2.5 The Market Share of Jewelry Import into the USA Market in Year 2006 Source: GJIT (2007) Nowadays Thailand has about 25 percent of the market share in the USA, whereas the next ranking; Italy, India and Mexico, have 15, 8 and 5 percent respectively (Figure 2.5). Export of silver jewelry from China has been growing rapidly. Although this situation will not eliminate the existing jewelry industry in Thailand soon, it is likely to obstruct Thai jewelry future growth. At present, the jewelry industry is a highly competitive market, especially with the low labor cost countries that have excess labor, like China and India. Recently, Thai jewelry lost the GSP benefit from the USA, and needs to pay for tariff. This means it is obviously harder to compete in terms of price. However, although the jewelry market is very price competitive, jewelry is about fashion and there is still room for other strategies: such as shorter time-to-market, better quality and increasing the variety of products (GJIT, 2007). 2.2 Gems 2.2.1 The meaning and classification of gems. Gems or Gemstones mean substances that are beautiful or durable or rare. The level of gem beauty is dependant on its color, transparency, brilliancy, luster and fire (or dispersion) (Keankeo, 2004; Manikhajit, 1995; Sahavat, 2006). The durability of a gem depends on its hardness, toughness and stability (Sahavat, 2006). There are several ways to classify gems, such as by its value (precious or semiprecious), by origin (natural of synthetic), by treatment (enhanced or unenhanced) and so on (Smigel, 2007). Keankeo (2004) suggested that by trade business classification, the 8

gems were classified into three groups, including: natural gems, synthetic gems, and imitation or simulants). 2.2.2 Synthetic gems. Synthetics are man-made gem products. Synthetics can be exact copies of natural gems, or unique materials which are not found in nature. One type of synthetics is the artificial gems which are manufactured to imitate the other gems. For example, cubic zirconia (CZ) is a synthetic diamond simulant, the imitation copy the look and color of the real stone but do not have the same chemical, physical and optical properties (Gemstone, 2007; Smigel, 2007). Glass and plastic is a common type of artificial gem, Swarovski (from Switzerland) and Preciosa (Czech Republic) are examples of the main artificial gem brands that were commonly used by the case study company. 2.3 Jewelry Production Likittachai (2007) stated that jewelry can be produced by several methods, as follows: 1) Handmade: jewelry is produced piece by piece, one piece per one design. The advantages are precision, uniqueness, and durability. The disadvantages are slow production, high expense, and it is time consuming and depends on worker skill. 2) Casting: jewelry is produced in massive quantities, and there could be many pieces with one design. The advantages are fast production, less costs if produced in big quantities and slightly dependant on workers skills. The disadvantages are less precise than handmade, less beautiful than handmade and stamping, and might comprise an air bubble during casting which could cause a hole on the surface or inside and result in undurable jewelry. 3) Stamping: jewelry is produced in massive quantities, and there could be many pieces with one design. Normally used for producing earrings, coins, etc. The advantages are consistent quality, less cost and time, needs little trimming before polishing and can be thinner than casting (leading it to be competitive in term of price). 4) Die-struck: this method is very expensive. 9

2.4 The Case Study Company: Sterling Silver Jewelry The selected case study company is located in Bangkok and its factory is in Nonthaburi province. The company was found in 1999. The company developed from a retailer to a manufacturer. At present, the company has 63 employees and is managed by the owner s family. The company does not have an official organizational structure; however the draft organizational chart is shown in Figure 2.6. The company manufactures fashionable sterling silver jewelry for girls and young women which may be decorated with synthetic gems, paint, crystal and others. The main products are earrings and nose jewelry that is for exporting only, with revenue earnings of about 70 million baht annually. The company has designers that create the new jewelry styles and propose them to the main customer. The company s main customer is in the United Kingdom, and they have stores in many countries such as Austria, Belgium, Canada, the USA (United States of America), Switzerland, etc. Due to rapid expansion, the company needs to outsource using the surrounding communities. Some outsourcers are the company s skilled workers that became owners of businesses; however the jobs are still performed by members in the outsourcers families. Therefore the defects can be found after the products are returned and checked by the company. Besides the defects found, the company also faces loss in the main material, sterling silver that is given to the outsourcers, and has extra costs incurred from mistakes in identifying the product items that are sent to the outsourcers due to an inability to track and trace the product type and production route. Contaminated metal, such as lead, in jewelry that the customer does not allow in jewelry is another problem that the company faces. Moreover, the company also wants to prevent other metal contaminations, such as with nickel occurrence, before it happens. The major production processes of the case study company are divided into three groups, i.e. silver tubing, silver stamping, and silver casting. The draft flow charts are shown in Figures 2.7 to 2.9, the processes that can be outsourced are in the bold boxes. 10

