Monthly Archives: June 2015

Tribal knowledge is ascertained through years of hard work and experience. Most plants and manufacturing sites tend to have seasoned workers that have worked on most facility assets and have seen it all. You may think that their skill and experience is an advantage to you, but tribal knowledge can be a dubious thing. If you do not formally preserve their knowledge, it is possible that senior workers will retire without ever passing that information on to others. Additionally, it is important to keep in mind that tribal knowledge is not meant to be guarded and kept hidden, nor is it something to rely on independent of process documents. It is important to record all tips and techniques learned over years of experience into management system procedures, so that tribal knowledge can benefit the organization at large.

“11 million manufacturing workers employed in the U.S. are 55 years of age or older”

 Consult with your gurus and soak up the knowledge
Manufacturing Business and Technology explained that since most organizations employ field service people who have worked on all assets of their plant, these individuals tend to have valuable insight with regard to things like best practices, maintenance schedules, and production idiosyncrasies. Manufacturers should always talk with these information gurus and learn what they have to say. Leveraging their tribal knowledge, you can witness considerable improvements in operations and raise efficiency at your plant. Digabit mentioned that when management employs a bottom-up approach and listens to the ones on the frontlines, they are able to incorporate better and more effective processes into standard operational guidelines.

Tribal Knowledge

Proper documentation can preserve tribal knowledge
According to Digabit, one of the best ways to make tribal knowledge work for you is to document everything and compile valuable information into management operating systems. Maintaining one central repository of information takes tribal knowledge out of the hands of a select few and makes it available across an organization. After consulting these industry veterans, the information learned should be reflected in process documents, training materials, and safety manuals. By doing this, a facility will increase opportunities for talent sharing and guarantee knowledge is transferred, whether there is high employee turnover or not.

Continually train staff to avoid organizational ‘brain drain’
Manufacturing Business and Technology pointed out that, according to some experts, 25% of the 11 million manufacturing workers employed in the U.S. are 55 years of age or older. For most organizations this means that regardless of high turnover, at some point, if they do not preserve the knowledge of senior workers, they are likely to experience a significant ‘brain drain’ when these people retire. Digabit advised manufacturers to make training of new hires a serious and dedicated commitment. By incorporating regular training sessions into plant schedules, organizations can insure themselves against losing tribal knowledge. Keeping tribal knowledge alive in an organization contributes to innovation and fosters competitiveness. Even the most seemingly insignificant details can pay off in the future and raise efficiency at your plant.

Ultimately, tribal knowledge alone does not make a good plant. However, leveraging the skill and experience of seasoned workers at your plant, management will be able to encourage a culture of learning, improve production processes, and make sure that new hires are always trained with the best practices. The best knowledge is the type that is tested and tried at your facility.

All manufacturers invariably understand the importance of keeping changeover time to a minimum, as increased downtime means a drop in productivity, and ultimately, revenue. To effectively lower changeover time, they must first be measured accurately. According to Lean Production, one standard calculation that manufacturers can apply across multiple assets is to measure changeover time from the creation of the last good product in the current run to the first good product in the next production run. This article explains one popular methodology for promoting faster changeovers – SMED – and provides 4 suggestions manufacturers should consider when aiming to limit downtime.

The basics of improving changeover times
Lean Production noted that improving changeover times is typically done through standardizing processes, maintaining up-to-date information on equipment settings, and keeping track of real-time metrics. Successful manufacturers will facilitate work in these areas through automation, but will not attempt to use automation alone to reduce times. Plant managers must update processes, establish plans, and adhere to efficient schedules before they can expect an investment in new technology to yield the desired results.

When standardizing processes, plant managers should focus on human improvements. This involves defining roles and establishing accountability. If necessary, manufacturers should coach their teams on the best ways to do their jobs. Regardless of position, operators and technicians must follow processes as they are laid out. Doing so will mean retrieving parts before the changeover time begins, regularly marking down equipment settings, and eliminating idle time. On the technical side, installing quick release mechanisms and modularizing equipment can also prove beneficial.

“Plant managers should focus on human improvements.”

changeover time

Single Minute Exchange of Dies
It is important to point out that changeover time can vary drastically from one industry to another. Packagers may only spend a few minutes doing a changeover, whereas automobile manufacturers could spend days or weeks adjusting equipment for new models. However, regardless of industry, keeping downtime to a minimum is essential. A LEAN Journey mentioned that one technique for reducing changeover time is Single Minute Exchange of Dies, or SMED, which enables manufacturers to perform more frequent changeovers. This approach is based on managing production in a more flexible manner, allowing for smaller batch sizes, while still maintaining high output.

