When it comes to the direct- versus in-direct costs associated with manufacturing labor, the question must always be asked, “Who’s in the plant, and what’re they doing?”. That is to say, when it comes to questions concerning the valuable, yet limited, resource of time, the tracking of personnel and their activities through any part of the day is absolutely necessary to eliminate waste, enhance productivity, and increase the bottom-line.

In the past, the accounting of personnel time was simply a matter of marking time-in and time-out as indicated on a manually punched timecard. The “in-between” time of an employee was lost to managers and only measured by the amount of finished goods delivered at the end of the day. That it took a shop floor machine operator a half an hour to search for a tool before returning to the pending job on his machine was shrugged off as unreportable data.

With trending in manufacturing toward totally integrated enterprise resource planning (ERP), software technology advancements have now evolved to the point where (more…)

Where do we in manufacturing find the “edges” that make or break our profit margins? Where do we make the changes in process, the tweaking, that maximize returns on investments (ROI)?

More often than not the edges that reach both output and quality goals are found in the efficiencies we make in the manufacturing technique. Today, in many job shops, make-to-order, or mixed mode manufacturers, those efficiencies in production are found in the elimination of waste—a technique commonly referred to as lean.

In a lean system the manufacturer seeks maximized ROI by attempting to eliminate the waste of resources commonly found in physical production processes. In effect, the greatest and most fixed resource available to any manufacturer is that of (more…)

When industrial visionaries create improvements in manufacturing technique far ahead of their time, reluctance to change is the common response of managers comfortable with traditional, production methods.

From Adam Smith’s eighteenth century “pin factory” to Frederick Taylor’s “scientific management” in the nineteenth century, and Henry Ford’s twentieth century “mass production” to Taichi Ohno’s contemporary “pull production” model, shop floor operation has been in constant evolution. In all of these periods of change, it has often been the early adopters of emerging manufacturing techniques who have enjoyed great benefits over their competitors.

Those benefits often result in increased market share, profit margins, or both, from enhanced efficiencies in the manufacturing process. In many job shops, make-to-order, or mixed mode manufacturers, these efficiencies in production are (more…)

As manufacturers, we are always looking for ways to make things run faster, cheaper, and simpler. Often, the approach we take involves reassessing the production elements within the plant that impede the system flow.

In such an analysis we take stock in the operation as a whole in search for efficiencies in the parts. In short, to enhance productivity while responding quickly to rapidly changing customer demands, we try to take full advantage of the resources available to our plant.

In doing so, the modern manufacturer strives for total enterprise resource planning (ERP) that ensures all plant elements are in synch with each other. In the evolution of ERP as a manufacturing concept, the idea of work center management has come to the forefront as a place of greatest gains in efficiency.

While pull-production techniques certainly strive for just-in-time (JIT) manufacturing modes, efficiencies that might be gained in (more…)

Since the introduction of the lean system of continuous improvement manufacturing (CI), the desire has always been for inventory management that minimizes stock on hand, if not fully eliminating it.

True to lean principals, by eliminating waste at every turn in the manufacturing process quality is improved while production time and costs are reduced. As one of the “seven wastes” in lean philosophy, inventory proves to be inefficient when a plant maintains more on-hand inventory than is minimally required to produce products in the immediate time frame.

Rather than the batched, push-production system where large inventories are maintained for the potential of future sales or supply chain problems, lean methods employ (more…)

As it concerns profit margins, inventory control is one of the more visible and appreciable aspects of the manufacturing business today. Raw materials, goods in process, and finished goods are each the visible consequences of inventory in some form or fashion, and each means actual money locked up until product is finally shipped out to the customer. The longer any of these aspects stands idle in the shop, the longer company dollars get tied up in inventory carrying costs.

Conversely, the shorter the time inventory stays on-hand, the greater are the enhancements to the bottom-line. What every inventory manager seeks is a rapid throughput and system flow of inventory, especially as a result of the supply chain stream so vital to business today. When inventory moves rapidly through the plant, (more…)

Accurate forecasting for raw materials and parts acquisition by inventory managers is an essential science in manufacturing today. With manufacturers expected to move at the speed of the Internet, processing orders, purchasing supplies, producing product, and shipping finished goods out the door must be accomplished with ever-decreasing lead times and ever-increasing expectations of quality.

It is a tightrope walk that inventory managers must take when assessing production needs as a result of sales orders and production throughput.

While customer demand can, in some instances, be anticipated based upon prior history, increased demands or slowdowns must also be contingencies planned for with regards to inventory management. In other words, (more…)

It used to be the case in job shop manufacturing that when something needed to be done, the information relating to the task was passed along the line with paper forms. Dispatch lists, routers, schedules, requisitions, and job orders were written down on hardcopies.

However, hardcopy forms often proved to be inflexible pains to change if there were hiccups in the system. Furthermore, there was always a disconnection between areas like scheduling, shop floor work centers, inventory, and shipping.

In the old days of paper forms, there was the constant problem of miscommunication—everyone in the plant was not always on the same page. The results were (more…)

One of the toughest parts of total enterprise resource planning (ERP) implementation in manufacturing is, perhaps, the efficient collection, storing, and analysis of data. Whether information comes from the shop floor in terms of employee time, work in progress or materials inventory, or from departments such as master scheduling or shipping, the wide variety of operational areas in a plant calls for the centralization of information. Such a notion is at the very heart of Lean manufacturing, and it is one that is important in contemporary “pull production” manufacturing operations.

Of course, the centralization of data collection for use in manufacturing software means there must be centralized data collection points useable throughout a plant. The Graphical User Interface (GUI) terminal is a tool that gives shop employees a centralized port to input and interpret production data quickly and easily.

It is more important than ever that (more…)

Enterprise resource planning (ERP) is a mode of manufacturing built upon the notion of a single software program serving the needs of all aspects of the operation. In strict terms, the true ambition of ERP is to integrate all departments and functions across a manufacturer through the single-source software program, while eliminating departmental standalone computer systems.

It is hoped that such integration will facilitate the sharing of the same real-time data simultaneously to all areas of the plant, thus coordinating decision-making processes and outcomes. To this end, an ERP approach can have significant on-time delivery improvements and positive ROI–if, the software is installed properly, integrated system-wide, and correctly utilized in operation. (more…)