Manufacturing Strategy for Window Fabricators 9 - Waste (Methods)

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The methods you use set your manufacturing capacity more than you realise. Waste not want not?

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What are waste activities?

Waste is 'the expenditure of resources that do not add value to the product at least equal to the cost of the resources expended'. This month we look at 'methods' waste in the production area and how this can be improved. This is often achieved not by doing things more efficiently but by not doing them at all. It is no good being extra-efficient at something that you don't need to be doing in the first place. Lets start to think about effectiveness rather than efficiency.

Reducing waste in any of its many forms translates immediately into real cost reductions in any industry and none more so than window fabrication. In manufacturing there is now an increasing focus on waste, particularly on non-value adding activities - these are exceptionally effective methods of cost management. The 7 wastes defined by Taiichi Ono (Toyota's Chief Engineer) are:

Overproduction

Making product with no current sales:

Waiting

Machines waiting for goods, maintenance, product or other action:

Transportation

Moving products:

Process

Using inefficient processes:

Stock

Stock definitely hides other wastes and:

Motion

Movement that does not create added value:

Defects

Creates all the other wastes and adds unnecessary cost to the product.

The waste activities

To start to identify the waste activities it is useful to separate all the activities into those that add vale and those that add cost. The table below shows that only processing and assembling add vale and the rest of the common activities only add cost to the product. A quick 'walk-around' of most fabricators shows that they spend more time adding cost than adding value! The simplest route to improved profitability is to do less of the adding cost activities and more of the adding value activities. A necessary first step is to find areas or processes that waste resources, of any description, and then to eliminate or redesign the process to reduce the waste. Be ruthless.

How much time do you spend on waste activities?
Classification of factory activities into value-adding processes and waste processes. Measuring the time spent on each of these processes in the production area gives a measure of the time wasted in the production area.

Quantify the waste activities

Quantifying the amount of waste is critical to success and a first estimate of the waste can be made by measuring the time in the manufacturing system and comparing this to the value-adding time. In many fabricators the material is only having real value added to it for less than 1% of the total time it spends in the system. The rest of the time it is WIP or inventory and in the new world, inventory is a liability rather than an asset. Complete the form for your own company and remember that reducing the time in the system not only has positive financial benefits but also makes scheduling and production management easier.

A cycle-time flow chart can be produced to monitor the time spent ‘adding value’ and the time spent ‘adding cost’. This can be converted into a percentage of the total time the product is in the system. For window fabrication the ratio is rarely higher than 1% and a ratio of 0.25% is not uncommon.

The example above shows an ‘adding value ratio’ 8%.

Adding value or adding cost - the cycle-time flow chart
Use the Worksheet above to quickly calculate how much of the time you are adding value and how much of the time you are adding cost. Anything above 5% is very good. Anything above 10% and you probably haven’t collected the information correctly! Reducing the cost-adding time will significantly improve process throughput and customer responsiveness. It will also release real cash back into the business.

Paperwork processes

A prime but often neglected target for methods waste reduction is the paperwork system of the company. Many companies have reached the stage where it takes less time to make the product than it does to complete the paperwork. If it takes 45 minutes to manufacture a window (real manufacturing time - not the time in the system) and it takes 60 minutes to process the order then the administration system must be redesigned to catch up with the production system. Is the real problem in the factory or in the office?

The greatest waste of all

This is the waste of not using all of the talent and ideas that are already in the company. We ignore our employees' ideas and treat them simply as a 'body for hire'. Truly the greatest waste of all. We have all seen signs in factories saying 'Stop Waste' or 'Eliminate Waste'. These treat workers as if they wouldn't stop waste if they saw it. The biggest problem is not that we don't stop waste but that we accept it as a normal part of the system and don't even think of it as waste. The signs should be changed to read 'Find Waste' to challenge all staff to find an area of wasted effort each week and to eliminate it on the spot. It is not actually that difficult if the emphasis is changed.

'Manufacturing Strategy' Series.

The 'Manufacturing Strategy' series is designed to give window fabricators a set of ideas for managing production. The series is being published in Fenestra on a monthly basis and published here after the Fenestra publication. The series is:

Part 1: The Essential Part 
Part 2: The Systems
 
Part 3: Just-in-Time

Part 4: Optimised Production Technology

Part 5: Work Cells

Part 6: Machines
Part 7: Machines (2)

Part 8: Scheduling

Part 9: Waste (Methods)

Part 10: Waste (Materials)

Part 11: Supply Chain

Part 12: Measurement
Part 13: Things to do NOW!
Part 14: The Cost of Quality

Part 15: The Hidden costs of inventory

Part 16: Environmental management

Part 17: Continuous Improvement

Last edited: 11/03/10

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