Lean Production explained how SMED can help manufacturers achieve a significant reduction in changeover time. The methodology is based on separating the changeover process into a series of sequenced events called ‘elements.’ The main goal is to manage as many elements as possible while the equipment is still running, thereby lessening downtime indirectly. SMED takes elements that are not involved in the current production run, moves them externally to the process, and streamlines their use by completing them faster. For example, if a smaller piece of equipment must be calibrated before it fits into a larger framework as part of changeover, the smaller piece ought to be managed independently of the process. SMED is particularly helpful in an iterative process.

Smart manufacturers understand that automation alone does not raise efficiency

Actionable items for faster changeovers
Whether using SMED or focusing on faster changeovers, the approach is the same. As previously mentioned, successfully reducing changeover time comes down to thinking, not tinkering. Accordingly, here are four suggestions to help you reduce your changeover times:

  1. Separate internal and external setup activities
    If you have certain processes that can be performed without having to shut down equipment, do them while production is still active. This will limit the amount of downtime you accrue.
  2. Laterally remove idle time from equipment and workers’ schedules
    Some manufacturers believe that machines can be idle as long as workers are still doing their job, but the best way to raise efficiency is to maximize productivity across the board. Equipment does not need to be offline as long as you may think.
  3. Maintain fully stocked staging areas with all necessary parts and tools
    You can rely on a Kanban system of inventory management, or keep track of parts using other methods, but make sure workers have the necessary tools at the right times. Not doing so results in more time spent wandering around, and less time on value-added activities.
  4. Maintain a schedule of changeover times and continue to beat your record
    You can display changeover times near plant equipment so that staff is always kept aware of operational goals. The only way to know if changeover times are reduced is to continually measure them over time.

Reliable Plant mentioned that improving changeover times will likely lead to the establishment and documentation of new work processes. As such, operators will have to be trained in best practices on an ongoing basis. However, as an organization becomes more efficient after each improvement, eventually it will achieve a lean manufacturing environment. The road toward efficiency and reduced changeover time can be painful at times, but it will most certainly pay off in the long run.

Have you ever sent someone to the grocery store with a list of items to buy along with the money necessary, then had them return home after spending more than you gave them/budgeted? And that they bought flank steak instead of ground beef and both hard and soft shells for your taco dinner?

When asked why they bought and spent what they did, the answer is something like this:

“Your list just said taco shells, so I didn’t know what kind to get (brand or texture) and I prefer to use flank steak when I make tacos as its quality and taste are significantly better than ground beef.”

Essentially, there wasn’t a clearly defined spec that someone other than you could follow when shopping and there wasn’t alignment between you and the shopper on the recipe or quality that was to be followed in preparing the meal, therefore there was no cost management. The net result of these disconnects: an increase in cost and probably longer cooking (processing) time.

The household example above is simplistic and didn’t break the bank or result in dinner being on the table too much later than originally planned, but when similar situations happen in business the impacts can be far greater and include: significant cost overruns and reduced profitability, missed available to ship dates, and angst between functional areas and/or a company and its suppliers, thus the importance of cost management and a well-defined spec.

cost management
Proper Use of Cost Management Principles Can Prevent Costly Budget Overruns

We recently encountered a situation with one of our Spend Management clients where there were significant disconnects between functional areas as to the scope of work and specifications that a supplier was working to. The result was a major change in cost from the supplier ($10,000 – $15,000 per production unit) which when combined with budgeted internal expenses, ended up creating a negative impact on margin. To make matters worse, the supplier was still not covering costs with what they were invoicing and decided that each unit they would handle would need to be quoted separately. The cost overrun on the next production unit was expected to be close to $25,000 further impacting margin in the wrong direction.

How did these disconnects occur?

