July 10, 2016 / best practices, customer service, LIT, strategic planning, value-added services
In today’s uncertain economy, diversification continues to be a key strategy for fabricators and other industrial metal-cutting companies. Forming new customer relationships, expanding into new OEM segments, and offering existing customers value-added services can all help dilute the impact of external influences and provide an additional stream of revenue.
Companies also use diversification to reduce business risk. According to an article from Forbes, most small and mid-sized manufacturers fall under the 80/20 rule—they make 80% of their profit from 20% of their customers. In some cases, that 20 percent may mean only one or two customers. While no one denies the value of landing a big customer (or two), relying on a select few to solely sustain your business can be extremely risky.
Diversification in Action
As described here, diversification saved many fabricators in 2015. In fact, companies like Merrill Technologies Group (MTG) are hoping the strategy will help double its business in the next five years, according to another article from the The Fabricator. Starting out as a small machine shop in 1968, MTG has now turned into a $72-million metal manufacturer offering light and heavy metal fabrication, machining, nondestructive testing, machine building, and engineering services.
This type of business evolution, the article states, is a sign that times are changing and that more and more fabricators are moving away from defined customer niches. “The modern metal manufacturing landscape is different,” the article states. “Large OEMs are consolidating their supply chains. Rather than source a large project to umpteen suppliers, they may well be looking for one source—a one-stop shop like MTG—to handle it all.”
Other industrial metal-cutting companies have found the same to be true. Jett Cutting Service, Inc., a 30-year old shop featured in the case study, “Best Practices of High Production Metal-Cutting Companies,” started out with just a few band saws. However, the industrial metal-cutting company has grown over the years to better serve its customers, acquiring new companies and expanding its capabilities to become a multi-faceted cutting service. From precision circular saw cutting to a lathe cut-off on round tubing, Jett Cutting has evolved into what it calls “a whole processor” that serves steel service centers, machine shops, and some mills.
Making the Move
Both the MTG and Jett Cutting examples demonstrate that diversification can be just as advantageous to customers as it can be to your business. If you are considering diversifying your business, an article from Inc. lists several ways to accomplish that. The following are a few of the strategies listed:
- Adapt. Tweak your product or service so it appeals to a new group of consumers or users.
- Find related services. Are there additional services that go along with what you sell or do?
- Open another location. If you only have one physical location, consider opening a second.
- Go overseas. Not every small business has the wherewithal to launch an overseas operation. Right now the big players are eyeing Africa the way they eyed Asia 10 years ago. Network in your community, and see if any businesses are exploring overseas ventures. You might find a project where your company fits in.
- Follow the growth. If you’re in an area with disheartening demographics or punishing tax rates, see if you should expand to a lower tax growth area. Look at the South, Texas, and North Dakota. Would one of these areas be a good candidate for a branch office?
As the Inc. article points out, smart investors place a high value on diversification, and smart business owners should consider doing the same. Could diversification be an option for your fabrication shop?
To read more about other manufacturers that have successfully diversified their business, check out the Forbes article, “The Argument For Market Diversification In Manufacturing.”
June 10, 2016 / best practices, continuous improvement, Employee Morale, human capital, lean manufacturing, LIT, maintaining talent, strategic planning
For the last few years, manufacturers have touted continuous improvement as a top priority and company goal. Case in point: two of the three industrial metal-cutting companies featured here in a case study on top performers listed continuous improvement as an imperative operational strategy and best practice that sets their metal-cutting shops above the rest.
However, the truth is while many managers understand the theory of continuous improvement, many are still unsure of how to successfully put it into practice. In fact, research has found that the success rate for continuous improvement efforts is less than 60 percent.
What is continuous improvement? Is it simply a set of tools to adopt and implement—or is there more to it than that? Below is a brief overview of this often over-used, misunderstood term, and some tips for putting it to work in your fabrication shop.
Defining Continuous Improvement
Continuous improvement (CI) is defined by ASQ as an ongoing effort to improve a product, service, or process. Most companies achieve this by either adopting one of the well-known continuous improvement methods or through the combination of two or more tools.
According to ASQ, the most widely used tool for continuous improvement is a four-step quality model—the plan-do-check-act (PDCA) cycle, also known as Deming Cycle or Shewhart Cycle. Other widely used tools include Six Sigma, lean manufacturing, and Total Quality Management.
Even so, as an article from Canadian Metalworking points out, it’s important for managers to remember that continuous improvement is more than just a collection of tools. “Many people mistake the individual tools of continuous improvement for the most important part of the program,” the article states. “The tools are just the most visible part that we can see, and subsequently adopt.”
