Category: Availability

Strategies affecting availability include Preventive Maintenance, Tooling / Process Maintenance, SMED, Reducing Changeover Time, Labour Management.

OEE in an imperfect world

A selection of Normal Distribution Probability...
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Background: This is a more general presentation of “Variation:  OEE’s Silent Partner” published on January 31, 2011.

In a perfect world we can produce quality parts at rate, on time, every time.  In reality, however, all aspects of our processes are subject to variation that affects each factor of Overall Equipment Effectiveness:  Availability, Performance, and Quality.

Our ability to effectively implement Preventive Maintenance programs and Quality Management Systems is reflected in our ability to control and improve our processes, eliminate or reduce variation, and increase throughput.

The Variance Factor

Every process and measurement is subject to variation and error.  It is only reasonable to expect metrics such as Overall Equipment Effectiveness and Labour Efficiency will also exhibit variance.  The normal distribution for four (4) different data sets are represented by the graphic that accompanies this post.  You will note that the average for 3 of the curves (Blue, Red, and Yellow) is common (u = 0) and the shapes of the curves are radically different.  The green curve shows a normal distribution that is shifted to the left, the average (u) is -2, although we can see that the standard deviation for this distribution is better than that of the yellow and red curves.

The graphic also allows us to see the relationship between the Standard Deviation and the shape of curve.  As the Standard Deviation increases, the height decreases and the width increases.  From these simple representations, we can see that our objective is to reduce to the standard deviation.  The only way to do this is to reduce or eliminate variation in our processes.

We can use a variety of statistical measurements to help us determine or describe the amount of variation we may expect to see.  Although we are not expected to become experts in statistics, most of us should already be familiar with the normal distribution or “bell curve” and terms such as Average, Range, Standard Deviation, Variance, Skewness, and Kurtosis.  In the absence of an actual graphic, these terms help us to picture what the distribution of data may look like in our mind’s eye.

Run Time Data

The simplest common denominator and readily available measurement for production is the quantity of good parts produced.  Many companies have real-time displays that show quantity produced and in some cases go so far as to display Overall Equipment Effectiveness (OEE) and it’s factors – Availability, Performance, and Quality.  While the expense of live streaming data displays can be difficult to justify, there is no reason to abandon the intent that such systems bring to the shop floor.   Equivalent means of reporting can be achieved using “whiteboards” or other forms of data collection.

I am concerned with any system that is based solely on cumulative shift or run data that does not include run time history.  As such, an often overlooked opportunity for improvement is the lack of stability in productivity or throughput over the course of the run.  Systems with run time data allow us to identify production patterns, significant swings in throughput, and to correlate this data with down time history.  This production story board allows us to analyze sources of instability, identify root causes, and implement timely and effective corrective actions.  For processes where throughput is highly unstable, I recommend a direct hands-on review on the shop floor in lieu of post production data analysis.

Overall Equipment Effectiveness

Overall Equipment Effectiveness and the factors Availability, Performance, and Quality do not adequately or fully describe the capability of the production process.  Reporting on the change in standard deviation as well as OEE provides a more meaningful understanding of the process  and its inherent capability.

Improved capability also improves our ability to predict process throughput.  Your materials / production control team will certainly appreciate any improvements to stabilize process throughput as we strive to be more responsive to customer demand and reduce inventories.

Until Next Time – STAY lean!

Vergence Analytics

Twitter:  @Versalytics

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OEE: The Means to an End – Differentiation Where It Matters Most

A pit stop at the Autrodomo Nazionale of Monza...
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Does your organization focus on results or the means to achieve them?  Do you know when you’re having a good day?  Are your processes improving?

The reality is that too many opportunities are missed by simply focusing on results alone.  As we have discussed in many of our posts on problem solving and continuous improvement, the actions you take now will determine the results you achieve today and in the future. Focus on the means of making the product and the results are sure to follow.

Does it not make sense to measure the progress of actions and events in real-time that will affect the end result? Would it not make more sense to monitor our processes similar to the way we use Statistical Process Control techniques to measure current quality levels?  Is it possible to establish certain “conditions” that are indicative of success or failure at prescribed intervals as opposed to waiting for the run to finish?

By way of analogy, consider a team competing in a championship race.  While the objective is to win the race, we can be certain that each lap is timed to the fraction of a second and each pit stop is scrutinized for opportunities to reduce time off the track.  We can also be sure that fine tuning of the process and other small corrections are being made as the race progresses.  If performed correctly and faster than the competition, the actions taken will ultimately lead to victory.

