Overall Equipment Effectiveness (OEE) is a term coined by Seiichi Nakajima in the 1960s to evaluate how effectively a manufacturing operation is utilized.

OEE (Overall Equipment Effectiveness) is the gold standard for measuring manufacturing productivity. Simply put – it identifies the percentage of manufacturing time that is truly productive. An OEE score of 100% means you are manufacturing only good parts, as fast as possible, with no stop time. In the language of OEE, that means 100% Quality (only good parts), 100% Performance (as fast as possible), and 100% Availability (no stop time).

Measuring OEE is a manufacturing best practice. By measuring OEE and the underlying losses, you will gain important insights on how to systematically improve your manufacturing process. OEE is the single best metric for identifying losses, benchmarking progress, and improving the productivity of manufacturing equipment (i.e., eliminating waste). OEE measurement is also commonly used as a Key Performance Indicator (KPI) in conjunction with lean manufacturing efforts to provide an indicator of success.

TEEP (Total Effective Equipment Performance) is a performance metric that provides insights as to the true capacity of your manufacturing operation. It takes into account both Equipment Losses (as measured by OEE) and Schedule Losses (as measured by Utilization).

TEEP is calculated by multiplying four factors: Availability, Performance, Quality, and Utilization.

Let’s briefly contrast OEE and TEEP:

• OEE measures the percentage of Planned Production Time that is truly productive.
• TEEP measures the percentage of all time that is truly productive.

Total Effective Equipment Performance (TEEP) measures OEE against all calendar hours, i.e., 24 hours per day, 365 days per year. TEEP, therefore, reports the ‘bottom line’ utilization of assets.

The 4 underlying metrics provide understanding as to why and where the OEE and TEEP gaps exist:

• Utilization: The portion of the TEEP metric that represents the percentage of total calendar time that is actually scheduled for operation.

• Availability: Availability takes into account Availability Loss, which includes any events that stop planned production for an appreciable length of time.

• Performance: Performance takes into account Performance Loss, which accounts for anything that causes the manufacturing process to run at less than the maximum possible speed when it is running (including both Slow Cycles and Small Stops).

• Quality: Quality takes into account Quality Loss, which accounts for manufactured parts that do not meet quality standards. The portion of the OEE metric that represents the good units produced as a percentage of the total units started.

Utilization Losses: –

TEEP (and utilization losses) indicate how much capacity is waiting to be unlocked in your ‘hidden factory’. It shows how much potential can be increased with current equipment. In many cases, reclaiming time from your hidden factory is a faster and less expensive alternative to purchasing new equipment. Utilization losses are usually grouped as plant not open or production not scheduled.

Examples of plant not open losses include:

• Breaks/meals if the production in manual in nature (continuous plants carry on running).
• Night and weekends.
• Public holidays.

Examples of production not scheduled include:

• Lack of market demand.
• Unfavourable economics, e.g., raw material prices too high.
• Lack of feedstock/storage.

Availability Losses: –

Example of unplanned availability losses include:

• Unplanned maintenance.
• General breakdowns.
• Equipment failures.
• Tooling failures.

Example of planned availability losses include:

• Planned maintenance.
• Planned operational downtime, e.g., setup, changeover, cleaning, filter/screen change.
• Warm-up time.
• Major adjustments.
• Material shortages.
• Unofficial breaks or tardiness around shift start/end and breaks.

Performance Losses: –

Example of minor stoppage performance losses include:

• Obstructed product flow.
• Component jams.
• Sensor blocked.
• Delivery blocked.
• Cleaning/checking.

Example of speed performance losses include:

• Under nameplate/design/maximum sustainable rate.
• Low product quality (that requires slower processing).
• Equipment wear.
• Operator inefficiency.
• Operator fatigue

Quality Losses: –

Example of quality losses include:

• Unsellable production such as scrap and rejects.
• Product downgrade.
• Yield losses, possibly fully, partially or not impactable.
• Process upsets/in-process damage.
• In-process expiration.
• Incorrect assembly.

Three methodologies for improving OEE in manufacturing: –

The three most popular manufacturing improvement methodologies are Lean Manufacturing, Six Sigma, and Theory of Constraints. OEE was developed as part of Lean Manufacturing – specifically as part of the powerful and holistic improvement process known as TPM (Total Productive Maintenance).

