Industry Classifications

I thought it would be appropriate to define the types of industries plant rats work in. Roughly speaking there are three types of general industry classifications. I work in a secondary type industry. My plant takes incoming materials and produces products. In fact, we use little raw material. We mostly take incoming components and produce final assemblies.

• Primary Industry (sources of raw materials) – e.g., Off-shore oil rig in Gulf of Mexico petroleum-based feedstocks, mining.
• Secondary Industry (converts raw materials into products) – e.g., Maytag’s microwave cooking units
• Tertiary Industry (service industries) – e.g., repair and maintenance of automobiles.

Now that I think about it, farming is also a primary industry.

I would be interested in hearing about your industry!

Plant Closings #4

This one is automotive related:

SHELBYVILLE, Tenn. -- Summit Polymers Inc. has announced plans to close its Shelbyville plant in January, leaving 263 people jobless.
The facility has 222 hourly production workers and 41 salaried employees.
The plant, which began production in 2004, was built to supply plastic interior parts, primarily for trucks and sport utility vehicles

There will be MANY MORE of these closings.

Plant Closings #3

I am by no means trying to list all plant closings. There are too many to capture anyway. I just try and pick out the ones that may have something of a lesson to learn. This article is posted in Triangle Business Journal:

Silver Line Building Products will shutter its plant in Durham before the Christmas holiday, laying off 428 people, according to the state Department of Commerce.

Silver Line, which makes vinyl windows and patio doors, told of its actions in a WARN Act notice with the Commerce Department. The company says it expects the closure to be effective as of Dec. 20.

Sometimes timing is everything. "The company came to the Triangle just four years ago, announcing in December 2004 that it would build a factory in Durham and employ 800 workers." Ouch, just before the housing boom ended.

Inventory Reduction

I know that my company is tightening its belt to conserve cash and reduce costs. Everyone, even households, will try and live off of existing inventory for as slong as possible.

"There's clearly been a slowdown in steel demand, which we have noticed in the United Kingdom, in export markets and in Southern Europe," a Corus spokesman said. "We are taking steps to adjust our production to tie in with the new demand realities and to maintain a low level of stocks."

The company, owned by India's Tata Steel, now produces more than 20 million tonnes of crude steel a year.
A collapse in steel prices, producers and traders de-stocking instead of buying new material and a gloomy demand outlook have helped force steelmakers across Europe to cut production.

Plant Closings #2

Another side effect of belt tightening. This time it is due to a reduction in direct mail advertising.

NC direct mailing company IWCO Direct officials say 380 workers are losing their jobs because a plant that develops direct mail advertising in a small North Carolina town is closing.

Officials handed out notices Thursday at IWCO Direct in the Wilson County town of Elm City. The workers earned between $9 and $25 an hour and were given 60 days severance pay.

The company's Debora Haskel said the plant was closing because fewer companies are sending brochures in the ailing economy. Haskel said the closing "is completely market driven.

"Credit card marketers aren't making as many offers as they used to," Haskel said. "They are not making as many (direct mail) loan offers."

This is a big difference from cutting back a shift or eliminating overtime. This is a permanent closing of a factory. It will not come back.

Doesn't it seem like direct mailing should be done on a regional basis anyway? The "IWCO said it is moving its operations to Minnesota and continues to send 200 million mailings a month." It seems more efficient to me to keep a spread of regional mailing centers to reduce logistics costs. This is how Netflix does it.

Using the Pause for the Upturn?

I think most producers are always looking at ways to be more agile. Recently there is an additional focus on being "green". Agility on the plant floor allows for shifts in product mix by having programmable controllers and CNC machines used in work cells. Green is now focused not only on emissions, but on ways to reduce costs by being more efficient in the indirect materials used.

When the next upturn comes, chipmakers aim to have much leaner, more agile fab operations ready to capitalize on it. That was a dominant theme at the International SEMATECH Manufacturing Intiative (ISMI) conference in Austin, TX (Oct. 22-23). Chip factories will also run greener, cutting costs at the same time, by using less energy, water, chemicals, and other consumables.

