The First Step to Improve the Status Quo

“What is the first step to improve your shop floor productivity? Has the status quo of your manufacturing operations management stagnated? If you are not sure of that first step, or perhaps have already taken many steps but failed, read on as we highlight a proven and cost-effective solution that affords manufacturers of any size the means to KNOW exactly what changes will increase productivity.”

Read the full article on page 17 of this months publication of CTMA ‘View’ magazine:

Canadian Tooling and Machining Association

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Top 5 Ways Manufacturers Should be Using Their Data

If you’re already collecting data in your organization, great! However, if you’re collecting data, and dropping it into a repository where it’s never seen again, what’s the point?

There are many great articles written on how companies should use their data, but manufacturers are quite different than retailers, or service providers, of any business that deal directly with the end user customer of their product. According to a recent article in Forbes, the common Top 5 ways to leverage data for those kinds of companies is:

  1. Make more informed decisions
  2. Understand customers, and market trends
  3. Provide smarter products and services
  4. Improve internal operations
  5. Create additional revenue opportunities

For many manufacturing plants however – those that don’t design the products they build or sell to the end customer as those functions and responsibilities belong to their customers – some of the above don’t apply ‘directly’. In the case of point 2, “Understand customers and market trends”, for many factories it would be more important to understand their workforce and the trends within the work force. Most companies in this category would not get a chance to create additional revenue opportunities, but they could use data to drive operator engagement on the plant floor, by modifying behavior, and thus creating more production capacity (i.e. revenue), or decreased cost, which creates additional earning, or improves competitiveness, which may lead to more business.

Our Top 5 list for Manufacturers would be:

  1. Make more informed decisions
  2. Understand your current workforce, and future trends to attract the best
  3. Make quicker decisions to prevent adding value to waste
  4. Improve internal operations (Lean, CI, digitization of documents etc.)
  5. Put data into action in real time to modify behavior engage workers

Arguably the most important of these 5 however, is making more informed, data-driven decisionsRandy Bean, and Thomas Davenport of the Harvard Business Review state:

“Analytical decisions and actions continue to be generally superior to those based on intuition and experience.”

There are many business cases that support this assertion, and manufacturers serve as an excellent example. Since the advent of industry 4.0, it’s become easier than ever to obtain performance metrics from manufacturing equipment. However, simply generating data in a manufacturing environment does not improve efficiency or productivity. Rather, it’s how manufacturers use their data that enables improvement. By monitoring their machine data, communicating more effectively with their operators, and scheduling dynamically, manufacturers can identify and address process bottlenecks, eliminate wasted time, material or energy, and greatly improving their overall production. This this allows manufacturers to produce more with the same amount of resources – directly benefiting the bottom line.

FreePoint Technologies CEO Paul Hogendoorn

Paul Hogendoorn
FreePoint Technologies Inc.

The Manufacturing Trifecta

Just in case you don’t know the term, “hitting the Trifecta” is an expression used to describe the ultimate winning bet on a horse race. It refers to picking the top 3 finishers of the race, in the correct order. Since the odds against doing so are extremely low, the winning payouts are often extremely high. If you picked the right horses in the right order, a two-dollar bet could return a 4-digit payout.

Wouldn’t it be great to know which 3 horses to bet on, and in which order?

In many manufacturing companies in North America today, there are many competing ideas and priorities being considered by companies:

  • What is the most important improvement to make first?
  • What investment will yield the biggest return?
  • Which improvements will prove critical, and which ones will result in minimal, if any, gain?

There is an approach that your manufacturing company can follow to “hit the trifecta”. It’s a simple 3 step process. The first step is easy, and relatively low cost. The second step requires a bit more effort but is risk mitigated because it is based on the results delivered in step 1. The third step requires the most investment, but since it is based on the results delivered in the first 2 steps, it is not only risk mitigated, but the cost of the investment may have already been paid for by the results of the first 2 steps. Picking the order is just as important as picking the horses.

I want to show you how you can hit the trifecta in your plant.

Pulling off the Manufacturing Trifecta

Step 1 Icon that is a circleStep 1: Establish an empirical baseline to truly understand the critical “value-adding” activities on your plant floor. This is done simply by connecting your machines to FreePoint’s ShiftWorx system. It is remarkably inexpensive and can be typically be done in less than an hour without modifying the machine or your current infrastructure. Within 30 days of placing this small bet, you will not only have established an empirical baseline of your plant, but you will also have given real-time visibility to the plant that puts everyone on the same page, aiming for the same thing you are: productivity and profit improvement.

Step 2 Icon that is a circleStep 2: Engage your people in the process of improvement by using FreePoint’s Narrative software. You will now be collecting all the information you need to determine all the reasons your equipment and processes aren’t running as effectively as they should be. And more importantly than that, you will have made your people a part of the solution and improvement process, every hour of every day. They will be engaged. FreePoint’s Narrative software is embraced by workers when they conclude that management is not monitoring them, but rather listening to them. This is a powerful game-changer for many companies, especially those companies where people are their biggest input cost. Those same people can also be their biggest asset.

Step 3 Icon that is a circleStep 3: Connect your live, empirical machine data, and your fully engaged people, to your schedule and workflow plan dynamically – in real-time. Most plants use a combination of accounting systems, whiteboards, even excel spreadsheets, to plan and then report on the performance of their productivity. Some may have an ERP system deployed and some may even be considering an MES system. The problem with most ERP and MES system deployments is that it represents a single, very large bet, that will take a very long time to pay out if it pays out at all. FreePoint’s approach is to use what was gained (knowledge, insight, plus early financial payback) from the first 2 stages, tying them together in a process using visualization tools that line up with your plant’s current effective processes. Placing a bet on a system that takes years to fully implement and requires your manufacturing processes to be modified for the system to work is not just a bad bet, it’s often a losing bet.

The Outcome

factory clip art freepoint technologiesIf you are still reading, you are probably wondering how long it should take to hit this trifecta. The first step should take 30 days and should result in a payback 30 days later. The second step should take 30 days, and it too should result in a payback in 30 days. The third step should take about 120 days, but it can take as long as you like, because at that point, you will already have great empirical data, engaged and motivated people, and your system can be built to match your improved, and continually improving, manufacturing processes.

What is the expected payback on hitting this trifecta? From our experience, our customers typically see a 10% to 15% improvement at step 1, a further 10% to 15% improvement after step 2, and a 20% to 30% improvement after step 3. Doing the math, that would work out to productivity improvement, or capacity increase, of between 45% and 79%.

There it is, now you have the knowledge on which horses to bet on! Our suggestion: bet on achieving empirical data first, engaging your people second, and digitizing your plan third.

Call FreePoint to get started today.

FreePoint Technologies CEO Paul Hogendoorn

Simple Reporting Systems Collect Valuable Data from Your Legacy Machines

Machines built 20-years ago were built to withstand decades of use. They are the core of many factories, but these machines also hinder your ability to compete, increase profitability and scale your operations to new heights. The problem with legacy equipment is that they were engineered in an era where access to real-time reports didn’t exist, and Key Performance Indicators (KPIs) were impossible to obtain on machines.

Read more