A Fourth Methodology: IDA

This introduces a simple and universal methodology for driving any improvement activity and shows you how to apply it to OEE. The methodology is known as IDA (Information, Decision, Action).

IDA (Information, Decision, Action) is a simple and highly effective process for improving productivity using information.

IDA emphasizes three factors:

• Information: Information is the foundation and starting point of IDA. Excellent information (i.e., accurate, relevant, and easy-to-understand) is a precondition for effective decision-making.
• Decision: Decisions are the pivot between Information and Action. It is the moment in time when Information is reviewed and a course of Action is decided.
• Action: Action is where theoretical possibilities are transformed into tangible progress; where Decisions are transformed into Results.

IDA is simple and universal. You may have noticed that the equation looks a lot like OEE. Three factors are multiplied together to get an answer:

Availability × Performance × Quality = OEE

Information × Decision × Action = Result

References

www.oee.com

Article By

Tanmay

1.0 Introduction.

Production planning and control (or PPC) is a maintenance strategy that aims at enhance the efficiency by allocating human resources, manufactured goods, and equipment/machines. Manufacturers must create high-quality items at a cheap cost while maintaining adequate flexibility to satisfy quickly changing consumer needs in order to be competitive. Production’s planning and control (PPC) is a critical function which allows a company to have control and visibility over all elements of production. It makes it possible to increase efficiency, collaboration, and the use of production-related data. Production planning and control looks at any equipment outages or maintenance schedule and tries to keep things running smoothly.

2.0 Production Planning.

Production planning is the process of planning and allocating raw materials, people, and workspaces in order to satisfy production goods on time. In a make-to-order situation, manufacturing purchases, also known as project tasks, are created when customer payments are placed.

3.0 Production Control.

Production control is the activity of monitoring and controlling a large physical facility or physically dispersed service. It is a “set of actions and decision taken during production to regulate output and obtain reasonable assurance that the specification will be met.

                                  Fig. Production Planning and Control Steps

4.0 Steps Involved in Production’s Planning.

Step-1: Planning:

The planning department receives comprehensive information from managers regarding the amount to be produced and the dates when delivery to consumers has been guaranteed. This allows for detailed planning of productive activities. The engineering department also provides the planning department with the required engineering and drawing specifications.

Step -2: Routing.

Routing requires deciding on the work’s direction and also the sequence in which particular tasks will be accomplished. Routing’s purpose is to find the most efficient and cost-effective sequence of occurrences.

Step-3: Scheduling.

Scheduling is referred as the process of estimating the time of completion and operation, and the time needed to finish the entire series as intended, while taking into consideration all important factors.

Step-4: Loading:

A load is an amount of work, and loading is the process of distributing that quantity of work to the processes required to create each item. Assigning jobs to work centers or equipment inside the work centers is referred to as loading.

5.0 Steps involved in Production Control.

Step-1: Dispatching:

Dispatching refers to the act of transmitting something to a certain location. It refers to completing all measures necessary to carry out the production schedule outlined in the routing and scheduling processes.

Step-2: Follow-Up (or Checking the Progress).

The control component of production planning and control is follow-up. It comprises analyzing if work is moving as planned and how far deviations from norms have occurred, along with taking corrective measures to restore Order.

Step-3: Inspections:

Follow-up is a control component of production planning and control. It includes assessing whether or not work is proceeding according to plan, as well as evaluating how far deviations from norms have happened and taking corrective measures to restore order. 

Step-4: Correction:

Other phases in the production control process are evaluated, and changes are made as needed. Routings, job scheduling, and even talks with workers who are taking those extended breaks are all part of this.   

6.0 Role of PPC in Operations Management:

Because of its interactive function and interdependency with almost every sector of the manufacturing process, production planning and control in operations has a lot of breadth and importance. Figure demonstrates this very clearly. Production’s planning and controlling (PPC) not only offers the entire approach to the manufacturing and production division, but also supervises and controls every step of the working environment, getting feedback from the product / process design and engineering divisions. PPC interacts with all other departments in the manufacturing department in both directions, including production and service, attaining and catalogue, construction and replacement, quality controller, manufacturing engineering, and work studies.        

                                   Fig: Role of production planning and Control.

