Three Low Cost Ways Fabricators Can Improve Output

October 15, 2014 / , , , , , , , , , , , , , , , , ,

Reports continue to show that U.S. manufacturing is on the upswing. According to the latest data from the Institute for Supply Management (ISM), manufacturing continued to expand in October, and new orders posted growth for the 17th consecutive month. The Fabricated Metal Products sector in particular reported growth in October, with one ISM survey respondent stating that “weakness in commodity prices has been very positive”  for business.

All of this good news means that fabricators have a prime opportunity for growth and increased profitability. However, because many companies are already running lean, managers will need to get creative with how they meet increased demand, especially if they can’t afford huge capital expenditures.

Looking for ways to do more with less? Below are three key ways fabricators can increase manufacturing output without breaking the bank:

  1. Identify Trouble Spots. Take an assessment of the factory floor to find machinery that’s either close to failure or not producing as expected.
  2. Estimate your savings. Once you fully understand the impact of the old equipment on your floor, run some calculations.
  3. Find your MacGyvers. Seek out specialists who’ve been handling specific types of equipment for years and see what creative ideas they have to boost efficiency.
  4. Set bounties for difficult challenges. Track each efficiency experiment to get a sense of what may be possible. Then, set bigger targets and attach a bounty to encourage friendly competition among experts.
  5. Raise the stakes. Engage everyone by creating factory-wide incentives for when targets are met.


Understanding Six Sigma and Lean Manufacturing in Your Industrial Metal Cutting Organization

September 28, 2014 / , , , , , , , , , , , ,

At this point, most metals executives have heard the message of continuous improvement loud and clear. As a benchmark study from the LENOX Institute of Technology (LIT) confirms, a large number of industrial metal-cutting organizations are embracing smarter, more proactive operations management to stay competitive in today’s uncertain market.

However, knowing where to start can often be both intimidating and frustrating. Active change takes time and costs money, so managers need to be sure they are strategically choosing the right methods to achieve their operational goals.

Two improvement methodologies that are widely used in industrial metal cutting are lean manufacturing and Six Sigma. While both are used to improve productivity and profitability, their approaches are not the same. Understanding the difference between both methods is important not only for managers trying to choose the right organizational improvement program, but also for managers who may want to consider using them together.

Lean Manufacturing
According to, lean manufacturing is “a collection of tips, tools, and techniques that have been proven effective for driving waste out of the manufacturing process.” Toyota is credited for developing it the 1980s, and over the years it has been used by manufacturers worldwide to improve all facets of the manufacturing business, from quality assurance to human resources.

Below are some key attributes of lean manufacturing, as defined by The Process Excellence Network:

Six Sigma
iSixSigma defines Six Sigma as “a disciplined, data-driven approach and methodology for eliminating defects in any process, from manufacturing to transactional and from product to service.” It was developed in the mid-1980s by Motorola engineers who were unhappy with traditional quality metrics. In response, they developed a new standard, as well as the methodology and needed cultural change associated with it. Six Sigma gained popularity in the 1990s after General Electric adopted it as part of its business strategy.

Below are some key attributes of Six Sigma, as defined by The Process Excellence Network:

The above is just a brief overview of two of the industry’s improvement methodologies and only touches on some of the main characteristics. For a more in depth, side-by-side comparison of lean manufacturing and Six Sigma, check out this article from Chron.

In an upcoming blog, LIT will explore how managers can strategically utilize both methodologies to achieve what some experts believe are longer lasting business results.


Scheduling Strategies for Fabricators

September 10, 2014 / , , , , , , , , ,

As customer demands for faster delivery increase, one of the biggest challenges fabricators face is scheduling. No matter how big or small an order, it is not uncommon for today’s customer to expect next-day or two-day turnaround. And, of course, there is almost always an expedited request thrown into the mix.

When it comes to scheduling, today’s managers need to be able to adapt on the fly, keep production moving, and still get everything out the door on time. As any manager will attest, this is no small feat. While 99 percent on-time delivery is always the goal, the reality is that a host of variables makes it almost impossible to achieve.

This is especially challenging for high-mix fabrication operations, where there are even more variables to consider. According to the annual Financial Ratios & Operational Benchmarking Survey  from the Fabricators & Manufacturers Association International, many custom fabricators are achieving on-time delivery (OTD) rates between 85 and 88 percent. In other words, there is room for improvement.