Managing Director Finance Accounting Marketing Production Export Product Design Sample Preparation Figure 2.6 The Draft Organizational Chart of the Case Study Company Silver and copper mixing and melting Pressing into sheet Rolling sheet to form tube Roll tube around the axis, like a spring. Cut a silver spring into hoops. Polishing and decorate the silver hoop. Attaching a wire to the silver hoop for holding Final polishing Anti-tarnish coating Packing Figure 2.7 Silver Tubing Process in the Case Study Company 11

Silver and copper mixing and melting Pressing into sheet Silver Stamping Checking and comparing to design. Attaching a pin to the stamped silver for holding Polishing Decorate the stamp silver such as coloring, stone setting and etc. Final polishing Anti-tarnish coating Packing Figure 2.8 Silver Stamping Process in the Case Study Company 12

Model making Rubber mold making Wax spueing Wax tree making Investment Silver casting Cut silver casting from silver tree to be in piece. Polishing Decorate the silver casting such as coloring, set stone, gold plating and etc. Polishing Anti-tarnish coating Packing Figure 2.9 Silver Casting Process in the Case Study Company 13

The other problems that the company faces are over stock due to the company does not have ability to determine the product statuses whether where they are, and in which processes, so the records for production traceability could be used for tracking the statuses of the products. 2.5 The Overview of Production Traceability The production traceability has been used by many industries for lot tracing, both in manufacturing and service such as food, electronics, automotive, medical, and logistics (Ministry of Economy, Trade and Industry [METI], 2003; Töyrylä, 1999). The majority product types that use traceability systems are human life effect products, high value products, products that comprise several and complicated components materials and so on. The benefits of production traceability that found in these industries are product recall application, product liability prevention, quality and process improvement, proof of product quality and product origin, tracing and tracking the route of products in logistics, security application, after sales service application, and accounting application (METI, 2003; Petroff, 1991; Töyrylä, 1999). A production lot traceability system has significant impact on both product costs and quality, and can have a major impact on business competitiveness. A company needs to have an efficient lot tracing system in order to survive (Petroff, 1991). The followings are examples of traceability systems applying in industries (METI, 2003): In food industry: processed foods; like canned food, vegetable in packaging, is identified the manufactured or expired date. In Japan, the consumers are allowed to access production and manufacturing information from the internet In electronics industry: to promote environmental protection, the recycling efforts needed through registration and management of information on component materials used in the manufacture of products. An identification and traceability system, to recover these materials to be recycled, is needed In automotive industry: an automotive industry needs a production traceability system to trace for product safety by documentation, and 14