Similarly, does it not make sense to monitor OEE in realtime? If it is not possible or feasible to monitor OEE itself , is it possible to measure the components – Availability, Performance, and Quality – in real-time?  I would suggest that we can.

Performance metrics may include production and quality targets based on lapsed production time. If the targets are hit at the prescribed intervals, then the desired OEE should also be realized.  If certain targets are missed, an escalation process can be initiated to involve the appropriate levels of support to immediately and effectively resolve the concerns.

A higher reporting frequency or shorter time interval provides the opportunity to make smaller (minor) corrections in real-time and to capture relevant information for events that negatively affect OEE.

Improving OEE in real-time requires a skilled team that is capable of trouble shooting and solving problems in real-time. So, resolving concerns and making effective corrective actions in real-time is as important to improving OEE than the data collection process itself.

A lot of time, energy, and resources are expended to collect and analyze data. Unfortunately, when the result is finalized, the opportunity to change it is lost to history.  The absence of event-driven data collection and after the fact analysis leads to greater speculation regarding the events that “may have” occurred versus those events that actually did.

Clearly, an end of run pathology is more meaningful when the data supporting the run represents the events as they are recorded in real-time when they actually occurred.  This data affords a greater opportunity to dissect the events themselves and delve into a deeper analysis that may yield opportunities for long-term improvements.

Set yourself apart from the competition.  Focus on the process while it is running and make improvements in real-time.  The results will speak for themselves.

Your feedback matters

If you have any comments, questions, or topics you would like us to address, please feel free to leave your comment in the space below or email us at feedback@leanexecution.ca or feedback@versalytics.com.  We look forward to hearing from you and thank you for visiting.

Until Next Time – STAY lean

Versalytics Analytics
 

OEE: Planned Downtime and Availability

Injection Molding Press
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As a core metric, Overall Equipment Effectiveness or OEE has been adopted by many companies to improve operations and optimize the capacity of existing equipment.  Having completed several on site assessments over the past few months we have learned that almost all organizations are measuring performance and quality in real-time, however, the availability component of OEE is still a mystery and often misunderstood – specifically with regard to Set Up or Tool Changes.

We encourage you to review the detailed discussion of down time in our original posts “Calculating OEE – The Real OEE Formula With Examples” and “OEE, Down time, and TEEP” where we also present methods to calculate both OEE and TEEP.  The formula for Overall Equipment Effectiveness is simply stated as the product of three (3) elements:  Availability, Performance, and Quality.  Of these elements, availability presents the greatest opportunity for improvement.  This is certainly true for processes such as metal stamping, tube forming, and injection molding, to name a few, where tool changes are required to switch from one product or process to another.

Switch Time

Set up or change over time is defined as the amount of time required to change over the process from the last part produced to the first good part off the next process.  We have learned that confusion exists as to whether this is actually planned down time as it is an event that is known to occur and is absolutely required if we are going to make more than one product in a given machine.

Planned down time is not included in the Availability calculation.  As such, if change over time is considered as a planned event, the perceived availability would inherently improve as it would be excluded from the calculation.  Of course, the higher availability is just an illusion as the lost time was still incurred and the machine was not available to run production.

If we could change a process at the flip of a switch, set up time would be a non-issue and we could spend our time focusing on other improvement initiatives.  While some processes do require extensive change over time, there is always room for improvements.  This is best exemplified by the metal stamping industry where die changes literally went from Hours to Minutes.

To remain competitive and to increase the available capacity, many companies quickly adopted SMED (Single Minute Exchange of Dies) initiatives after recognizing that significant production capacity is being lost due to extensive change over times.  Overtime through extended shifts and capital for new equipment is also reduced as capacity utilization improves.

Significantly reduced inventories can also be realized as product change overs become less of a concern and also provide greater flexibility to accommodate changes in customer demand in real-time.  Significantly increased Inventory Turns will also be realized in conjunction with net available cash from operations.

Redefining Down Time

The return on investment for Quick Tool Change technologies is relatively short and the benefits are real and tangible as demonstrated through the metrics mentioned above.  Rather than attempt to categorize down time as either planned or unplanned, consider whether the activity being performed is impeding the normal production process or can be considered as an activity required for continuing production.

We prefer to classify down time as either direct or indirect.  Any down time such as Set Up, Material Changes, Equipment Breakdowns, Tooling Adjustments, or other activity that impedes production is considered DIRECT down time.  Indirect down time applies to events such as Preventive Maintenance, Company Meetings, or Scheduled IDLE Time.  These events are indeed PLANNED events where the machine or process is NOT scheduled to run.

Redefine the Objective

Set up or change over time is often the subject of much heated debate and tends to create more discussion than is necessary.  The reason for this is simple.  Corporate objectives are driven by metrics that measure performance to achieve a specific goal.

