Manufacturing Operations Management, Quality and Aerospace Talk

The Manufacturing Continuous Improvement Lifecycle

 

 

 

 

 

 

 

 

 

 

 

 

 

 

This one is common to Six Sigma, Lean Manufacturing, and any process improvement philosophy. These days... if you are not continuously improving, you are probably moving backwards and it might be time for a change.

: )

 

 

The Problem Isn't Motivation or ROI

It is a new year again and we have some resolutions to put in place. For me, one resolution is to make healthier choices—eat better, exercise more, get leaner and lose a few extra pounds. But I have trouble getting “motivated” and starting the new routine of exercising in the mornings. I keep telling myself “I’ll start next week.” What can I do to improve my motivation?

Perhaps I am not asking the right question. Is “motivation” really holding me back? I am motivated enough to put these things on my resolution list. I want to be healthier and feel better. Why would I not be motivated to do that? The Return on Investment (ROI) is clearly there. This will add more healthy years to my life. Perhaps motivation is not my problem. What if I rephrase my problem as lack of follow-through?

Perhaps the solution is not putting up motivational posters on my walls trying to visualize a healthier and more competitive me. I just get more frustrated as I see some of my friends getting better and faster at the basketball court every day. (I am the one getting slower.)

The solution to a motivational problem is the exact opposite of the solution to a follow-through problem. The mind is essential to motivation. But for follow-through, the mind can get in the way overly thinking things and sabotaging our aspirations. For example, we decide to go to the gym after work but then, when it comes time to go, we think, “It's late, I'm tired, I could get hurt, maybe I'll skip it today.”

If I want to follow through on something, I need to stop over-analyzing. Shut down the conversation that wants to start again in my head. Stop worrying and finding reasons to put it off. Just put in place a plan and follow it through. Like the ad says: “Just Do It!”

This year I am going to make a very specific decision to implement some changes in my routine and put a specific timeline on it. Something like: “Starting Monday Jan 9th, I will work out each Monday, Wednesday and Friday at 6 AM for 30 minutes”.

I am also going to put in place a reward/penalty system to counteract the natural resistance to change. If I complete my scheduled workout each week, I can eat whatever I want on Saturday; otherwise I eat only salad on Saturday.

Perhaps you can apply these same ideas to some of your personal or business improvement goals for 2012:
• Stop putting off what you know you need to do—projects with clear and known ROI; projects needed for your personal or professional competitive edge.
• Create an environment that supports change and your new goals
• Commit to a concrete plan and timeline
• Maintain a sense of urgency in this new commitment
• Put in place reward and/or penalty measures to counteract the natural resistance to change.

When your mind (or your team) starts to argue with you —remember that is the natural resistance-to-change getting in the way. Just follow the plan. This year, we are going to stop putting off the projects we objectively know will improve our personal and professional success.

WIsh me luck and good luck with your initiatives. Happy New Year!

Are We Teaching Young Kids Lean Practices?

If we want Lean Manufacturing practices to become more common, we should start teaching them at an early age. What are we actually learning?

5S (Sorting, Straightening, Shining, Standardizing, and Sustaining). Kids do learn early how to keep their area clean, clean up their own mess and put things back in their proper place. My kids’ early grade classes had shelves carefully labeled to help students remember where things belonged and students had to return materials back to their place after completing a project. Excellent 5S practice.

Make to Order. We are definitely teaching kids this lesson. My kids will NOT do any studying or homework in advance even when they know what is due next week. They understand that there is no sense in having a buffer of homework inventory that could go to waste if the teacher decides to change plans, skip a chapter or do them out of order. I have to agree with Just-In-Time homework.  

 Visual Work Instructions. I feel that we are failing in this area. We hugely  depend on the teachers to demonstrate the proper way of doing things and we don’t necessarily provide good visual work instructions. Would the kids follow the instructions if they were provided? Perhaps if we started this habit young, we would read those instructions manual later in life.

Work Cells. We do not practice the concept of work cells or assembly lines in school. Each student usually does their own project from start to finish craftsman style. We see a few team projects in later grades but workload is hardly ever balanced. They might get to feel the efficiency of an assembly line at lunch, but many schools don’t have cafeteria style anymore.

