September 20, 2015 / benchmarking, best practices, blade failure, blade selection, continuous improvement, Cost Management, industry news, LIT, operations metrics, operator training, performance metrics, preventative maintenance, productivity, quality, root cause analysis, strategic planning
In any manufacturing operation, a small amount of scrap is inevitable. However, reducing material waste should still be a top goal for machine shops that cut and process metal. Like all other forms of waste, scrap can negatively affect profitability, especially if it is generated as a result of an error.
The truth is that any amount of scrap or rework you’re experiencing in your operations provides an opportunity for improvement. Taking the time to reduce scrap often leads to better productivity and higher quality cuts. As this manufacturing.net article points out, eliminating scrap and waste also contributes to your company’s environmental efforts, which may be important to some customers.
How can you keep your scrap and rework costs low? While there are several ways to accomplish scrap reduction, below are a few simple strategies any machine shop can implement:
- Measure and Compare. As with any continuous improvement activity, you need to start with measurement. If you aren’t measuring your scrap rate, this is your first step. You should also know your scrap and rework costs. Once you have some quantifiable data, you should compare your operation to others in your industry. For example, scrap and rework costs of Industry Week’s Best Plants winners and finalists for the last five years were a median (or middle) 0.5% of sales, while the mean — or average — was 1% of sales. How does your shop compare?
- Evaluate Operators. If you know your scrap and rework rates could be better, identifying the root cause of the issue is the only way to make any real, sustainable improvements. Often times, high inventory levels and scrap rates are indicators of “hidden” inefficiencies such as operator error. Are all of your operators properly trained on how to use equipment? Are they running saws at optimal levels, or are they just focused on getting the job done as fast as possible? Have you recently taken on a new job that may require a different saw setting or saw blade type? Poorly trained operators that misuse equipment often lead to low-quality cuts, higher instances of scrap due to error, and shortened blade life—all of which add up to elevated costs.
- Break in Blades. Proper use and maintenance of metal-cutting equipment and tooling can also play a role in keeping scrap and rework costs low. Based on the results of a benchmark study conducted by the LENOX Institute of Technology, this important, everyday practice can have a direct impact on the bottom line. Survey data showed that 70 percent of organizations that report their scrap and rework costs are less than five percent also say they “always” break in their band saw blades. This provides strong economic validation for the proactive care of saws and blades. By breaking in blades properly, organizations are able to reduce “soft” failure that leads to waste and scrap that eats into their bottom line.
- Pick for Clean. As more and more customers expect deliveries in half the time, many shops are doing whatever they can to speed up turnaround. However, companies need to be sure they are taking the time to reuse material whenever possible. Scrap can quickly get out of control if operators are reaching for a new piece of material every time they start a job. That’s why many shops are moving away from the “pick for speed” method of inventory selection and, instead, are embracing “pick for clean” methods. Picking for clean is the practice of picking high-quality leftover materials from a previous job to use up the inventory. In other words, you reach for remnants first. This keeps inventory and material costs low.