manage the records of machines used for manufactures, part lot numbers and parts that were repaired or replaced 2.6 Product Classification A priority task in developing a production traceability system is to develop a standard product coding and classification system for identifying products (METI, 2003). The product coding and classification system can be designed by several ways, the examples are as follows: Hospital: a coding system is defined by classifying to be many groups such as disease coding groups, drug coding groups, hospital coding groups, personnel position coding groups and so on. Each classification groups have different design structures of coding systems that appropriate to the purpose use. For example, the diseases coding groups follow the International Classification of Diseases: ICD) that use three to five digits of alphanumeric, the personnel position coding groups use the two digits defined by each hospital (Department of Industrial Engineering [DIE], 2006.) Publishing: the international standard likes ISSN (International Standard Serial Number) and ISBN (International Standard Book Number) are widely used 2.7 Product Classification of Jewelry Hendry (2004) has invented the system and method for appraising and describing jewelry and other valuable items such as antiques, gemstones, fine China antiques and other collectibles. The objectives of inventing this system and method are for making appraisals, detailed descriptions, insurance underwriting assessment, claims adjustment, and the like. The invention provided examples of the system by using data processing system that guiding a user through series of forms on the computer screen to fill in or drop down list menus to choose. The data sets of various classes of the valuable items were kept in database. The items are classified by descriptions that built of sets of elements that users will choose associate elements to build the description. For the jewelry classification, the examples of classes are ring, bracelet, necklace, or other jewelry items, and examples of elements are: 15

type, size, weight, color, cut, and clarity of a gemstone material, styling, and style of setting or mounting the gemstone on such jewelry The detailed examples of the above classification of jewelry are listed in Table 2.2. Table 2.2 Examples of Design Classification for Jewelry Classification Level Primary Level Second Level Third Level Fourth Level Loose Goods Diamonds Assorted Cuts Round Assorted Sizes.01 -.12 cts.13 -.24 cts.25 -.49 cts.50 -.74 cts.75 -.994 cts.995-1.49 cts 1.50-1.99 cts 2.00-3.00 cts 3.01 cts up Marquise Cut Emerald Cut Pear Cut Oval Cut Tapered Baguette Baguette Cut Fancy Cut Precious Gems Emerald Ruby Sapphire Gems Stones Alexandrite Almandite Garnet Amber Amethyst Andalusite Aquamarine Beryl Bloodstone Chrysoberyl Citrine Coral Cubic Zirconium Demantoid Garnet Fire Agate Garnet Garnet-Almandite Garnet- Demantoid 16

Strung Pearls Other Stones Mixed Millimeter Garnet- Grossularite Garnet- Pyrope Garnet-Rhodolite Garnet- Spessartile Garnet-Tsavorite Grossularite Garnet Hematite Iotite Jade - Jadeite Jade - Nephrite Jet Kunzite Lapis Lazuli Malachite Moonstone Morganite Mother of Pearl Onyx Opal Opal - Black Opal - Boulder Pearl Peridot Pyrope Garnet Quartz Rhodolite Garnet Rubellite Sardonyx Shell Spessartite Garnet Spinel Tanzanite Tiger - Eye Topaz Tourmaline Tsavorite Garnet Turquoise Zircon Other Assorted Shapes Round Off Round.01 -.49 cts.50 -.99 cts 1.00-1.49 cts 1.50-1.99 cts 2.00-2.99 cts 3.00-3.99 cts 4.00-4.99 cts 5.00-7.99 cts 8.00-11.99 cts 12.00-14.99 cts 15.00-19.99 cts 20.00-24.99 cts 25.00 cts up 17

Mounted Diamond 0-2 Millimeter 3-4 Millimeter 5-6 Millimeter 7-8 Millimeter 9-10 Millimeter 11-14 Millimeter 15 Millimeter up Platinum Diamond Jewelry Oval Pear/ Tear Drop Rice Baroque Other Shapes Lady s Ring Men s Ring Lady s Jewelry Anniversary Ballerina Band Cameo Class Coin Engagement Fancy Fraternal Insert Intaglio Ring Jacket Signet Waterfall Wedding Wedding Set Wrap Other Anniversary Band Cameo Class Coin Fancy Fraternal Intaglio Signet Wedding Other Barrette Bracelet Bracelet - Bangle Bracelet - Cameo Bracelet - Coin Bracelet - Cuff Bracelet - Intaglio Bracelet - Jacket Bracelet - Tennis Brooch Button Covers 18