Production’s planning and controlling entails organizing and planning the production process in general. It includes, routing, scheduling, dispatch, inspections, and coordinating, as well as material management, techniques, tools, and operating hours. The eventual goal is to establish the supplies and movements of constituents and labor, as well as machine usage and associated operations, to achieve the intended production outcomes in terms of quality, quantity, time, and location.

7.0 Benefits of PPC.

References.

What is production planning and how to do it? A comprehensive guide.,” ERP Next, 2020. https://erpnext. com/blog/manufacturing/production-plan.

“Production Planning and Control Procedures In A Manufacturing Company,” optal software. https://www.optelco.com/role-of-production-planning-and-control-manufacturing-industry/.

International Journal of Multidisciplinary Innovative Research. ISSN: 2583-0228 Volume 1, Number 1 (Jul’ 2021) pp. 70-78© CIIR, Noida, INDIA https://www.ciir.in

International Journal of Multidisciplinary Innovative Research.
ISSN: 2583-0228 Volume 1, Number 1 (Jul’ 2021) pp. 70-78
© CIIR, Noida, INDIA

International Research Journal of Engineering and Technology (IRJET)

Overview of MRP-I and MRP-Il

Article By:-

Sachin B.

What is OTIF?

OTIF stands for On Time in Full. OTIF can be defined as delivering the product on time with the right quantity and quality to the customer.

First step for OTIF improvement is to understand the process flow and identify the main delay reasons due to which there is OTIF failure. Using the 80-20 rule the 20% of reasons that caused 80% of the delays were identified.

The main delay reasons identified were:

1. Semi-Finished Good (SFG) unavailability
2. Lack of visibility of orders on the system
3. High lead time between important milestones

SFG Unavailability:

SFG unavailability was mainly due to lack of inventory practices. To address the issue, Minimum and Maximum levels of inventory had to be set for all SFG’s along with a Re-order Level.

• Minimum stock level: Threshold value below which inventory level should not drop.
• Maximum stock level: Maximum quantity of stock that is to be in hand
• Re-order Level: Inventory level at which process order is to be released to replenish the stock

This ensures all SFG follow the Make to Stock (MTS) production strategy and and all orders coming in would be Make to Order (MTO) thus reducing SFG shortages and also the overall lead time of the process.

Approach to define Min-Max & Re-Order Level

1. Based on monthly consumption pattern of all SFG stock used materials would be classified into A, B and C classes.

A – Runner materials – Most repeated materials
B – Repeater materials – Less often repeated materials
C- Stranger materials – Materials that are used once in a while

Based on Monthly Consumption

2. Maximum & Average Demand During Turn Around Time
− Maximum Demand = Production Lead Time * Maximum Daily Consumption
− Average Demand = Production Lead Time * Average Daily Consumption

3. Defining ROL, Min & Max Inventory Levels
− Re-Order Level = Maximum Demand during Turn Around Time
− Minimum stock level = Reorder point – Average demand during Turn Around Time
− Maximum stock level = Reorder point + Maximum demand during Turn Around Time

Process of setting Inventory Levels for a material

1. The raw consumption data for all varieties of the material was taken along with the previous processing materials.
2. The varieties were drilled down to only one variety as it was the only that was stored as SFG. There were 25 types of SFG for that variety.
3. After segregation of the list of materials based on the varieties, then discussed with the team for further understanding of items given to identify actual consumption of the material.
4. During discussion it was identified that 25 SFG’s segregated consisted of materials that were part of the intermediate process to prepare the final SFG
5. On further discussion with the production manager the list was drilled down and a final list of SFG’s with 10 products was prepared and signed off by the manager.
6. The actual production data of the plant for Last year (Apr’21 to Mar’22) was collected to identify the actual output of the plant and compared it with last year’s consumption to avoid capacity mismatches.
7. Using this data SFG levels for the material were calculated using the above-mentioned formulas.

These inventory levels and reorder levels are now set in the system. When the inventory levels of the material reaches reorder level, system will automatically initiate production plan for that item.

Lack of visibility of orders in the system and High Lead time between important milestones

A basic process flow was created from Order entry to product dispatch to the customer. The lead time for all orders vary based on the customer and/or country required certificates and documents and mode of shipment. This causes different streamlines for each order and the lead time variance is high. To further understand these streamlines Country-wise and customer-wise certifications and documents data was collected. This data was used to identify the most common streamline of orders.

