Continuous Improvement

How Can Operations System Design Help Manufacturers?

Posted on by Adam Payne

Operations system design for manufacturers has become a key issue in the manufacturing industry. This is because manufacturers are facing a lot of challenges such as increased competition, decreasing market share, supply chain issues, cost reduction and more.

Operations system design is a process or methodology that can help companies to improve their performance and achieve their objectives by implementing new strategies and processes on how they operate their business. It involves analysing the current performance of your company, identifying areas where improvement could be made and then developing solutions that will increase efficiency and profitability.

Some of the important concepts used in operations system design are the following:

Demand and Capacity Management

The demand and capacity management system are the main engine driving operations. It works by matching product demand with production capacity, which includes both production equipment and labour. The most important aspect of demand and capacity management is how it deals with shortages or excesses.

In a manufacturing environment, demand is often very unpredictable. This means that there are times when the factory needs more workers than normal, but also times when it has an excess of workers on its hands. Demand can also fluctuate depending on seasonality and other factors outside of your control as well as within your control (such as sales promotions).

The first step in creating a robust demand and capacity management system is to understand what drives your business and how this affects your supply chain requirements. For example:

If you’re making products on a seasonal basis, then you need to know when those seasons occur so that you can plan ahead for them.

If you’re planning sales promotions or other marketing initiatives, then you’ll need to know how many people will be needed to support these activities so that they don’t negatively impact production schedules or increase costs unnecessarily.

Planning and Scheduling

Planning and scheduling are the process of determining the activities or tasks to be performed, the sequence or order in which they are to be carried out, and the resources and time required for each.

Scheduling can be done manually or automatically. Scheduling systems can be used in manufacturing, warehousing, distribution, and other areas where work must be performed on a sequence of tasks that must be completed in a specific order. Manufacturing scheduling processes may include:

Multi-process workflow management — Scheduling of multiple processes to optimize resource utilisation and minimise total cost of operation.

Workload forecasting — Forecasting the amount of work that will need to be performed over time, so that sufficient resources can be allocated for production. (See our blog on Sales, Inventory and Operation Planning.)

Shop floor control — Monitoring the actual performance of each machine in the shop floor so that any bottlenecks or other problems can be identified quickly.

Scheduling optimisation — Using mathematical algorithms to find the best possible schedule for a given set of requirements.

(for automation visit FactoryIQ: What is a Manufacturing Execution System)

Operational Excellence in Logistics

Logistics is the management of the flow of goods between the point of origin and the point of consumption in order to meet customer needs. In terms of logistics, a product is a good or service with some utility to the customer. The term logistics comes from the Greek word logistikos, which means “skilled in calculating.”

Logistics involves the integration and synchronisation of all aspects of supply chain management. It includes planning, procurement, inventory control, production planning and control, distribution, packaging, order processing and shipping as well as associated financial services such as bill payment and revenue management.

Logistics is important because it is often an overlooked aspect in a company’s overall success, but it can also be an important part of any business model. A company that has effective logistics operations will be able to provide customers with products that they want at a price they are willing to pay while still making a profit. This allows a company to compete with other companies that may have lower prices or higher quality products but less efficient logistics operations.

Inventory Management

Inventory management is a system of control that determines the optimal location and quantity of inventory needed to minimise the cost of carrying that inventory. Inventory management is often used in conjunction with a Just-In-Time (JIT) or lean manufacturing system, which relies on careful monitoring of inventory levels to ensure that production lines are never interrupted by parts shortages.

Inventory management is usually accomplished through a computerised system, typically using barcode scanning technology to track individual items as they are received from suppliers and shipped out to customers. Inventory management also typically includes some form of point-of-sale (POS) software or hardware, which allows retailers to track sales and determine when sales goals have been met for each item sold.

The goal of inventory management is to reduce excess inventory while still meeting customer demand. These include:

Reducing Inventory Costs: Excess inventory can tie up valuable capital resources and increase carrying costs (i.e., storage space, insurance).

Minimising Out-of-Stock Situations: If a company has too little inventory on hand, it may not be able to meet customer needs. In addition, customers may perceive this as poor service or lack of concern for their needs.

Maximising Profitability: By keeping optimal levels of inventory on hand at all times, companies can reduce costly markdowns or write-offs due to excess stock in slow-moving items.