Personnel development, the Canadian Metalworking article continues, should actually be the central focus of continuous improvement. This means that people—not tools—need to be the primary focus of your CI efforts.
People before Process
When focusing on personnel development, there are three areas in particular that managers should focus on. As the following explains, teamwork, management, and culture all play critical roles in a successful CI program:
- Teamwork. According to the eBook, Five Performance-Boosting Best Practices for Your Industrial Metal-Cutting Company, “continuous improvement initiatives need to be a team effort to be sustainable.” In other words, to improve your industrial metal-cutting operations to its fullest potential, you need to have the right people with the right skills to keep your plan on course. Without a team backing the process, the very notion of any continuous improvement program is impossible. (You can read more about building an effective CI team here.)
- Management. Managing an effective CI team requires a unique set of skills. As another article from Canadian Metalworking explains, because CI systems are a set of integrated systems, the management implications also are a set of intertwined values and approaches. “Organizational improvements very rarely take the form of massive, sweeping change,” the article explains. “Competent managers seem to have their fingers on all of the smallest details, and effective leaders are often described as “doing all of the little things” that make people feel appreciated, challenged, and engaged.” (To learn more about managing a CI team, read the full article here.)
- Culture. As any shop manager knows, employee “buy-in” is critical to the success of a shop. An operator who cares about his performance and understands how his job affects the company’s overall success is invaluable. The same principle holds true in CI programs, except that everyone needs to buy-in. It needs to be embedded into the company culture. “Building an effective continuous improvement culture is not just about executing a handful of process improvement projects,” explains a report from Deloitte. “That’s a good place to start—and companies may reap tangible rewards from those projects. But more is required to drive sustainable results over time and embed continuous improvement into the very fabric of the organization. That’s when the kind of real, transformational changes take place that can generate hundreds of millions of dollars of opportunities.” (For more information, you can download the full Deloitte report here.)
In theory, the concept of constantly improving a business sounds good. However, the truth is that many managers don’t fully understand what it takes to implement a successful CI program.
To be effective, continuous improvement needs to be about more than just a set of process improvement tools. While a tool may help you achieve short-term improvement, it is the people behind the effort that will help you realize continuous, ongoing improvements. Managers who focus on building a strong team and company culture fully devoted to continuous improvement will see long-term, sustainable results.
May 10, 2016 / best practices, Cost Management, cost per cut, KPIs, lean manufacturing, operations metrics, optimization, predictive management, productivity, ROI, workflow process
As fabricators continue to seek new ways to optimize their operations, many are turning to software. Whether using it to connect the plant floor to the front office, or to measure key performance indicators (KPIs), data shows that more and more fabricators view software as a smart—and necessary—manufacturing tool.
For example, according the “2016 Capital Spending Forecast” from the Fabricators & Manufacturers Association International, more than 94 percent of survey respondents said their software spending this year would either remain the same or increase. This is significant, especially as more and more reports show that many companies are pulling back on spending this year.
A separate benchmarking survey from Modern Machine Shop shows that leading shops are more likely to utilize advanced software programs in their operations. Specifically, the survey found that top-performing machine shops (referred to as “top shops”) are more apt to utilize software solutions like enterprise resource planning (ERP) and toolpath simulation software in comparison to other shops.
While there are many reasons software is becoming a valuable tool for manufacturers, for fabricators, a lot of it has to do with evolving customer demands. “As more custom fabricators are taking on more design work—beyond just design for manufacturability—engineering and estimating functions become more complex, especially as that work focuses on more subassemblies and full assemblies that call for multilevel bills of material and a multitude of sourced parts,” states a report from thefabricator.com. This, the article continues, is causing shops to invest in better methods of communication, as well as software tools like CAD/CAM, nesting systems, and ERP.
The good news is that as more manufacturers embrace software, the more tools are being developed—both by software designers and supply chain partners. Like consumers, industrial manufacturers are finding that where there is a need or challenge, there is indeed “an app for that.”
In metal cutting, specifically, there are several tools fabricators can use to help optimize their operations—many of which are free of charge. Below are two in particular that fabricators may find helpful:
- Bandsawing. SawCalc, a web-based software program from LENOX, is a free online tool that helps plant managers and operators solve band-sawing challenges encountered in the field by providing cutting recommendations for maximum blade performance. Users have free access to the program, which determines the proper cutting parameters based on material composition, size and shape, as well as the machine model. The program’s library of materials is regularly updated, providing accurate cutting recommendations for 54 country standards, and more than 35,000 materials and 9,000 band saw machines. Because the program is web-based, managers and operators can access the service right from the shop floor. Aerodye Alloys, a service center featured here in a case study, says that using the online tool has helped increase efficiency at one of its facilities by about 15 to 20 percent.
