May 1, 2016 / best practices, customer satisfaction metrics, industry news, KPIs, lean manufacturing, LIT, operations metrics, performance metrics, productivity, quality, strategic planning
As companies look for new ways to stay competitive, more and more manufacturers are utilizing “big data” and analytics in their operations. In fact, according to the results of a survey from Deloitte and the Council on Competitiveness, these types of advanced technologies have the power to put the U.S. back on the map as the most competitive manufacturing nation.
“CEOs say advanced manufacturing technologies are key to unlocking future competitiveness,” the report summary states. “As the digital and physical worlds converge within manufacturing, executives indicate the path to manufacturing competitiveness is through advanced technologies, ranking predictive analytics, Internet-of-Things (IoT), both smart products and smart factories via Industry 4.0, as well as advanced materials as critical to future competitiveness.”
Specifically, the report states that the application of these more advanced and sophisticated product and process technologies will help the U.S. and other traditional manufacturing powerhouses of the 20th century (i.e. Germany, Japan, and the United Kingdom) reclaim their spots as the most competitive nations in 2016. The U.S. in particular is expected to take the number one spot away from China by the end of the decade.
What does this mean for industrial metal-cutting organizations? It means that if you haven’t already considered using data and software analytics in your facility, it may be time to revisit the idea. If data-driven manufacturing has the ability to make nations more competitive, that certainly says something about what it can do for individual companies.
Metrics that Matter
For many industrial manufacturers, the thought of using data may seem a bit daunting; however, it doesn’t have to be as complicated as it sounds. For example, a metal service center featured here in a white paper started by developing an internal software system that automatically tracks the number of square inches processed by its existing sawing equipment. At any point, the manager can go to a computer screen, click on a particular band saw or circular saw, and see how many square inches each saw is currently processing and has processed in the past. Gathering this type of data allows the service center to easily track trends and quickly detect problem areas.
Richards Industries, a Cincinnati, OH, company that manufactures industrial valves, is using data in a similar way, according to a recent article from Modern Machine Shop. Although the company has been practicing lean manufacturing for years, it recently installed a machine-monitoring system that enables shop floor personnel to track activities and record the performance of its machine tools. “Like readings from a Fitbit or Jawbone, the data gathered and analyzed by this system is making the company more aware of how well machine time and manpower count toward productivity,” Modern Machine Shop reports.
Of course, these are just two examples. There are many other ways manufacturers can utilize data and advanced analytics to improve their operations. An article from IndustryWeek calls out a few key metrics industrial metal-cutting companies should consider as they implement data and analytics tools into their factory:
- Line speed by product. Take note of when and how often your line manufactures certain types of products; and then use tools to track the time and effort required to generate meaningful output for each. That way, you’ll have a better handle on what mix would produce the greatest profit.
- Granular utilization data. Look at the specific days and hours your factory produces its greatest output, as well as at what mix and with which operators on the floor. In other words, study the conditions that lead to the very best outcomes and then seek to reproduce those outcomes on a regular basis.
- Error rates correlated by product and employee. Avoiding mistakes is every bit as important as optimizing your mix and hours on the floor. Use Big Data and analytics tools to study error rates and then correlate the results by product and employee.
- Assembly speed by product and employee. Careful and error-free production is important, but so is speed, especially for facilities that deal with high volume. By using data and analytics tools to segment production, you can get a clearer understanding of what products are easier to produce and then ask your floor leaders why.
Whether you decide use data to gain productivity, monitor machines, or improve quality, the point is that data-driven manufacturing is here, and companies big and small are taking advantage of its many benefits. If you haven’t jumped on the bandwagon yet, don’t get overwhelmed. Just get started.
How are you utilizing data to improve your operations and stay competitive?
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 5, 2016 / best practices, continuous improvement, Cost Management, industry news, KPIs, operations metrics, performance metrics, predictive management, preventative maintenance, productivity, quality, strategic planning, workflow process
The economic uncertainty from 2015 is unfortunately spilling over into 2016. As reported in a recent IndustryWeek article, the head of the International Monetary Fund Christine Lagarde said “global growth in 2016 will be disappointing and patchy” due to rising interest rates in the U.S. and a slowdown in China, among other reasons.