Lean manufacturing has been a mantra for decades and a way of life for Toyota since it reached maturity in about 1975. The current immense slowdown will shock many managers with the realization that some "lean plants" are not as flexible as hoped. I am sure the lean idea will be refreshed and become even more entrenched in modern thinking.

Another Reason the Current Crisis is Going to Hurt

"Consumer spending accounts for more than two-thirds of the U.S. economy," is a quote from an article by David Lazarus in the LA Times.

U.S. retail sales fell in September for the third straight month -- the first time this has happened since the government started tracking such data in 1992. The holiday shopping season is expected to be the worst in years. But some forecasters are predicting that spending will pick up by the middle of next year as consumers shake off the recession blues.

Now is the time to consider how well our factories and workshops have been capacitized. With orders declining how will production be reduced? Will an expensive large integrated line have to be run for one shift a few days a week? Or, will is be run with fewer employees to meet the new output requirement?

Job Loses on the Rise

The New York Times has another article about the downward trend in employment. You have to do a free registration to read the article. I think all of us working in production already know. Some of us are watching as layoffs occur.

As the financial crisis cuts demand for American goods and services, the workers who produce them are losing their jobs by the tens of thousands.

Some industries have been hit hard and fast; heavy appliances, automobiles, expensive consumer goods like TVs.

In just the last two weeks, the list of companies announcing their intention to cut workers has read like a Who’s Who of corporate America: Merck, Yahoo, General Electric, Xerox, Pratt & Whitney, Goldman Sachs, Whirlpool, Bank of America, Alcoa, Coca-Cola, the Detroit automakers and nearly all the airlines.

With the current mood I am sure we have not seen the bottom of the tightening yet. So factories will continue to see lack of work.

Factory Girls in China

Howard W French, in the New York Times, has a review of a book about factory life in China. The book, Factory Girls - From Village to City in a Changing China , focuses on the huge pool of young women that migrate from villages to work in factories in the industrial centers of China.

The author is Leslie T. Chang. It turns out Leslie has a profile on blogger. She contributes to China Beat.

The life Leslie describes for these workers sounds harsh. But it is a way to make some progress from the even harder village life. The book sounds interesting. I have been to China and visited many factories there.

The recent economic downturn we are experiencing in the US is also having an effect on China. Factory orders are down. An economy that has been on a steady rise for years will be shocked when the brakes are put on.

Improvement Planning Charts

Does anyone have some good examples of improvement planning charts? What I mean is a chart that shows how some planned fixes should affect quality or efficiency over time.

Step Chart Elsmar cove has a set of slides about "Error Proofing Techniques" slide 3 has a quality Step Chart (Has note Copyright General Motors. All rights reserved)

This kind of chart comes in handy to show some projects that will be coming online over the next months to solve high defect rates, high downtime, etc.

I have not found a good standard so far. Any suggestions?

Is Your Company a Top Supplier?

Industry Week.com has an article about Proctor & Gamble's 2008 Top Supplier's.

From P&G's 80,000 suppliers 6 were selected. The selections were made "for scoring the highest in broad-based quantitative and qualitative evaluations conducted by the company."

I wonder what the criteria was? I assume the 6 had zero quality problems. Probably they met some cost reduction goal. Another criteria is probably delivery on time. What do you think it takes to be a top supplier? And, does your company qualify?

New Book - Predictably Irrational

Dan Ariely has written a new book called "Predictably Irrational - The Hidden Forces That Shape Our Decisions". I just started to read it. I browsed through the text at the library and found the first chapter interesting. He asks, "do you know why honor codes actually do reduce dishonesty in the workplace?" I don't know the answer yet, but he promises I will know by the end of the book.

Here is a hint about one of his central premises; which middle circle is larger? Many of you have seen this optical illusion and know the center circles are the same size. Yet they LOOK different. The circle surrounded by small circles looks larger than the one surrounded by larger circles. The brain knows what it knows, but sees what is sees.
Being cognizant of this brain function can be helpful when training or explaining.


Update: I finished the book. It was an interesting read. Ariely describes a bunch of experiments he and colleagues conducted to delve into human behavior. I suppose some of this information would be useful for general skill improvement.

You can check out more at predictablyirrational.com.

