What is more important? Throughput or Efficiency?
Author – Tim Smith
In many regards there are two camps in every manufacturing enterprise; The first is the “Throughput Camp”. This camp is made up of operations and production personnel focused on getting product out the door by the delivery deadlines. They are driven by targets and are granular down to the shift level. The orchestration of the shop floor is to balance priorities, deadlines, resources and operations to best meet the commitments of the enterprise to it’s customers.
The other camp is the “Efficiency Camp” manned by Quality, Maintenance, and Manufacturing Engineers, Lean Black Belts and Continuous Improvement Specialists, all working towards improvements to process and product.
The demand to keep operations running and product moving through the plant has been the focus of management for decades. From an accounting perspective, reduce costs, defray expenses, but do not impact throughput. Outsource whatever operation reduces costs and pushes quality and delivery responsibilities and challenges into some one else’s hands. But, as attrition eats away at experienced personnel and labor markets dry up, the ability to leverage such experience, let alone capture it, is a failing endeavor. Management has been working hard to open the silos of wisdom through any number of methods, from consultative engagements, to human resource projects for transferring of knowledge to employing technology to mitigate much of the work.
Efficiency improvements historically are labor intensive and painfully iterative. employing the tools of the trade work well in the lab or classroom, but move them into the daily shop activity will, by their very nature negatively impact the process that is targeted for improvement. Interruptions to the throughput of the floor are unacceptable in most cases and such improvement projects are relegated to areas less critical, which defeats the purpose. One manufacturer spent four years trying to collect and validate enough data on a single-piece flow line to prove a hypothesis they instinctively already knew had an irreconcilable constraint. This delay was as much the fault of the inability to interrupt the throughput on a 7/24 line as was the inability of the CI team to extract data that was not already compromised.
The ability for both the operations and the support engineering to work together tends to be a rocky marriage from the start, with neither side wanting to compromise their position. The difference in philosophy is that production is target oriented whereas engineering is goal oriented. Let me liken the two to a family road trip where dad wants to get to the planned location with as little interruption as possible but mom wants the kids (and dad) to experience the trip, looking towards a happy family experience. So, though the target is paramount, improving the overall process yields long term benefits designed to drive more throughput. The goal of base-lining the processes and mitigating the constraints and measuring the results and employing the changes which mitigate, minimize, eliminate, or move a constraint requires time and that means interruption to throughput. Throughput myopia restricts access to processes which require attention. Running a process without due maintenance is a recipe for disaster and producing bad parts is counter productive. Production has no time to waste and engineering requires time to perform the tasks to reduce the non-productive time to improve the throughput. In most cases you end up with a facility where one group or the other rules and the lesser group can never achieve their mandate. The introduction of Data Driven Manufacturing is the key to providing what both parties require, time. With a system that monitors the process and reports on the throughput the resulting data equips the CI engineers with a means to hypothesize improvements without interruptions to the floor. The ability for production management to monitor the floor means that they begin to see where the constraints are impacting the throughput and are much more acceptable in providing key windows of time to the engineers to employ improvement recommendations. The results are an iterative series of improvements stepping up throughput while introducing better quality, better maintained equipment, faster processes, while reducing per part costs. Historically, manufacturers report a plant efficiency of about 50%. Look at it another way, if your machines, when averaged, run for 30 minutes out of every hour that makes your efficiency 50%. (Note: Check out this video for more information on Impactful Continuous Improvement and business case building. https://go.memexoee.com/on-demand-BCB-webinar) That means that there is a considerable amount of potential throughput waiting to be harnessed. In the end what is more important? Without throughput there are no sales. With efficiencies, improved throughput can expand sales.