The most recent metal service center shipments confirm the gloomy forecast. According to data from the Metal Service Center Institute, service center shipments of both steel and aluminum were down—albeit at slower rates—in November compared to both the previous month and year prior.
Given current economic conditions, it’s not surprising that metal service centers are using metrics and data to improve their operations—the only aspects of their businesses they can control. As reported in a white paper from LENOX Institute of Technology, market leaders know that proactive—not reactive—improvement is the key to being successful in today’s market.
When it comes to metrics, more and more companies believe key performance indicators (KPIs) are the best means for gathering quantifiable and traceable measurements because they are tied directly to business strategy. In fact, KPIs are so popular that the University of Tennessee’s Reliability and Maintainability Center (RMC) started an initiative called “Six Metric Areas to Best Practices” to help companies focus on the right metrics and align them to their organization.
As reported by Plant Services, Tennessee’s RMC initiative focuses on three guidelines:
- Work on what matters. There can be hundreds of KPIs, but only a few of them can dramatically improve an initiative. Make sure these KPIs are aligned with the company’s business goals and strategy. Tasks should be explicit and all actions should support a larger goal.
- Data should be industry specific. While using an average is a good place to start when determining improvement goals, it is important to look at industry specific data to ensure those goals remain realistic. Averages provide a guideline, but specific data provides meaning and context as to what is attainable or not, depending on market, costs and other industry related factors.
- Use benchmarks. Other data, according to industry, should act as a guideline and provide focus for ongoing improvements. RMC plans to publish competitive gaps and summarize results for participating companies.
As part of its initiative, RMC has also identified six universal KPIs that all companies, regardless of industry, should consider adopting. These include the following:
- Percent Reactive Maintenance, including data on predictive, preventive, and capital projects
- Maintenance Cost/Replacement Asset Value, expressed as a percent
- Overall Equipment Effectiveness (OEE), including availability, performance, and quality
- Inventory Turns for both overall product and maintenance, repairs and operations (MRO) spare parts
- Mean Time Between Failure (MTBF)
If your service center isn’t already using some of the above KPIs, now is the time to consider identifying at least a few, if not all, of them. If the process feels overwhelming, do some research, ask for help, and start measuring. In today’s uncertain economy, manufacturers can’t afford to ignore the operational areas that need improvement. As they say, you can’t improve what you can’t measure.
Are you using KPIs to optimize your operations? What metrics have resulted in the most improvement for your metal service center?
November 30, 2015 / best practices, Employee Morale, industry news, LIT, performance metrics, productivity, Safety
Nearly every manager recognizes the need for workplace safety and aims to foster a safe environment within their operations. In fact, the most recent data from the U.S. Bureau of Labor Statistics shows that the rate for nonfatal workplace injuries and illnesses continues to decline—and has so for the past 12 years.
According to OSHA’s “Survey of Occupational Injuries and Illnesses,” private industry employers reported 54,000 fewer nonfatal injury and illness cases in 2014 compared to the prior year. Unfortunately, the manufacturing industry is the exception. OSHA data shows that although the total number of manufacturing cases remains unchanged, the number of cases that required a job transfer or restriction (DJTR) exceeded those that only required days away from work (DAFW). In other words, the majority of all manufacturing cases were serious enough in nature that those workers involved could not return to their job or had job restrictions after the workplace accident.
It is clear that industrial metal-cutting companies need to place a priority on safety—despite the many other priorities today’s high-production environment demands. As a white paper from the LENOX Institute of Technology points out, ball and roller manufacturers are facing many operational challenges, but safety shouldn’t be pushed to the wayside. Instead, it should be integrated into day-to-day processes. By instituting standard safety procedures, industrial metal-cutting companies can ensure their workforce stays healthy and productive.