As this white paper from the LENOX Institute of Technology (LIT) states, meeting delivery demands starts with having the right equipment and efficient production processes. However, it also means making sure your scheduling processes are helping—not hindering—your operation. Below are a few strategies to help today’s fabricators tackle their scheduling challenges and, hopefully, improve their OTD rates:


Five Tips for Achieving the Perfect Cut in Machine Shops

August 20, 2014 / , , , , , , , , , , , , , , ,

In the busy production environment of a machine shop, achieving the perfect cut is key to maintaining quality and productivity. Premature blade failure and excess scrap caused by operator error or equipment misuse can create quality issues, bottlenecks, and increased costs. In other words, it pays to get it right.

The LENOX Institute of Technology (LIT) knows what it takes to get the best cut out of your operators and the best “cost per cut” out of your blades. The following are few tips and tricks machine shops can use to optimize their band-saw cutting operations:







For more metal-cutting tips and tricks, you can download the complete white paper, Understanding the Cut: Factors that Affect the Cost of Cutting, here.


How Fabricators Can Use Overall Equipment Effectiveness for Continuous Improvement

August 10, 2014 / , , , , , , , , ,

Over the last several years, a growing number of fabricators and other industrial metal-cutting companies have started measuring overall equipment effectiveness (OEE). This is definitely a good trend, as measurement is a critical part of continuous improvement. However, many companies are jumping on the OEE bandwagon without being fully informed, which is causing a lot of misunderstanding and misuse of this important metric.

Knowing what OEE is—and what it isn’t—is the only way to make sure you are using it effectively. Here’s a quick primer.

What OEE Is
According to, OEE is a best practices metric that measures the percentage of production time that is truly productive. It takes into account all six types of loss, resulting in a measure of productive manufacturing time.

In simple terms, OEE can be described as the ratio of fully productive time to planned production time. According to, it can be measured in one of two ways:

(Good Pieces x Ideal Cycle Time) / Planned Production Time


Availability x Performance x Quality

(You can  find a more detailed description of the calculation here, as well as a sample calculation.)

A plant with an OEE score of 100 percent has achieved perfect production—high quality parts as fast as possible, with zero down time. While that’s ideal, it’s not quite possible in the real world. According to, studies show that the average OEE rate among manufacturing plants is 60 percent, which leaves substantial room for improvement. Most experts agree that an OEE rate of 85 percent or better is considered “world class” and is a good long-term goal for most operations. The good news it that 85 percent is achievable. As this case study from Metalforming magazine describes, Magellan Aerospace in Kitchener, Ontario, Canada  was able to improve its OEE from a mere 36 percent to a world-class 85-percent-plus.

Managers can use OEE as both a benchmark and baseline. Specifically, says it can be used to “compare the performance of a given production asset to industry standards, to similar in-house assets, or to results for different shifts working on the same asset.” It can also be used as a baseline “to track progress over time in eliminating waste from a given production asset.”

What OEE Isn’t
Even with a basic understanding of OEE, many operations are still misinterpreting it and, therefore, aren’t using it effectively. This blog post, for example, argues that OEE is not a key performance indicator (KPI), and it shouldn’t be measured at a company or plant level. The author goes on to state five reasons why OEE is not a good KPI, including the fact that it is not comparable between different pieces of equipment and/or different locations. Instead, he suggests OEE should be used as a way to help identify and eliminate waste in front of a process, line, or equipment.

Another misconception is that OEE is the same thing as Total Productive Maintenance (TPM). An article from IndustryWeek (IW) says this is definitely not the case. “OEE is the measure most closely associated with TPM, but OEE is not equivalent to TPM,” the IW article states. “At its heart, TPM is not about complex metrics; it’s about developing the capabilities of people.” So while a good understanding of OEE can help with TPM, the two terms shouldn’t be used interchangeably.

How to Use OEE Effectively
So how do you use OEE correctly? Below are a few pointers we called out from the IW article:

Also, if you are short-run, high-mix fabricator, don’t assume OEE isn’t for you. Check out this article from, which describes how automated data collection can help you to better measure OEE in more custom manufacturing applications.

As the IW article states, OEE is often misused, but it is not a “bad metric.” In fact, it can be very useful in helping companies quantify improvement opportunities. Just be sure you know the facts before you start using OEE measurements to make strategic decisions.


Tackling the Six Big Losses in Your Metal Service Center

August 5, 2014 / , , , , , , , , , , , , ,

Whether or not you consider yourself a “lean” operation, there are some lean manufacturing principles that are universal to almost every manufacturer. One of those is waste. As a metal service center, your ultimate goal is to turn material into profit as efficiently possible, which means you want to avoid waste and downtime at all costs. And while this isn’t groundbreaking information, many service centers aren’t effectively tackling waste because they don’t know where to start.

Identification of the Six Big Losses is one tool manufacturers can use to understand the most common forms of waste or “loss” within their operations. According to, the Six Big Losses are key because ”they are nearly universal in application for discrete manufacturing, and they provide a great starting framework for thinking about, identifying, and attacking waste.”