Unfortunately, in the latter case, the objectives are translated into personal performance concerns for those involved in the improvement process.  Rather than making real improvements, the tendency is to rationalize the current performance levels and to look for ways to revise the definition that creates the perception of poor performance. Since availability does not include planned down time, many attempts are made to exclude certain down time events, such as set up time, to create a better OEE result than was actually achieved.

Attempts to rationalize poor performance inhibits our ability to identify opportunities for improvement.  From a similar perspective, we should also be prudent with. and cognizant of, the time allotted for “planned” events.

It is for this reason that some companies have resorted to measuring TEEP based on a 24 hour day.  In many respects, TEEP eliminates all uncertainty with regard to availability since you are measured on the ability to produce a quality part at rate.  As such, our mission is simple – “To Safely Produce a Quality Part At Rate, Delivered On Time and In Full”.  Any activity that detracts from achieving or exceeding this mission is waste.

Remember to get your OEE spreadsheets at no charge from our Free Downloads Page or Free Downloads Box in the sidebar.  They can be easily and readily customized for your specific process or application.

Please feel free to send your comments, suggestions, or questions to Support@VergenceAnalytics.com

Until Next Time – STAY lean!

Vergence AnalyticsVergence Analytics

Flawless Execution – “This Is It” – Practice Makes Perfect

We are often encouraged to look beyond our own business models to expand our horizons or to simply gain a different perspective.  Music is one of my personal areas of interest in the outside world and I have learned to appreciate and value the many genres of music that exist today.  As a lead guitar player for a number of bands over the years and a little recording in my studio, I can only imagine the level of commitment required to perform and record professionally.

I was inspired to write this post after watching Michael Jackson’s DVD, “This is it“.  It is impressive to see how everyone is engaged and intimately involved with every nuance of the performance – from the performers themselves to the people working behind the scenes.  Even more amazing was Michael Jackson’s recall of every note and step of the choreography.  Michael provided extensive direction and leadership to assure a world-class performance could be delivered.

What does this have to do with Lean?

At its core, playing music can simply be described as playing the right notes at the right time.  In many respects, music is analogous to many of our manufacturing processes.  Music has a known process rate (beats per minute).  The standardized work or method is the music score that shows what notes to play and when to play them.  Similarly, the choreography serves as standardized work to document each and every step or movement for each performer.  It can be very obvious (and painful) when someone plays the wrong note, sounds a note at the wrong time, or mis-steps.

Knowing that “This is it” was produced from film during the development of the production also exemplifies how video can be used to not only capture the moment but to improve the process along the way.  The film provides the opportunity to review the performance objectively even if you happen to be in it.  You will note that people are much more engaged and become “self-aware” in a radically different way.

Communication + Practice makes Perfect

It is also readily apparent that many hours of rehearsal are required to produce a world-class performance.  Imagine working for days, weeks, months, or even years to produce a two-hour show for all of the world to see.  How much can one person do to refine and perfect the performance?  How much effort would you be willing to expend knowing that literally billions of people may someday be watching you!

As professionals, individual performers are expected to know their respective roles thoroughly.  They are paid for their expertise and ability to perform with high expectations and demanding circumstances.  The purpose of the rehearsal is not to necessarily practice your part as an individual, but rather to exercise your expertise as part of the team.  Each performer must learn their cues from other performers and determine how they relate and fit in to the overall production process.  Rehearsals provide the basis of the team’s communication strategy to assure everyone is on the same page all the time, every time.

Effective Training

Finally, “This is it” demonstrates the importance of training the whole team.  Although individual training may be required, eventually the team must be brought together in its entirety.  A downfall of many business training programs is that often only a select few people from various departments are permitted to attend with the expectation that they will bring what they learned “back to the team”.  One of the most overlooked elements of training is the communication and coordination of activities between team members.  Group breakout sessions attempt to improve interaction among team members, but this can’t replace the reality of working with the team on home turf.  It seems that some companies expect trained professionals to intuitively know how to communicate and interact with each other.  Nothing could be further from the truth if you are looking to develop a high performance team.

Last Words

Imagine what it would be like if we rehearsed our process and material changes with the same persistence and raw determination that performers and athletes in the entertainment and sports world exhibit.  Overall Equipment Efficiency and more specifically Availability may improve beyond our expectations.  Imagine applying the same degree of standardization to tasks that we perform everyday!  As we strive for excellence, our tolerance for anything less diminishes as well.

Flawless execution requires comprehensive planning, communication, training, practice, measurement, reflection, leadership, commitment, and dedication.

