Dudes and Dudettes. Just stop it.
Stop jumping from one rediculous abstract performance metric to another. It's like a fad diet. It works because your excited and you put a bunch of energy into it, but it isn't sustainable and it doesn't work for everybody.
What's an abstract performance metric?
OEE, TEEP and MTBF
It’s partly the result of decades of well-meaning academics influencing manufacturing methods with impractical theories – the kind that sound impressive at conferences, but which can sabotage any practical attempts to reduce your downtime.
If you’re in manufacturing or machine building, at some point you’ve probably been saddled with the task of using some abstract performance-measuring metric to improve production.
Stuff like ‘Overall Equipment Effectiveness’ (OEE), ‘Total Effective Equipment Performance’ (TEEP) and even ‘Mean Time Between Failure’ (MTBF)...
Acronyms like these drive people in our industry nuts. Why?
Because they represent ‘magic metrics’ that give you no actionable steps to take. They’re counter-productive and expensive.
20+ years of helping manufacturers improve performance has shown me that not only are these metrics unhelpful, they actually frustrate people in operations & maintenance, while killing any attempts to build a culture of continuous improvement.
Because when it comes to the reality of day to day operations, abstracted metrics aren’t just useless – they’re actually detrimental to continuous improvement efforts.
Theories and acronyms sound great in seminars and boardrooms, but they’re actually incomplete processes. They won’t help you if you’re an operator, Production Manager or Plant Manager needing to address the real issues behind an expensive problem...
When you’re down on the plant floor faced with a bunch of downtime and losses eating into your production numbers, with quotas to make and customers breathing down your neck, you’re crying out for practical insights you can act on.
Abstract metrics that say something like “we’re at 70%, we need to be at 80%” are pointless. They tell you where you are, but not how to get where you need to go.
So putting a big screen out on the machine or production floor that displays OEE or some other abstract metric, won’t help your team find out what’s wrong so they can fix it.
That’s when the head-scratching and finger-pointing starts, and your team suffers as a result. The losses go on, and nothing actually improves – which can be one hell of an expensive problem.
The analyst firm Aberdeen Research found that in 2016, the average financial cost of unplanned downtime rose to $260,000 an hour. Per company.
The key to improving your plant’s production has NOTHING to do with abstract metrics. It’s really about following an actionable performance improvement process – one you can apply to any line in your manufacturing system.
How ‘Managing To Your Losses’ Helps You Reduce Downtime More Efficiently
Unlike the acronyms and abstraction of performance metrics, managing to your losses is more than just academic theory. It’s a practical and proven ‘in the trenches’ process you can implement in the real world.
When you use it, you can address 90% of your missing capacity, fix it, and then improve continuously.
It’s also a process that requires NO abstracted metrics, NO endless meetings or ‘decisions by committee’, and NO miscommunication from management to plant floor.
Instead of meaningless data, you’re able to deliver practical insights and clear opportunities for improvement right where they’re needed: into the hands of the people who can fix the problem.
Again, this isn’t some impractical academic theory, or wishful thinking. This is actually how companies like Otterbox, Boeing and YanFeng Automotive reduce downtime and increase their capacity. They’re managing to their losses, not obsessing over metrics.
I’ve seen it in the field again and again. So how does it actually work?
Well, it takes a shift in mindset, and it also requires you to make some practical changes. But once you make those changes, you’ll be rewarded with reduced losses and increased uptime.
Let’s take a closer look at what steps you can take to start managing to your losses and reduce machine downtime at your company.
The No-BS Method For Continuous Improvement
Pointless, abstracted metrics with fancy acronyms don’t actually help anyone. Managers and machine builders need practical, real-world insights they can use to improve their process. So how do you get those insights?
First, you properly empower your production employees and operators to find and fix problems at machine level. They need to be able to uncover clear, specific opportunities for improvement.
Like “This part of the machine jammed 6 times in the last hour, so that’s what we’ll open up first”. Or “that incoming raw material wasn’t feeding into the right tray, so now we know what part of the line we need to adjust”, and “the outgoing boxing machine had the wrong thickness of box loaded, so now we can replace the boxes and fix the jam”...
