The picture illustrated above is worth the thousand words! With traditional way of working, most of the manufacturing industries are into this mode for years! The cash that you see in above picture that the person is trying to catch while he’s running at best of his speed, is not the cash generated from business but the “cash drain” happening due to “REPEATED man-made mistakes”!
These man-made mistakes can be lack of precise planning!
In most of the manufacturing industries, production planning tools are not used (even after enforcement). Production is planned based on the “gut-feeling” and “experience” of the senior most person who is looking after it!
As deliveries have been happening on time, the nitigrities of it have been getting ignored.
We fail to evaluate the number of times these deliveries/dispatches have happened by stretching working hours and the over-payouts (overtime pay to workers + electricity + food + additional bills).
We are glad that dispatch happened on time and we succeeded inspite of all odds! But in reality, we’ve not succeeded as we have drained out CASH in our hand for the surprise which could have been avoided.
Do we do Root Cause Analysis (RCA) after such incidents? No!
Suppose, we decide to pull out records for past two financial years to understand how much have we spent on overtime payouts (it does not only include worker payouts but other related expenses as well). With current systems, tools and processes we have, will we be able to filter the information by following RCAs? Overtimes happened because:
- There was a machine breakdown
- When was machine breakdown, at the beginning of production
- If yes, then was there a Plan B in action for seamless production
- How much time was spent in waiting or transferring production to different machine?
- Or at LATER stage of the production
- When was machine breakdown, at the beginning of production
- Raw material arrived late / Shortage of Raw Material
- Shortage of Man Power
- Electricity Issues
Most of manufacturing units use hand-filled job sheets and paper work for maintaining records of daily production. End output is measured and chapter is closed for day to day operations.
However, most important DATA is missed out which DETERMINES FUTURE OF THE ORGANIZATION!
How DATA can help?
Data will be captured by Industrial IoT devices mounted on respective machines. This data will not be hand-filled, it will be recorded automatically. In case of any surprises, supervisor /operator can do necessary corrections in the data if required.
With help of Industry 4.0, you get to know beforehand itself that with current speed of production; if planned production of the shift/day will be achieved or not! If not, you can make necessary measures during the course of operation itself rather than do fire-fighting at later stage.
What if you get a tool in which:
- You set a period – suppose a month, quarter or a financial year and you filter to see how many times you’d overtimes during that course of period?
- You get to know the related costs spent for that?
- You get to know the reason for that?
- You can have statistics of PATTERNS being repeated?
- If you can drill down the granularities of these records?
And this is the power of digital transformation!
You are not generating new revenue, rather you are saving on CASH DRAIN OUT which can be avoided by doing necessary measures which are in your control.
The investment it requires can be either one-time investment or a small amount that you pay on period basis, but the results you get are so substantial that the amount invested proves to be just a small percent of what you’ve EARNED! Yes, a penny saved (using technology), is a penny EARNED!