Elimination of Time and Material Waste. We do pretty well in this area in early grades. Students spend the entire school day in one classroom including nap time. Materials are very efficiently used since they are in short supply in school these days. But in later grades we become more wasteful. Someone decided that it is more efficient to move hundreds of students with full backpacks from class to class rather than move a few teachers around. We could set better examples at school of avoiding wasteful movement of inventory, tools and work-in-progress. Instead we learn that standing in line for half of the lunch time is normal and an expected part of life.

Are kids learning enough Lean know-how? Could they? Perhaps we will have to practice more at home... perhaps a hamburger work cell tonight : )

 

Q&A with Peter Coffee on Social Apps - Adding Value or Disruptive?

This week I attended a presentation by Peter Coffee at a Salesforce.com partner event in California and had a chance to ask Peter a question. I have been a fan of Peter's writing for a long time so I was looking forward to his keynote speech. Peter did not disappoint. He made some interesting points contrasting the different approaches towards the "cloud" by Amazon, Microsoft, Google and Force.com. Peter contrasted the idea of providing "services" in the cloud versus providing "platforms" in the cloud.

Are we just moving the same problems somewhere else? Is Force.com really doing something different? Interesting food for thought but I honed in on something Peter said toward the end of his presentation. He wrapped up with three recommendations: (1) Don't ride a Unicorn, (2) Don't feed a Minotaur, and (3) Don't be Antisocial. You might think the Unicorn and Minotaur would get my attention, but his third point got most of my interest.

Peter: New systems should be social. They should initiate conversation based on what you are doing. They are not just waiting for you to ask them what to do.

Peter wrapped up his presentation, but this thought resonated in my head. Should an application start conversations? I like to get alerts when I have a task due, but do I want my software suggestions new tasks? Sounds interesting, but I'm not all convinced. So during the Q&A session I had to ask this question:

Conrad: At the office, we have all experienced the neighbor that tries to peek over the wall and start a conversation when we are really focused in the middle of a task. How does a social app balance between starting social conversations based on what I am doing and becoming a pest with unwanted obtrusive interruptions?

Peter: Good question. We are very concerned about creating apps that improve productivity. We have found that many users find the new paradigm less intrusive than paradigms like email. In social apps you usually subscribe to content you are interested in with actions like pressing the "Like" button on interesting content. In the email paradigm you are pushed content that you did not ask for. We have seen email go down as much as 40% in organizations that have shifted the way they distribute content internally.

Peter gave a few more examples, but I was not completely convinced.

Do you agree with Peter or do you also share my concern? Do we want our applications starting conversations? Or is this just a new type of virtual solicitor at my virtual door?

 

Why should we NOT go Paperless?

I have spent a lot of time trying to talk people into going paperless on the shop floor, but perhaps they are on to something. They are wearing me down and I’m starting to believe that perhaps going paperless is overrated. Let’s spend some time analyzing this choice and see if I can talk myself out of going paperless.
 
There is something to be said for leaving “good enough” alone—we minimize risk!

Risk is not a good thing. We teach project managers about assessing and mitigating risk. We have formal methods of analyzing risk like Failure Mode Analysis and I have a feeling that changing the way we do business is a risky business indeed.

We have done business like this for years. Why change now? We better have a really good reason. The current systems have their problems, but at least we know the problems. A new paperless process could create new problems. Who knows what kind of new problems? How can we know what we don’t know? But we do know that it will be different and different is not necessarily better. Could be better, but could be worse… right? I guess it depends on how bad things are now. But how bad could they be. After all, we have been doing it this way for years.

If we change our processes, we will have to change all our procedure books and we will have to train everyone. It took me ten years, but I was finally getting the hang of our current processes. You want me to learn it all again? Our shop floor people are used to the current way and I am not sure they can learn new ways. Do we want to risk it? They might file a bunch of complaints.

What do those manufacturing “engineers” know anyway? They want me to read THEIR work instructions, but I keep my own notes in my locker. I have been doing this job for years and I know all the little tricks to putting this assembly together. Check this out… I have all my notes written in the margins of this old drawing. They want me to forget my notes and use their recommendations, but they hardly come down here to see how we put it all together.

The few things we do today on these old computers take forever. I don’t see how asking us to do more on the computer is going to make things faster. Do you want me manufacturing? Or typing on the computer? The paper doesn’t make me wait. If I make a mistake, I can just throw the form away and start over. Or I can strike over what I wrote, initial it, and do it again.