10 Case studies on different sales orders was used to study the entire process flow from Order creation to product dispatch. The process flow compared the standard lead time of each process with the actual lead time data that was gathered from the case studies. The average lead time between the date product was ready and order dispatched to customer was 30 days.

Hence, to reduce the overall lead time parallelizing and sequencing of the activities in the streamline was done. A time and action plan was designed for the same and pre-requisites for certificates and documents and for material movement was mapped.

To provide further visibility on orders through the system a dashboard will be available to allow the user to check the status of each order along the process flow. This dashboard will also help identify delays in the process and display the total hours of delays.

Automating the workflow management through the system will help avoid miscommunication and communication delays. This will also reduce man dependency and allows easy progress monitoring.

Article By:- Rju Samrat

• Introduction to six sigma

Let us first understand what is six sigma, 6σ is Way of systematically improving processes by eliminating defects or in other words we can say that “Six Sigma” refers to the notion that if you have six standard deviations between the mean and the nearest specification limit, practically nothing will exceed the limits. It was initiated by Bill Smith at Motorola in 1986. Six Sigma is a data-based methodology to improve performance by reducing variability. It requires thorough understanding of product and process knowledge and is completely driven by customer expectations. In other words, it is a methodology to achieve 3.4 defects per million opportunities. It can also be used to bring breakthrough improvements in the process. It focuses on the bottom-line and is a proven methodology for problem solving.

• Understanding Six sigma through graph

Sigma or standard deviation is a statistical measure of dispersion in data. It is a measure which uses the characteristic of past data to make judgements about how the process will perform in the future. If a given set of data has normal probability distribution, then the number of defects that will occur in the process over a period of time can be known depending upon the sigma level of the process. In a 3 sigma process the values are widely spread along the centre line, showing the higher variation of the process. Whereas in a 6 Sigma process, the values are closer to the centre line showing less variation in the process. Lesser the standard deviation of the process, more precise or consistent is the process. Below is the number of defects which based on the sigma level of any process.

• Methodology of Six Sigma

The two main Six Sigma methodologies are DMAIC and DMADV. Each has its own set of recommended procedures to be implemented for business transformation. DMAIC is a data-driven method used to improve existing products or services for better customer satisfaction. DMAIC is applied in the manufacturing of a product or delivery of a service is a part of the Design for Six Sigma (DFSS) process used to design or re-design different processes of product manufacturing or service delivery. The five phases of DMAIC & DMADV are

• The Six Sigma Equation

 Y = f(x)

The simple looking equation mentioned above can be described as the crux of the Six sigma philosophy. The component parts of the equation are as follows:

• Y = Outputs also known as Dependant Variables
• X = Inputs also known as independent Variables
• F = Function

What the equation is actually saying is that the outputs we receive are the function of the inputs that we give to our process. Hence if we were able to control the inputs with precision, the outputs would also be controlled in a precise manner

• Benefits of Implementing six sigma

1.    Reduces Wastage

2.    Reduces Inventory Needs

3.    Reduces Reworks and Defects

4.    Increases Customer Satisfaction

Six Sigma results in massive cost savings to the organization involved. These cost savings are highlighted by the fact that after a Six Sigma project any organization has considerably less requirement for labour hours. Also, the requirement of skilled labourers is also reduced. Hence, both these factors combined have an effect of drastically reducing the labour bill of the organization.

Reference Link

Article by:- Dhaval Gohel

An Introduction to JIT Production System

The JIT production system is a market-oriented production system that rests entirely on the foundation of serving client needs.

Often, JIT is misunderstood as Toyota Kanban System. That is an indication how famous Kanban System has become. The fact is, though, the Kanban System is part—but not all—of the JIT production system. The Kanban system can be thought of as the conveyance system that helps make the JIT production system work.

The JIT production system first gained public attention in Japan in the aftermath of the 1973 oil crisis, when market demand slacked off. A strong diversification trend was born, and Japan’s economic growth slowed to a more modest rate. Amid this environment, the JIT production system gained the media notoriety as a recession resistant production system.

