Understanding the Costs of High Cycle Times
When it comes to production work cell optimization, companies must be able to lower cycle times and increase production throughput. However, some companies understand the process better than others. Why is it that some companies lack the ability to perform the proper cycle time analysis? It’s because they lack the ability to apply a dollar value to lost and idle time. Without properly identifying the true costs of high cycle times, a company will never be able to put plans in motion to eliminate lost time and reduce costs.
High Cycle Times Must Have a Cost Associated to Them
There can’t be any ambiguity as to the costs of lost time. Companies must be able to immediately identify the dollar value impact of delays throughout the production floor. Otherwise, it becomes a point of contention and one that’s open to discussion as to the net effect of delays and down time.
When it comes to production work cell optimization, manufacturers must provide the tools to allow management to quantify the costs of down time in a dollar value that everyone understands. Whether it’s based on the hourly wage someone makes or the gross profit of the product made in a given work station, it must be out in the open for everyone to review. By applying a dollar value to these costs, it brings an immediate sense of urgency to addressing downtime. So, what does this involve?
1. Determine Existing Cycle Times
Every good cycle time analysis needs a starting point. In this case, it involves taking the initial cycle times before any changes are made and properly documenting lost and idle time as it occurs. The success or failure of this exercise depends upon the transparency of this initial trial. In this case, capturing lost and idle time is a good thing. Don’t try and make changes to these initial cycle times as they occur. It will help put a dollar value figure on future delays and will point the way to savings.
Take the current cycle times: Every operation in production has a cycle time. There is a cycle time for the finished product, and one for each operation. Track the cycle time in this workstation with all the downtime. Capture the time from beginning to end – with or without any delays.
Track the cycle times on a grid: As this exercise unfolds, there will be high and low cycle times. In fact, it should be all over the map. There’ll be times when the cycle times are extremely low and other periods where it’s extremely high. Again, don't try and change these times. This is an essential aspect of success.
Be mindful of the delays: In general, it will become abundantly clear what is causing the delays. It could be an incomplete bill of materials, part and material shortages, poor assembly drawings, unclear work instructions or even machine downtime. Gradually it will be obvious where the issues are. While it’s not important to capture the lost time, (as it’s already captured inside the cycle times), it is important to capture the inherent causes of the downtime.