By: Paul Van Metre
Non-Conformances (NCs) are unavoidable in any job shop or manufacturing process. Some are related to setting up and proving out new jobs or processes. Others happen during production when processes go out of control, tools break, humans make an error, etc. When parts need to be scrapped, reworked, or remade, costs can skyrocket! All manufacturing companies should endeavor to minimize scrap, root causes of scrap, and the cost of scrap, and data found in Non-Conformance Reports (NCRs) is the key to doing this.
When a non-conformance (NC) is identified, many shops consider those parts scrap immediately, and throw them in the garbage, the recycle bin, on the bottom of the cart, or otherwise don’t do any formal process to document what happened. When that happens, valuable information is lost that can help to improve the process to reduce NCs in the future. And also, parts that could possibly be reworked or use-as-is may be discarded unnecessarily. This is more understandable when the overhead cost to generate and manage a report of the non-conformance is too high. If filling out a paper NCR, submitting it to QC, scanning, filing, collating data in an Excel sheet takes a lot of time, the value may be questionable at first glance. In some shops, the decision to make an NCR or not is left to the discretion of the people involved, which means that there is no system, and some employees will create NCRs more often compared to others, skewing the data. If you ask these shops how much scrap costs them every year, or which reasons are the most frequent or costly, they likely will have nothing better than a gut feel.
Every time an NC happens, whether it’s “planned” (ie. setup pieces) or “unplanned'' there is a root cause for that occurrence. Maybe it’s because a new CNC program has an error in it, or the wrong tool was selected from the tool crib. Maybe it’s because a part was misloaded in the fixture, a tool wore out and started cutting out of tolerance, or a part got dropped on the floor and damaged. There are many reasons NCs happen, some far more often than others. Regardless of the reason, NCs can be a very expensive problem. To help determine what the total cost is, and why the NCs are happening, it’s important to always make a non-conformance report (or an NCR for several parts of the same reason). A quote I like that best describes why this is important comes from the famous British physicist, Lord Kelvin: “What is not defined cannot be measured. What is not measured, cannot be improved. What is not improved, is always degraded.” With that in mind...
Top 7 reasons to make an NCR at the moment a non-conformance is identified:
Depending on the cost of the material, how far along in the manufacturing process the NC occurs, the cost to replace or remake the part, etc. the cost can vary considerably. If the data for the cause code of an NCR code is collected and analyzed on a Pareto chart, it will become apparent that some causes are much higher than others and far more expensive. These are likely the “lowest hanging fruit” and the best ones to focus on right away to reduce the cost of NCs. It’s through a formal MRB (Material Review Board) process, or a Management Review on a monthly or quarterly basis where those larger trends will be revealed.
In order to reduce the transactional and overhead costs of creating and dispositioning NCRs, the process should be digital. NCR creation should be tied into the inspection process and software should identify immediately if an inspection result is out-of-tolerance and allow instant creation of an NCR, and the software should pull all the meta-data about the part and job onto the NCR, including part number, work order number, client, work cell, operation, operator, dimension tag number, and more. When this is done, an alert should be sent to quality or management staff so that help can be immediately mustered if warranted. When all the NCR data is digital, has all the corresponding meta-data, and took just seconds to produce, it makes it very easy to then analyze that data on dashboards, helping management make the best and most timely decisions on what actions to pursue to reduce the cost of non-conformances in the shop. This can have immediate and positive effects on the bottom line of any shop, and the money that used to go towards dealing with NCs and scrap can be used to invest in the growth of the company.
Not surprisingly, the advice in that last paragraph about making the inspection and NCR process digital is exactly how ProShop works. Considering that the manufacturing staff is directly interfacing with ProShop at the work cell, the NCR creation process can be virtually instantaneous, getting machines running again while collecting that critical data needed for root cause analysis. When alerts are sent, quality staff or leads can be dispatched immediately to help support production and disposition parts right away when warranted. ProShop even allows for giving employees permission to only disposition to scrap, if the parts are clearly bad, but requiring QC staff or a lead to make the decisions about use-as-is or rework during an MRB process. Our Training Access Control feature even allows the ability to lock employees from editing the disposition field (or any field) until sufficient training is provided to the employee. Auditors love this feature!
When the time comes to evaluate NCRs at a monthly Management Review Meeting and take action, Improvement activities can be identified, NCRs can be assigned to staff, and Corrective Action Requests (CARs) can be generated with a tap of a button. NCRs can be easily and instantly analyzed from a part number perspective, by the machine, by the client, by the employee, by shift, and of course by cause and NCR code. This reduced overhead burden makes easy work on the administrative side of quality control, freeing up vast time from Quality Managers. In fact, many clients report freeing up about 50% of their Quality Manager’s time, allowing them to actually work on more strategic and money-saving activities and implementing measures to reduce NCs and the associated cost in the first place.