To help ball and roller bearing manufacturers improve safety in their daily operations, below are a few strategies to consider:
- Track Near Misses. As Modern Machine Shop reported in a column by Wayne Chaneski, one way to increase safety in a manufacturing environment is to report what he calls “near misses.” A near miss is an incident that didn’t result in medical attention or time away from work, but could have. Tracking near misses can predict potential workplace accidents and provide an opportunity to prevent them from occurring in the first place. Some common causes of near misses include electrical cords, hoses, or tubing on the floor; sharp objects inside a drawer; low-hanging objects; unsecured ladders; a hot tool or piece of equipment left out without a warning tag; and improperly secured items in cabinets. According to Chaneski, the best way to track near misses is to encourage employees to report them and to add them as a category during internal safety audits.
- Make Safety Visual. One simple but effective way to improve workplace safety is to make it visual. This strategy makes safety procedures and practices easy to follow, while also improving an operation’s workplace organization. For example, another article from Modern Machine Shop suggests using color-coded “lanes” on the shop floor to separate pedestrians and motorized vehicles. Another suggestion is to use rubber mats with visual outlines to indicate where supplies or inventory should be placed. In addition to providing a nice organizational reminder, mats can be easily relocated when needed. Finally, managers can post images and photos to quickly and clearly describe a process, show a desired outcome, or remind workers to put the process into practice.
- Get Employees Involved. Richard Knowles, a safety leadership and management consultant, recommends a more employee-centric approach to safety called Partner-Centered Safety. In an article published by EHS Today, Knowles states that safety can only be sustained when everyone works together to make the workplace as safe as possible. He proposes that managers can achieve this through three main elements:
- First, managers must ensure that employees have shared beliefs and values. This is generally achieved and agreed upon during a Safety Excellence Workshop where employees agree about the current status of the workplace and opportunities for improvements and change. For example, the group can agree that they want everyone to go home safe every day and then identify and implement how that goal can be achieved.
- The second element of Partner-Centered Safety is focused on the workplace environment. During the Safety Excellence Workshop, employees discuss the challenges they face and then develop a plan to help and support each other during those challenges. This ensures that the best safety decisions are being made in the moment when action is needed.
- The third element, also developed in the workshop, happens intrinsically throughout the process. The third element provides cohesion and order for the organization. What Knowles calls “The Bowl,” is essentially a culture of safety where outliers are called out and leaders and managers help everyone understand and maintain the safe culture. This sense of behavior and standards creates an agreed-upon culture that provides cohesion and order for the workplace, and empowers employees to follow and enforce those shared values and action plans created earlier in the workshop.
How does your company promote safety in your daily operations?
November 5, 2015 / continuous improvement, Employee Morale, industry news, KPIs, lean manufacturing, performance metrics, root cause analysis, strategic planning
In today’s lean manufacturing world, you don’t have to be an expert to know some of the lingo. Most manufacturing executives could easily rattle off terms like continuous improvement, kanban, just-in-time, and root cause analysis without even fully understanding what each entails, and many could probably provide a basic definition.
However, one lean manufacturing term that is not as well known—and even harder to say—is Hoshin Kanri. Although not as popular as some of the other lean strategies, Hoshin Kanri (also called Policy Deployment) can be a valuable planning tool for manufacturers. In fact, according to an article from IndustryWeek, the methodology is starting to gain traction among industry leaders.
“Hoshin Kanri is fast becoming an integral part of the strategic planning process at many organizations,” William Waldo, COO of consulting firm BMGI, writes in IndustryWeek. “From decades of refinement, this methodology has emerged as extremely effective in creating strategic alignment and galvanizing an organization toward achieving its vision.”
What is Hoshin Kanri?
Although difficult to pronounce, Hoshin Kanri is fairly simple in concept. The Japanese strategic planning process is designed to ensure that a company’s mission, vision, goals, and annual objectives are communicated and implemented throughout the entire organization, from top management to the shop floor level. According to leanproduction.com, this alignment eliminates the waste that comes from inconsistent direction and poor communication. In essence, it aims to “get every employee pulling in the same direction at the same time,” the website explains.