We do lose some paper documents once in a while or something gets damaged, but it rarely happens. Nobody ever really goes back and checks the paper. Except for that one audit a year ago. That auditor was so frustrated going through all the paper that he probably does not want to come back : ) If we make it easier to audit historical records, we might get audited more often.

What if the computers go down? It happens, right? Are we going to print paper “just in case”? If we do, what is the point? What are we saving?

We have an amazing IT guy. He can do whatever we need using spreadsheets. We have different spreadsheets for different things. Different managers like to do their numbers differently and we often have to adjust the numbers we get from the shop floor. Some days are better than others, but we don’t want people panicking over a bad day. As long as the average for the week is okay—it’s all good.

I am not sticking my neck out on this new project. What if it fails? I am not sure my manager is fully behind this idea either. After all, he was instrumental in putting the current processes in place.

Even if we want to do this project, everyone is so busy. Who is going to work on this project? You know what happens to people on special projects when we need to reduce the workforce.

Where is the money going to come from? Perhaps we should be buying new machines instead. We are all going to be replaced by robots someday soon, so why bother trying to make us more productive?

They are looking at a commercial off-the-shelf software solution. I don’t know why when our IT guy can probably write a program specific to our needs in one or two weeks. He might be able to do it working during his lunch breaks. Why should we spend the money on a commercial product? 

What if the project works? I could get stuck assigned to doing this type of project all over again at another site. That would mean a lot of travel and I don’t like to travel.

What do you say? Do you really want to change the way you are doing business? Or do you agree we should leave “good enough” alone? Is there any risk in the “do-nothing” choice?

Fishbone Diagram Templates for Root Cause Analysis with Common Manufacturing Problems

Why start a root-cause analysis with a blank canvas? Are we better served starting with a blank canvas and an open mind, or do we put some common manufacturing problem areas in our template? Will the defaults in our template bias the discussion or make sure we always touch base on certain topics?

I was creating a template to facilitate meetings and ensure certain topics were always covered during a root-cause analysis. However, I found myself quickly filling up the paper.  I ended up switching to a tabloid page size, but I thought I should capture several iterations of the template to compare and decide which one would be more conducive to getting a good discussion started. 

Which one gets your brainstorming juices flowing? Which one will be more effective?

Do we start with a blank slate? 

Staring at a blank template or whiteboard can be intimidating at first. It is now up to the participants to come up with some ideas. However, strong personalities can lead the discussion in a single direction and we risk skipping some potential areas for causes. 

I personally like a little more guidance in a template. At least have some common headings for areas of discussion. This way we ensure that certain topics are discussed in every root-cause analysis. 

On the other hand, starting with a full fishbone diagram does not seem good either. Perhaps we start with the last one we used like the one above. The risk here is that we might get a feeling that we are done already. Looks finished to me. So perhaps we need a partial template like the one below. 

Maybe even this one is too full. But we might want to make sure certain common problems are always included in the discussion. 

Consider adding the following common sources of problems in manufacturing to your templates. 

1. Materials – Wrong, Deficient, Out of Spec – Is the material correct? Does it meet quality standards and specifications?

2. People – Skills and Certifications for Technicians and Inspectors - Are the employees performing the job qualified to do so? Is the training received sufficient?

3. Methods/Instructions – Incomplete, inaccurate or ambiguous – Are standardized work instructions provided? Are instructions illustrated? Are the work instructions missing a critical sentence or warning? 

4. Environment – Controlled, temperature, humidity, vibration, etc. – Is the assembly environment adequate to perform the work? Do the environment conditions need to be monitored for the particular process?

5. Machines/Equipment/Gages – Set up, maintenance, cycles – How do you know that a machine was properly configured to perform the work? When was the last machine maintenance?

6. Configuration – Wrong, obsolete, or changed configuration –  How do you know the correct configuration was selected when the assembly was worked?

7. Measuring/Test Equipment – Insufficient, inaccurate or incorrect measurements – How would you determine that the measuring/test equipment produced the desired result? When was the tool last calibration? 

8. Design – Rework, work-arounds, ECO/ECN – Was the problem or failure due to design? Due to building the wrong configuration?  Different revision levels? 

Which template do you prefer as a starting point? Empty or half full?

News: NAM, "The rumors of U.S. manufacturing’s death have been greatly exaggerated"

The rumors of U.S. manufacturing’s death have been greatly exaggerated, said the National Association of Manufacturers today as it issued a blueprint for boosting America’s manufacturing competitiveness and creating jobs.