By focusing on your biggest losses as a priority, you’re able to make changes that actually have an impact. And these kinds of practical insights can only come from effective, real time condition monitoring.
The fastest way to recover 90% of your missing capacity
When you know what your top 3 downtime issues are, you can isolate and address them first, and recover around 90% of your missing capacity.
Then you focus on the next biggest issues, in order of their impact, and keep improving from one day to the next. My experience working with manufacturers and machine builders has shown me, over and over again:
Real time condition monitoring of your machines and systems is the ONLY way to uncover, access and act on the information you need.
That’s why a growing number of businesses are using remote equipment management tools such as Wave7 to monitor their equipment, so they can see at a glance exactly where there’s a problem, and how they should address it.
By allowing you to monitor downtime in specific areas, you can quickly identify which are having the biggest impact on your process. And when information is presented to your team in a way that’s clear and actionable, not abstracted into some directionless % or figure, it makes every single issue easier to find and fix.
You don’t have to worry about tackling everything all at once, either. Because when you can identify and address your top 3 causes of downtime, you should be able to improve your machines’ effectiveness by around 90%.
That’s the kind of impact I see again and again with manufacturers who use condition monitoring to manage to their losses.
Multiply that by every instance of downtime, starvation, blockage or idle time you experience in a day, and you save a hell of a lot of time, stress and money. Because it’s what you don’t know you don’t know that’s holding you back...
OEE, TEEP, MTBF – all the acronyms and metrics in the world won’t help you if you don’t know where the problem is, or what’s causing it. Here’s an example:
How One Manufacturer Uncovered The Surprising Cause Of An Expensive Downtime Issue
I recently worked with a machine builder whose manufacturing client had a significant downtime issue at their plant – and worse, it was one of the machine builder’s systems. The production line manager knew production was way down over a two day period. But they didn’t know why...
The problem happened one week after the machine builder deployed Wave7’s loss monitoring system on the production line. On day two, he received an alert from the system: the client was experiencing higher downtime than usual.
Using the Wave7 app on his phone he could see that one particular machine in the line had 20 downtime instances per hour instead of their usual 3-4 a day. And after close to 200 emergency stops in two days, all that unplanned downtime was putting a big dent in their production capacity.
The frustrating thing for the production manager was he had NO IDEA what was happening, as every e-stop was followed moments later by an operator hitting restart, and the line would churn into action again.
An unusual discovery
Armed with the exact location of the stops through Wave7’s condition monitoring system, the machine builder was able to locate exactly where the problem was happening, in less than an hour.
It turned out that the sensor causing all these costly e-stops was being triggered by an overspray from a cleaning agent landing on a machine-guarding light curtain, which gradually reduced the light strength...
So after a simple wipe of the light curtain with Windex and a rag, they were back on track!
It’s not uncommon for this sort of thing to happen – thousands, even millions of dollars of production can be put at risk by something so minor that almost goes undetected.
That’s why it’s so important to accurately monitor your downtime in real time, and pinpoint the exact cause. So you can act fast and move on to the next biggest issue, and the next – to eliminate the causes of downtime before they start costing you money.
That’s Continuous Improvement in action. Not just in theory, but actually happening on the plant floor, with the right information in the right hands at the right time. Here’s another example:
The Micro-Starvation That Almost Led To Millions Of Dollars In Losses
A large manufacturer I spoke with recently had installed a brand new automated production line. They ran it initially alongside 3 manual lines, and if it proved successful they intended to continue adding automated lines to save around 300 employee costs on a seasonal basis.
But shortly after startup they discovered the production output was nowhere near what it was supposed to have been, or what they had paid for.
Like with many production processes, there were a number of companies involved – including machine manufacturers and integrators, each trying to fix the issue. But they all struggled to understand where or what the problem was.
Inevitably, there was a lot of finger pointing…
The blame was passed from the individual machine manufacturers to the main integrator who’d helped put the system together, and back again. Tensions were high, money was being lost, and reputations were on the line.