Process Stability

Process stability is the ability of a process to produce consistent product quality and quantity, on a day-to-day basis. It is a measure of how well the process delivers on its promise to produce the same product each time it is run. A stable process is one that can be relied upon to consistently provide high-quality, low-cost products.

Process stability is important because it affects both customer satisfaction and profitability. If customers are not satisfied with their product or service, they may find another supplier or stop buying altogether. If production costs increase unpredictably, profits will suffer as well.

Process stability also affects productivity levels and capacity planning, making it an important consideration for any manufacturing operation. Lean and Six Sigma methodologies say a big part here.

Process Foundations

A manufacturing operation is a system that transforms the materials and energy resources of the environment into finished goods and services. Manufacturing operations are divided into three main areas: processes, support functions and information technology (IT). Each of these areas has an impact on how efficient and effective your production system can be.

Processes

Processes include all activities that transform raw materials into finished goods or services. The processes themselves may be physical or organizational in nature. Physical processes include material handling, assembly, machining, painting, testing, and packaging. Organisational processes include planning, scheduling, forecasting, and controlling.

Support Functions

Support functions provide products or services to internal or external customers but do not directly produce finished goods or services. They include purchasing; quality; maintenance; engineering; human resources; finance/accounting; EH&S; supply chain management/logistics; information technology (IT); marketing, sales and many more (the complete value chain!).

Information Technology (IT)

Information technology is required to support many of these activities including: process control systems for manufacturing operations such as machine tool controls and robotics; ERP / MRP.

Takeaway: Operations Systems Design enables organisations to optimize the alignment of their processes, resources, people, and information systems.

PS: If you need support with Operations Systems Design or Lean Implementation please do get in contact.

How To Cut Waste And Increase Productivity By Implementing Lean Manufacturing

Posted on by Adam Payne

Lean Manufacturing is a culture and a strategy. It’s a way of doing things that helps companies improve efficiency, quality, and flexibility. It’s not just about tools and processes—it’s about people, too.

Lean Manufacturing is all about making things more efficient. It focuses on eliminating waste and finding ways to streamline workflows so that the company can produce more with less time and money.

Create a Lean Manufacturing culture

A Lean Manufacturing culture is an environment where people are taking responsibility for their own improvement, the improvement of processes and products, and the overall improvement of the company. It’s a culture built on trust, accountability, and continuous improvement.

In order to create this culture, it’s important to give employees the freedom to make decisions about how they do their job and then hold them accountable for those decisions. This can be tricky if you’re not sure what your employees’ strengths are or how they work best. But one way to develop this understanding is by asking questions like: “What’s been most helpful in improving your efficiency?” or “What practices have helped you achieve your goals?”

Once you’ve identified some of these practices, try them out on other employees! Make sure they’re working before adopting them as official company policy though—you don’t want anyone feeling like they’re being punished just because they weren’t included in testing new ideas before implementation!

Have the Upper Management Lead by Example

Lean is a powerful strategy, but it’s not something that can be implemented overnight. In order to make the most of your Lean efforts and get the most out of your employees, it’s important to have upper management lead by example.

Upper management should be actively engaged in the process of implementing Lean, from the beginning to end. They should also be involved in training new employees on Lean’s principles and ensuring that everyone is working together toward common goals. This will help employees understand how important their role is in helping you achieve those goals, which will increase their sense of ownership over their work.

Upper management should also be willing to let go of their preconceived notions about how things should be done in favour of allowing employees more freedom when it comes time to make decisions about how tasks should be completed.

Train your Team on Lean Basics

One of the best ways to get your team on board with Lean is to train them on the basics.

The Lean principles are not complicated, but they can be difficult to understand if you’re new to the concept. You should prepare your team by giving them a solid understanding of what Lean is and why it’s important before you start putting it into practice.

If your team doesn’t have a clear understanding of the principles, they will have trouble implementing them into their day-to-day work. If, for example, if you try to reduce waste without first explaining what waste is and why it needs to be reduced, then you’ll find that the effort isn’t effective or sustainable.

This is especially true when it comes to engaging your employees in Lean initiatives: if they don’t understand why they should participate in these efforts and how they’ll benefit from doing so, then they won’t be motivated enough to participate fully or consistently.

