How to Optimize Manufacturing Operations
Set up production right, before you hit the start button.
In my previous post on manufacturing strategy, I discussed the need to start planning earlier and to review often. This is particularly important for laying out manufacturing production. Whether it is a new line, a new facility, or setting up a new cell, get input and iterate on the options. One of the things I do here at Prime Movers Lab is help the startups think through their operations to save time and money further downstream and that begins with good plans.
Planning out the manufacturing operations begins with understanding the type of production the business is going to undertake. Will the product be high rate and minimal product mix? Then you need to set up a flow line. Will the products be low rate and high mix? Then you are likely to need more of a job shop. Are the rate and product mix somewhere in between? Then you will likely need to set up a hybrid show with some level of batching.
There are advantages and disadvantages to each so getting the product and production mix figured out early is essential. I once ran a large aircraft structure value stream where we had only 14 different parts that ran down the line so we essentially set up a flow line. Flow lines are easier to automate, measure, and optimize because you can quickly see where the bottlenecks are and where any potential problems are occurring. There are a lot of resources available to set up flow lines; many based on the book Learning to See by Mike Rother and John Shook.
The other side of the coin is to set up a production job shop. This may be a good option early on in a businesses’ life (and in fact, many small shops remain set up like this) because it is easy to set up, there is high flexibility in the system, and increasing capacity can be as simple as adding a new machine or cell. The problem with this setup is in the scheduling and monitoring. Because of the mix, the opportunities to standardize are more costly and any change in demand can require significant effort to replan. The couple times I ran shops that were a variation of one of these, we had planning staff monitoring progress full time.
Once the demand mix is determined, it’s time to actually plan out the production shop. To plan the shop, there are three keys:
- Start this process as the product is being designed. Running these in tandem will move the MRL along much quicker and save the hassle and downtime of changing the process later. And make someone directly accountable for the whole process.
- Lay out the process on paper. Then try different variations to see which will work best. Use spaghetti diagrams and value stream maps to help visualize how the process will flow.
- Build a prototype. Use cardboard boxes or, if you’re more advanced, a digital twin. It might be best to do both if time allows. Walk the process with the operators and simulate actual set up and production. Use this process to change the product or processes if needed and then start building the standard work in advance of production start.
After the production line is planned, it’s time to determine what to measure. Correctly setting up Key Performance Indicators (KPIs) will let you know whether you are winning or losing. Generally, for a manufacturing shop, the KPIs will include some combination of:
- Safety (near misses, accidents, etc.)
- Production through monitoring (goal v planned)
- Delivery (On-time v past due, etc.)
- Direct costs (time, scrap, inventory, etc.),
- Quality (first pass yield, rework, etc.)
- People (morale, attendance, CI activities, training levels, etc.)
- Many other KPIs depend on the type of production
The key in my experience is to ensure they are very visible and regularly communicated. It’s like my old boss used to say: “It’s like sports, no one will care if they can’t see the score.”
I am also a big proponent of Gemba walks and having the team walk the process regularly to help with any issues and to remove any roadblocks that may be occurring.
Take the time upfront to do as much optimization in these steps as possible. Use the lean tools and get some outside sets of eyes on the process. The more work that can be done in advance will make achieving the customer demand easier and make the product more profitable quicker.
Prime Movers Lab invests in breakthrough scientific startups founded by Prime Movers, the inventors who transform billions of lives. We invest in companies reinventing energy, transportation, infrastructure, manufacturing, human augmentation, and agriculture.
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