Men s Jewelry Case Charm Clasp Clip Compact Earrings Earrings - Cameo Earrings - Coin Earrings - Cuff Earrings - Foldover Earrings - Intaglio Earrings - Jacket Earrings - Studs Enhancer Jabot Locket Necklace Pendant Pendant - Cameo Pendant - Coin Pendant - Intaglio Religious Studs Tie Chain Watch Attachment Watch Bracelet Watch Strap Other Belt Buckle Bracelet Bracelet - Cameo Bracelet - Cuff Bracelet - Intaglio Button Covers Case Clip Cuff Links Earrings Earrings - Cameo Earrings - Coin Earrings - Cuff Earrings - Foldover Earrings - Intaglio Earrings - Jacket Earrings - Studs Necklace Pendant Pendant - Cameo Pendant - Coin Pendant - Intaglio Religious Stays Studs Tie Bar Tie Chain Tie Tack Watch Attachment 19

Mounted Precious Gems (Emerald, Ruby, Sapphire) Mounted Gems (other than Diamond, Emerald, Ruby, Sapphire) Platinum and Karat Karat Yellow Gold Diamond Jewelry Karat White Gold Diamond Jewelry Karat Gold Diamond Jewelry (Other than YG or WG) Platinum Precious Gem Jewelry Karat Yellow Gold Precious Gem Jewelry Karat White Gold Precious Gem Jewelry Karat Gold Precious Gem Jewelry Platinum Gem Jewelry Karat Yellow Gold Gem Jewelry Karat White Gold Gem Jewelry Karat Gold Gem Jewelry Lady s Ring Men s Ring Lady s Diamond & Colored Stone Ring Men s Diamond & Colored Stone Ring Lady s Jewelry Men s Jewelry Lady s Ring Men s Ring Lady s Diamond & Colored Stone Ring Men s Diamond & Colored Stone Ring Lady s Jewelry Men s Jewelry Lady s Ring Men s Ring Lady s Jewelry Men s Jewelry Lady s Ring Men s Ring Lady s Jewelry Men s Jewelry Watch Bracelet Watch Strap Other 20

Gold Jewelry Silver Jewelry Gold Plated, Filled and Other Jewelry Watches Platinum Jewelry Karat Gold Jewelry Lady s Ring Men s Ring Chain Lady s Jewelry Men s Jewelry Lady s Ring Men s Ring Chain Lady s Jewelry Men s Jewelry Watches with Stones and Karat Gold or Platinum Watches - Karat Gold or Platinum Lady s Watch Men s Watch Lady s Ring Men s Ring Lady s Jewelry Men s Jewelry Lady s Ring Men s Ring Baby Ring Chain Lady s Jewelry Men s Jewelry Lady s Platinum & Stone Watch Men s Platinum & Stone Watch Lady s Karat Gold & Stone Watch Men s Karat Gold & Stone Watch Lady s Platinum Watch Men s Platinum Watch Lady s Karat Gold Watch Men s Karat Gold Watch Dress Pocket Sport Other Dress Pocket Sport Other 21

Source: Hendry (2004) Dress Pocket Sport Other This design classification that revealed by Hendry (2004) covered a wide range of types of jewelry. The classification system was invented for the purpose of assessing the value of such items such as making appraisals, detailed descriptions, insurance underwriting assessment, claims adjustment, and so on. In this thesis, however the focus will be on the fashionable sterling silver jewelry in the case study company, for the traceability purposes. Hendry s classification is used only as a guideline and many adaptations may be needed. 2.8 Method for Developing the Product Classification and Coding System Group technology (GT) is an engineering and manufacturing methodology used for improving productivity by grouping parts and products based on their similar characteristics (geometry or manufacturing process) into families. GT begins by grouping part families based on their attributes. There are three methods to form part families: manual visual inspection, production flow analysis, and classification and coding (Anlağan, 1996). In this thesis, the classification and coding method has been focused on and used. A manufacturing system can be separated into smaller subsystems of part families based on similarities in design attributes and manufacturing attributes. Examples are as follows (Britton, 2000; Hyer & Wemmerlöv, 1984): Design attributes: part configurations (such as round, square), dimension envelops (such as length to diameter ratio), surface integrities (such as surface roughness, dimensional tolerances), material types, raw material stages (such as casting, forging, bar stock) and so on Manufacturing attributes: operations and operation sequences (turning, milling, etc.), batch sizes, machine tools, cutting tools, work holding devices, processing time, etc Examples of design and manufacturing attributes that are typically included in a group technology classification and coding system are shown in Table 2.3. 22