By: Lacey Hill
For a prospective or existing customer, a shop tour is an excellent way to connect with their supply base and review the operations, systems and processes of a given supplier. For a supplier, this is your opportunity to shine; showcasing your capabilities, workflows, daily operations, ERP system, quality management systems, skilled staff, etc…...OR this can be a moment where you fail fast.
Paul Van Metre recently wrote a blog post titled Use Your Machine Shop Management System as a Sales Tool that directly relates to this. In that post, he states “shops can’t just promise great quality and delivery. They need to prove they have the processes and systems to guarantee they will execute. This will open doors to more discerning clients.” Paul, and a few of our ProShop clients, go on in that article to talk about how showing customers their ERP system, and discussing the workflows that are supported by it, can be an excellent sales tool. Also, I can attest to that from the first-hand experience, from the customer perspective.
Before joining the ProShop team, my career was in the supply chain field as a Buyer, Purchasing/Planning, and Supply Chain Manager, and I conducted a lot of supplier onsite tours in that time. I quickly learned that with some very simple questions I could glean a lot of information about key areas of a supplier’s business. Also, I could see how robust their shop management systems were.
If you aren’t using your ERP system as a sales tool yourself, OR if you lack a solid ERP system (or any structured system) to run your business with, then hopefully the following 4 examples will help you see how those can be key to maintaining your current customer base and growing it!
Below are 4 examples of simple questions, broken out by a subject area, that demonstrate what information can be obtained from how the supplier answers the question, and what steps they use in answering it.
Customer question: “Can you tell me where job # 1234 is?” Does it look like it's on track to deliver on time?”
What information can be obtained from this question:
Steps followed to answer, using shop management tools:
Steps followed to answer, without shop management tools:
This example clearly outlines how drastically different the customer’s experience can be given an ERP system, and other workflow processes, are in place in your business versus not.
Customer question: “What orders are due to ship out this week? And how do you prioritize jobs?”
What information can be obtained from this question:
Steps followed to answer, using shop management tools
Steps followed to answer, without shop management tools:
I’ll add, in paper-based shops, where travelers can be found throughout the shop floor, as I’d walk the floor, I’d often look for customer due dates on the WOs. If the majority of the due dates were in the past, that was a warning sign that the supplier didn’t have processes or systems in place to prioritize work throughout their shop.
Customer question: “What’s your current on-time delivery percentage for this month?”
What information can be obtained from this question:
Steps followed to answer, using shop management tools:
Steps followed to answer, without shop management tools:
On-time delivery is one of the crucial components to customer satisfaction and the success of a business, and it was the driving metric for the departments I worked for and managed. So I expected the same from the suppliers I worked with. How they answered this question and how laborious the steps were to supply that answer told me a lot about how important meeting my company’s delivery dates were to them.
Customer question: “How do you know what this material is, how much you have on hand, and how long it’s been in your inventory?”
What information can be obtained from this question:
Steps followed to answer, using shop management tools:
Steps followed to answer, without shop management tools:
I remember, on one site tour, I had gotten a call from my Quality department letting me know we were missing some certs on an order that had recently been delivered from the supplier I was visiting. So on the tour, I asked if a copy of the certs could be supplied to me before I left. The tour lasted an hour, and in that time the supplier couldn’t locate the requested paperwork. Two days later they called and confirmed they couldn’t determine what material was used for that order. We had to scrap the finished parts, and the supplier had to re-make them using material that had cert traceability. We lost 2 weeks of lead time on our own production schedule and missed our delivery date to our own customer.
ProShop’s tools are geared to address these, and many more questions that customers will ask on shop tours. Whether it’s the on-time delivery metrics that we displayed on the ProShop homepage, or the dedicated Scheduling module designed to quickly and efficiently schedule work through your shop and provide visibility of that order of jobs in real-time throughout the organization, ProShop is here to help you fly high instead of fail fast during a customer site tour!
A nearly perfect case study of this phenomenon was outlined in this article from Modern Machine Shop Magazine, featuring a ProShop customer East Branch Engineering in CT. The article describes how, after visiting 2 suppliers who were dual sourced on a large project, East Branch won the entire project because of how well they could answer questions and demonstrate their digital system compared to the other vendor and their paper-based system with its inherent problems.
