Another perspective on productivity.

Productivity is one of the most important weapons metalcasting facility managers have in their fight to improve profitability, expand capacity and revenue-producing ability, and boost return on investment. Unfortunately, most in our industry tend to see automation as the only path to productivity.

While this view is more applicable to production metalcasting firms than it is for job shops, it is not the whole solution for either type of operation. Other paths to improved productivity focus on getting more from your existing facilities, equipment and labor force, and they offer the side benefit of preventing your business from falling into the mature industry cash trap.

Eliminating Non-Compatible Work

Compatible castings are those that fit your operation, are clearly within the firm's capabilities and flow well through the plant. Most metalcasting facilities are burdened with significant quantities of non-compatible, problem-causing castings that flow poorly and put a dent in productivity and capacity. Eliminating non-compatible castings should be a top priority and addressed without waiting for compatible replacements for the lost volume.

Eliminating non-compatible castings begins with the quoting philosophy that not all castings are good castings, not all volume is good volume, and not all customers are good customers. Stop quoting non-compatible work and look to poor job profitability and other indicators of non-compatibility for direction on what else to eliminate.

Throwing Out Quality "Black Holes"

The best example of a quality black hole I have seen was at a client's Disa metalcasting facility. The job looked perfect at the RFQ stage--it was a value-intensive, dimensionally challenging, high-volume part that the firm was able to sell fully machined. Unfortunately, the sales department over-sold and over-promised on the plant's capabilities in order to ink the deal, and in so doing set manufacturing up to fail.

As it turned out, the customer's tight dimensional specs could not be met consistently, and between 20-40% of production was scrapped either at the metalcasting facility or at the in-house machine shop. When we added up all the hard quality costs and soft administrative costs, it became clear that the part was a whopping financial loser, a huge staff resource hog and a major waste of capacity.

Identifying quality black hole parts is easy--just look at the stack of NCRs on your quality manager's desk, see which orders consistently ship partial (i.e. late), and find out to whom your customer service people are constantly apologizing. Eliminating these parts will lower top line revenues and production and increase productivity, capacity and bottom line profitability. There is no price in the world high enough to make these parts worth keeping.

Regaining Balance

Getting rid of non-compatible work and eliminating quality "black holes" will have a synergistic impact in the metalcasting facility. The combined positive effect on productivity of making these changes will be far greater than what one would expect from merely eliminating each of the individual problem castings. I call this phenomenon "regaining the metalcasting facility's balance," and that balance will take your firm to new heights of productivity, revenue generating ability and profitability.

Regaining the plant's balance means that the mix of products moving through the plant narrows as outliers are removed; this in turn enables workers to better understand the remaining parts, work more efficiently on them, eliminate mistakes and otherwise enhance productivity. The flow of work through the shop is smoother, which eases or eliminates bottlenecks and causes all jobs to pass through the plant faster. And, because the parts which have consistently caused the firm to fail are gone, morale is improved, workers have a greater ability and desire to pay attention, overtime and rework is reduced, and scrap replacements and past dues are eliminated.

All of this combines to greatly enhance productivity and revenue generating ability while also lowering costs.

There is a path by which CEOs can lead their metalcasting businesses to much higher levels of success and profitability, and it begins with the elemental understanding that bottom line profits are far more important than volume and top line revenues. This awareness will open up your organization to a whole new array of productivity-enhancing and money-making opportunities.

Dan Marcus, TDC Consulting Inc., Amherst, Wisconsin