Although experts often vary on the specific steps involved in Hoshin Kanri planning, Waldo of BMGI believes there are seven key steps to successful implementation. Below is a brief summary of each step:
- Step 1. Establish Organizational Vision: This requires you to evaluate the current state of your organization with respect to your vision, business planning processes, and execution engine.
- Step 2. Develop Breakthrough Objectives: Breakthrough objectives are significant improvements that require your organization to stretch itself and will take three to five years to achieve.
- Step 3. Develop Annual Objectives: What will you need to achieve this year in order to reach those three to five-year breakthrough objectives?
- Step 4. Deploy Annual Objectives: The goal here is to turn those breakthrough objectives into workable targets and objectives at the departmental level using tools such as the Hoshin Planning Matrix, detailed action plans, summary reports, and value stream maps.
- Step 5. Implement Annual Objectives: This is where improvements are executed, using the most appropriate problem-solving approach.
- Step 6. Monthly Review: A monthly review fosters a culture of accountability and action by reviewing progress toward achieving annual improvement objectives.
- Step 7. Annual Review: This is a thorough review of the year’s objectives that shows where the organization stands against the stated objectives and what adjustments must be made to the next cycle.
Like any lean manufacturing initiative, Hoshin Kanri can seem a bit daunting. However, many manufacturing leaders have had success with the methodology, including Bridgestone, Boeing, Motorola and Toyota, to name a few. Accuride, a manufacturer of forged aluminum wheels and other commercial vehicle components, was recently honored by The Association for Manufacturing Excellence (AME) for its continuous improvement efforts, including implementation of Hoshin Kanri at its Rockford corporate facility and factory, reports The Fabricator.
There are two main reasons why your service center should consider joining many others in adopting Hoshin Kanri strategic planning. First, it creates a shared vision across the entire organization, which fosters good communication and can be good for employee morale. In addition, it can have a positive impact on performance. “Implementing Hoshin allows an organization to build a high performance culture and measure the progress of culture change toward a high performance,” according to an article from iSixSigma. “Following this process on a set schedule for each of the fundamental plans and annual plans throughout the organization ensures achievement of the business mission and progress towards the business vision.”
Even if Hoshin Kanri is not for your service center, adopting some form of strategic planning is critical if you want to be successful in today’s market. As Confucius once said, “A man who does not plan long ahead will find trouble at his door.”
October 15, 2015 / benchmarking, best practices, Cost Management, KPIs, lean manufacturing, LIT, operations metrics, performance metrics, preventative maintenance, strategic planning, workflow process
If there is one “go-to” answer for solving a company’s productivity issues, most experts point to lean manufacturing. The lean movement is, as one author put it here, “our current silver bullet.”
At this point, most manufacturers have jumped on the bandwagon and have incorporated at least some lean principles into their operation. Some companies like A.M. Castle, a metal service center featured in a recent case study, have undergone complete lean transformations, while others have adopted basic lean tools like 5S.
However, even with the growing popularity of lean manufacturing and its countless success stories, the reality is that not every lean journey is smooth. In fact, according to research from management consulting firm Quality for Business Success, Inc. (QBS), many are actually quite bumpy. After conducting 200 interviews with managers and lean champions from 71 different companies engaged in lean implementations, QBS found that many managers experienced “false starts” and felt overwhelmed by the learning curve. “Many managers we spoke with find themselves ‘drowning in a sea of half-understood tools and techniques,’” the firm states in a white paper. “Others, unaware of their narrow interpretation of lean, boast successful implementations when they’ve actually barely scratched the surface.”
To help companies achieve successful lean implementations, QBS outlined the most common missteps companies make in the process in a white paper. Below are the top 15 pitfalls managers should avoid:
- Thinking of 5S as something you do to an area
- Imposing 5S top-down, with limited involvement bottom-up
- Equating waste reduction with cost cutting
- Remaining aloof to the larger global end-to-end value stream
- Assuming your Future State Value Stream Mapping (VSM) is nothing more than your Current State VSM with the identified improvement opportunities corrected or addressed.