- Circular Sawing. For fabricators using circular saws, Tsune America has developed Sawculator, a free web-based software tool to assist fabricators and other industrial metal-cutting companies with pre-planning their sawing requirements. The downloadable program allows users to perform automatic US and Metric Dimensional Conversions on the fly, makes automatic suggestions for proper blade selection and chip load, provides more than twenty cutting job outlines, and calculates everything from estimated blade life and bar utilization to trim cut and net cutting time. Users can report prospective cutting jobs to their computer screen, as well as send it to concerned participants on the job via a local printer, email or Smart phone outputs. You can view a video of how the program works here.
Enhance Your Toolbox
Having the right tool for the job has always been a critical part of any metal-cutting operation, but fabricators are finding that it pays to have more than just hardware in their strategic toolbox. While it will never replace the important work machinery and other hardware tools perform on the shop floor, software tools can further optimize cutting operations by measuring important metrics, analyzing job trends, automating certain functions, and educating operators on proper cutting parameters. Although some software programs can be costly in terms of both money and training time, there are plenty of free tools available that can help even the smallest fabrication shop improve their operations.
What software tools are helping your shop optimize operations?
April 10, 2016 / continuous improvement, industy, LIT, maintaining talent, operator training, skills gap, strategic planning
As we covered in our annual Industrial Metal-Cutting Outlook, the outlook for 2016 is—in a word—flat. Slow growth from 2015 carried over into the first quarter of the year, leaving most analysts expecting little to no growth.
According to the Manufacturers Alliance for Productivity and Innovation (MAPI), manufacturing industrial production will likely register zero growth in the first half of 2016, with 1 to 2 percent growth in the third and fourth quarters. For the entire year, the research firm forecasts only 1.1-percent growth.
Unfortunately, MAPI’s outlook for fabricated metal parts is also a little disappointing. The most recent forecast shows production of fabricated metal parts down 0.9 percent in 2016, with small growth of 1.4 and 2.0 percent in 2017 and 2018, respectively.
A recent uptick in manufacturing activity in March, however, provides some hope. The monthly Purchasing Manufacturers’ Index (PMI) from Institute for Supply Management (ISM) increased by 2.3 percentage points in March, putting the index above the 50-percent growth threshold for the first time in 2016. In addition, ISM reports that 12 of 18 manufacturing industries reported growth in March, including the fabricated metal products and primary metals industries. According to one survey respondent from the fabricated metal products segment, “Capital equipment sales are steady.”
Even with some small movements forward, business for most of the metals industry has been tough. For fabricators, a lot of the challenges stem from the struggling agriculture and energy sectors, as well as bigger picture issues like high inventory levels and a strong dollar. However, none of those challenges seem to be sending the industry into a total panic.
According to an industry survey from The Fabricators & Manufacturers Association Intl. (FMA), most small and medium-size job shops and fabricators entered the year expecting growth. Specifically, the survey found that 39 percent of respondents were positive about 2016, and 38 percent said conditions are at least stable. Even so, a significant number (23 percent) didn’t expect conditions to get any better.
FMA’s “2016 Capital Spending Forecast” projected that total capital spending will increase a little more than 2 percent next year, with some equipment categories such as welding and bending seeing dramatic gains. As reported by The Fabricator, “…this shows that the metal fabrication manufacturing technology business has regained its losses from the Great Recession and then some.”
Whether or not that is true is up for debate, but it seems some fabrication shops are finding ways to still be profitable in the midst of an uncertain market. According to an editorial from Tim Heston, senior editor at The Fabricator, several fabricators he has spoken to are faring really well, depending on their customer mix and the specific OEM plants they serve.
“2016 really will be about hitting the right spot when it comes to the customer mix,” Heston notes. “Some sectors will continue to struggle, but others will thrive.
“Figuratively, the future will really be about hitting…the right mix of fabrication services, talent, technology, and customers,” Heston continues. No matter what economic headwinds may come, the right mix will help a custom fabricator land on its feet.”
Finding the Right Mix
Like any strategic decision, this so-called “sweet spot” will require some risk and will depend largely on your current customer base, capacity, and resources. In other words, there is no silver bullet formula. While it is tempting to assume that growing markets like automotive and aerospace should be your target, as Heston noted in his editorial, some aspects of agriculture (i.e., small equipment) are still profitable.
