Digital transformation is everywhere today. SMART factories. Industry 4.0. AI. You can’t read a newspaper, watch TV, scroll your phone or even drive the highway without seeing the words. We ask ourselves what they mean – what they truly mean – for manufacturers and we get answers that might surprise you.
Have you spent money on initiatives that haven’t moved the needle? Time on things that haven’t made you more productive? Reported on how your team did but didn’t impact tomorrow’s work?
That’s where we believe the digital world has gone astray. And I’m going to the diet world to prove my point.
If you’ve shopped the supermarket recently, the number of products – sheer product categories – that you can now purchase to help you lose weight have increased dramatically. In 1975, less than 1 in 100 foods were dietary; today, that’s 1 in 4. Over the same period, fitness levels dropped as actual work became much less active and Americans were forced to seek out deliberate exercise (gyms, running, workouts). The outcome? The average American went from 155 pounds in 1975 to 190 pounds by 2025 (a whopping 23% increase) and adult obesity rocketed from about 15 to 40%.
Simply put – the growth in dietary foods has not impacted the relative health or weight of the American public. Is that what you see in your shop? For the money you’ve spent on automation and AI, have you seen the money, time and effort significantly impact performance?
production control
We are not here to ask why dieting hasn’t worked for Americans. We’re here to find out whether the investments manufacturers are making in digital transformation have the intended outcomes. Whether you are 2% or 20% profitable, you cannot afford to give away that profit without knowing that there’s a return and that’s where so many are going wrong.
Your operations team needs tools to help them do their work. In an ideal setting these tools do 5 things:
So many shops we see are spending money on tools that help them report on their performance but not actually drive it. What do we mean by that? Let’s look at the ingredients in your shop, like those diet foods, and see where things are helping and not.
production operations
Diet food does not help you lose weight. And the data shows us it has, indeed, not had the intended effect at all for the people who are buying it. That doesn’t mean it has no net gain. The same can be said for your shop and the initiatives you’ve tried to solve the issues you have. Low calorie foods reduce your caloric intake and if you eat a small portion, you can reduce your overall count. Dashboards in your shop may show you what’s happening or expected to happen; if they are real-time and built on your operator’s actions, they can help to drive productivity, but otherwise, they maybe like the ingredients list on the side of package and nothing more. Dashboards don’t inherently drive productivity – that’s in the action itself.
In your shop, the critical “ingredient” – if you will – is all centered around resources. You have limited time, money and people to assign to any given work effort and these must have the intended outcome to be a good investment. If you are not using technology to drive the 5 key ingredients from above, you are not getting the necessary return.
So what drives them? Let’s look at them one at a time.
Production time – you need to reduce the time it takes for your operators to do the work you’re asking. This is everything from materials management – having inventory ready when and where you need it – to clear instructions for first-timers or new work. Make sure your team has a clear plan for the day and it should shift automatically as work starts to take account for everything that’s currently happening so you can take advantage of work moving ahead of schedule and fix things that aren’t working quickly and move on.
Quality – your team should be reporting everything that’s going wrong in real time so you can track and trace it. That’s the only way that you’ll be able to eliminate it later. Your quality team (person) should not be putting out fires; they need to focus on continuous improvement so that your team gets better over time.
Performance – if you have really good performance metrics, you can see where things are slowing down, costing you more time and money. These metrics should be person by person, job by job, step by step, day by day. Can you compare one operator to another on different machines and different days? Knowing these differences can help you bolster training for those who need it, and leadership opportunities for those who are better. Change the culture; change the outcome.
Costs – if you can lower overall costs with the initiatives you take, you make money from the dollars and time you spend. If the focus of your system(s) are to report on what happened rather than run the work, it’s doubly hard to make money from the efforts. You should be able to lower overstocked inventory, rush inventory and rush orders, time overages and rework. These are real areas for cost savings and your technology should make this possible.
Future performance – this is where the real ignition starts. If you can get enough information from your production system to impact the next time you do the same or similar work, then you are “cooking with gas” to go back to our food metaphor. The theory of compound interest is a great metaphor for this. You put little bits of information into the system throughout the day and it pays back a bit at a time and over time it makes a huge impact. This is not the big bang theory of spending a lot of money to fix one specific problem and hope it works; it’s about improvement in every area of your shop for the maximum benefit.
transformation and impact
Perhaps the biggest impact we see in shops is where manufacturers raise the level of everything they’re doing. Controlling inventory – purchases, uses, makes, reserves. Scheduling resources – people, jobs, machines, work centers. Driving productivity with improvements throughout the process, as needed. The system needs to flex with you, learn from you and you need to be able to control what’s being done while also being free to some “quiet enjoyment” of the licenses. Need to know more about what’s possible? Ask us
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