For any business that involves manufacturing, maximizing efficiency is critical in improving the business’s profitability and growth.
Manufacturing efficiency is achieved when the company successfully produces products with the lowest possible total costs and at the fastest possible time, and obviously, achieving it can be easier said than done.
In this article, we will learn all you need to know about how to improve manufacturing efficiency to maximise your business’s output while minimising your resource usage and losses.
Without further ado, let us begin.
OEE stands for Overall Equipment Effectiveness, and as the name suggests, it is a metric used by equipment-intensive organizations (i.e., manufacturing companies) to measure an equipment’s effectiveness in its operation across different aspects (hence “overall.”)
OEE is widely regarded as the gold standard for measuring productivity in manufacturing all around the world.
In a nutshell, OEE measures the percentage of operation/manufacturing time that is truly productive and successfully produces non-defective products. OEE is measured by taking into account three main elements: quality, performance, and availability.
In relation to OEE, the Six Big Losses offers a perspective on how a piece of equipment experiences a loss of production time.
Both OEE and Six Big Losses have their roots in Total Productive Maintenance, and one of the most important goals of TPM is to reduce and ultimately eliminate the Six Big Losses. Eliminating the Six Big Losses would translate into a major improvement in manufacturing efficiency.
Similar to OEE, Six Big Losses also addressed three core elements: Availability, Performance, and Quality:
Availability losses
Performance losses
Quality losses
Using OEE monitoring software and the Six Big Losses framework provides a clearer roadmap for businesses to improve their OEE score and, in turn, their manufacturing efficiency:
Below, we will have a more in-depth discussion on how businesses can address these losses to improve efficiency, starting with addressing quality losses.
In the efforts to reduce and ultimately eliminate availability losses, there are two main focuses: reducing equipment failure and minimizing planned stops.
Minimising Planned Stops
Planned Stops, also often called Setup and Adjustments, refer to any significant period of time in which a piece of equipment cannot operate during a Planned Production Time due to tooling adjustments, changeovers, setups, cleaning, quality inspections, and other planned reasons.
Changeover, also called setup, startup, or warmup, is typically the largest source of planned stop time.
An important foundation for reducing Planned Stops is to establish a clear and consistent policy, especially in how you measure Setup Time.
There are two basic ways to measure Setup Time, but it can vary depending on the nuances surrounding your unique manufacturing process:
Both approaches are perfectly fine, and as mentioned, you can use your own unique measurement depending on your needs. What’s important is to document this policy, make it available to your stakeholders, and implement it consistently.
Implementing SMED (Single-Minute Exchange of Die)
Another popular and effective method for reducing Planned Stops is to establish SMED.
Simply put, SMED is a system for dramatically reducing the time it takes to complete a Setup to less than 10 minutes (single-digit minutes, hence the name.)
It involves thoroughly dissecting and analyzing the Setup process into smaller elements to assess whether each element can be:
For example:
Using reason codes to address Unplanned Stops
Reducing the occurrence of Unplanned Stops due to equipment failure can be quite challenging in practice since each failure may have unique causes with unique nuances.
Thus, an important prerequisite when addressing these Unplanned Stops is to first identify the root cause of the issue and understand the nature of each issue.
One of the best approaches to do so is to leverage the use of Reason Codes, or also called Failure Codes, for example ARLK for air leaks, CALB for calibration-related issues, ADJS for equipment that currently requires adjustments, and so on.
By attributing each instance of an Unplanned Stop to a reason code, we can accurately apply Root Cause Analysis (RCA) and identify top causes.
Here are a few tips on using Reason Codes:
Evaluate regularly, and remove codes that aren’t regularly used.
The most important foundation in addressing and reducing performance loss is to accurately identify and understand your equipment’s Ideal Cycle Time.
The Ideal Cycle Time is the theoretical fastest cycle time that the manufacturing process can handle, assuming optimal circumstances.
It’s very important to measure your Ideal Cycle Time accurately, or else you may unknowingly mask loss production time, which can hurt your business’s productivity and effectiveness in general.
Once you’re sure that you’ve identified an accurate Ideal Cycle time, analyze your data and look for patterns of sudden performance losses. For example, if there’s an unusual number of Small Stops after any specific material change.
Apply Root Cause Analysis (RCA) or other analytics methods to identify the root cause of these losses so you can figure out the appropriate solutions.
In most cases, Performance loss scenarios can be addressed with the following solutions:
As discussed above, quality losses come in two forms: Production Rejects and Startup Rejects.
Most tools and machines require a startup or warmup period in which they haven’t yet reached an optimal production capability, so they typically have reduced yield during this period.
With that being said:
One of the most effective methods to reduce quality losses is to reduce variation (ensuring all manufacturing processes are as consistent as possible), especially in equipment configuration/setting and materials used.
It’s advised to establish and implement more precise equipment settings, if possible, on a part-by-part basis. Also, try to run material tests on different equipment to ensure consistency.
Reducing variation may also be effective in reducing/eliminating performance losses. for example, optimal and consistent equipment configuration may help reduce equipment failure.