There are some key areas, however, fabricators should focus on as they attempt to make 2016 a profitable year. Based on our research, the following three areas deserve consideration:
- Diversification. In uncertain economic times, it is not uncommon for manufacturers to diversify to dilute the risks that may be associated with some OEM segments. As described here, diversification saved many fabrication shops in 2015, and experts believe the trend will continue in 2016. In some cases, this may mean forming new customer relationships, or it could mean offering existing customers a few value-added services for a more predictable stream of revenue. One fabrication shop, featured here, added prototypes to its mix as an added service.
- Advanced Technology. Fabricators both large and small can no longer afford to underestimate the role technology can play in their shop’s success. Whether you decide to invest in predictive analytics, mobile technology, or the latest cutting technology, the truth is that today’s competitive environment requires leaders to stay on top of manufacturing advancements. Jett Cutting, a metal-cutting company featured here in a case study, says that investing in new technology allows his shop to offer competitive pricing, which has led to many new customers. “We need to constantly keep on top of the latest technology out there,” Baron states. “We don’t want to spend extra money, but if it’s going to cut 20 percent quicker than I do now…then we’ll go after it.”
- Good Talent. As most manufacturing executives are well aware, the industry’s skills gap continues to widen. As The American Society of Quality’s 2016 Manufacturing Outlook Survey confirmed, an increasing number of U.S. manufacturers are struggling to fill open positions. Respondents stated that the biggest challenge was the lack of qualified applicants, followed by the time it takes to hire a new employee and lack of budget to fill open positions. However, the survey also found that many companies are proactively addressing the issue: 55 percent of manufacturers say they’ve hired an agency and 41 percent are working with local colleges on programs that teach the required skills.
Will 2016 be a year of growth for your fabrication shop? Although economists may tell you no, some strategic shuffling and smart investments may just prove them wrong.
March 10, 2016 / best practices, blade failure, blade life, blade selection, continuous improvement, Cost Management, resource allocation, ROI
In band-sawing, fabricators and other industrial metal-cutting companies typically rely on two types of blades—bi-metal and carbide-tipped blades. Both blade technologies offer more performance and life expectancy than carbon steel blades, and choosing between the two types used to be fairly straightforward. However, advancements in both technologies have made it a little more difficult for companies to make the best blade choice for their operations.
For example, bi-metal band saw blades have been traditionally used for easier-to-cut metals such as aluminum and non-ferrous metals, carbon and structural steels, and some alloy steels. However, as featured here in Modern Metals, a new carbide-tipped band saw blade has been introduced by LENOX that has been designed specifically to cut aluminum and non-ferrous alloys. The new blade has a range of features that optimize it for aluminum cutting applications, including a specialized grade of carbide on the tip, a multi-chip tooth pattern, and a high rake angle.
To help metal fabricators make the best decision about the “right” blade type for their band-sawing operations, below is a brief overview on both blade types from the white paper, Selecting the Right Cutting Tools for the Job.
Bi-metal blades are a common choice for most metal-cutting applications, especially since they are more affordable than carbide-tipped blades.
Generally speaking, bi-metal blades are sub-divided as either general-purpose blades or production-sawing blades:
- General-purpose blades are often used for easier-to-cut metals such as aluminum and non-ferrous metals, carbon steels, structural steels, and some alloy steels. These blades are also good for switching between different metal types and sizes, as well as from solids to structural pieces. However, some industry experts warn to be judicious when switching between different metal types, sizes and shapes, as subjecting blades to different types of cutting shortens blade life.
- Production-sawing blades tend to be more versatile and are able to cut everything from the easiest-to-cut materials to difficult-to-cut nickel-based alloys. These blades are also ideal for cutting structural pieces and bundles, and they typically offer a long blade life and fast, straight cutting.
Although carbide-tipped blades are more expensive, machine shops may elect to trade up to a carbide-tipped blade for three key reasons:
- longer life
- faster cutting
- better finish
The various choices of carbide-tipped blades will cover the machinability spectrum, but they are most often used for hard-to-cut materials like super alloys. High-performance carbide-tipped blades work especially well with hard tool steel that needs to be cut fast. Some high-performance carbide-tipped blades—especially coated versions—can offer extreme cutting rates, while others can perform exceptionally well when cutting super alloys.
