It’s an unfortunate fact of the manufacturing life that customers are increasingly demanding lower costs for seemingly perfectly produced products, and delivered on-time—every time. And, never mind the excuses for not performing. Today, customer loyalty is often a vacuous concept and any dissatisfaction at all simply becoming a matter of clients moving along to next vendor in line who promises the desired delivery. At its root, the bane of most manufacturers is excessively long order-to-delivery cycle times, even when efforts have been made to streamline production systems.

In lean models of manufacturing, wasted time means wasted opportunities to gain efficiency. Evidence of the waste of time is everywhere in the system and often takes the form of waiting for something to happen. The shop floor waits on sales orders to get processed, machine operators wait for engineering documents to update or clear, bottlenecks form in the production line, material delivery is slowed during inventory searches, and the list of waiting maladies goes on and on. Just remember that waiting—any waiting—keeps making the order-to-delivery cycle time longer than it really needs to be. And, longer order-to-delivery cycle times nibble into valuable, and narrower, margins.

Another factor in extending the order-to-delivery cycle time, to the point of bottom-line profit erosion, is that often a company doesn’t even know when the cycle is considered to be “too long”. Though it’s not a very complex notion, the idea of introspection of process and/or inefficiency is not a very appealing one. There is nervousness about looking inward to determine productivity in terms of cycle time, merely because the resulting corrective measures may be lengthy and unpleasant. Why rouse a sleeping dog?

Still, it is vital for a manufacturer to stay diligent regarding the symptoms of poor cycle time performance. These include poor quality of product, low throughput numbers, excessive inventory, large in-direct costs and/or non-value added activity, low on-time delivery percentages, and, or course, disgruntled customers. You might hear a lot of manufacturers lament that cost-cutting has produced its own range of cycle time problems. Indeed, how can you produce more, in less time, on-time, and with higher quality? In some instance and with some products, it simply cannot be done. In others, it’s up to the manufacturer to maintain a sense of value through balancing all of these customer demands while maintaining a high (though not unreasonable) level of them all.

In manufacturing, as in life, some of the most obvious things are also the hardest to see.

If direct-time efficiencies can be maximized, and in-direct time waste reduced, cycle times can, in fact, be shortened in equal measure. This is a good starting point for working toward the cost-cutting efforts most manufacturers need, while also passing along the resulting decreases in overhead along to the, now, happy customer—all while improving on-time delivery and without sacrificing quality.

This entry was posted on Monday, September 29th, 2008 at 9:00 am and is filed under Inventory, Labor and Payroll, Quality, Scheduling. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.