Margins are ok, the factory and subcontractor are making deliveries to customers, and quality is acceptable, what is the big deal? There is no big deal until margins begin dwindling, deliveries start to miss, and quality starts lagging and affects re-orders and reputation.
If your company has a large percentage of new product delivery with high margins or your company has higher percentage of legacy products with nominal margins, you need to pay attention to your manufacturing operations and cost to be able to extend the life of your high margins and/or become more competitive in the legacy products.
You cannot survive the competition without a manufacturing advantage. Do you want to compete or dominate your market?
Making manufacturing a competitive advantage cannot be accomplished by visiting your virtual factory once a month, a quarter, or twice a year. This is not managing manufacturing; this is a visit to Asia. It can only be accomplished by managing your manufacturing operations on a daily basis. This is how successful companies get successful and stay successful. They develop outstanding working relationships with subcontractors, they get the best cost, delivery, and quality available, and they work closely with the subcontractors on yields, cycle time, and process improvements, etc., to continuously reduce cost. This is what SOMC does for its’ clients. We have done it before and we continue to do it today
Someone will always jump on a good product and discover ways of making it better and cheaper. Why leave your new technology to those not quick enough to develop it first, but are more competitive and certainly smart enough to know how to improve on it from a manufacturing cost, quality, and delivery standpoint? This is why smart companies understand how important manufacturing is to the company as a competitive advantage and SOMC can help you avoid being “out-manufactured”.
Henry Ford said, “Competition is the keen cutting edge of business, always shaving away at costs”. This is true; keep your margins high by continuous improvement in your manufacturing operations. Your customers will want good quality at cheaper prices. As your ASP’s erode, you will need to be ready with the absolute best manufacturing practices available to you. This is manufacturing as a Competitive Weapon.
“A business absolutely devoted to service will have only one worry about profits. They will be embarrassingly large”, Henry Ford again. This literally translates to best cost, best delivery, and best quality. The best thing your company can do to get on top and stay on top is provide your customers with world-class service before they know they are not getting it from you.
SOMC can help you develop your competitive advantage and deliver performance to your customers.
Click on the SOMC logo to the right for more information;
6/06/2010
Tools of the Trade
It never ceases to amaze me, how companies approach solving their manufacturing problems without using the right tools. Critical to developing and maintaining your manufacturing to perform at world-class standards is, how we look at the problem itself and the approach we take to solving problems.
When I sit in a meeting to solve a manufacturing problem and listen to what is being done to address it, I expect to see an overall graph depicting the indices having the problem. Then, I would want to see a breakdown of the issues associated with the bad indices in a Pareto chart of the defects. Lastly, I would look for action plans based on the Pareto chart to address the specific corrective actions. In the actions, I expect to see not only who is going to do what and when, but also what impact will the action have on the Pareto chart and the overall indices. I am never surprised to see that not only do managers not use Pareto charts to further breakdown the problem, but also they fail to ask when the actions will be complete, not to mention what the impact will be. Without understanding what affects the action will have, there is no way to understand how to prioritize the actions or if they will even have an impact.
Using this simple process of a 3 panel slide we can show 1) the problem, 2) what is the makeup of the problem in a Pareto chart and, 3) actions to be done by who and when, and what the impact to the problem will be.
Once we understand the problem, we can then apply the projected impacts to the chart in the form of our improvement forecast on the overall indices graph and track our progresst. This is an excellent way to keep your group on track with real fixes that have a positive impact on your problem and to communicate within your group and management describing how and when you plan to fix a problem and the expected results.
If you wish more details on the subject, please don't hesitate to contact me.
When I sit in a meeting to solve a manufacturing problem and listen to what is being done to address it, I expect to see an overall graph depicting the indices having the problem. Then, I would want to see a breakdown of the issues associated with the bad indices in a Pareto chart of the defects. Lastly, I would look for action plans based on the Pareto chart to address the specific corrective actions. In the actions, I expect to see not only who is going to do what and when, but also what impact will the action have on the Pareto chart and the overall indices. I am never surprised to see that not only do managers not use Pareto charts to further breakdown the problem, but also they fail to ask when the actions will be complete, not to mention what the impact will be. Without understanding what affects the action will have, there is no way to understand how to prioritize the actions or if they will even have an impact.
Using this simple process of a 3 panel slide we can show 1) the problem, 2) what is the makeup of the problem in a Pareto chart and, 3) actions to be done by who and when, and what the impact to the problem will be.
Once we understand the problem, we can then apply the projected impacts to the chart in the form of our improvement forecast on the overall indices graph and track our progresst. This is an excellent way to keep your group on track with real fixes that have a positive impact on your problem and to communicate within your group and management describing how and when you plan to fix a problem and the expected results.
If you wish more details on the subject, please don't hesitate to contact me.
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