Scrap materials can sometimes pile up on the shop floor, especially when a plant ramps up production in order to meet peaks in demand. Excess scrap can lead to safety issues and cleanup costs; however, waste extends beyond trash in the manufacturing setting.  Here is an expanded definition of “waste” and some cost-effective ways to help reduce it.

Waste Redefined

Profitable manufacturers strive to make as many products as possible using limited resources. Efficient production starts with waste reduction efforts that focus on:

• Scrap (leftovers from the production process);
• Energy consumption;
• Defects;
• Motion;
• Transport;
• Queue time; and
• Inventory.

Preventive maintenance, routine physical inspections and effective quality control are the keys to operational efficiency.  Do you conduct ongoing maintenance on equipment? Doing so can ensure that each machine is properly calibrated and running smoothly. Rather than wait for an equipment failure, regular maintenance schedules can prevent unexpected breakdowns and leaks that drain electricity, gas, oil, coolants and other costly resources.

Another part of preventive maintenance is replacing equipment on a regular basis. No machine lasts forever and it is important to be financially ready to make the necessary replacements. New equipment can help speed up production, minimize defects and lower energy costs.

There are more creative ways to help combat waste other than costly equipment maintenance and replacement.  What if on the first workday of the month, you got into the habit of walking the plant floor? What would you learn and observe about the production process? Use this time to look for issues such as how much time machines and employees sit idle and whether or not the workflow seems to be organized. By simply revising the workflow to be more linear, or by moving raw materials closer to the production line, you can minimize idle time and transport. It is also important to pay attention to whether locations are clearly delineated throughout the facility. You may occasionally need to update signage or repaint lines on the floor to help employees function more efficiently. Keep your eye out for broken, dusty or expired inventory items in order to spot slow-moving inventory items. These inventory items are a waste of working capital.

Every manufacturer needs quality inspections to detect waste and prevent defects from recurring. These inspections should always look for the underlying cause of quality issues and immediately begin to brainstorm how to correct these causes. It is possible that there may be a specific employee that would benefit from more training or a machine that may need to be repaired or replaced.

It is also important to consider any recycling opportunities. Activities such as reusing rinse water in the cooling system or melting down metal scrap to be returned to raw materials that could be sold to a recycling yard rather than thrown in the trash, improve efficiency.

Company outsiders can offer fresh perspectives on waste reduction. One source of practical, objective input is your CPA. He or she has seen the best (and worst) practices from other manufacturers and can offer ideas to boost your bottom line.

For more information, contact Amy Jackson at 312.670.7444. Visit ORBA.com to learn more about our Manufacturing and Distribution Group.