Analytics For Manufacturing: What Will You Actually Get?

Most North American manufacturers are run by smart people that know that data is important to run their business. It’s why they create standards, collect data, and use information to drive change on their shop floor. This doesn’t always mean that these businesses deploy true analytics for manufacturing or implement best practices for gathering data inside of their organization, but typically means they are very conscious of its importance.

The reason why some are more mature than others in this area is because of their ability to understand what they truly need to learn from analytics to drive cost-change in their business. This stems from a spectrum of awareness around the truth and the story; as it relates to what’s happening on the shop floor. What’s the difference? I’m glad you asked.

analytics for manufacturing

The truth = what actually happens on the shop floor

The story = what’s supposed to happen and what you think actually occurs

Let me explain. Most of us in manufacturing clearly realize that there is a chasm between what is supposed to happen on the shop floor and what actually happens. In most cases, we hope that the variables are small and that what we think is supposed to happen is generally what takes place. If it doesn’t we’d know , right?

Well, the more and more we learn about manufacturing, the more the industry is showing that this may not be the case. What’s happening between what was supposed to happen and what actually happens may be a bigger deal for a lot of manufacturers than what we initially thought.

The maturity in analytics that we discussed earlier is directly determined by a manufacturer’s ability to dig into that massive space in between and affect it. Where do you fall? Let’s find out.

The Scrap Rate Conundrum

Do you have scheduling issues? Do you know how long it takes to make a part? Are you able to properly account for labor hours and production time? A lot of this is ultimately determined by your ability to accurately understand and effect your scrap rates. Scrap rates influence all of these things directly; yet are rarely looked at with a sharp eye for a number of reasons.

Why should you care about scrap rates?

Most manufacturers I’ve worked with often set a certain scrap rate (maybe it’s 4%… just as an example). 96 good ones for 4 bad ones. Easy-to-understand numbers that make it simple to plan and build processes around. The problem with standards are that they can typically only be measured in snapshots and determined under optimal conditions (on paper). And as many of you in manufacturing know,  things rarely work exactly how they do on paper.

This is exactly the case with scrap rates. People, machines, and processes can create tremendous variability in this whole process. The inability to look at how things are working as they happen means that these snapshots are only historical perspectives of how things actually played out. So at the end of the year, a manufacturer may find out that they were at a 10% scrap rate but have absolutely no idea why.

What’s worse, if the goal was 4% and the end of the year is 10%, you’re still only looking at the average. It’s possible you were at 4% the majority of the year but were at 30% during a certain period; which could be skewing the data. The truth is you will have no idea of knowing why.

Why this potentially could save you a lot of money

Imagine this, you think that for every 100 widgets you make that you make 4 bad ones, but in reality, you make 10 (150% more). That means it takes you longer to make the right number of products, makes you run production longer, buy more raw materials, change scheduling, and add additional labor all because you had no idea how long it took you to make the right number of items/parts/etc. This is directly related to scrap rates.

Extrapolate that over days, months, and even a year! That is a massive cost that many either aren’t looking at, aren’t adjusting, or aren’t able to effect because they don’t know what’s actually happening.

This is why analytics for manufacturing is so important. The truth and the story are both very important, but neither on their own can save you money. What you need is the inbetween.

scrap rates analytics

Making Analytics For Manufacturing Work

When setup to deliver information like scrap rates in real-time, analytics for manufacturing can allow businesses to do a better job of optimizing for standards (or better), and recognize problems the moment they start occur instead of later on when the damage is done and the opportunity for cost savings is lost. This means saving money on raw materials, production, and labor in ways that many are missing out on.

What makes this difficult is finding an easy way to access the data that is meaningful to your shop floor in an affordable way. Ultimately, most analytics software can’t tell you anything unless they understand your problem; like the scrap rate scenario described above. This is a huge issue for most costly analytics packages, because even when configured properly they may not know how to best get to the heart of an issue properly or have the expertise to add value throughout the data gathering process.

The problem is that many times organizations do not deeply understand their problem in a way that will allow them to set up analytics for manufacturing either. ERP and MES packages are too expensive and hard to implement, so they are often intimidating to tackle when a manufacturer may not have 100% clear direction as to what they want to accomplish.

Getting your money’s worth

That’s one of the reasons why SensrTrx has become so attractive to manufacturing businesses. It was designed to collect manufacturing data easily without complex integration of configuration (OEE, availability, how to connect to machines, what data is important). Manufacturers simply don’t want to explain all of these things to expensive consultants who ultimately will need to be corrected when setting all of this stuff up. Most manufacturers just want the data in real-time so they can make adjustments and save money. This has been expensive and difficult until now.


Learn More

If you’d like to learn more about SensrTrx, what it does, or how it could help you gather valuable data, watch the SensrTrx demo. The manufacturers using the tool are getting great results.

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Summary
Are Analytics For Manufacturing A Waste of Money?
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Are Analytics For Manufacturing A Waste of Money?
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Should you invest in analytics for manufacturing? You might be surprised by the answer. We take a deep dive into the value of true manufacturing analytics.
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SensrTrx
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