Table 2.3 Examples of Design and Manufacturing Attributes included in a Classification and Coding System Design Attributes Manufacturing Attributes Basic external shape Major processes Basic internal shape Minor operations Rotational or rectangular shape Operation sequence Length-to-diameter ratio (rotational parts) Surface finish Aspect ratio (rectangular parts) Machine tool Material type Production cycle time Part function Batch size Major dimensions Annual production Minor dimensions Fixtures required Tolerances Cutting tools Source: Britton (2000) and Hyer and Wemmerlöv (1984) The GT classification and coding method is achieved by classifying parts according their design and manufacturing attributes. The GT classification method usually classifies a structuring of part or product attributes into a set of families that have similar attributes. However the attributes may be in the wide variety of characteristics, such as geometrics, material ingredients, function and so on, a careful definition of attributes needs to be considered. For example, parts that are similar in one set of attributes (such as shape, sizes) may not similar in the other attributes (such as color, weight). This is a fact that there is no single way to classify parts or products. Each part and product classification system needs to be developed bases on the intended use. However, families should cover all parts or products and also each part or product should be able to assign only one family (Britton, 2000; Hokey & Shin, 1994). Examples of reasons to use a coding system are as follows: Design information retrieval and variety reduction: during part developing task, a designer can determine if a similar part has already existed. A simple change in an existing part would take much less time than designing a whole new part. 23

Improving manufacturing performance: a part code for a new part can be used to search for process plans for existing parts with similar codes. To assign symbols in the GT coding system is based on three different structures of codes as follows (Anlağan, 1996; Min & Shin, 1994): Monocode or hierarchical structure Polycode or attribute structure or chain code Mixed code or hybrid structure 2.8.1 Monocode or hierarchical structure. This coding system was originally developed for biological classification in 18 th century. The monocode structure is like a tree in which each digit(s) amplifies the information provided in the previous digit(s). The first digit represents an entire group and the next digit(s) represents sub-groups and so on. The meaning of each digit(s) is dependant on the previous digit(s) in the code. An example is shown in Figure 2.10. The advantages of monocode are as follows: with a relatively small numbers of digits, a large amount of information can be stored it is useful for storage and retrieval of the design-related information such as the part geometry, material, size, etc The disadvantages of monocode are as follows: it is difficult to define the meaning for each digit in the different sub-groups may have different levels of sub-sub-groups, therefore the codes in some positions may be blank 24

Figure 2.10 Example of Monocode (Hierarchical Structure) Source: Joneja (2003) 2.8.2 Polycode or attribute structure or chain code. The code symbols are independent of each other. They are fixed position codes. Each digit(s) in a specific location of the code describes a unique property of the feature, thus the value of any given digits within the code has no relation to the other digits. The advantages of polycode are as follows: it is easy to formulate it is easy to understand and is useful in manufacturing situations where manufacturing processes have to be described The disadvantages of polycode are as follows: length of codes may become excessive and very long because less information can be stored per digit to compare the coded parts, such as to check for similarity, requires more works because needs to compare every digit and each digit is not related to the others 2.8.3 Mixed code or hybrid structure. It is the mixture of both monocode (hierarchical structure) and polycode (attribute structure) systems by using the monocode when can and use the polycode for the other digits. The model structure of the mixed code is shown in Figure 2.11. The mixed code retains the advantages of both systems; it is the most commonly used 25