- Equating visual workplace with top-down visual communication
- Viewing Total Productive Maintenance (TPM) as an improvement initiative that exclusively relates to engineering and maintenance personnel
- Using overall equipment effectiveness (OEE) to evaluate operations rather than as an improvement gauge
- Equating Standard Work with procedures
- Engaging in “industrial tourism” and thinking you are benchmarking
- Pursuing a one-size-fits-all solution to production planning and control
- Forgetting to reduce supermarket inventories once established
- Preconditioning continuous flow to waste elimination
- Believing you will achieve a lean transformation applying lean tools
- Betting your strategy on lean
To read more about these common missteps, you can download the full QBS white paper, The 15 Most Common Mistakes in Lean Implementations, here.
What has been your experience with lean manufacturing? Have you made one or more of these missteps?
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?
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.
September 15, 2015 / continuous improvement, industry news, KPIs, LIT, operations metrics, performance metrics, predictive management, production planning, productivity, strategic planning
A brief look around at any public establishment quickly reveals just how much connectivity has changed the world. Whether checking an email on the train, texting a family member outside a restaurant, or posting photos on social media during a concert, almost every adult—and teen—rely on some type of connected device to function. It has, at this point, become a social norm in first-world culture.
However, could the same be said when looking around your shop floor? In some cases, the answer would be yes. Some industry leaders grabbed onto connectivity years ago, making the strategic decision to connect their production equipment to the Internet and/or back office functions to streamline processes or to gain access to valuable data.
Others haven’t quite caught on. As one article from Forbes reported, some industry leaders are saying that as little as 10 percent of industrial operations are currently using the connected enterprise. That number, which may or may not be accurate, seems surprisingly low when publications like the Harvard Business Review are saying that the use of smart, connected products “is perhaps the most substantial change in the manufacturing firm since the Second Industrial Revolution.”
In fact, thanks to advancements in machine-to-machine (M2M) and communications technology, many believe the manufacturing industry is on the brink of the “fourth industrial revolution,” also known as Industry 4.0. This concept has been widely discussed and promoted in Europe, especially by German manufacturers Siemens and Bosch, but the term is starting to gain a little traction in the U.S as well.
What is Industry 4.0?
Because this is a newer term, the definitions for what comprises Industry 4.0 vary greatly. An article from ZDNet outlines the four major shifts in industrial manufacturing as follows:
- Industry 1.0: Water/steam power
- Industry 2.0: Electric power
- Industry 3.0: Computing power
- Industry 4:0: Internet of Things (IoT) power
In general, many use Industry 4.0 as a collective term that refers to all of the technologies that will help foster the next-generation “smart factory”—a place where machines communicate with each other and their users in real-time, and factory processes become visible and controllable in virtual space. This typically includes technological concepts like embedded systems, automation and robotics, and the Internet of Things (IoT) and the Internet of Services (IoS).
According a report from Deloitte, there are four characteristics that define Industry 4.0:
- Vertical networking of smart production systems
- Horizontal integration via a new generation of global value chain networks
- Cross-disciplinary “through-engineering” across the entire value chain
- Acceleration through exponential technologies
For a great primer on Industry 4.0, including its distinction from terms like “Industrial Internet,” read this article from Industry Week.
How Can You Prepare?
Regardless of how you define or categorize the evolution of manufacturing, the point is that most experts agree that connectivity has the power to change manufacturing as we know it. Research also shows that many manufacturers are not prepared or equipped to be part of this next industrial revolution. A 2014 Smart Manufacturing Technologies Survey, for example, found that 40 percent of the survey participants have no visibility into the real-time status of their company’s manufacturing process. Adrian Jennings, Chief Technology Officer (CTO) of software provider Ubisense, which conducted the survey, says this reveals a major blind spot among today’s manufacturers.
“The manufacturing world is talking about Industry 4.0, but this survey confirmed that most manufacturers are far from embracing cyber-physical systems which define the next Industrial Revolution,” Jennings said.