The first step to reducing waste in your organization is to identify your losses. There are six types of loss every manufacturing operation faces, and each fall under three main categories—downtime loss, speed loss, and quality loss.

The following is a brief description of each of the Six Big Losses:

  1. Breakdowns. These are considered a downtime loss and could include tooling failure, unplanned maintenance, and motor failure.
  2. Setup and Adjustments. This is also a downtime loss and could include changeover, material shortage, operator shortage, and warm-up time.
  3. Small Stops. This is considered a speed loss, and it only includes stops that are less than 5 minutes and don’t require maintenance. This might include a blocked sensor or minor cleaning.
  4. Slow Running. This is another speed loss, and it covers anything that prohibits equipment from running at its optimal speed. Incorrect setting of parameters and equipment wear are prime examples.
  5. Startup Defects. This quality loss covers any scarp or rework that occurs during setup or very early in the production phase.
  6. Production Defects. This is the second form of quality loss. This refers to any scrap or rework that happens during the steady-state production process.

Once you have identified the Six Big Losses and the events that contribute to them, the next step is to record and monitor what you find within your operation. The only way to do this effectively is through measurement and documentation. This article from gives several tips for addressing each loss category and includes helpful links to help you accurately measure your losses.

The final step is attacking your losses and preventing them from happening again. This is where strategy comes into play. In a recent benchmark study of industrial metal-cutting organizations, the LENOX Institute of Technology (LIT) identified three key areas where organizations can gain additional productivity and efficiency on the shop floor. These include the following:

  1. invest in smarter, more predictive operations management;
  2. embrace proactive care and maintenance of saws and saw blades; and
  3. invest in human capital.

To read more about these recommendations, you can download the full report here.

As a service center that cuts and processes metal, some waste and loss are inevitable. However, the only way to keep those losses from hurting your business is to identify, monitor, and attack them, one by one. Add in a little strategy, and you might just be able to turn those losses into opportunities for improvement and growth.


Reducing Scrap in Forges that Cut and Process Metal

July 25, 2014 / , , , , , , , , , , , , ,

In industrial metal-cutting, a small amount of scrap is inevitable. However, reducing material waste should still be a top goal for forges that cut and process metal. Like all other forms of waste, scrap negatively affects profitability, especially if it is generated out of 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. According to this article from CONNSTEP, a Connecticut-based continuous improvement organization, reducing scrap and rework rates can also improve cash flow. “The number one reason small businesses go out of business is lack of cash flow,” the article states. “If the scrap rate is 8 percent of your production now and it is reduced to 6 percent, that newly created 2% may now be used to produce new/additional product and your savings should account for the cost avoidance of using new/additional material to complete the existing order.” In other words, by reducing rework and scrap from occurring, industrial metal-cutting organizations can actually generate money that goes right to their bottom line.

If you are a forge that cuts and processes metal, here are a few strategies we gathered to help you reduce your scrap rates:’


In the end, scrap is just one of the many areas of waste that today’s leading forges are trying to attack. However, with the cost of inventory being so high, no industrial metal-cutting organization can really afford to ignore a pile of wasted material that could have been used for profit. When it comes down to it, every piece of scrap counts in today’s lean manufacturing world. However, by implementing some of the above strategies, not every piece of scrap has to count against you.


Getting Machine Shop Operators Involved in Preventative Maintenance

July 20, 2014 / , , , , , , , , ,

Most machine shops understand the benefits of implementing a preventative maintenance (PM) program. They can improve efficiency, enhance safety, reduce costs, and save time. In fact, a recent benchmark study confirmed that preventative maintenance is a best practice among many of today’s leading industrial metal-cutting companies.

The problem is that maintenance departments are typically busy putting out fires, which pushes anything “preventative” to the side. Why take the time to stop a potential problem when there are enough real problems happening right now? So while a machine shop may have a PM program in place, it isn’t always followed, which completely eliminates most of the benefits preventative maintenance can offer.

This is where a team-centered approach can help. In today’s lean manufacturing world, most continuous improvement initiatives need to be a team effort if they are going to be sustainable, and PM programs are no exception. One way to do this is to get operators involved in the day-to-day maintenance of your equipment. This tactic not only empowers shop-floor employees and encourages communication, for many companies, it is the only way they can feasibly adhere to their PM schedule.

TPM: A Lean Team PM Tool
To create a more team-centric PM program, a growing number of companies are using a lean tool called Total Productive Maintenance (TPM). According to, TPM “blurs the distinction between the roles of production and maintenance by placing a strong emphasis on empowering operators to help maintain their equipment.” The goal of a TPM program is to create a shared responsibility for equipment maintenance to maximize the operational efficiency of equipment. Many companies have found this approach to be very effective in increasing up time, reducing cycle times, and eliminating defects.

