MEMEX - OEE Factory Automation

Watershed Thinking in our Industry – New Tooling is Only Marginal Improvement

I had some most interesting customer feedback, as it is a watershed in what is going on in our industry – huge productivity gains will come from efficiency on the shop floor production processes, not just the machines themselves.

About 15 months ago, my partner and I presented to the corporate management team of an international machine tool manufacturing vendor – we had the ears of the top execs.  Moreover we had the connection with shop floor engineers in specific plants that wanted to install our OEE Productivity Monitoring systems – they needed our system.  Well nothing happened, and it dragged on – you know the story.

Yesterday I got a call from the main engineer (we had met at IMTS – 2008) the project was on!

He described the political layout, champions, etc., and mentioned the people we met 15 months ago, and pointed out that their corporate boss (CEO / VP MFG) was driving this project.  Yes, this is excellent sales work, sowing the seeds, planning, capital budgets, etc.

But most importantly, the engineer shared with me that over the last few years they have invested in the latest and greatest equipment, fastest this machine and that, better tooling, all kinds of things.  They had noticed that their productivity improvement from new equipment usage was initially in the 20% range and has steadily dropped down to the 2% range.  That means the marginal gain of using the latest and best equipment was really minimal.  So the question then was why – what was happening in their process that meant they could not get a high return on their new equipment.  Was it machine utilization, equipment, was it their processes?  Where could they spend their financial capital to get a maximum return?

They have come to realize now that their huge productivity gain would come from efficiency on the shop floor.

But first, they needed to measure what was going on – and this is where Memex comes in, as this is what we do, automatically at the machine.  This to me is huge – we understand it by being in the industry, and it is like the forest and trees syndrome, but to hear a customer quantify it with real return numbers was music to our ears.

I also believe the economic cycle is at work here, 2011 is the year manufacturers are spending, and it has taken until now to open up those projects.  I can tell you we are gearing up engineering in a big way – for all the right reasons.

We expect manufacturers to be more efficient, we are seeing it with our customers daily in real-time!

Advice on Software for Job Shops

Recently the manufacturing journalist, Derek Singleton published an interesting article in Software Advice that should be of strong interest to Job Shops.

During his research with shop leaders, three areas surfaced as essential components to consider when choosing software: flexibility of bill of materials, work order features and the ability to deliver real-time, actionable data. We at Memex believe in providing real-time data, automatically from the machine and complementing a flexible work order system on the shop floor. Our customers tell us the same things, as we support them to bring true value to their operations. Below is a quick synopsis of Derek’s article.

  1. A Flexible Bill of Materials Fosters Custom Production – Job shop production requires software that supports a dynamic bill of materials (BOM). As such, it’s important to look for BOM functionality that allows the production team to adjust materials during manufacturing processes. At the same time, there should be functionality to substitute alternative materials in an already defined BOM plan. This is a fundamental building block of job shop production and important feature for the high level of product variation in shops.
  2. Work Order Functionality Maintains Workflow – It’s not unusual for a mid-sized job shop to have 200 work orders floating around at a given time. Managing these manually is a paperwork nightmare – not to mention inefficient. With automated software, however, you can deliver work orders directly to machine operators at their work stations. This prevents operators from having to go to the production manager to ask for their next tasks.
  3. Real-time Data Creates a Proactive Environment – Having a flexible BOM and strong work order functionality does little good if real-time data isn’t accessible for employees to make the best decisions. The laundry list of information that needs to be kept up to date can be dizzying. A shop needs to know what’s being fabricated, what’s being scrapped, why items were scrapped, how many parts shipped and so on. Providing real-time access to this data clearly means gathering information in real time. One way to achieve this is to follow Forrest Machining’s lead: Put computers at or near every work station for workers to input data for analysis.

Beyond knowing which software components are the most important, it’s also necessary to understand how to get the most out of your system. In other words, the software alone cannot make your shop successful – you must also be able to make efficient use of the functionality to maximize your outcomes.

MTConnect and Memex Support Legacy Machine Connectivity E-mail Clarification

Dave Edstrom, President and Chairman of the Board for the MTConnect Institute, has requested that we clarify an earlier email where we stated, “A significant announcement at the show was the industry consortium, MTConnect, asked Memex to co-chair the Legacy Machine Tool Connectivity Working Group to develop industry standards, effectively endorsing our product direction.”

Dave Edstrom stated, “We are thrilled that David McPhail is the Co-Chair, with John Turner, of the new Legacy Machine Tool Connectivity Working Group. It is imperative that everyone understands that the MTConnect Institute has never and will never endorse any company, organization or set of products. This is why I asked Memex Automation to send out this clarification.”

OEE in Process or Discrete Manufacturing

The Process manufacturing sector has been way ahead of the rest of manufacturing in adopting and using efficiency metrics, all for a good reason. Discrete manufacturing has not been able to adopt metrics easily in the past and we now have a cost effective solution that can be of huge advantage to companies.

The simple logic here is the Process manufacturing sector, characterized by chemical changes in product often in a continuous environment (eg. Refinery), is very capital intensive using process control MES systems that capture all this information, so it is then easy to report on the metrics. Typically multi-million dollar project implementations, all part of the initial machine deployment.

Discrete (CNC and many other types) on the other hand, which are characterized by making individual parts, have not needed the sophisticated MES controls and could not justify the very expensive implementations of $10,000 to $millions per machine, so they have not done much in the OEE metric area. Up until now, and primarily because of our product, we have brought the price point down to the $4,000 per machine level – which is now cost effective and justifiable. The benefits of 20% or more productivity (our customers say it is much more) pay for this system very quickly.

And we can make this an “Operator-less” input – meaning we pick up signals right from the machine and there is no need for an operator to give some input, unless required for reject or downtime reason codes. We are hearing from our customers that this is very important – you can just imagine all the reasons. Many ERP and other solutions just about all require operator input (bar-code scanning etc.) and this is old thinking and often problematic with operator productivity, errors and even hand writing on a clipboard for entry days later. Our real-time, direct connection is most accurate and saves much labor time – often justifying the hard direct expense in itself, let alone the benefits of increased efficiency, lower product costs and competitive advantage.

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Customer Perspective on Benefits of OEE

There is always interesting new benefits of OEE from a customer perspective especially as it relates to a positive experience for operators and people on the shop floor. A recent interview dug up these golden nuggets:

“We now have a tool to communicate to the people on the shop floor that our performance can improve.”

“The OEE data provided improves human as well as machine-to-machine communications.”

“We believe we can use Memex data to motivate employees with a shared understanding of how we can be more productive, and that’s what it’s all about.”

“Our biggest differentiator is productivity and OEE helps us identify areas to improve our efficiency.”

“Machines are islands of unconnected information – like having a group of office PCs, each with different software – now we can network machines together, just like networking an office.”

“We had passive OEE with manual clip boards and now we have active OEE, visible in the plant.”

“The key to better productivity is not just to track performance, but to act on problems in real-time.”

“Machine connectivity unites the islands of machine automation, establishing a fully-connected, enterprise-wide manufacturing nervous system that gives real-time visibility of production and the ability to adapt and control each machine.”

“Customers can see and believe in what we’re doing to improve on time delivery because we have traceability of machine operations through OEE.”