There’s no doubt about it: continuous improvement can work wonders in a high-volume, repetitive manufacturing environment. But continuous improvement can also truly help custom manufacturers specializing in low-volume, highmix work.
Often, custom manufacturers assume “the techniques that are used in repetitive manufacturing don’t apply to them,” said Jim Houge, WMEP manufacturing specialist. “It’s true there are differences, but custom manufacturers can greatly benefit from similar techniques like standardizing their process and mistake-proofing orders coming in.” The results from such efforts can be dramatic.
As with any kind of improvement work, custom manufacturers should start with a thoughtful plan. “You need to have some well-understood business objectives,” said Jim Hensch, WMEP manufacturing specialist. “But you also have to understand whether you’re looking at symptoms or root causes. Lack of flow on the shop floor can result in excess inventory, but the real issue may be a need for cross-training or smaller lot sizes. A plan is important, but so is identifying metrics to determine if the plan is being accomplished.”
In fact, improving overall Data Collection is an important tool for custom manufacturers. “It’s about collecting data not necessarily by product, but by process,” said Brian Weeks, WMEP manufacturing specialist. “A lot of financial data that’s collected is ‘rear-view mirror.’ We try to focus Data Collection in a more proactive way, to predict future success.”
One way this is done is by collecting data visually on the shop floor (i.e. Visual Management). Scheduling boards, Kanban signals and similar methods show how much work is waiting to be done at each operation. “It helps get things out in the open, rather than using computers, which hide the data behind the screen,” said Weeks. “You can see whether you’re on time or not.”
To optimize material and information flows throughout the company, the flows must first be identified. Value Stream Mapping (VSM), a tried-and-true Lean tool that many custom manufacturers utilize every day, shows where waste and bottlenecks are occurring. For custom manufacturers, the trick to applying VSM effectively is knowing exactly what to map.
“They need to do several maps that represent general categories of custom jobs,” said Houge. For example, a map might be done of an order that required no engineering, but that needed a unique label provided by sales. A second map might be done of an order that needed some design work, and a third map of a product that was brand new and required the sourcing of new parts and the use of new processes.
What the maps often reveal is that the products have a good deal in common. “Most custom manufacturers have a high level of standardization in their products, with variation only at the end of the process,” said Weeks. “Often there’s a lot more uniformity in the flow than they believe.”
To determine where the uniformity lies, a Process Matrix is used to identify product families. The matrix is created by listing products down the left side of a table and listing processes across the top (for example, stamping, welding, deburring, etc.). The processes each product goes through are checked off, and the products that go through a similar process flow are identified as a product family. “The idea is to improve the flow of one product, which should improve the flow of the entire family,” said Weeks.
Custom manufacturers can also benefit from an Office VSM, which shows the flow of information through the front office functions. Different questions are asked for an Office VSM, such as, “What percentage of the time is the information you receive complete and accurate?”
“There’s a lot of error correction going on in the front office,” said Houge. The first-pass yield for those functions might be 5%, and the company realizes that “some triage needs to be done.” Solutions include everything from order processing cells (with members from different functions); optimizing office layout to shorten walks to the copier to reducing the number of approvals on processes or paperwork. It’s clear that office functions can offer significant opportunities for improvement.
Another useful tool for custom manufacturers is the supermarket concept, a system consisting of clearly labeled storage bins for parts that are placed at strategic points where the parts are needed. The idea is to have parts immediately available for production. Generally, two rotating bins are dedicated to each part, so that when the first bin is emptied, parts are reordered or machined to refill it and the second bin is pulled forward and tapped for its parts.
A variation of the supermarket that is especially helpful to custom manufacturers uses common base assemblies. Since the customization of products often occurs at the end of the manufacturing process, it is possible to process parts up to a certain point, then hold them as WIP (Work In Process) until orders come through. The final processing steps can then be performed to customize the parts. Sani-Matic, a manufacturer of custom sanitation equipment in Madison, applied this technique to their spray ball area and significantly improved their response time (see details on page 4).
This can actually increase WIP, but the amount of WIP is really a balancing act, because “if there is no WIP, you risk idling workers because of lack of material,” said Houge. “The supermarket goal is to establish rules around WIP and understand how much is enough.”
For custom manufacturers looking for an immediate return with very little investment, Lean tools like 5S/Visual Management can yield quick benefits by organizing the shop floor to increase efficiency. Componex, Inc., an Edgerton manufacturer of aluminum precision rolls for the web handling and converting industry, applied 5S to its shop floor, removing clutter, clearing aisles and establishing lockout-tagout procedures. Their 5S work not only improved efficiency, but also helped them avoid a premium increase for their liability insurance. They also began posting key indicators in the workplace, a Visual Management technique that lets everyone know the status of critical metrics like on-time delivery (which is at 98%). Componex has not only sustained the 5S changes, but also used them as a way to become organized for additional continuous improvement work.
Another custom manufacturer, Marion Body Works, which makes engineered truck bodies in Marion, adapted Visual Management to their assembly line, where they build cabs in a variety of heights. The posts that determine the height of the cabs are used as a visual cue at the assembly start area to let workers know that all the parts have been assembled for the next cab, and to signal what kind of cab is to be built. Sani-Matic also used Kanban cards to signal the need for additional parts to be replenished.
Finally, custom manufacturers should consider Capacity Planning and its potential to align the needs of the various business functions of the company. “Capacity Planning is about having a common understanding of the bottleneck work centers throughout the organization,” said Hensch. “For example, the sales manager may come in and say, ‘Hey, I got a $100,000 order!’ The manufacturing manager understands the product ordered will need to go on the overloaded lathe, so he’ll schedule it at three weeks, not three days. The finance guy thinks, ‘This customer never pays their bills on time. The product ordered is costly, so we’ll need more working capital next month.’” Capacity planning is designed to get all business functions in sync to understand the manufacturing capacity, sales and cash needs of the company.
Custom manufacturers face unique challenges. Properly applied, continuous improvement tools can increase efficiency, reduce waste and lead times and improve competitiveness. Take advantage of the flexibility of these proven tools to tailor your improvement work to meet your company’s needs and reduce your bottom line.
For more information on these and other tools for custom manufacturers, please call WMEP at 888-372-9610.