Value Stream Map – Study the Current Process

The first step in implementing Lean is to study the current process. This will help you identify areas of improvement and determine whether or not you are ready for the changes that will be necessary to make this happen. You can do this by performing a value stream map, which is a visual representation of your workflow.

The process should be broken down into steps. You want to look at each step and ask yourself what can be done to improve it, and how this change might affect other parts of the process as well. It is important to consider how each step impacts other steps, so you can look at all aspects of your operations and make sure that they are working together effectively.

Look for Waste and Remove It (Muda – Waste, Mura – Unevenness, Muri – Overburden)

You can define waste as anything that detracts from the value of a product or service you’re producing from your customers’ point of view. Waste can take many forms, such as overproduction, unnecessary resources, and more. These things need to be eliminated so that organisations aren’t creating products or services that don’t add value.

Muda is any kind of wasted motion, such as unnecessary steps in a process or unnecessary travel between locations. Mura refers to unevenness in the production line—it means one part of the process might be operating at peak efficiency while another part is idle or struggling just to keep up. Muri refers to overburdening people with too much work—this is often seen when you have an employee working alone on a task that should be split between two or more people to match customer demand (TAKT).

Map out the Main Bottlenecks

The main bottlenecks in a process are the aspects of the system that are limiting its throughput.

In order to identify these, you’ll need to first look at or build your Value Stream Map or Process Map and identify where there are bottlenecks. Then, you can work on fixing them by identifying what’s causing the bottleneck and finding ways to remove it. This may involve making changes like adjusting how people work together, reducing change-over times, increasing the Overall Equipment Effectiveness or changing how tasks are assigned (e.g., having workers perform different parts of a task).

Once you’ve identified where your bottlenecks are, you can start working on removing them.

Standardise Everything

This means that you need to define what “standard” means, and then make sure all employees are aware of it and trained to it. Standardising your processes gives consistency in how your team members perform their tasks. 

For example, if you’re a software company and you’re trying to improve efficiency by standardising on coding practices, then every employee should know which practices are allowed and which are not allowed.

You should also standardise your equipment and tools. If multiple employees use the same equipment or tool, everyone should use it in the same way every time.

If your company has multiple locations, then standardising everything is even more important because it helps create consistency between locations. If everyone knows what standards they need to meet at each location, then they’ll be able to work together better across locations knowing the desired quality will always be met.

Develop a Continuous Improvement Mentality

Implementing lean means shifting your focus from your business’s outputs to its inputs. But if you’re going to do that, you need to first develop a continuous improvement mentality.

To do this, you have to be willing to adopt an attitude of continuous improvement and continuous learning. You need to be constantly looking for ways that you can improve how things are done in your office or factory and how they contribute to the overall success of your business.

You also need to be willing to consider new ideas, because one of the main tenets of lean is that there are no bad ideas—only challenges in implementation. If someone suggests something new or comes up with a way of doing something differently, try it out! Even if it doesn’t work right away, you may learn something valuable about how something works or doesn’t work within your organisation.

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Continuous Improvement: The Simple Philosophy That Can Help Your Business Thrive

Posted on by Adam Payne

Continuous Improvement, The 1% rule, or Marginal Gains, whatever terminology you want to call it, they are all similar in philosophy and application. It is the idea of focusing on small incremental improvements to grow your business easily. The most successful businesses are always striving to improve to stay ahead of their competition.

In this blog I’ll explain how the philosophy of small incremental improvements can improve your business. This is a technique that many successful companies use in addition to Lean Thinking – a company’s philosophy of eliminating waste. It has been used for decades and can be found in micro businesses right through to corporate business models across industry and service sectors.

I’ve been a lean Sensei for 25+ years and implemented these small incremental changes in Hairdressers to Big Corporate Manufacturers. By implementing these marginal gains, it’s possible to make a huge impact on the performance of your company in a relatively short period of time. It’s Simple! and the data has proven time and time again that this method works!

You CAN NOT ignore the role of Continuous Improvement in business – and here’s why.

What is Continuous Improvement?

“Be Better Today Than You Were Yesterday, Plan To Be Better Tomorrow Than You Are Today” is a quote I have lived by for 25+ years of my working career.