the structure of coding and classification. A code created by using mixed code structure would be relatively more compact than a pure attribute code (polycode) structure while retaining the ability to easily identify parts with specific characteristics. Figure 2.11 Model Structure of Mixed Code (Hybrid Structure) Source: Joneja (2003) One example of the mixed code structure that is widely used by industries and provides a basic framework for understanding the classification and coding process is the Opitz coding system. The Opitz coding system was developed by Dr. H. Opitz, Technical University of Aachen in 1970. It considers both design and manufacturing information. The basic structure of the Opitz coding system comprises of three groups of digits as shown in Figure 2.12. The example of form code (digits 1 to 5) for the rotational parts in the Opitz coding system is shown in Figure 2.13. 26

Form code Supplementary code Secondary code 12345 6789 ABCD Part geometry and features relevant to part design Information relevant to manufacturing (polycode) Production processes and production sequences Figure 2.12 The Basic Structure of Opitz Coding System Source: Anlağan (1996) and Özdemir (2005) 27

Figure 2.13 Form Code (Digits 1 to 5) for Rotational Parts in the Opitz Coding System Source: Özdemir (2005) 1 28

Although the Opitz coding system is a widely used system but Fatheldin and Kirkpatrick (1968) had mentioned as follows: Opitz system is suitable both for design retrieval as well as for the formation of parts families for cellular manufacture. This point is disputed by other researchers. Some criticisms of Opitz s code are: 1) Washers which are identical from the design point of view can be produced by (i) sawing off from a tube, (ii) turning from a bar, and (iii) stamping from a strip. 2) The choice of the L/D ratio for the first code digit brings components of, say, L = 100, D = 20 together with those of L = 1,000, D = 200. The two types of components have different production requirements. 3) The code does not distinguish between the internal and external teeth for gears, the number of teeth, and so on.... It indicates that, whilst universal codes may be useful as the first step in adopting a code, it is usually necessary to modifications to better accommodate the requirements of the particular firm. (as cited in Lee, 1984, p. 5) Anlağan (1996) suggested about an important to understand the attributes of classification and coding system for the purpose of selecting or developing coding system that met company needs. Some of the important classification and coding system attributes that should be considered were as follows: 1) Flexibility for various applications such as part family formation, process planning, costing, and purchasing 2) Accuracy, to provide correct information on parts 3) Expandability, to utilize information on more part attributes 4) Ease of learning 5) Ease of retrieval 6) Reliability and availability of software 7) Suitability for specific applications 29

Hyer and Wemmerlöv (1989) mentioned that the process to perform coding and classification could be completely manual or computer-assisted with interactive expert-system (as cited in Tatikonda & Wemmerlöv, 1992). 2.9 Method for Developing the Production Traceability System Considering that the information that is relevant to the production traceability are still vague and undefined, the historic information regarding the actual production records such as the production history and the transaction history should be treated carefully (METI, 2003). Steele (1995) defined the data contents required to collect for a production traceability system, the following information was considered necessary: 1) The processes or component materials used to make this product and the characteristics of these processes or component materials. 2) The process records, component material sources, letter of analysis, or certificates that show the level of compliance to the specification. 3) The other items that may be defective. If the processes or component materials are suspected to be defective, those items may need to be inspected or repaired. The needed information is dependant on the purposes of the production traceability, the company, and the industry, and can be considered in the following perspectives: the frequency of the referring information (real time or on demand information), the amount of the information used (complete product life cycle process from production, only production records or only information required by customer) and the details of the information required for traceability (each item, need serialization, each lot or only product code or type) (METI, 2003; Steele, 1995). Steele (1995) suggested that to design a production traceability system, required the unique identification for a physical lot, data recoding for lot movement, lot-process linking to the process data, and reporting that retrieves the lot-tracing data from the system to find source lots or component materials associated with a suspected lot. 30