Making the Right Choice
Of course, there are instances when the “right” blade choice won’t be clear cut and will require managers to strategically choose between a “good,” “better” and “best” option. For example, as this article from Canadian Industrial Machinery (CIM) explains, bi-metal blades can be used to cut superalloys. However, cutting speeds will need to be slower and blades will wear out faster than when using carbide blades. “An experienced operator can adjust parameters to cut the occasional superalloy with a bimetal blade, but carbide is the choice to cost-effectively cut large quantities of hard materials,” the article states. “Blade choice comes down to a cost-per-cut situation and what fits with a shop’s operation.”
Blade selection also needs to take into account the total operational costs of running the blade, including maintenance costs and equipment requirements. Case in point: While carbide-tipped blades are more advanced in the right application, they do not perform well with a lot of vibration. Therefore, they can only be used with certain saws. Metal-cutting operations using carbide-tipped blades need to make sure they are using a saw that can run the blade speeds that are required. In other words, the saw must have a motor that can push the blade fast enough and one that has a more rigid construction with better vibration dampening to accommodate these types of blades.
In the end, the “right” blade choice requires fabricators to weigh the following:
- upfront costs against overall operating and maintenance costs
- long-term productivity of a machine and its intended use
- equipment and blade life, as well as cost per cut
By understanding some of the basic features of each blade type and then strategically assessing operational needs and goals, managers can make informed purchasing decisions that will help their metal-cutting operations reach their full potential and, ultimately, achieve market success.
February 10, 2016 / benchmark study, bottlenecks, KPIs, LIT, operations metrics, performance metrics, preventative maintenance, quality, workflow process
Manufacturing leaders know that measurement is the only way to truly gauge how their operations are performing and, more importantly, identify areas that need improvement. However, many companies fail to realize that metrics can be applied to every area of an organization, not just production.
One area that can greatly benefit from measurement is maintenance. A strong maintenance department keeps equipment up and running, which directly impacts production schedules and costs. As an article from Reliable Plant points out, maintenance should be treated just like any other business area.
“You must make good decisions that add value,” the article states. “This means you need input and lots of it. Making decisions based on gut feelings just doesn’t cut it these days. Key performance indicators (KPIs) can provide the input you need to help meet this lofty objective.”
Where Do You Start?
As we covered in a previously published blog, the challenge for many metal fabricators is knowing which metrics to measure, especially in niche areas like maintenance. Not all KPIs are created equally, and the goal should be quality—not quantity—when it comes to metrics of any kind.
According to Lifetime Reliability Solutions (LRS) Consultants, maintenance KPIs should reflect achievement and progress in meeting an agreed maintenance benchmark. “In measuring maintenance performance we are concerned not only with doing good maintenance work, we are also concerned that the maintenance work we do successfully removes risk of failure from our plant and equipment,” LRS advises on its website.
The consulting firm suggests that maintenance managers use a mix of lagging indicators and leading indicators so they have an understanding of what is happening to the risk and performance of their operational assets through maintenance efforts. “Lagging indicators use historic data to build a performance trend line,” LRS writes, while leading indicators use historic data to monitor if an operation is doing those activities that are known to produce good results. A good example of a lagging indicator related to machine health is Mean Time Between Failures (MTBF), whereas a leading indicator in maintenance might be the percentage of condition inspection work orders performed when they fall due.
In general, LRS suggests maintenance managers consider using KPIs within the following six categories:
- Maintenance Delivery (e.g., Proportion of Work Orders Performed when First Scheduled)
- Maintenance Work Quality (e.g., Number of Rework Work Orders)
- Equipment Reliability (e.g., Asset mean time between failures)
- Operational Risk Reduction (e.g., Number of Equipment Improvement Work Orders Completed)
- Maintenance Resource Usage (e.g., Proportion of Work Orders Started at the Time Scheduled to Start)
- Maintenance Costs (e.g., Maintenance Cost Component of Unit Cost of Production)
Why Do Maintenance KPIs Matter?
Like any other business area, maintenance performance can directly impact the bottom line. For example, if maintenance personnel fail to follow a shop’s preventative maintenance (PM) schedule, a host of problems can arise, ranging from lower quality cuts to unplanned machine downtime. As confirmed by a recent benchmarking study of fabricators and other industrial metal-cutting companies, maintenance tasks like PM can impact job completion rates, blade life, and material costs.
With the right KPIs in place, maintenance managers can make sure that maintenance performance is up to par, as well as play a key role in ensuring that the shop as a whole operates as optimally as possible.
How are you measuring maintenance performance at your fabrication shop?
