A Practical Guide to Securing ROI from SPC
Start by defining the fundamental reason for your search.
When mulling over options for a new SPC software solution, multiple factors may be at play. Maybe you want to save money in the long run, cut waste and scrap, improve traceability, speed your process, move to a real-time, Cloud-based SaaS platform, or all of the above.
Perhaps the biggest contingency is return on investment (ROI). In other words, how can you be sure that the platform you’re purchasing will enhance your company’s bottom line?
Douglas C. Fair, Chief Operating Officer at InfinityQS International, offers this guide to figuring it out.
What must you consider about your business before shopping for an SPC solution?
Generally, organizations shop for SPC software when they either have quality problems, monetary issues, the need to comply with regulatory requirements, or a client who requests that the vendor use SPC. Regardless, you need to define the foundational reason for your search as that can make a difference in what you look for and how much you spend.
Any of the reasons above are viable motivations for using SPC, yet the greatest motivator is business need. That is, if you are hemorrhaging cash because of quality issues, it tends to focus the mind and speed the shopping process more so than other reasons.
To minimize IT support and maintenance costs, consider a cloud-based system. Software-as-a-Service (SaaS) products follow a lease-type arrangement (rather than a purchase) and do not require up-front outlays of capital monies. Nor do they require the purchase, setup and support of servers, databases and related hardware and software. That should be managed by the SPC SaaS vendor.
Cloud-based SPC software is ideal for companies that need to deploy across multiple plants. A single deployment should support not only lots of plants, but data entered by vendors and many different languages. Having a single repository for all quality data allows previously unheard-of levels of comparative analyses, sharing of best practices, and the ability to make huge strides in quality and cost containment across the entire enterprise.
Lastly, the most successful SPC deployments I have witnessed had excellent managerial support defined by frequent, formal reporting and meetings. Look for SPC systems that can sort, slice, and dice data any way you want to see it – even across products and plants – and support a wide array of different charts and graphs. Formally reviewing reports supports quick responses to the information learned in those meetings, further solidifying managerial support and the value of the SPC system.
What questions should you prepare for a potential SPC provider?
With the right SPC software, generating huge returns on investment is not too difficult. Returns on investment should be measured in months, not years.
The greatest opportunities for cost containment and quality improvement come from the ability to compare and contrast data from different products, processes, and even plants. Too frequently, SPC is focused solely on control charts – the micro view of quality. Instead, the macro view of quality is where big reductions in cost can occur.
Revealing the macro view of quality is the result of two components:
- Data aggregation (query) capabilities
- The use of post-data entry analysis tools for reporting.
Therefore, look for SPC software that has great flexibility in both data querying abilities and reporting tools. It should be easy to create a “macro view of quality” by including lots of different products on a single report – even if their specs are different. In fact, the macro view of quality means that you should be able to create reports that tell you about any comparison you want. Although the resulting data set may seem complex, analysis should be simple, and reporting tools should be native to the product (no exporting of data should be required).
Therefore, ask potential SPC vendors these questions:
- How many different reports are supported in the software?
- What reports are offered (other than control charts)?
- Are all reports included in the same application, or do I need to purchase additional modules?
- Do you require data to be exported to spreadsheets to perform reporting?
- How is data accumulated across multiple plants?
- Does the vendor require multiple databases, or just one?
- How is the data structured to ensure uniformity and consistency in naming conventions between plants and regions?
- How are different languages managed with the data?
- How can queries be made to “roll up” data across multiple parts/machines/plants/regions?
- How can comparisons be made between different parts/specs/lines?
- How do reports account for differences in specification limits?
- How can I make fair performance comparisons between:
- Multiple product codes?
- Different production lines that run lots of different products?
- Product features that are not only critically important, but which have different total tolerances and/or single-sided spec limits?
- Different plants, and different regions?
Should you ask for trial period?
Yes, you should always ask for a trial period. Doing so will allow you to “test drive” the system to ensure it performs as expected. Can you imagine purchasing a used car without first driving it? Some people do, but it’s a risky proposition. SPC vendors should be happy to allow prospective clients at least 30 days for a risk-free trial. If they don’t, then something’s amiss.
What are the most important features to look for in an SPC software that will result in monetary gains/cost savings? Can these be clearly tracked or measured?
As mentioned above, query and reporting flexibility is key to uncovering big monetary wins. Control charts are great for process control on the shop floor, but they were not designed for data comparisons across multiple machines, products, plants and regions. So, be sure your SPC software natively supports lots of different data aggregation capabilities and has lots of analysis power and reports. Even though your SPC software may be powerful and flexible, I have witnessed many failed SPC programs.
Failure to generate monetary benefit from an SPC system takes several forms:
- Lack of a diverse set of charts, graphs, and reporting options
- Lack of management support
- Lack of formal, scheduled analysis and reporting meetings
- Focus on data collection (instead of generating quality intelligence and information)
If your focus is on generating actionable intelligence and information from the data you gather, you likely already have management support. As a result, scheduling meetings to review intelligence generated by the SPC system should be pretty simple as management is motivated to uncover information they can use for improving quality and cost structures.
Some of the biggest monetary “wins” I have experienced were from reviewing data that falls within specification limits. Just because it is categorized as “good” doesn’t mean that there isn’t vital information to glean from in-spec data. See the second success story below for more information on how in-spec data can be enormously helpful in reducing costs.
Any success stories to share?
As noted, leveraging query and reporting flexibility is key to generating fast reductions in cost while generating sustainable gains in quality. Here are two different success stories that I had direct experience with, where the “macro view” of quality was analyzed using high-level queries and flexible analysis tools:
- Within 4 months, an aerospace manufacturer was able to eliminate long-standing, big quality issues on large aluminum products. They went from a 40% scrap rate to zero scrap in less than 4 months. The result was savings in the tens of millions of dollars, while increasing plant throughput by nearly 50%.
- Even though none of their products were out of specification, a beverage manufacturer was able to eliminate big variations in bottle fill volumes. By greatly eliminating filling variation, they were able to put less product in each bottle while still staying above minimum fill requirements. The result was over $900,000 in annual savings on a single fill line. Deploying SPC across the other 20 production lines proved to be equally successful.
- Within 6 months, a carton manufacturer was able to go from the worst quality to the best quality amongst 20+ plants in the corporation’s enterprise, saving the plant from closing. Improvements in quality convinced large customers to place more than $10 million worth of new business with the plant and secure the plant’s rating as a premier vendor.