JIT, or “Just-In-Time,” refers to the timing of production flow; goods are delivered to the manufacturing lines just in time to be used, just in the immediately needed quantities, and just to the production processes that need them. Saying “in time” is not enough, since parts can arrive at processes a week or two prior to their use and still be there “in time.”

Figure 1 – Overall Image of the JIT Production System

It is helpful to picture Just-In-Time production as something like a river, in which separate workpieces float along in a level manner from station to station as they are sent downstream. Figure 1 presents an overall image of the JIT production system.

The JIT production system seems simple enough, but when we begin to delve into its inner workings, we find it to be extremely complicated and full of things that cannot be well understood until they have been tried out in the factory. Factory-based improvements are not something to be talked about, written about, heard, or seen—they are something to be done. Such improvements are “first-hand” to their very core. The following is an introduction to the types of improvements that must be made to bring about Just-In-Time production:

1. Flow Manufacturing

Flow manufacturing requires the elimination, whenever possible, of pileups and conveyances to enable work-in-process to flow in a level manner through the line. The goal is to have each workpiece move through the chain of processes, so it is correctly processed within the cycle time.

2. Multi-Process Handling

In the conventional equipment layout scheme, where several machines having the same processing function are grouped together as a shop, one worker might be able to handle several machines, but handling several processes is out of the question. A different layout scheme, in which the machines that make up an entire sequence of processes are grouped together, would enable a single worker to move with the workpieces from process to process until the workpiece processing is finished. This latter arrangement is called multi-process handling.

3. Kanban

The Kanban system comprises one of the tools for maintaining Just-In-Time production. Kanban are signs that contain operation instructions and/or parts delivery information. Kanban are useless in factories that still use the conventional “shish-kabob” type of production method. In fact, they tend to increase warehouse inventory levels in such situations. The factory must first switch over to flow manufacturing and must start pulling workpieces from process to process rather than pushing them.

4. Manpower Optimisation

Conventionally, production lines have been organized with a view toward maintaining a steady number of workers on the line. The JIT production system rejects this way of thinking and instead organizes production using the minimum number of workers (personnel costs) required to meet the demand (fluctuation) of the next process (the market).

5. Visual Control

A key method for making bold improvements is to make line failures or other factory-floor problems visible and obvious enough so that anyone can easily spot them. Various devices can be used to make production line problems more visible. Kanban and Andon (line-stop alarm lights) are two such visual control devices.

6. Levelling

A little earlier, the term “shish-kabob” was used in discussing the kind of production scheme that was popular during the mass-production era. The shish-kabob image refers to the way that lots were processed in large, separate groups (the larger the better), much like the way meat and vegetables are set one by one on shish-kabob skewers. Lots were processed and then warehoused. The concept of levelling calls for product types and volumes to be spread out to produce as level a production flow as possible. Thus, levelling is fundamental to both Just-In- Time production and flow manufacturing.

7. Changeover

Changeover Improvement Steps

Here, the term “changeover” is a broad term that covers not only the replacement of dies and blades, but also other operations, such as the revision of standards and the replacement of assembly parts and other materials. The goal of changeover improvements should be to shorten the time needed for such operations. They should make marked reductions in labour-hour requirements to build a strong, flexible manufacturing line that is adaptable to changes.

8. Quality Assurance

Quality is not something that just happens when we have good production equipment. Likewise, having equipment operators work more cautiously does not necessarily reduce the number of defective products. Rather, quality assurance requires a comprehensive approach that addresses all production factors, including people, goods, production equipment, and production methods.

9. Standard Operations

Three Basic elements of Standard Operations

Standard operations are essential for maintaining flow manufacturing once it has been established and for keeping pace with the production schedule. In short, standard operations are the operations that have been painstakingly developed to achieve and preserve an effective combination of people, goods, and machines to produce high quality products economically, quickly, and safely.

10. Jidoka – Human Autonomation

Jidoka is automation with a human touch, and therefore differs from automation in the ordinary sense. Jidoka brings humans into the automation process to ensure reliability, flexibility, and precision.

11. Maintenance and Safety

Production Maintenance Cycle for Zero Breakdowns and Zero Defects.

In the JIT production system, the entire production flow is stopped whenever even the smallest machine breaks down. That is why the JIT production system places immense value on maintenance activities that maintain high production capacity. Equal emphasis is placed on safety— the primarily consideration in production—to prevent breakdowns and accidents.