Chapter 3 Research Methodology 3.1 Introduction The purpose of this study is to develop the product classification and production traceability system for the sterling silver jewelry company. The literatures were examined by focusing on the product classification and coding, and the production traceability. The related literature was reviewed to synthesize ideas to develop the product classification and production traceability system used in this research. This chapter describes the methodology that is used in the research, which included data collection, system development, field-test and system adjustment as shown in Figure 3.1. Data Collection System Development Literature Review System Adjustment Field-Test Figure 3 The Methodology used in this Thesis 3.2 Data Collection for Studying Products and Processes in the Case Study Company To ensure the reliability of the data findings for developing the system in this case study company, several data sources were collected. The data collection in this study used multiple sources of evidences, which adapted from Yin (2003), including documentation, interviews, direct observations and physical artifacts. Yin (2003) suggested that no single source has a complete advantage over all the others. In fact, the various sources are highly complementary, and a good case study will therefore want to use as many sources as possible. 31

3.2.1 Documentation. Yin (2003) suggested that documentary information was useful, but it could have bias and must carefully use. For a case study, the document should use as an additional evidence from the other sources. The case study company is a family business that has only a few documents in its system; the collected documentary information was described in Chapter 4. 3.2.2 Interviews. Rubin and Rubin suggested that the interview was one of the most important sources of a case study information and appeared to be a guide conversation rather than structured questions; it was likely to be fluid rather than rigid (as cited in Yin, 2003). It was able to provide shortcuts to the prior history of the situation and identify the other relevant sources of evidences (Yin, 2003). In this thesis, the several interviews were conducted to get the details and update data, checked the company requirements, and discussed the result of the field test. 3.2.3 Direct observations. Yin (2003) suggested that the direct observations could range from formal to causal data collection activities, and the field-workers might be asked during observation. The direct observation might be made throughout the field visits, including during which other evidences, such as from the interviews. The observational evidences were useful in providing additional information about the topic being studied. In this thesis, many direct observations were performed, almost every visiting during the development of the system. 3.2.4 Physical artifacts. Yin (2003) suggested that physical artifacts have less potential relevance in the most typical kind of case study. However, when relevant, the artifacts can be an important component in the overall case. The examples of the physical artifacts are a technological device, a tool, a work of art, and so on. Therefore, the case study company s products, parts, material and tools were investigated. 32

3.3 System Development To develop the system of the jewelry design information retrieval and the production traceability based on interviews and workshops with the case study company s executive, designers, and operators, as well as used the existing database and the information retrieval systems. The developed system had the unique identification for product lot, data collection for tracing the lot movement. 3.4 Field-Test The field-test of the developed prototype to ensure the operational acceptability and practically by implementing the product classification and the production traceability system in the company and interviewed the associated people such as the company executive, designers, and operators for practical use and gather information for revision the developed system. 3.5 System Adjustment The developed system was adjusted according to the information receiving until the system was considered satisfactory by the company executive through the questionnaire. 33

Chapter 4 Development and Application of the System This chapter presents the development, application and result of the product classification and production traceability system in the case study company which included: the data that are collected from each source, the development of the product classification and coding, and the development of the production traceability system. 4.1 The Collected Data According to the data collection to study products and processes in the case study company that described in Chapter 3. The data were collected by using four sources of evidences: documentation, interviews, direct observations and physical artifacts. The results were as follows: 4.1.1 Documentation. The case study company is a family business that had a few documents in its system. The main documentation and information related in this thesis were summarized in Table 4.1. Table 4.1 The Case Study s Documentary Information Document Title Customer Purchase Order (PO) Delivery Bill Information Related to This Study Customer product code Product description Product picture (hand-written form) Product quantity Ornament type and color (such as pink rhinestone, white cubic zirconia) Type of finished card (for packing) Process group (i.e. tubing, stamping and casting) Delivery date Product description Product picture (hand-written form) Product quantity, total weight Remark The company uses this document for making order to 34