It’s time to play some riffs!

Until Next Time – STAY lean!

Contingency Planning For Lean Operations (II)

Contingency Planning For Lean Operations – Part II

Putting together a contingency plan can be quite challenging when you consider all the things that could go wrong at any given point in time.  Contingency plans should not only be restricted to “things gone wrong” and are not limited to operations or process specific events.  All aspects of an operation are prone to risk.  As such, contingency planning must be an enterprise wide activity.

Failing to understand and assess the risks that may impact your operation is a recipe for future failure.  If you fail to plan then plan to fail.  The same is true for contingency plans.  Effective risk management and contingency planning are critical to minimize or eliminate the effects of failure.

Natural disasters (like we’ve never seen before) continue to plague us without prediction.  Yet, we are able to respond immediately and effectively.  If you get hurt or injured, someone is there to help you simply by dialing 911.  Emergency units are ever present and available to respond.

Unfortunately the same is not necessarily true for business.  The recent turn in the economy caused financial markets to tumble and decimated corporations on every scale.  Millions of people are affected by the fallout.  The government “loans” were not crafted after the event.  Did contingency plans exist to even consider this level of change in the economy?

Although history may be the best predictor of future events, it is not exclusive or exhaustive to predicting unforeseen future events.  Even if history did provide a glimpse of potential future failures, we may simply choose to ignore the probability of recurrence – this isn’t the first time the financial markets have crashed, yet we can’t seem to determine or understand what key indicators existed that could have prevented this current situation.

Certainly new variables are introduced as technologies continue to evolve and become more integral in our operations.

In Part I of this series we suggested that contingency plans should be prepared to address potential labour challenges and more specifically availability.  Certainly, the recent concerns regarding the H1N1 virus have heightened attention with respect to labour shortages.

  • Inclement Weather – Immediate effects of Snow Storm, Hurricane, Heavy Rain, Tornado.
    • Other considerations include:
      • Duration
      • Seasons
      • Cumulative Severity
      • Delayed Effects (flooding)
      • Property Damage.
  • Accident / Injury:  Personal versus Workplace
    • Long Term
    • Short term
    • Considerations to reduce or minimize impact to operations:
      • Early Return To Work
      • Modified Duty
      • Restricted Duty
      • Reduced Hours
  • Illness (Personal / Family / Extended Family)
    • Short Term
      • (Flu, Cold)
      • Emergency
    • Long Term
      • Surgical Care
      • Chronic Care
  • Sudden Premature Death
  • Parental Leave (Maternity Leave)
  • Bereavement – Immediate Family, Out of Country
  • Retirement / Attrition
  • Training
    • Onsite vs Offsite
    • Duration
  • Meetings – Department
    • Company Wide
    • On Site
    • Customer Site
  • Quality Disruption
    • Containment Activity
      • Sorting
      • Rework
  • Travel
  • Vacation Allowance / Timing
    • Customer Driven
    • Company Mandated
    • Personal Choice
    • Season
    • Duration
      • New Hires – Zero Weeks
      • Senior Employees – Per “X” Years of Service
  • Holidays
  • Absenteeism (Culpable)
  • Layoff and Recall
    • Short Term
    • Long Term
  • Supply Chain Disruptions – Raw Material or Part Supply
  • Planned Shutdown / Start Up Events – Holidays
  • Leave of Absence – Short Term / Long Term
  • Facilities
    • Loss of Utilities:  Water, Electricity
    • Fire, Suspended Services
    • Parking Availability
    • Locker Space
  • Equipment – Breakdown / Malfunction (Major)
  • Tooling – Breakdown  / Malfunction (Major)
  • Skill Levels Required – Non-Skilled, Semi-Skilled, and Skilled Labour
  •  Union – Strike
  • Customer Decreases
    • Shutdown (Reduced Volume)
    • Slow Down (Reduced Volume)
    • Reduced Work Week (4 vs. 5 days)
    • Shutdown (Planned)
  • Customer Increases:
    • Volume
    • Extended Work Days (Daily Overtime)
    • Extended Work Week (Saturday)

There are likely more areas of concern that may impact your labour pool, however, this does serve as a starting point.  Do all of the above elements require a contingency plan?  Not necessarily.  We still contend that it is good practice to document all potential concerns.  It is easier to add a note to document the reason for exclusion from the contingency plan by stating:

  • The following elements were discussed during the preparation of this plan, however, specific contingency plans were not considered necessary at the time of review:
    • Training – Scheduled Activity
    • Culpable Absenteeism – Progressive Discipline Program
    • Add Elements to the List as applicable

This latter task may seem somewhat trivial, but consider who else may be reading the report.  Defining the scope of the contingency plan and adding a list of exclusions supported with reason(s) clarifies any ommissions from the core plan, will minimize the time required for review, and eliminates any assumptions regarding unintended ommisions.

