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Increasing Process Profitability through Insight from Visual Management

February 10, 2012
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Kaizen, lean manufacturing, six-sigma, total quality management, continuous improvement-all of these terms refer, in some form or another, to the efforts of companies as they strive to become more competitive in a global economy. While various strategies are implemented in order to improve productivity, they all have two things in common: the collection of KPIs-key performance indicators-and the communication of those KPIs to the people who can most affect improvement-the production floor personnel. However, this data doesn’t do any good unless everyone can see it, particularly those who are responsible for it and those that are judging other’s performance based on it. That’s where visual management-the process of displaying critical information so it is easily seen and understood-comes into play.

Even if a company doesn’t employ formal continuous improvement initiatives or quality processes, efficiency gains can be realized by borrowing the lessons learned from the visual management techniques of those processes. The best part is that months or years aren’t required to realize the gains. Visual management techniques can be deployed very quickly, without a huge investment in software or changes to existing processes, allowing a profit increase in short order. Many companies, whether or not they practice continuous improvement, want production to flow uninterrupted, and have therefore adopted some form of andon, a term that refers to a system used to notify management, maintenance and other personnel of a process or quality issue. The green, yellow and red light “stacks” or “towers” seen in a production facility are andon messaging in action.

Mounted up high, these simple andon systems allow everyone to see the status of virtually every machine in a room. A green light means the machine is running well, while a yellow light usually indicates the machine is running but requires attention. A red light almost always means that the process has stopped and requires immediate attention. While stack lights are convenient, they provide little information other than crude status, and many facilities have therefore adopted displays that provide detailed messages regarding machine status.

Common Key Performance Indicators

On the factory floor, visual management can take shape in the form of key performance indicators that relate to production quantity, speed and quality, as well as machine uptime and downtime. In keeping with visual management’s requirement that the information can be seen at a glance, the information is shown on large displays that can be seen from a distance and by more personnel than just the machine operator. While the key performance indicators that a specific company should use vary, there are some common KPIs used on diverse plant floors to improve profitability.

Count (Good or Bad)

One of the most important metrics is how much product has been produced thus far. The count can refer to the amount of product produced since the last machine changeover or for the entire shift or week. To invoke a competitive spirit in their employees, many companies will compare each of the co-worker’s or shift’s output against the others.

Reject Ratio

Everyone’s process will occasionally produce scrap. Knowing whether or not the amount of scrap product being produced is within tolerable limits is critical to maintaining profitability.

Rate

If your machine or process produces goods at a variable rate, it’s important to know if the operators are maintaining an ideal speed. Too slow, and profit drops; too fast, and quality issues may arise.

Targets

Properly motivated employees know exactly what’s expected of them – plant floor personnel are no exception. Therefore, many companies opt to display target values for output, rate and quality.

Takt Time

Takt time is the amount of time, or cycle time, for the completion of a task. This could be the time it takes to produce a product, but more likely it’s the cycle time of a specific operation on the product. By displaying takt time, manufacturers can quickly determine where the constraints or bottlenecks are within a process.

Overall Equipment Effectiveness (OEE)

OEE is a metric that indicates the utilization of resources. Production managers are interested in seeing the value of this metric increase, as it indicates more efficient utilization of the available personnel, machinery, etc. The formula for OEE is OEE = Availability x Performance x Quality.

Downtime

Whether it’s due to a breakdown, or simply a machine changeover, downtime is one of the most important metrics that can be displayed. When the machines are down, money isn’t being made – reducing these periods is an easy way to increase profitability. Many companies that track downtime require their operators to enter a “reason code”, via keypad, pushbutton, or even a bar code scanner, so that the information can be reviewed at a later time.



Visual Management Solutions-from Simple to Sophisticated

Over the years, the methods for collecting and communicating KPIs have evolved considerably. Early on, a person equipped with a pencil, a stopwatch and a clipboard collected data. The information they collected was then transferred to large chalkboards. Today, solutions for displaying KPIs and andon messages range from machine status via simple stack lights that cost under $100 to complete PC-based production monitoring solutions that cost in excess of $100,000.

Large 7-segment LED displays

For simplicity, it’s hard to beat what are effectively just panel meters but with large LED displays. Their sheer brightness and contrast makes them viable for viewing critical values over very long distances. Sizes range from just over an inch to as large as four inches. The former are easily visible at 70 feet, while the latter are readable at up to 180 feet. Different versions of these large displays are offered to accept standard digital, analog or serial inputs, making them easy to use. Because these displays can’t provide descriptive text, they’re best used when only a single KPI is of interest.

LED marquees

LED marquees are displays manufactured with a matrix of single LEDs, in various resolutions. Over the last decade, multi-color LED marquees have become a common method of displaying plant floor information. Their ability to display multiple lines of information, combined with the ability to display text, make them ideal for displaying more than one KPI. By allowing the display to change colors, e.g. from green to red, users can more easily draw attention to the display if critical messages must be communicated quickly, e.g. line down messages.

The most important criteria when selecting a marquee is how it collects the data. Some manufacturers offer models with digital inputs, while others offer only a serial slave interface. The latter will typically require the user to write the necessary code to “talk” to the display, commanding it to display specific characters in specific formats. The more clever models offer built-in communications drivers and can communicate directly with automation devices such as PLCs, motor drives, etc. This allows them to collect and format the data to be displayed.

While more advanced than 7-segment LED displays, LED marquees are still somewhat limited in their ability to display more sophisticated images such as trend lines and bar graphs. Their cost can also make them prohibitive, particularly in the larger sizes.

Television-based solutions

The latest trend in production displays arises from the ever-falling cost of consumer-grade televisions. With their ability to display images in high-definition, flat screen TVs are quickly becoming the most common method of displaying information on the plant-floor. Early on, savvy users made use of TVs by running SCADA software on a dedicated PC – the TV was simply connected as a monitor. Today, dedicated solutions are available for connecting, collecting and displaying plant floor data on any TV.



Selecting a Visual Management Solution

When selecting a system to display process performance data, managers should consider what other functionality modern solutions provide. Since productivity displays must collect data from automation devices, it makes sense that today’s more capable products offer built-in data loggers. By having the ability to review historical production trends, supervisors and management can easily determine if the initiatives they’ve put in place have been effective, and of those initiatives, which were most profitable. By logging the causes of line-down events, management can determine which lines are most problematic, as well as how to resolve the most common issues.

Today’s solutions also offer the ability to keep remote personnel informed via a web-based interface, allowing on-call maintenance or traveling managers to keep abreast of their processes’ performance. These devices also offer the ability to send status updates and alerts via text message or email for the ultimate in andon communication.

Regardless of the technology – 7-segment LED or high-definition TV with logging and remote notifications – the most important point to remember is that information, when communicated to the appropriate personnel, increases efficiency and reduces downtime. Since various solutions can be had for as little as a few thousand dollars, and can represent a significant increase in profitability, there’s a compelling reason to implement visual management in most facilities.

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