For starters, the initial spec that the supplier bid on was not complete. The client’s Purchasing Organization developed a spec that was used in the bid process without involving other functional areas to make sure that the entire scope was captured and ultimately aligned with internal quality end customer expectations. Since then, things have spiraled out of control with three things driving the cost increase:

  1. Other functional areas that interfaced with the supplier pushed work from the internal manufacturing process down to the supplier which has a cost impact on the supplier and in turn on our client.
  2. When quality issues arose, the Quality Control group didn’t work with Purchasing to provide timely feedback to the supplier and work to understand the root cause of the problem so corrective action could be taken. Instead, they developed a tighter quality inspection specification which they provided directly to the supplier without consideration for the impact on cost. Furthermore, they didn’t communicate the new spec to Purchasing.
  3. Sales didn’t understand the spec that work was being performed to and therefore wasn’t appropriately managing the end customer acceptance process. They also weren’t appropriately pricing what they were selling based on COGS.

The new, even higher quote triggered a lot of anger, frustration, and concern throughout our client’s organization and a request to solve the problem immediately. Likewise, the supplier was very frustrated which was evident in conversations with them as we sought to understand and solve the problem.

When the quotes came back, our supplier had sharpened their pencil overall. (Win #1) We then presented the quotes to Quality and Sales and asked them to make the final decision as to what the inspection criteria would be since this drove the difference in cost between the quotes. Quality deferred to Sales. (Win #2 as Sales has to manage the customer, not our internal Quality Group.) Sales decided to go with the lower cost option and agreed that they would manage the end customer to the correlating inspection criteria or charge more for a tighter spec. (Win #3) Lastly we gained alignment internally and externally that all direction to the supplier would flow through purchasing and that the supplier was not to take direction from any other member of the organization. (Win #4)

After gaining an understanding of the situation through conversations with the supplier and numerous people in the client organization, we pulled together a cross functional team of people (the users) to review the current scope of work and inspection guidelines, make adjustments, and ultimately develop a comprehensive scope of work agreed to by all involved internal parties that could be provided to the supplier for a revised quote. We also asked for quotes on several inspection options so the cost vs. quality trade-off could be weighed appropriately. Lastly, we explained the margin situation to the supplier and asked them to sharpen their pencil as much as possible on this quote while we worked to develop a new bid package for them to respond to.

KEY TAKEAWAY: Everything starts with the specification development process. Without the input of a cross functional team, there is high risk of missing parts of the specification/scope of work leading to unrealistic cost expectations and the potential for frustration and poor supplier relations. Furthermore, if the cost isn’t right, you can’t develop the right selling price and present options to customers that maintain margin.

You should care about your online reputation, as it can overshadow the reputation you try to build in person. Anymore, if you’re scheduled to meet someone for the first time for professional reasons, they have probably looked you up online before you walk in and shake their hand. And honestly, you probably did the same to them.

Like it or not, everyone can be found online. Even if you keep it simple and don’t actively participate in any online communities, chances are there is still a decent amount of information about you available for anyone to find. Whether you’re job hunting, meeting a new client, or are simply networking with other business professionals, you should do your best control what other people uncover about you and be aware of how your online presence can impact your real-world experiences.

While you may believe your Facebook, Instagram, Twitter, and other various online profiles are personal and completely separate from your LinkedIn profile, think again. Just because you only post “professional” content on your LinkedIn, doesn’t mean everything else you post everywhere else online has suddenly vanished and your connections won’t see it.

Take a minute right now to search yourself online (just type your name into Google and see what comes up). What did you find? Is your online persona reflective of how you want to be seen professionally? Were the majority of the results actually about you or other people who share your name?

If the results were less than favorable, maybe it’s time to reassess your online activities. I’m not saying you should delete all of your social profiles, but you should take extra care of the privacy settings, be mindful of your friends/followers/connections, and think before you post. You can’t control what is online about other people with your name, but you can control what you put online.

If your Facebook is full of personal content (status updates, pictures, videos, comments, etc.), don’t “friend” your colleagues or clients. Your vacation pictures may be fine for your friends/family to scroll through and comment on, but you may not want upper-management seeing your pictures and the comments.

When your friends reminisce on Thursdays by posting college photos to Instagram and tag you in them, #tbt doesn’t justify your questionable behavior or clothing choices to your new clients, especially if college wasn’t that long ago. Keep track of what you tag and are tagged in, and know who is able to see those pictures.

Tweeting about your long work week, how much you dislike new company policies, or how incompetent your superiors are may be your way of letting off a little steam, but your current employer and potential future employers will not look favorably on those kinds of comments.

By actively cultivating a positive online presence, you can shape what other people discover and the impacts of those discoveries. It’s never too early or too late to take your online presence seriously. Our lives become more public every day, so getting ahead of it and putting your best self forward will prove beneficial in the future.