Getting Certified

Many of us ponder whether to seek certification or not. There is a huge time commitment and there are some significant costs. Taking the ASQ Six Sigma Black Belt CSSBB test ("Stand out as a quality leader in your organization with an ASQ certification next to your name.") cost non-members $420 and members $260. The benefits are personal pride and potentially some career gains.
Mike Micklewright has an interesting article in Quality Digest entitled Black Belt For Sale. Mike is an experienced quality and manufacturing engineer who finaly took the plunge to seek certification. Because of his vast experiences he struggled with how to prepare for the test. In order to understand what to expect he bought a common primer. he found himself focused on the test and not on knowledge, per se.

I was gaining the knowledge of how to pass a test so that I could become
certified. I wasn’t gaining much in the way of knowledge. W. Edwards Deming
would have been ticked off!

Mike's honesty wrung true with me. Topics of whether to certify or not, who gave the certifier the right to judge competency and charge such fees, and is the certification worth it, are ongoing.

The Worsening Economy

With the economy continuing to falter we hear about more factory closings. Ford and GM just announced early closings of plants scheduled for closure. There are federal guidelines governing companies in cases like this. From the US Dept of Labor:

The Worker Adjustment and Retraining Notification Act (WARN) protects workers, their families, and communities by requiring employers with 100 or more employees (generally not counting those who have worked less than six months in the last 12 months and those who work an average of less than 20 hours a week) to provide at least 60 calendar days advance written notice of a plant closing and mass layoff affecting 50 or more employees at a single site of employment. WARN makes certain exceptions to the requirements when layoffs occur due to unforeseeable business circumstances, faltering companies, and natural disasters. Advance notice gives workers and their families some transition time to adjust to the prospective loss of employment, to seek and obtain other jobs, and if necessary, to enter skill training or retraining that will allow these workers to compete successfully in the job market.

But are we now in a period of "unforeseeable business circumstance"?

Error Proofing vs. Process Control

I recently had a discussion about the differences between error proofing and process control. Later I was looking for documented answers and realized that error proofing itself is described by several terms with slight shades of meaning. There is also mistake proofing, mistake prevention and mistake detection, fool proofing (now seen as a derogatory phrase but what was its definition?), and Shideo Shingo's description as related in an Elsmar Cove discussion.

Poka Yoke roughly translates as mistake proofing and is typically applied to the PROCESS to prevent the cause of the mistake, shut the process down if the mistake occurs, or trigger an alarm if the mistake occurs. This was originally called Misu Yoke, or fool proofing, but was quickly changed, when Japanese sensibilities were offended by the term fool (anyone can make a mistake).Shingo uses the term Error Proofing to refer to actions applied to the DESIGN to prevent errors from occurring. This could include the addition of design features to prevent misassembly defects such as reversed, upside-down, etc. This could include making the part asymmetrical so it can only be assembled one way, or making it perfectly symmetrical so it does not matter how it is assembled.

More to come

Operating with a Sense of Urgency

The Harvard Business School Working Knowledge website has a book excerpt from "A Sense Of Urgency" bu John C. Kotter. The section excerpted deals with urgency arising from crisis.

The problem with using crises to reduce complacency and create urgency is that the tactic is a potential diamond sitting on a rock surrounded by quicksand and very nasty beasts. Any naiveté about the downside risks can cause disaster.

Kotter lists four Big Mistakes that can be made when asserting or expecting urgency in a time of crisis. He makes some good points. Could be a good read. Mistake #2 is especially timely, "Going over the line with a strategy that creates an angry backlash because people feel manipulated."

John Malkovich Feels Your Pain

The November issue of Esquire features a "What I've Learned" by John Malkovich. A few of his comments struck home.

"Nothing you do particularly matters. But I'm not sure that's a great excuse for doing it poorly."

How often have you had to run against the organizational barriers that stood in your way? Perhaps there was a manufacturing cost reduction that needed a dozen approvals before you had the chance to even run TRIALS. The better of us keep pushing even when you feel that it will not amount to much.

"I've pretty much learned not to worry about things I can't control. I often find myself with friends or acquaintances and they're worrying about this or that - I say, You're worried about the plane going down? What are you, a pilot?"