January 10, 2016 / best practices, blade life, bottlenecks, continuous improvement, Cost Management, customer delivery, customer satisfaction metrics, customer service, LIT, predictive management, preventative maintenance, productivity, strategic planning
It’s no secret that downtime is the enemy of any fabrication shop and, really, any manufacturer. Huge volumes, continuous sawing, and extremely tight tolerances are characteristic of many fabrication environments, so any process or workflow bottlenecks that slow production can cause quality issues, slow delivery schedules, increased maintenance costs, and hurt overall business performance.
In the white paper, The Top 5 Operating Challenges Facing Fabricators’ Metal-Cutting Operations, Jim Davis, corporate operations services manager at O’Neal Steel, explains why today’s shops can’t afford any unplanned downtime. “Downtime affects us heavily,” Davis states. “When you’re cutting five- to six-thousand pieces for a customer or you’re doing ‘just-in-time’ production where you’re taking orders on the previous day and guaranteeing delivery the next day, downtime will affect us heavily.”
However, instead of finding new ways to react to unplanned downtime events, several leading manufacturers are attacking the issue head on by using proactive strategies. In fact, according to a recent blog published by ARC Advisory Group, Inc., four industrial manufacturing leaders are aiming for “zero downtime”—a goal that may seem a bit lofty and unrealistic. However, with the help of technology, these big name companies seem to believe it is within reach.
For example, late last year, Cisco and Fanuc America announced a 12-month Zero Downtime (ZDT) pilot project with a major automotive manufacturer. The goal was to achieve zero downtime by proactively detecting equipment issues that could cause downtime.
According to a press release, the pilot was a success. Using cloud-based technology, Fanuc and Cisco’s solution detected and informed the automotive manufacturer of potential equipment or process problems before unexpected downtime occurred, allowing the maintenance issue to be addressed in a planned outage window. The end result was a significant decrease in related production downtime and increased overall equipment effectiveness. (To learn more about Fanuc’s technology solution, check out this video).
There are other types of proactive strategies metal-cutting leaders are using to turn “interruptive downtime,” which can hurt performance and impact on-time customer delivery, into “predictive downtime,” which can actually improve cutting performance and extend equipment life. Research shows that simple strategies such as breaking in band saw blades and other preventative maintenance are helping fabricators and other metal-cutting companies predict blade failure and, as a result, better plan for downtime.
In a benchmark survey of industrial metal-cutting organizations, 67 percent of operations that claimed to follow all scheduled and planned maintenance on their machines also reported that their job completion rate is trending upward year over year – a meaningful correlation. “The implication is that less disruptive, unplanned downtime and more anticipated, planned downtime translates into more jobs being completed on time,” the study states. “Slightly more than half (51 percent) of organizations that ‘always’ follow scheduled and preventative maintenance plans say that blade failure is predicted ‘always’ or ‘mostly.’”
What could be the business impact of near-zero unplanned downtime? According to the ARC blog, there are at least four key benefits, including:
- lower maintenance costs
- increased capacity and revenue
- lower inventory (less safety stock for unplanned events)
- improved customer satisfaction (with more on-time shipments)
Even if the concept of zero downtime still seems impossible, the above examples show that proactive—not reactive—strategies can help eliminate unplanned downtime. Whether using high-tech solutions like Cisco and Fanuc’s cloud-based application or simple preventative strategies like breaking in blades, today’s fabrication shops have the opportunity to reduce unplanned downtime and achieve real, bottom-line benefits.
What strategies does your fabrication shop use to reduce or predict downtime?
December 10, 2015 / best practices, continuous improvement, customer delivery, lean manufacturing, optimization, productivity, strategic planning, supply chain, workflow process
With the rise of online retail giant Amazon, nearly anything—from batteries to furniture (and more)—can be delivered to front doors across America within the same day of ordering. With free two-day shipping and even the introduction of drone deliveries, consumers are increasingly becoming used to clicking and receiving.
In fact, there’s a name for this focus on responsiveness. It’s called the “Amazon Effect,” and according to manufacturing consultant Lisa Anderson, this mentality is creeping its way into manufacturing. For example, one of her clients, a building product manufacturer, ships out a product within 24 hours as a worse case scenario, while another ships within two days.
Industrial metal-cutting companies and fabricators are no exception to this trend. Customers are now expecting orders to be completed in half the time they were just 5 years ago. Like all manufacturers, today‘s fabricators are faced with doing more (increased demand) with less (efficient resource allocation) as quickly as possible.
