Recent Blog Posts

Many feel “uncertainty” is the new normal

“Geoff Forester photograph, courtesy of the New Hampshire Community Loan Fund”.

For many companies, the past was prelude to the future. Response trends could be developed for a host of inputs, and planning was a tedious, but often reasonably accurate corporate exercise. Fewer companies feel this way as we work our way out of the recession. Many now are trying to plan for uncertainty. This can be an expensive undertaking, as contingency planning ties up time and resources. But there may be no alternative for many, as being caught off guard is more risky than planning for numerous alternatives. A recent survey by Tompkins Associates, “Uncertainty is Certain – Perceptions of Future Risk on the Rise” highlights the thoughts of many global companies are they try to find their way into the future.

Explaining Theory of Constraints at the Pancake Griddle

“Geoff Forester photograph, courtesy of the New Hampshire Community Loan Fund”.

I’ve been a strong proponent of Theory of Constraints as one of the best philosophies for running manufacturing operations. TOC gives you a perspective that helps you focus on constraints to flow in your operation and provides methods on how to deal with them to improve flow.  This focus on “throughput” rather than “costs” is transformative and requires a different thinking process than used in the cost driven world. I had a good lesson in constraint identification and throughput improvement while making pancakes yesterday.

Imagine, as you will, that I have a market for my product. The demand is time dependent (my market is hungry and wants to eat – NOW) and satisfaction limited (they will eventually get their fill, and the demand will subside). Getting product to the market to fulfill this demand cycle is critical to my business. I have plenty of raw material (my pancake batter), but a constrained production resource, my cast iron griddle. My griddle is fixed in size, and the energy input to the griddle is limited by batter chemistry and the batter load (the more batter on the griddle, the more energy required to produce a pancake, but too high an energy input, and the pancakes burn). If I had a lot of WIP (several pancakes on the griddle), I found that the production time increased (due to the higher energy requirements and temperature variation on the griddle), the quality went down (undercooked or overcooked sections on a pancake), and I couldn’t supply my demand on time. When I reduced WIP to one pancake at a time, my pancake production velocity or “throughput”  went up, quality improved, and I met the demand.  Making one pancake at a time was actually faster than trying to make a bigger batch of pancakes at once (the lower unit cost mindset).

In the factory, we know that smaller batches and lower WIP  increase production velocity. Higher velocity means higher sales revenue and higher throughput. All the lessons of the factory floor revealed while making a Sunday morning breakfast!

Assembly Magazine Gets It

What do they Get?  The value and cost benefits featured in Graphicast’s newest trade magazine article.  This case study shows how moving from CNC produced components to a casting process lead National Optronics to big savings on a low volume part.

After working with Graphicast to convert the design, National Optronics has taken what was a four piece pin and screw assembly, down to a single, precision machined casting.

 This project reduced part inventory, assembly time, and made for a much more rigid design.  Oh yeah, they also brought the cost down!

Sound like something that can help you?  CLICK HERE to read the story.

Manufacturing in 2011 – Up, Down, or Sideways?

“Geoff Forester photograph, courtesy of the New Hampshire Community Loan Fund”.

Although there are many polls out there indicating the manufacturing pundits’ opinion on 2011, it seems we’re all still guessing about the future. Some say up, but slowly. Others say up and steady. There a few saying up, but volatile. From our view of the world, I think I will agree with the last group. We can clearly show an upward trend beginning in June 2009, but the path is anything but steady. Month to month can fluctuate +/- 40%, but year to year is measurably up. It’s a tough way to plan and execute. Is this the new normal, or will we finally settle down to some stability, perhaps with a new landscape? We’ll keep on the lookout for any clues.

Old Machines Making Money

“Geoff Forester photograph, courtesy of the New Hampshire Community Loan Fund”.

I just read an interesting article on how a number of machining houses are making money and growing their businesses using older equipment. What sets them apart is their attitude toward business, not modern, high productivity equipment or low cost labor. They cross train their people, they eliminate wasted time and effort, they pay fair wages and provide benefits, they treat their customers and suppliers well. If you ever read Goldratt’s book, The Goal, you’ll recognize these businesses. They’re doing the same thing Alex Rogo did in his factory to turn it around. All these machining houses are applying a Theory of Constraints mentality to their operations, even if they don’t recognize it as that. Congratulations to them for their insight and commitment to their businesses.

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