Article written by Chris Turner – Director of Lean Training and Development at Radical Transformation LLC.
I don’t know about you, but I find that most of the information in articles on the internet are more about the conceptual application of lean principles. I donâ€™t find many articles that actually demonstrate how lean principles are improving business practices in different organizations across the country. It would be great to find articles that share the real-life experiences of a company that shows howÂ lean manufacturing methods increase throughput velocity, eliminate waste,Â reduced costs, etc.
It is for this very reason that I find it refreshing to find a great article such as this one in Aerospace Manufacturing and Design about TCI Precision Metals in Gardena, CA. It identifies some of the operational challenges that job shops are facing to improve the service to their customers by taking a look at throughput, efficiency, cost control and workforce education. The key question here is: How did lean manufacturing methods help TCI Precision Metals to overcome many of their operational issues and improve their processes?
Lean Manufacturing Methods Increase Throughput Velocity
Many shops, committed to being lean, feel they are doing everything they can, given the programs they have put in place. The problem with this thinking is, being lean and agile is a process, not an event. In the interest of customer service and profitability, new ideas need to be evaluated all the time.
We hear a lot about being lean these days, but what does it really mean? It is not simply a check list or a certificate on the wall. The concept of lean manufacturing is more of a commitment to critical thinking, oriented towards shortening cycle times by eliminating waste and reducing incidental work, while increasing value-added work. If you can effectively achieve lean, (lean cannot be achieved; but a shop can always be working toward being leaner and more productive), you will see more velocity through your shop, improved profitability, increased customer satisfaction, and heightened morale.
There has been a substantial increase in order activity during the past 12 months, and all indicators point toward 2012 producing similar volume. A weak dollar has also provided a boost in making U.S. manufacturing more competitive, resulting in some manufacturing returning (re-shoring) to the United States.
The customer may tell you that price is not always the most important thing, but eventually it plays a large role in the customer-supplier relationship. Understandably, the customer does not care what your internal issues are; they just want good parts, on time. During the past few years, there have been everything from reverse auctions, customer-driven top-down changes in terms and conditions, and target price mandates. Customers continue to demand faster, more frequent deliveries, while trying to reduce their own inventory levels.
Everyone wants to take on more work even when backlogs are increasing. After all, it is all about throughput â€“ how much can you push out the back door without severely impacting the different parts of your business. How do you do that given all the constraints of running a business profitably?
Most shops continue the time-honored practice of purchasing oversize raw materials at the beginning of the cycle. When the raw stock arrives, it is either staged for the prep work necessary to finish machine or it is machined to size as part of the finish machining process. Typically, other outside processing operations that need performed are not part of a shopâ€™s core competencies. What you are faced with is a classic batch and queue system. Few of the steps are being performed simultaneously. The end result is raw materials moving around for days or weeks before the real shop value of final machining takes place. Shop capacity also suffers from poor machine utilization as expensive state-of-the-art equipment is used for incidental prep work. Batch and queue fails to serve your customersâ€™ interests since it slows down the pipeline of finished parts to them.
Example 1: One finished part has a calculated savings of $10 each, but equally important, in this example, is the shop realizes an increase in capacity of more than 43 hours. The quantity ordered was 100 pieces and the total run time was 54.83 minutes per part â€“ a reduction of approximately 26 minutes per part.
Example 2: The savings in time and money are reflected in the reduced cost and price of the machine-ready blank. Since two sides of a part are cut at the same time, the machine-ready blank user benefits from a cost standpoint compared to using raw stock. When the machine-ready blanks arrive with additional features added, less in-house machine time is required.
Sometimes throughput is done internally through creating work cells designed around a product or a family of parts that use essentially the same disciplines. In addition, sometimes it requires finding external solutions to streamline the flow of raw materials or parts so that as little time as possible is wasted. There are ways to be creative about the pre-production stage â€“ especially when you have a supplier who can economically reduce the incidence of attrition on the front end and present cost saving opportunities in your shop as a result. This is where lean-ready, machine-ready precision blanks come in.
Machine-ready blanks are square, rectangular, or round aluminum, stainless steel, or other alloy blanks, ground and milled to tight-tolerances. These blanks enable a CNC machine to get right to final machining, eliminating the need for squaring up the material prior to finishing the part. Adding features to blanks, especially parts requiring large amounts of material removal is also possible, eliminating the need for specialized machines or tying up machines that are better served performing other operations.
Increasing throughput velocity on the shop floor is what it is all about. When there is an increase in the velocity of parts through the shop, more parts ship out in the same period of time, which increases profit and customer satisfaction. Other ways of looking at increased velocity, include:
- Freeing time on the shop floor for better uses
- Reducing constraints that prevent shipments of more product
- Identifying under-utilized capacity and putting it to better use
- Improving backlog by off-loading unnecessary prep work and second ops
- Increasing a shopâ€™s capacity without adding unnecessary costs such as payroll
I think the quote by George Bernard Shaw sums up this article: “Progress is impossible without change, and those who cannot change their minds cannot change anything.” For any organizations to change it must start a process of self-analysis by taking a deeper look into the ways it interacts with its customers on a daily basis. When it can do this in an open and honest manner it will discover what it needs to improve to give better customer service. The entire process can only be successful is you can change the way you think about your business practices and processes. Until you can do this we will not be seeing any articles about your company entitled â€œlean manufacturing methods increase throughput velocity!â€
If you are interesting in learning more about online Â lean training courses for Manufacturing, Healthcare or Administration, please click here.