As reported in the LENOX Institute of Technology white paper, The Top 5 Operating Challenges Facing Fabricators’ Metal Cutting Operations, customer service and delivery continue to be a top challenge for fabricators as they attempt to balance quality with speed. Forecasts and schedules can help fabricators estimate delivery times, but when it comes to improving response time, the proof is usually in the process.
To get orders out the door faster, managers need to take the time to evaluate their processes and observe where and how product travels on the shop floor. A recent article from manufacturing.net provides four key areas fabricators should focus on:
- Rethink the manufacturing footprint. While ordering raw materials offshore helps save costs, it can extend lead times from 30 days to more than 180 days. To deliver faster, consider bringing operations back stateside. Talent can be recruited with new facilities or by relocating operations to maintain a competitive advantage.
- The right product for the right customer. To ensure you have the right product for the right customer at the right price, fabricators need to reduce complexity in their operations. Start by cleaning inventory and assessing SKUs to determine which ones should stay in the portfolio. Then, work with customers and stakeholders to assess the impact of new launches and discontinued products. Tracking customer schedules, including exceptions to lead time, order minimums and costs will help provide customer profitability. Equipped with knowing which customers and products create the most value, fabricating operations can then reduce the number of suppliers to better manage materials flow and delivery.
- Improve material flow and inventory accuracy. Simplify operations and reduce inventory to shorten lead times. Keep inventory organized so it’s easy to find when needed and easy to see when it’s time to reorder.
- Continuously improve. Lean manufacturing and an efficient process is the foundation of improving response time. Simplifying production from supply chain to delivery all adds up to shorter lead times.
Out of the four strategies offered in the article, the last strategy is probably the most important. While continuous improvement has long been touted as a best practice, it shouldn’t be overlooked. It takes time to constantly improve, but lean tools and other improvements strategies are almost always worth the effort. According to an article from Industry Week, one manufacturer cut lead-time in half—from 10.5 days down to 5 days—by taking the time to conduct a value stream map exercise. Specifically, the team mapped out each area of operations and was able to optimize production from receiving to shipping.
In a hectic fabricating environment, it’s easy to push product through and forget about the process. However, with today’s on-demand mentality, manufacturers can’t afford to miss any opportunity to improve response time. By evaluating and rethinking some of the key areas of their operation, fabricators can optimize their processes and, in turn, better meet the demands of their customers.
When was the last time you re-evaluated your fabrication processes?
November 10, 2015 / agility, continuous improvement, Cost Management, customer delivery, customer service, LIT, ROI, value-added services
As the market gets more and more competitive, a growing number of fabricators and other industrial metal-cutting companies are diversifying their services to gain an edge over the competition. For some, this might mean adding a value-added service to benefit existing customers, while for others, it might mean investing in equipment and training to serve new customers.
One specialty that could open up new opportunities is large-part fabrication. For shops that have been focused on smaller segments like home appliances and automotive, large-part fabrication could expand the customer base into areas such as agriculture, commercial construction, and aerospace.
Greiner Industries, for example, has spent the last few years investing in new technology to differentiate itself and has now earned a reputation for taking on extremely large and complex fabrication projects. According to an article from The Fabricator, the Mount Joy, Pa.-based Greiner now has the cutting, drilling, and welding capabilities to take on large railroad girder jobs.
“You have to keep looking for opportunities or areas to explore,” Frank Greiner, founder, told The Fabricator back in 2014. “That will never stop. That’s just part of growing.”
Quality Iron Fabricators, another fabrication shop based in Memphis, TN, is currently working on providing structural steel sections that will be used to build a 161-ft rocket test stand that will be used by NASA, reports Modern Metals. Like Greiner, Quality Iron Fabricators has made investments to better serve large-part customers. Specifically, the fabricator has invested in an integrated fabrication system that includes an automated material handling system and software to connect machines to each other. President Brian Eason tells MM that his company is also looking to revamp its production line to make it even more efficient.
“We always strive to get better at everything we do, and this has been a key part to improving our process,” Eason says in MM.
As both examples demonstrate, moving into large-part fabrication offers great opportunity, but it also requires careful consideration and, usually, some investment. If your fabrication shop is considering large-part fabrication, we have gathered the following considerations based on an article from Canadian Metalworking:
- Choose equipment carefully. Machines designed to handle oversized material can take up a lot of floor space. “When looking for equipment to cut large parts it’s important to make sure that the machine is built rugged enough to support all tools over a large working span,” Brad Williams, national sales manager for Koike, tells Canadian Metalworking. In addition, make sure you choose equipment manufacturers that have a strong track record for building and supplying large format cutting systems.