What does this look like on the shop floor? TPM uses a set of eight techniques or “pillars” for improving equipment reliability. The first pillar, for example, gives operators the responsibility of routine maintenance (i.e., cleaning, lubricating, and inspection). This not only keeps a machine running better on a daily basis, it helps operators have a better understanding of their operation. With a simple checklist, operators can enhance their knowledge base and positively affect performance on the shop floor. (You can read about the other seven pillars of TPM here.)

Put it in Writing: Daily Operator PM Checklist
Even if you don’t decide to implement a complete TPM program, daily operator checks are still a great option. These will vary based on your equipment needs, but the goal is to create a checklist that is simple and straight forward. Daily PM checks should take an operator less than 10 minutes and should be performed regularly (i.e., the start of each shift). Programs can be as detailed as a company feels is necessary, but the following are some key checkpoints outlined in a white paper from the LENOX Institute of Technology:

Again, this is just a starting point. Managers should work closely with their blade and equipment manufacturers to create their daily PM programs. No one knows your equipment needs better than the ones who made it. In addition, many suppliers also provide complimentary annual or bi-annual PM check-ups, which can provide more in-depth equipment diagnostics and take some responsibility of your stressed maintenance department.

Operator Input Pays
If you still aren’t sold on making PM a team effort, a recent article from IndustryWeek does a good job of reinforcing why it is worth the effort to involve all employees in continuous improvement activities. Using an all-to-familiar scenario, the article points out that the root cause of one shop’s productivity issues is a lack of equipment maintenance—something that could be solved with a strong PM program. The real nugget, however, is when the article points to an even deeper issue at far too many companies and that is management’s total disregard for operator input.

In the end, the benefits of getting operators involved in preventative maintenance are pretty hard to argue. Managers get the typical benefits of a solid PM program (i.e., reduced costs, increased blade and tooling life, and improved productivity), as well as the additional benefits of fewer errors, better cross communication, a more knowledgeable team, and valuable, shop floor insight.


Benchmark Survey Helps Industrial Metal Cutting Companies Hit the Mark

July 15, 2014 / , , , , , , , ,

In today’s challenging operating environment, it is critical that managers stay on top of industry trends. Benchmarking what your peers are doing, the latest strategies they are using, and even the pain points they are facing can help you gauge your company’s competitive edge. In fact, management consultancy McGladery, which has strong experience in the manufacturing and industrial arena, says the use of benchmarking is on the rise as companies look to offset the effects of the uncertain economy by reducing costs and improving effectiveness.

In Fall 2013, the LENOX Institute of Technology (LIT) conducted a Benchmark Survey of Industrial Metal-Cutting Organizations to identify key trends happening in industrial metal-cutting – especially among Fabricators, Forges, Machine Shops, and Metal Service Centers. The study surveyed more than 100 companies within this group and collected information on productivity, scrap rates, training programs, safety, and other operational issues.

The survey revealed that there are three pain points today’s industrial metal-cutting companies continue to face, despite industry efforts to improve operational effectiveness. These challenges included machine downtime (35%), blade failure (27%), and operator errors (15%).

The key findings, however, identified how leading industrial metal-cutting companies are addressing these challenges. Based on LIT’s survey results, there are three strategies industry leaders are using to not only tackle their top pain points but, even more so, to optimize their operations. These include the following:

For more information about the results found in LIT’s Benchmark Survey and to download a complete copy of the report, visit the LENOX Industrial Metal Cutting Resource Center.


Long Term Solutions for Improving Cut Quality in Metal Fabrication

June 10, 2014 / , , , , , , , , , , , , ,

When quality hiccups or bottlenecks occur, the first instinct is to blame the machine. A quick blade replacement or tooling adjustment is the go-to response, and in the short-term, the problem is addressed. Production continues, and the order is eventually filled.

However, industrial metal-cutting leaders know that quick fixes are not doing anyone any favors, especially when quality is involved. Fabricators with high quality standards need to be sure that all areas of their cutting operation are optimized; otherwise, their costs are going to go through the roof. For instance, an operator that doesn’t understand the proper speed setting for a specific type of metal might end up going through a half a dozen blades to maintain a square cut, when the job should have only required two blades.

The harsh reality is that today’s customers are demanding tighter tolerances and higher quality without the added cost. While it is tempting to make knee-jerk responses to meet tight timetables, fabricators that want to remain competitive need to focus on long-term solutions to improve cut quality. Really, you can’t afford to do it any other way.

With the right strategies in place, maintaining premium cut quality doesn’t have to cost a premium. Here are a few to consider:

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