The 1% Rule is a relatively new contender but has now become a business management philosophy that states that you should focus on improving your product or service by at least 1% every day. It was developed by Sir Dave Brailsford, former performance director of British Cycling, and used as a means to achieve micro improvement in the British Cycling Team. The concept behind the 1% rule is simple: if you focus on small improvements, you can achieve significant results over time.

The concept of the 1% rule in my opinion is based on Kaizen, which is Japanese for “continuous improvement.” Kaizen was first introduced to the Western World in the 1970s by Toyota, who taught that companies should embrace a culture of continuous improvement rather than trying to maximise efficiency one big hit at a time. Kaizen aims to reduce inefficiency in its 3 major forms. These are muda (waste), muri (overburdening work), and mura (inconsistency of work).

When we look at these strategies, we can see how the power of tiny gains really makes a difference.

1% Improvement Every Day 1.01365 = 37.78%

1% Decline Every Day 0.99365 = 0.03%

How does the Continuous Improvement work in business?

The PDCA Cycle, also known as the Plan-Do-Check-Act Cycle, is a model for continuous improvement that uses four phases to drive process changes through the organisation. This linked to the 3 forms of in-efficiency, muda (waste), muri (overburdening work), and mura (inconsistency of work) gives a superb structure and focus for all employees.

The PDCA Cycle Explained:

Plan: In this phase, you identify a problem or opportunity for improvement. You also create a plan for how to solve the problem or capitalise on the opportunity.

Do: In this phase, you carry out your plan and implement your solution.

Check: In this phase, you review your work to see if it was successful in achieving its objectives and if there are any unintended consequences of your actions.

Act: In this phase, you make adjustments based on what you learned in the check phase and continue with another iteration of the cycle to drive continuous improvement.

By continuously improving your processes, your organisation can achieve higher levels of performance at lower cost. This not only improves customer satisfaction but also helps an organisation achieve its goals faster.

The key to this and building on the marginal gains is to empower everyone to make these short, sharp improvement cycles small enough to be managed at a local level. This will enable them to use their creativity and judgment to find the most effective solution for their teams and customers.

The second aspect of this is that the improvements have to be visible and celebrated. This is not just about being proud of what you have achieved, but also about helping others see what you have done. This creates an environment where people are constantly looking for new ways to improve, which in turn leads to innovation.

The third aspect is that it has to be built into every process in a business. You cannot expect people just to do it because you asked them to – they need processes that encourage continuous improvement across everything they do from how they order stock through the distribution system all the way through customer support.

Why use the Continuous Improvement?

Continuous improvement is a process that can be used in every business setting of all sizes and all sectors, from small businesses to large corporations.

It’s Good for Business

The benefits of continuous improvement can be seen throughout the business world. By using this approach, companies are able to stay competitive while providing better quality products and services at lower prices. This helps them grow their customer base while increasing their profit margin through increased sales volume.

It’s Good for Employees

Continuous improvement is also good for employees because it provides them with job security. If you have implemented a continuous improvement program in your company, then you have created an environment where everyone is constantly making improvements which makes your company more competitive in the marketplace and less likely to be outsourced in favour of cheaper labour costs elsewhere.

  • People feel empowered because they have more opportunities for growth and development.
  • Employees feel more engaged because they feel like their work matters and makes a difference.
  • The company attracts better talent because employees want to work for companies that are doing great things for their customers.

Does Continuous Improvement really work?

Yes! Continuous Improvement absolutely works!

I’ve implemented and completed Lean Thinking and Continuous Improvement Projects in 100+ businesses over my career and have no doubt on the impact it can make.

On my very first project back in the 1990’s we took a machine change over from 480 mins to sub 20 mins, saving a £250K capital expenditure. As Senior Exec I’ve saved £10m+ year on year through the implementation of Continuous Improvement. I’ve seen every employee within a business take pride in completing numerous small incremental changes that compound in delivering a huge result.

In order to achieve these results, you need to be prepared to put in the work. It’s not an overnight process—it takes patience as well as an unwavering commitment to creating positive change at every level of your organisation. But once you’ve seen the first results, you’ll find it’s worth every minute invested!

You’ve only got to read some of our Case Studies to realise the potential.

Takeaway: Challenging yourself and your employees to make small improvements every day can have a dramatic effect on your overall business growth.