But after deploying Wave7 on the system, the team discovered it had nothing to do with the machinery on the production line. Instead they were able to identify the problem as a starvation issue, related to the raw material being fed into the production line.
In fact, to make things even more difficult, it was a micro-starvation issue of around 1-5 seconds – which was happening close to 500x an hour. That was why it was so hard to identify, at least until Wave7 was deployed.
After applying and monitoring Wave7 on their system, they discovered the operators were removing every other package from the infeed of the production line, and placing it on the manual line just a few feet away!
Knowing what was starving the machine, the client was able to correct the operator process and bring their downtime back to normal almost immediately.
The investigation and fix took just a day or two, but without Wave7 they would have been looking at millions of dollars in continued losses – not to mention strained vendor relationships.
I see this kind of thing happen all the time across various manufacturing industries, from food processing to medical and transportation. So often it comes down to a manufacturer or machine builder identifying the top 3 downtime causes, correcting them and being able to recover around 90% of their missing capacity.
That’s what managing to your losses is all about. And it’s changing the performance improvement industry for the better. Because when I speak with people in manufacturing, I hear the same things again and again...
What Plant and Production Managers REALLY Want
They want specifics about the causes of their biggest downtime issues, so they can fix things before they spiral out of control, not after. They don’t want to spend thousands on costly infrastructure projects that rely on multiple providers, or sit in endless meetings to decide what to do.
They need to avoid taking chances on an internal project started by people who aren’t performance improvement experts. And they’ve had it up to here with all the ineffective theories and useless metrics that have gotten them nowhere.
Instead, they’re desperate for practical information they can act on, and actually empower their operators with.
That’s why I’ve spent the past 10 years listening to manufacturers and machine builders, and using their insights to create and optimize Wave7 – the most effective tool for reducing downtime and increasing capacity.
Production performance improvement is something I care deeply about, because I’ve seen first-hand the impact it can have on a business when done right.
It’s time to stop shooting in the dark...
Without the right equipment management tools at your disposal, it’s like you’re constantly shooting in the dark – at a target you can’t even be sure is there.
But when you’re able to see exactly where the problem lies and how it’s affecting your machines in real time, eliminating 90% of your downtime and boosting performance becomes the norm.
Wave7’s IIoT (Industrial Internet of Things) technology lets you do that at a glance – whether you’re on the plant floor or in the boardroom, or even remotely, from your tablet or smartphone. And you can do it all WITHOUT having to hire consultants, fork out for new hardware or other expensive troubleshooting exercises that slow down production and eat up your budget.
Want to see how this process can work for YOUR specific plant or machine?
I’d be happy to personally walk you through it on a call. Just get in touch and I’ll get back to you.
How To Find Out More About Reducing YOUR Machine’s Downtime
Get a FREE one-on-one phone consultation with 25-year manufacturing change evangelist David McKay – ask me anything, and find out what's working now for hundreds of successful businesses across various industries
On our call we’ll discuss your specific situation and I’ll be able to outline a process YOU can use to reduce losses and boost your performance, capacity & profit.
We’ll also cover:
How to manage to your losses – instead of losing performance and staff buy-ins with the same old tired metrics
How to improve manufacturing performance with cross-functional teams
How to create a simple roadmap to Continuous Improvement for your business
PLUS I’ll answer your questions personally – and give you the benefit of my years of performance improvement experience with various companies and industries
Each week I schedule a couple of these one-on-one calls with Production & Operations Managers, Plant Managers and Machine Builders who need advice.
There’s no charge for our time together – but because I attend each call personally, limited spots are available.
Just send me a note so I can prep for our call, and I’ll be in touch to schedule it. I look forward to helping you kick some performance improvement butt!
About David McKay:
David McKay is a manufacturing change evangelist and one of the founders of Wave7, a company dedicated to helping manufacturers and machine builders increase profits by reducing downtime and increasing capacity.
Across 25 years working with businesses in various industries, David has advocated that machine performance improvement can be accomplished without being expensive, inefficient or reactive.
Wave7 compresses analytics, data collection and Industrial Internet of Things (IIoT) technology into a simple, seamless, low risk, low cost and cross functional performance improvement system.