Our next post will address the elements to be considered when developing a contingency plan.

Until Next Time – STAY Lean!

Contingency Planning For Lean Operations – Part I

Contingency Planning For Lean Operations – Part I

Lean operations are driven by effective planning and efficient execution of core activities to ensure optimal performance is achieved and sustained.  The very nature of lean requires extreme attention to detail through all phases of planning and execution.  Upstream operations simply cannot tolerate any disruptions in product supply or process flow without the risk of incurring significant downtime costs or other related losses.

Effective risk management methods, contingency plans, and loss prevention strategy are critical components of successful operations management in a lean operation.  Risk management and preventing disruptions is the subject of contingency planning and requires the participation of all team members.

Successful contingency planning assures the establishment of an effective communication strategy and identification of core activities and actions required.  Contingency plans may require alternative methods, processes, systems, sources, or services and must be verified, validated, and tested prior to implementation.

Understanding and assessing the potential risks to your operation is the basis for contingency planning with the objective to minimize or eliminate potential losses.

Inventory represents the most basic form of contingency planning.  Safety stock or buffer inventories are typically used to minimize the effects of equipment downtime or disruptions in the supply chain. 

The levels of inventory to maintain are dependent on a number factors including Lead Time, Value, Carrying Cost, Transit Time (Distance), Shelf Life, Minimum Order Quantities, Payment Terms, and Obsolescence.

Why is this relevant?

Material and Labour represent two key resources that may be influenced by external factors that are beyond the control of any company policy or practice.  Internally controlled or managed resources such facilities, equipment, and tooling are less susceptible to unknown elements.  For the purposes of this discussion, we will examine Labour in a little more detail.

The H1N1 virus, originally known as the Swine Flu, is the latest potential health pandemic since the outbreak of SARS only a few years ago.  The government has been struggling to organize mass immunization clinics and to engage the media to aid in the cause.  In the meantime, the potential impact of the H1N1 virus on your operation remains to be an unknown. 

Experts have commented to the media that the lessons from the SARS outbreak have still not been learned.  One would expect that past practices would have already been adopted into new best practices from our experiences with other similar events in our history.

Government agencies at all levels (Federal, Provincial, and local) have mismanaged the activities required to procure and distribute the vaccine, and failed to provide an effective communication and immunization strategy to ensure the risk to public health was minimized and the at the very least understood.

The lack of coordination and accountability for the success or failure of the communication strategy, procurement and distribution of the vaccine, and other related activities are strong indicators that the planning process did not consider the infrastructure requirements and relationships needed between levels of government.

The lack of an effective communication strategy introduced confusion and speculation in the media and the general public.  Mass education only seemed to become more aggressive as incidents of severe H1N1 complications and related deaths were reported in the media.

If this really was a pandemic event, many operations today would (and may still) be adversely affected due to direct or indirect (supply chain) labour shortages.  Do you have contingency plans in place to address this concern?

It could be argued that “if we are affected to this extent, then our customers will be as well.”  This is not necessarily true unless your customers and / or suppliers are located in the same immediate area or region of your business.

People travel all the time, whether they are commuting to work from out-of-town or traveling to or arriving from a foreign country on business.  The source of exposure is beyond your immediate control. 

What other elements can directly impact labour?  We will explore some of these in our next post.  In the meantime, keep your hands washed and remember to cough into your sleeve.

Until Next Time – STAY Lean!

Unexpected and Appreciated – Uncommon Courtesy:  This morning, a person cut into the drive through lane ahead of us – not realizing the gap in the line was there for thru traffic.  Recognizing the error in drive through etiquette and to make amends, we were pleasantly surprised by the “free” coffee at the pick up window.  Thank you ladies!

Going DEEP with OEE

Does anyone actually look at their daily equipment availability? Instead of using TEEP that is typically based on calendarized availability, looking at the Daily Equipment Effectiveness Performance of your operation may provide some interesting insights.

Working overtime due to material or equipment availability occurs many times.  Unfortunately, we find that sometimes these very same machines are idle during the week.

A detailed explanation for calculating DEEP can be found in one of our earlier posts, “OEE, Downtime, and TEEP.”  Understanding machine utilization patterns may provide greater insight into the actual versus planned operating pattern of your process.

Just something to invoke some thoughts for your operation and to perhaps identify another opportunity to improve performance.

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Until Next Time – STAY Lean!