This is a good one. I often hear, "I am worried about this...or that." I always respond happily that by identifying a potential problem we have a great chance of developing the process to prevent it, or at least detect the problem. Knowing the failure mode is a big part of the solution. Remember the old idiom, necessity is the mother of invention. Sometimes the organization needs worried non-pilots. In the manufacturing business there is little you cannot control if you just know what "it" is that you need to control.

The November issue of Esquire also features Halle Berry as the "Sexiest Woman Alive"

Poop Plant?

Alcohol brewed from corn is becoming common place. Cellousolic biofuel is still in development. But alcohol from cow manure?

Dallas-based company catches a lifeline for completing its troubled manure-powered ethanol plant in Texas. Three weeks after facing the possibility of canceling construction of its cattle-manure-powered ethanol plant, Panda Ethanol has cut a deal with its lenders to complete the Hereford, Texas, facility.

I am not too familiar with continuous processing plants. Anyone work in the new biofuels industry?

Ford's Big Time Factory

Ford Motor Company is in dire peril, along with many other legacy manufacturers. Many of us older (ahem) factory rats remember large factories bustling with thousands of employees. Now there are fewer of those vertically integrated behemoths. Ford's Rouge complex was an iconic standout of the industrial age.




Interior of the Ford River Rouge tool & die factory United States. Office of War Information. Overseas Picture Division. Washington Division; 1944

Recently Ford stock, NYSE symbol "F", traded as low as $1.88 a share, the lowest price in 25 years. Ford's CEO Alan Mulally says bancruptcy is not an option. But you have to wonder when the slide will end.

So far this year, Ford's U.S. sales are down 17 percent, and its market share has dropped from about 26 percent in the early 1990s to around 12 percent last month.

PFMEA

The PFMEA is one of the most useful yet underutilized tools for analysing a process to find potential problems and assign controls. Do you find that the failure modes for quality problems we find at the customer are usually well known and not documented in the PFMEA or not well controlled? Any comments about effective PFMEA usage?

QualityTrainingPortal has a description of the PFMEA.

What It Is Used For
To methodically examine a process or product design to identify where failures can occur and what the relative risks are for each mode of failure.
When to Use It
Start using this tool during the design stage for any process or product.
On existing products and processes, this tool can be used at any time as part of improvement efforts.
Important Notes
FMEAs are a complex undertaking and should always be conducted by a team.
FMEAs need to be updated whenever changes are made to the process or product.

Plant Closings 1

I am sure we will be seeing more plant closings.

The Brunswick Corporation, a Navassa boat company, announced Thursday that it's shutting down.
Nearly 300 workers will lose their jobs when the factory closes.
Company executives say the poor economy has eroded the demand for boats.

The Brunswick Corporation plans to close four manufacturing plants across the United States, costing nearly 1,500 workers their jobs.

Food Quality

Quality is important for fresh foods as well as for manufactured goods. Cases of E. coli outbreaks are becoming more common, at least to my perception. I would be interested in hearing from experts in the food management industry about common methods to prevent E.coli outbreaks and how those controls may be failing.

An interesting fact is that due to the time required for an outbreak to become identifiable and the perishable nature of the food, sometimes the evidence is lost.

California is the source of E. coli-tainted iceberg lettuce suspected to have sickened 36 people in Michigan, officials said Thursday.

The culprit probably is industrial-size packages of iceberg lettuce sold to restaurants and institutions, according to the Michigan Department of Community Health.
Although lettuce is the "common link" among all the cases, the produce is so perishable that state agencies were not able to test packages produced during the outbreak's time frame, Holton said. So far, all tests for E. coli in lettuce have come back negative.

Job Losses

Much of the current news about the economy is focused on the stock market. However, the credit crunch is having far reaching effects. Without going into all the linkages, one result is a slow down in business and the resulting job losses.

Increasingly skittish employers dropped the ax even harder in September, chopping payrolls by 159,000 - more than double the cuts made just one month before. It was the ninth straight month of job losses. A staggering 760,000 jobs have disappeared so far this year.

Inauguration Day

Today is inauguration day for the site for plant rats. Plant rats are people working in our factories, plants, refineries, or anywhere where materials are transformed into saleable goods.

I hope to provide useful links for information about manufacturing and quality topics.