According to the NAM, the United States is the world’s largest manufacturing economy, producing 21% of its manufactured goods, followed by Japan, with 13%, and China, with 12%. Manufacturing accounts for roughly 18.6 million U.S. jobs, or about one in six private-sector jobs, that pay an average of $70,666 annually, well above the non-manufacturing worker’s average salary of $57,993. The problem, as the NAM outlines it, is that foreign manufacturers, with support from their governments, are posing tough competition, and the United States lacks a comprehensive, national policy to parry such attacks.

See the full article at... 

http://www.managingautomation.com/maonline/news/read/NAM_Calls_for_National_Manufacturing_Strategy_33579

Why Manufacturing Operations Management (MOM) or Manufacturing Execution Systems (MES) in addition to ERP? - Online References

The following are some nice references that discuss how MES/MOM systems are used at the shop floor in manufacturing companies to complete the enterprise systems landscape on top of ERP systems. MES/MOM adoption is on the rise and several of these papers discuss trends and the reasons behind them.

Aberdeen - Manufacturing Operations Management Report
http://literature.rockwellautomation.com/idc/groups/literature/documents/wp/ftalk-wp011_-en-e.pdf

Cambashi whitepaper sponsored by SAP - Foundation for MES/MOM Payback
http://www.managingautomation.com/library/download-detail.aspx?content_id=254408

Managing Automation poll finds MES purchasing at the top of the list
http://www.managingautomation.com/maonline/exclusive/read/MES__PLM__ERP_Dominate_Product_Plans_27756105

Expert Q&A: MES Takes Its Place in the Enterprise Suite
http://www.managingautomation.com/maonline/magazine/read/view/Expert_QampA_MES_Takes_Its_Place_in_the_Enterprise_Suite_252676

Industry Directions – Whitepaper - Best of the Best Plants Use MES
http://www.glbinc.com/MES_Performance_Advantage.pdf

AMR Research – ERP Myths Versus MES Realities
http://www.mesa.org/knowledge-base/details.php?id=166

Overall Equipment Effectiveness (OEE) or Overall Resource Effectiveness?

Can you manage what you can't measure? Some cowboy managers probably do, but most managers would agree that consistent reliable metrics across operations help manage the business effectively. The topic of metrics gets much attention lately and there is much talk on OEE (Overall Equipment Effectiveness) as one of the preferred metrics. However, when using metrics that combine several metrics into one, we should use caution and mitigate the risk of hiding important information as a result of these combined metrics.

OEE is a fine metric, especially in industries where the manufacturing process revolves around a few expensive pieces of equipment. It is one of several metrics we should consider for KPI’s (Key Performance Indicators). More interesting to me are the components of OEE, which are also all good metrics, and how these should be defined differently for different industries. In other words, the principles behind OEE can be applied to multiple industries and types of manufacturing, but one OEE definition does not work the same for everyone.

Why are we interested in metrics like OEE?

Because we need metrics to answer management questions and aid decision making. Questions on the minds of the management team might change periodically depending on the business priority of the day but usually include questions like the following:

• How am I doing? What is our current capacity, status, schedule attainment?
• What can I make today? What is current work-in-process and raw material status?
• Where should I make it? What is current assignment of resources to production among facilities – internal and outsourced?
• Where am I underperforming?

How does OEE help answer these questions?

OEE is an overall efficiency metric defined as OEE = Availability x Performance x Quality. It is an overall health type metric for the company. However, it is only as good as how we define its components: “equipment”, “availability”, “performance, “quality”.

OEE or ORE?

Personally, I do not like the use of the word "equipment" in the definition. A more appropriate term would be "resource". In other words, think of it as Overall Resource Efficiency and we have a metric applicable to a broader range of industries since equipment is not the primary critical resource for every type of manufacturing. Of course, we can just leave the word equipment in there to avoid creating yet another new term, but think “resource” when you see the word “equipment”.

Are we interested in every piece of equipment or every resource in this metric? I would say, No. We should only be looking at critical resources―resources that are critical because they are very expensive (big investment) or because they are potential constraints in the manufacturing process. Otherwise we are diluting focus from where it should be. It may be that in your industry some specialized labor skills are the most important resources. In that case, you might actually consider changing the term, because some people might not like the idea of being considered “equipment”.

Components of OEE

Each one of the components of OEE provides valuable information and should be looked at individually in addition to OEE. Several different metric definitions could feed into the components of OEE depending on the industry. A few examples are listed below.

