Material Issues Create Huge Losses!

Posted by on Feb 16, 2019 in Continuous Improvement, Kaizen, Lean, Lean Six Sigma, Process Improvement | 0 comments

Material problems wreak havoc in many operations.  Inconsistencies and variation within a lot or between lots of material can cause operators to constantly tweak machines and processes, which in turn can lead to defects and high scrap rates.

Having multiple suppliers for the same material creates variability and can cause production delays, especially if the change from one supplier to another occurs during a production run.  I saw the effects of this problem firsthand when a company I worked for had two sources of silicone compound for their extrusion and molding processes.  It took literally hours to get acceptable product when switching between the two suppliers.  The purchasing department finally designated one supplier for the molding compound and the other for the extrusion compound.

Painting and coating thickness problems create delays, rework and multiple trips to the supplier that increase transportation and handling waste.

When material variation becomes a problem, the first step is to always work with the supplier.  It’s unlikely that the problem will disappear overnight, but by maintaining focus and consistently providing feedback, the material variation should eventually be reduced – especially if they value you as a customer.

Even the simple act of receiving material can create issues such as: Where will the material be stored?  How long can it be stored before damage occurs, i.e., open doors and windows, material stored outside in the elements, etc?  Are their expiration dates that need consideration?  How will temperature and humidity affect your materials?  Is there a first-in, first-out (FIFO) system to be maintained?  In other words, material must be monitored from the time it’s acquired all the way through production until it’s in the final product.

Here are some of the questions I ask clients I work with:

  • What materials cause the greatest number of problems and what are you doing about them?
  • Do materials meet all specifications?  How do you know?  Can you show me your records?
  • Are material handling practices adhered to?
  • How and where is the material stored?
  • Are all like materials stored in the same location?  If not, why?
  • How good are your suppliers at delivering materials on time?
  • How well does material flow into and out of the work areas?  Is the amount of material at the workstation controlled, i.e., raw materials, work-in-process (WIP) and finished goods?
  • How do you handle defective materials, scrap, and rework?
  • How much inventory do you have for raw material, WIP, and finished goods?
  • What is your material turnover ratio?  What is your goal for material turnover?
  • Do you utilize kanban and supermarkets in your operation?

Each of the above questions should be addressed in procedures and work instructions so that employees can reference them when needed.  Records should be kept on each supplier for quality levels, on-time-delivery (OTD), and any other issues that arise.  An on-going evaluation should be done on each supplier and reviewed with them at least quarterly.

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