SOURCE: JIT Implementation Manual by Hiroyuki Hirano

Article By:- Mallikarjun

A product is believed to go through definite life stages within the same manner as a living organism. Product are first introduced within the market and customers settle for if they notice them serving their desires, sales go quickly. Finally, everyone who desires the product acquires it and sales highland. At some stage, either the want for product was satisfying to see to exist, or a different solution to that need emerges. An organization that introduces new product naturally hopes that the product will contribute to supply customers satisfaction for a longer amount of time.
On reality basis this does not happen, so progressive organization tries to stay aware about the sales & market relation of product with customers.

A product life cycle is that the amount of time a product goes from being introduced into the market until it’s commenced the shelves. The concept of product life cycle helps inform business decision-making, from pricing and promotion to expansion or cost-cutting.

Theodore Levitt (1965), a well-known marketing management thinker has created his ideas in the basic concept of the life cycle of the product.

Levitt idealize the concept of the product life cycle as:

1.  Products have a limited life span

2. The sales and consumptions passed through distinct stages, each poses different challenges, opportunities, and problems to the sellers.

3. Profit rise and falls at different stages of the life cycle of products. 

4. Product required different marketing financial, manufacturing, purchasing and human resource strategy in each stage of their life cycle.

There are many factors affecting the life-cycle of a product. Joel Dean (Father of Managerial Economics) said,  

“The length of the product life-cycle is governed by:

• The rate of technical change
• The rate of market acceptance 
• The case of competitive entry.”

There are four stages during a product’s life cycle—introduction, growth, maturity, and decline.

1.  Introduction/Development stage: Once a product has been developed, it begins the introduction stage of the PLC. In this stage, the product is released into the market for the first time. During the introduction stage, marketing and promotion are at a high, and the company often invests quite a bit of effort and capital in promoting the product and getting it into the hands of consumers. In this stage the product is new and the customer acceptance is low and hence the sales are low.

2. Growth stage: During the growth stage, consumers have accepted the product in the market and customers are beginning to truly buy in. The growth stage is when the market for the product is expanding and competition begins developing. Potential competitors will see your success and will want in. Here knowledge of the product and its capabilities reaches to a growing number of customers. 

3. Maturity stage: The maturity stage is when the sales begin to level off from the rapid growth period. This means that product features might be enhanced, prices might be lowered, and distribution becomes more intensive. During the maturity stage, products begin to enter the most profitable stage. The cost of production declines while the sales are increasing. The product is widely acceptable and sales are now stable, and it grows with the same rate as the economy as a whole grows.

4. Decline stage: Although companies generally attempt to keep their product alive in the maturity stage as long as possible, eventual decline is inevitable for every product. This decline that generally follows could be due to reseeds such that consumers changes in taste and preferences improvement  in technology or introduction of better substitute. In the decline stage, product sales drop significantly, and consumer behaviour changes, as there is less demand for the product. 

These four stages can be summarized in different sector like sales, marketing, pricing and competition.

PLC analysis is a method of purposefully examine a product and creating strategic style, pricing, and marketing decisions to optimize the product for every stage of its life cycle. Conducting PLC analysis will facilitate firms verify if their product are servicing the market they target efficiently so that new strategies can be introduced.

Examining their products life cycles – can help firms verify if they have to develop new products to continue generating sales, particularly if the bulk of their product are in the maturity or decline stages of the Product Life Cycle.

Popular PLC pricing strategies

1 Price Skimming

Price skimming is a strategy that involves setting the value of a product high at first, then lowering it to “skim” additional groups of customers as the market expands. Once it is launched the pricing is set high and it gets introduced to customers who are willing to pay for latest products. After it fulfils the demand of this group, the price is lowered to attract demand from new, price-sensitive group of customers. 

2. Price Penetration

Price penetration is a strategy that involves setting the initial price of a product low to penetrate the market as quickly as attainable. This strategy helps build client awareness, that will increase demand. The product’s pricing is increased as demand for it grows.

Conducting PLC analysis can help companies learn when they need to reinvent their product or pivot it in a new direction. For example, online streaming service Netflix pivoted their product by transitioning away from their DVD-delivery service and toward streaming movies and television series directly online, which was met with great success.

By Aman Tembhekar