OEE = Availability x Performance x Quality

Availability

• Ratio of Operating Time to Planned Production Time
• Percent of calendar hours that equipment was available for production or equipment up-time
• Percent of calendar hours product is not held idle by constraints like availability of parts, skilled resources, or equipment

Performance

• (Ideal Cycle Time x Total Pieces)/Operating Time
• (Total Pieces/Operating Time)/Ideal Run Rate
• Standard Labor Hours/Actual Labor Hours

Quality

• Good Pieces / Total Pieces
• (Actual Labor Hours – Rework Labor Hours)/Actual Labor Hours

Note that all these metrics are constructed so the elusive target is 100%. But don’t feel bad if your result is 70% or 80% instead of 95%. Since OEE can be defined slightly different according to the industry it is hard to use general benchmarks. Plus most companies are tracking all equipment (not just critical equipment) and that is just puffing up the OEE number to make them feel better. Industry benchmarks are nice but not required; any company can simply monitor each metric and make its own improvement goals based on past performance.

Still confused? Here are some more references to further confuse on the OEE subject :)

“Improving return on industrial assets”, MBT Magazine, 9-1-2009

http://www.mbtmag.com/article/365621-Improving_return_on_industrial_assets.php

“Overall Equipment Effectiveness” at Wikipedia

http://en.wikipedia.org/wiki/OEE

Are We Giving IT Conflicting Objectives in Manufacturing?

“To innovate or not to be”― that should be the question. These days we often see CIO’s with a cost cutting agenda as a primary goal. Should the CIO be relegated to a penny-pinching job or viewed as an architect in the company’s future growth?  

Manufacturing companies are facing a major change in the business marketplace. The emergence of global markets, rapid technology changes, and better informed and more demanding customers have rewritten the rules of manufacturing. Achieving and sustaining a competitive edge today requires that manufacturing companies use information strategically to turn the new rules of the market to their advantage.

To innovate or cut cost? Can we afford to keep IT in cost-cutting mode much longer? Many manufacturing companies don’t think so. As an indicator, we are not seeing the 15%-20% declines in technology purchases that we saw during the 2001-2002 downturn. Instead we are only seeing 2%-4% declines because some companies are looking at their technology investments more strategically. A survey performed by Managing Automation for 2009 spending revealed that even though companies have tighter budgets this year, they are still spending on strategic technology to improve productivity and enable new capacity and new markets.

Many manufacturers are realizing that they cannot survive tied down by paper intensive processes in their supply chains and their shop floors. Paper-based processes that prevent quick upgrades to the product line and prevent real-time visibility of status and issues.  Manufacturers tied down by slow old processes will not be able to compete in the new marketplace.

Technology solutions are available and maturing, but the CIO needs to embrace a new role in the company. The CIO must learn about the processes required to manage processes in the supply chain and the manufacturing shop floors. These are areas that have not been traditionally supported by enterprise IT departments. 

To innovate or standardize? To customize or integrate? Do we use best-of-breed solutions or try to implement a solution with a broad footprint? Some CIO’s might favor taking the easy path and focus on one ERP vendor to provide a complete solution for their enterprise. However, we often see companies spending much more creating custom extensions to their ERP systems, and ending up with less functionality than if they would have integrated a COTS solution in the first place. Just because a solution works for the Accounting department, does not mean that it works for the shop floor and the supply chain. It is vital to spend time understanding what competencies will enable the company’s business plan and what different solutions are being used in industry and by competitors.

It is often difficult for the internal IT department to resist the urge to be creative and develop their own custom solutions. If the IT department has a history of developing custom solutions, it would be prudent to hire a neutral third party consultant to evaluate alternate solutions available commercially, like MES and MOM systems.

To optimize or centralize? Many CIOs have been cutting cost by standardizing and centralizing IT solutions for the corporation. However, these strategies might not work for the manufacturing shop floors that need to sustain 24x7 up time, provide good response performance, and not slow down the production line. It is common to install local shop floor systems with high availability platforms and integrate these to centralized ERP systems.

The IT department must work through this change of agenda and must help the company invest wisely. Efficient manufacturing and supply chain processes can be an effective competitive weapon. The CIO must be an architect and must invest in best-of-breed technology that will provide change agility, best quality, great customer support, and enable increased capacity to handle future demands.