How can your shop transition to what is likely the future of manufacturing? A contributed article appearing manufacturing.net provides some helpful tips and provides the value story for moving your operation from Industry 3.0 to Industry 4.0. Specifically, the article suggests the following:
“Start small and start local — trying to create large scale cyber-physical systems as a single effort presents too many challenges to be successful. Pick a problem or pain point and tackle it to prove that these solutions work and provide value. As benefits surface, roll this out to other processes keeping the ultimate goal of end-to-end visibility in mind. Be sure to invest in the right infrastructure at the outset and create islands of cyber-physical systems throughout the operation.”
Another article from Modern Machine Shop simplifies it further:
- Take heed. The Industrial IoT is real and taking shape here and now.
- Keep your eye on the prize. Better decision-making is the main benefit of creating a connected factory in which machines and people are smarter.
- Start small, but plan big. Whether it is machine monitoring or cloud-based CAM programming, the initial steps have to be manageable, transparent and respectful of the individual.
And if you think this transition isn’t already happening in the metal-cutting world, think again. According to a white paper from the LENOX Institute of Technology, one metal service center has developed an internal software system to automatically track the number of square inches processed by each band saw and each blade. At any point, the operations manager can go to a computer screen, click on a saw, and see how many square inches that saw is currently processing and has processed in the past. This has allowed the service center to easily track trends and quickly detect problem areas.
In what ways has your metal-cutting organization prepared for this next phase of industrial manufacturing? Are you ready to usher in “smarter,” more connected operational strategies?
August 20, 2015 / benchmarking, best practices, continuous improvement, Cost Management, LIT, operations metrics, performance metrics, predictive management, preventative maintenance, productivity, resource allocation, strategic planning
With changing customer requirements and an increasingly competitive marketplace, leading manufacturers are finding it pays to be proactive—not reactive—in their strategic approaches. Instead of simply measuring performance, many companies are taking the next step and using measurement to anticipate and prevent future challenges—a concept known as predictive operations management.
This trend has found its way into industrial metal cutting. According the LENOX Institute of Technology’s benchmark study of more than 100 machine shops and other industrial metal-cutting organizations, companies can gain additional productivity and efficiency on the shop floor by “investing in smarter, more predictive and more agile operations management approaches.”
One such approach is predictive maintenance. Not to be confused with preventative maintenance, which uses planned maintenance activities to prevent possible failures, predictive maintenance (also known as condition based maintenance) uses tools to predict failures just before they happen.
Reliable Plant defines predictive maintenance as “the application of condition-based monitoring technologies, statistical process control or equipment performance for the purpose of early detection and elimination of equipment defects that could lead to unplanned downtime or unnecessary expenditures.” By using tools to predict and then correct possible failures, operators can keep machines running while eliminating unnecessary preventative maintenance downtime and reducing reactive maintenance downtime.
Monitoring tools typically include vibration analysis, infrared thermography, motor circuit analysis, sonic and ultrasonic analysis and other technologies that can find defects while the machine is in normal operation. In most cases, condition-based monitoring won’t interfere with production schedules—a huge plus for any manufacturer.
If predictive maintenance is effective, maintenance is only performed on machines before failure is likely to occur. According to www.maintenanceassistant.com, this brings several cost savings, including:
- minimizing the time the equipment is being maintained
- minimizing the production hours lost to maintenance, and
- minimizing the cost of spare parts and supplies.
While this can translate into less maintenance downtime compared to preventative maintenance, predictive maintenance also has some drawbacks, including:
- high upfront investment for condition monitoring equipment and software, and
- high skill level and experience required to accurately interpret condition monitoring data
According to an article from Life Cycle Engineering, creating an effective predictive maintenance program is a bit more complicated than it appears. The magazine poses four questions managers need to address before implementing a predictive maintenance program:
- Can predictive maintenance technologies provide real value to your preventive maintenance program?
- What is the most effective predictive technology for your plant?
- Can you provide the right training?
- Will you actually use the information?
In the end, predictive maintenance may not be an option for every shop or every piece of equipment, but many manufacturers find it worth the investment for machines that have a critical operational function and have failure modes that can be cost-effectively predicted with regular monitoring.