Implementing SIC
Another popular and effective method for addressing quality losses is to implement SIC (Short Interval Control.)
Simply put, SIC is a method for dividing production shifts into smaller intervals of time, typically 2-4 hours each. The idea is that the shorter the interval is, the easier it will be to identify bottlenecks/issues and implement tighter controls to maximize productivity.
To maximize SIC implementation, plant-floor employees should leverage data to identify, plan, and implement improvement actions.
When implemented correctly, SIC can be very effective not only in reducing quality losses but also for all types of losses by shortening the time in which countermeasures to problems can be proposed and implemented.
All machines and tools, no matter how advanced and expensive, will always require maintenance so they can work at their most optimal levels. However, maintenance will also translate into downtime, which will contribute to lower ineffectiveness and inefficiencies in operations.
With that being said, finding the right balance between minimising downtime and performing maintenance before the equipment experiences failure can be very challenging in practice, and this is where establishing a comprehensive preventive maintenance program comes in.
The idea behind a preventive maintenance program is to schedule maintenance tasks based on the known schedule of wear (and failure) for a particular machine. This way, companies can perform maintenance on a specific tool before it’s necessary, but not so often that the maintenance causes too much downtime.
When planning a preventive maintenance program, companies can collect and analyse data regarding past failures, as well as consult the tool manufacturer on its known schedule of wear.
A key aspect of improving manufacturing efficiency is identifying areas for improvement in your current manufacturing workflow.
To do so, we can monitor and review three critical areas in your workflow: equipment, human resources, and processes:
Regularly monitor your workflow, and strive to continuously make data-driven improvements to your manufacturing workflow.
One of the key ways to improve Overall Equipment Efficiency (OEE)—and thus, manufacturing efficiency—is by ensuring a real-time and accurate collection of production data.
Even the most advanced manual data collection or, even worse, paper-based data will always involve inaccuracies and delays, so the company will be disadvantaged and delayed when it comes to making real-time decisions and solving problems. This delay and inaccuracy in data collection alone can significantly contribute to the ineffectiveness and inefficiencies of the manufacturing process.
Fortunately, integrating automated real-time data collection is now much easier and more affordable. LineView offers a comprehensive smart factory solution to automatically perform OEE and True Causal Loss analysis on each of your production lines, providing you access to real-time data for improvement.
In practice, collecting equipment and operator data in real-time can provide an immediate improvement to productivity, especially by quickly identifying any tools and machines that are currently performing at a suboptimal state.
One of the biggest contributing factors to manufacturing inefficiencies is excessive material waste, and here are some actionable tips on how to reduce it:
Even if you’ve optimized all other aspects of your manufacturing process, it will only be as efficient, productive, and effective as the weakest member of your team.
Don’t underestimate the importance of having strong human resources in improving your efficiency, and investing in real-world training remains the most effective method to improve your human resources.
The ideal scenario is when every team member has a clear grasp of their roles, their tasks, and how to execute the manufacturing workflow from start to finish as efficiently as possible, and regular training is the way to achieve this.
Different team members may have different approaches to executing tasks, but while they may have good intentions in doing so, how they do things may not be the most efficient.
Set clear and comprehensive policies to standardize every task from the simplest one to the most complex one so you can ensure efficiency.
Make sure to communicate your policies and checklists so that every employee on the shop floor can follow them. You’d be surprised how standardizing operations alone can be very effective in reducing downtime and improving performance while ensuring optimal product quality.
Don’t underestimate the role of your suppliers in helping you achieve manufacturing efficiency. Monitor and analyze each supplier. If a supplier constantly delivers: competitive costs, consistently high-quality materials, and so on, make sure to build good relationships with them and, if necessary, reward them by giving them more of your business.
To maximise efficiency, it’s also important to work with suppliers and vendors with responsive, high-quality customer service so you’ll be able to troubleshoot any issues related to them faster while minimising potential losses.
Another effective approach to improving manufacturing efficiency is to adopt cellular manufacturing.
Simply put, cellular manufacturing is a methodology in which similar processes are grouped together while dividing workspaces into ‘cells.’ Each cell is assigned a standardised set of tasks, so the human resources and equipment in each cell can focus on this single task or similar group of tasks rather than carrying out a wide variety of tasks (which can often lead to inefficiencies and errors. )
With the cellular manufacturing methodology, you are also required to view the manufacturing process as a series of separate steps, so monitoring and improving each cell will be a lot easier. This approach can also significantly help when it comes to reducing waste.
While achieving 100% manufacturing efficiency can be very challenging, by following the tips and strategies we have shared above, you should be able to gradually improve your efficiency, little by little, without sacrificing productivity.
In general, you can improve efficiency by reducing/eliminating waste, improving equipment effectiveness and efficiency (by improving OEE), optimising material yield, and improving labor efficiency. By focusing on these areas, you should be able to notice improvements in your overall efficiency.
Since improving manufacturing efficiency is a long-term game, it’s important to continuously monitor your progress and collect production data in real-time so you can more quickly and accurately make decisions and solve problems as you go, minimising downtime to ensure efficiency.