- Consider automation and material handling solutions. Transporting large parts often requires two or more operators, which can pose safety issues and slow productivity. Automation and material handling systems can save on labor costs, reduce safety incidents, and increase efficiency. For extremely large and heavy parts, overhead crane systems are typically a better option than forklifts.
- Maximize productivity wherever possible. Operators often fatigue when fabricating large parts, especially in processes like bending. Brian Welz, product group manager for TRUMP, tells Canadian Metalworking that production accessories like bending aides can help minimize operator fatigue and maximize productivity.
- Base processes on application. For optimal results, large-part fabricating demands that equipment and cutting processes be defined based on the application requirements, Douglas Shuda at ESAB Welding & Cutting Product, tells Canadian Metalworking. Plate size and material thickness are also important considerations when exploring large-part fabricating.
Even if large-part fabrication isn’t a good fit for your shop logistically or economically, perhaps it is time to consider taking on some new capabilities to better serve your customers. According to a white paper from the LENOX Institute of Technology, in addition to higher quality and tighter tolerances, a growing number of customers are asking fabricators to provide value-added services. This provides shops with a prime opportunity to differentiate from the competition.
What new services or capabilities could add value to your existing customer relationships and, more importantly, open the door to new relationships?
October 10, 2015 / best practices, continuous improvement, customer delivery, Employee Morale, operations metrics, operator training, performance metrics, productivity, quality, ROI
With manufacturing rates on the rise and a strengthening economy, many manufacturers and industrial metal-cutting companies are looking for more ways to drive operational efficiency to deliver products faster, improve quality, and remain competitive.
One way metal fabricators are meeting this challenge is by way of technology—specifically the Industrial Internet of Things (IIoT). IIoT combines machine-to-machine communication and data collection to create “smart” machines that help eliminate inefficiencies on the production floor.
For example, as reported in a white paper from the LENOX Institute of Technology, one metal-cutting company developed a software system that eliminated the need for an operator to enter order information into the sawing equipment. By connecting the company’s order-tracking system and sawing equipment, the company no longer has to enter the information twice. This saved time and reduced the chance for error.
Just like CNC communication changed the way many fabricators operate, machine-to-machine communication is expected to do even more. To accomplish integrated communication within their shops, many manufacturers start by adopting a communication standard called MTConnect. This technology enables companies to collect uniform data from various manufacturing and production equipment, including sensors and other hardware, to help increase efficiency, improve processes, and boost productivity. The idea is that with one communication standard in place, manufacturers can monitor all equipment and enable it to communicate and learn from each other. When combined with analytical software that translates raw data into reports and dashboards, MTConnect helps transform a “smart” machine into a “smart” shop.
According to a case study published by Modern Machine Shop, one machine shop’s utilization rate hit 65 percent and above after implementing MTConnect. The shop now has plans to improve to 70 percent with the ultimate goal of 85 percent utilization to be on par with world-class manufacturing.
In addition, Mazak Corp., a machine tool manufacturer, recently used the technology to increase machine tool shipments by 200 per month, reports Canadian Industrial Machinery (CIM). Not only did MTConnect help the Florence, KY-based company achieve its shipment goal, but it also increased productivity by an estimated 20 percent, improved machine utilization 42 percent, reduced operator overtime by 100 hours per month, and decreased outsourced work by 400 hours per month.
While the case for MTConnect may be convincing, Neil Desrosiers, developer of digital solutions for Mazak, admits that integration is a major undertaking. In a recent article from Manufacturing Engineering, Desrosiers offers some tips to shops that are considering adopting MTConnect:
- Connection. A correctly installed Ethernet network is a must and all equipment should be connected to it. A hardwired network usually provides better connection than wireless networks.
- Compliance. Machines must be MTConnect compliant or compatible. Software and hardware adapters may be required. OEMs can provide step-by-step instructions on how to upgrade equipment.
- Software. Third-party monitoring software collects, organizes, and translates data to create custom reports. Ideally, it should also store and archive collected data on a dedicated server or cloud system.
- Goals. Set goals on what information you want to collect, what should be done with that data, and what production metrics you want to achieve.
- Big Brother Effect. Employees may think their every move is being watched. Dispel any myths with upfront and transparent communication and training about the technology.
- Continuously Improve. Once up and running, your job isn’t over. Keep looking for improvements and dig deeper into processes to continuously improve.
Do you think MTConnect is a valuable standard? What technologies have driven your operational efficiencies, and is MTConnect part of that plan?