Manufacturing Metrics that Really Matter

July 17th, 2014

According to new research conducted by MESA International, manufacturers across industries are reaching new levels of excellence, pushed forward by the dynamics of a shifting business landscape. Manufacturing organizations are achieving this elevated performance through continuous improvement directives and programs that require the synergy between people, processes, and supporting technology resources.

The focus of this research is to understand the business impacts of metric programs and that are being used across a wide range of manufacturing industries. With the breadth and span of available metrics, it is important that organizations choose the right metric approaches that align to business and manufacturing processes to diver optimized improvement efforts.

In this report, the following questions were answered: 

  • Which metrics are being used to best understand manufacturing performance and opportunity areas for improvement?
  • How does my company’s performance improvement compare to industry?
  • How do we connect operational metrics to financial metrics?
  • How can technology help support and impact metrics programs and performance? 

All respondents were asked about specific performance levels of three critical metrics:

  • On-Time Completed Shipments (OTCS)
  • Overall Equipment Effectiveness (OEE)
  • Successful New Product Introductions (NPI)

Key Relationships Between Operational and Financial Metrics

Many positive correlations were found between average annual metric improvements and average annual financial metrics. The 2014 survey revealed the following key observations:

  • The average percent successful NPIs was 72%, with the top 7% of performers achieving 90% or better.
  • The average OEE was 71, with the top 11% performers achieving 80 or better.
  • The top performers in NPI had average annual financial improvements of 16% versus 8.6% for all others.
  • Those with OEE of 80 or better had average annual financial improvements of 14% versus 8.6% for all others.

Respondents with NPIs of 90% or better reported average annual financial improvements of 16%. These respondents also had 32% annual improvements in customer fill-rate/on-time delivery shipments/perfect order versus an average of 12.5% overall.

Research shows that companies are achieving elevated performance through following effective continuous improvement programs. This requires the collaborative support of people, processes, and technologies, but in order to focus on the correct areas, companies also need to ensure that the most impactful metrics are used within these programs.

For more report information, visit the MESA International website.   Looking for a list of effective manufacturing and service process metrics? Contact us and we will email list to you.   

 

Call for Public Comments on ISO/DIS 9001:2015

June 19th, 2014

Many of us are aware that ISO 9001 is going through a major revision with the future revision being published in late 2015.   The United States Technical Advisory Group to ISO TC176, is the responsible group for developing consensus positions on ISO 9001 and ISO 9000.  Currently they are collecting feedback from stakeholders in its continuing work on a national view. Public comments are now welcome!

The American Society of Quality (ASQ) is providing the ISO/DIS 9001 documents Free to anyone, with the condition to review and provide comments to prepare the U.S. position.  You will receive two documents, the draft standard and the comments document for submission.   We have submitted our comments and suggestions on the draft.

To request a copy for review and submission of comments, please email standards@asq.org. Comments will be accepted until July 15, 2015.  Let your voice be heard!!

Lean Methods Digest

May 20th, 2014

Process improvement – Lean methods can vary considerably in function, level of effort, and complexity required. They can range from quick fixes and actions your organization can implement regularly with simple tools or team participation, to week-long and longer events that require more in-depth planning, participation and formalized methods and specialized tools. Designed to reduce waste and improve efficiency, Lean methods can be used for a variety of purposes—from making your own working environment more structured with less clutter to designing and implementing faster, better, and cheaper manufacturing and service environment methods for product and service delivery. Let’s take a look at a Lean method type:

Process Walk

A process walk, also referred to as a treasure hunt or waste walk, is a rapid technique to help you identify wastes in your everyday operations. A cross-functional team of employees walks through the work area over a short period of time, identifying opportunities to reduce waste and introduce improvements as they progress. Improvements can usually be implemented rapidly, resulting in quick gains. This method can help to engage employees in spotting waste in their day-to-day activities after the initial process walk.

Typical Duration: A process walk is usually conducted in one day or less.

Identify the employees who are involved with the process. Have the group walk through the workplace with clipboards, while team members write down wastes as they identify them. Some questions to ask during the walk include: 

• What inputs and outputs do you see in the process?

• Where do the outputs go?

• What is the typical process time?

• How many items are currently waiting to be processed?

• What causes delays or problems?

• What “DOWNTIME” wastes do you observe, and what causes them?

  • D – Defects
  • O – Overproduction
  • W – Waiting
  • N – Non-utilized/underused employees
  • T – Transportation
  • I – Inventory
  • M – Motion
  • E – Excess processing 

Next post we will describe another effective Lean Method in our continuing digest.  Looking for a Process Walk Checklist?  Contact Us.      

 

AS9101E QMS Audit Requirements Published

April 21st, 2014

AS9101 has changed from Revision D  to Revision E.  AS9101E is the standard for Quality Management Systems Audit Requirements for Aviation, Space, and Defense Organizations.

This standard defines requirements for the preparation and execution of the audit process. Additionally, it defines the content and composition for the audit reporting of conformity and process effectiveness to the 9100-series standards, the organization’s quality management system documentation, and customer/regulatory requirements.

Changes to the standard include:

  • Audit forms have been consolidated
  • The PEAR (Process Effectiveness Assessment Report) will capture objective evidence of conformity (planned activities) and performance (planned results). It includes both the performance and the conformity assessment results. 
  • CB Auditors will record definitions, targets and values of key performance indicators (KPI’s) related to the audited process on the PEAR
  • CB Auditors will record detailed objective evidence (e.g., audited procedures, PO’s, work orders, and documents
  • The principle of recording objective evidence still remains
  • The Objective Evidence Record (OER) has been replaced.  Objective evidence will now be captured in the super-pear (clause 7 processes).  This includes a QMS Process Evaluation Matrix (for other than clause 7 processes) and an audit report summary.

The rollout date of AS9101E has not been announced by the certification bodies. The certification bodies along with the  auditors will need to be trained on the new forms and provided a date to implement the changes.  We will keep you informed on further information. You can order AS9101E from the Society of Aerospace Engineers at www.sae.org.

IAQG and future AS9100 series

March 24th, 2014

As stated in our last post, we want to share more information we received regarding the International Aerospace Quality Group (IAQG) and future AS9100 series documentation changes/requirements.

The 9100 series of standards are scheduled for project completion in early 2016. Plan is to fix what is broken and be very cautious in adding new requirements. 3 CB representatives on AS9100 team–IAQG to provide transition plan, guidance documents.

AS9101E – Waiting on international translation. Expect release in spring. No financial impact for customer but online training course for auditors.

The International Aerospace Quality Group (IAQG) recently identified reasons for returned audit reports for:

  • Missing required objective evidence
  • Poorly written findings or acceptance of poor root cause analysis
  • Acceptance of dates from auditor for NCR’s that do not support requirements
  • Audit plans that do not meet requirements
  • PEAR’s with poorly documented blocks 9 and 11
  • Missing documentation
  • PEAR’s not meeting industry expectations
  • Audit duration not meeting requirements

Next post we will provide information on Frequently Asked Questions (FAQs) on AS9100/1 from a certification body interpretation.