The manufacturer landscape has seen numerous challenges, but especially throughout the past few years governed by the COVID-19 pandemic, and most recently the tense situation between Russia and Ukraine. This has made it difficult for manufacturers to compete, optimize, or even survive in such difficult times.
We put together a list of manufacturing hacks to help you navigate through 2022, if you’re looking to improve your processes, make use of digital technology to gain a competitive edge, and take your business to the next level.
1.Manage your supply chain
The pandemic and the latest European conflict have contributed to supply chain disruptions and material shortages. It’s becoming increasingly difficult to manage manufacturing supply chains with multiple suppliers and overseas shipping. It’s important to plan ahead and consider potential emergencies, as well as their solutions. Think about backups for your existing suppliers, have consignment inventory or safety stock.
2. Use software to manage inventory and production
Long are the days when manufacturer used Excel spreadsheets or complicated, clunky or expensive tools. Today, smart manufacturing software is specifically designed for the needs of a modern manufacturer. Such software helps you track raw materials, schedule production, plan machinery maintenance at the least busiest times, manage resources, and more. Essentially, it helps you manage your entire business operations from a central dashboard and it enables you to make accurate decisions based on real-time data.
3. Cut down manufacturing lead times
It’s important to prioritize production tasks, so that your staff can work in the most efficient manner possible. Focus on minimizing prolonged work-in-progress manufacturing and shipping items faster.
4. Cut down carrying costs
It is acceptable to have some indirect materials on hand, but don’t keep bulky stock around. Cut down on carrying costs that don’t bring value to your business, get rid of dead stock, and free up cash tied up in inventory.
5. Use reorder points
A reorder point is an inventory threshold that you don’t want to go below. The right inventory reorder point gives you enough time to make a new order right before your stock reaches this threshold. It essentially helps you find the right time to order new materials and when to start manufacturing more.
6. Use trustworthy suppliers
Working with trustworthy suppliers is crucial for the success of your business. Even though some suppliers might be more expensive at first glance, if you know you can trust their services and product quality it’s worth keeping them instead of adventuring into the unknown and searching for new ones.
7. Create your BOMs
Think of your bill of materials (BOM) as a recipe for your product: what materials are needed, in what quantities, what equipment is used, what tasks need to be done, who performs these tasks, etc. Make sure each product has its own BOM and that you find the best way to keep it updated.
8. Practice lean inventory management
Lean inventory management is not only helpful for the environment, but also for your business’ profitability. It’s a Japanese methodology designed to improve efficiency in manufacturing. The next five tips explain the fundamentals of this principle.
9. Identify the value
Value is defined by the customer’s needs for a specific product. In order to define value, you need to know the timeline for manufacturing and delivery, the price point, the requirements and expectations to be met.
10. Map the value stream
Once you’ve identified the value, the next step is mapping the value stream – all the steps involved in the manufacturing process, from raw materials to delivering the finished goods to the customer. Mapping the value stream is a very simple, yet eye-opening task, that helps you better understand your entire business operations.
11. Create the flow
Now you need to make sure that everything is streamlined and avoid delays or bottlenecks. Easier said than done, but using the right tool, taking advantage of technology, and having a motivated team makes everything flow smoothly. This leads to enhanced productivity and efficiency, which essentially directly impact your profitability.
12. Establish pull
When the flow is smooth, time to customer can also be improved. Compared to “just-in-time manufacturing” this makes it much easier to deliver products as needed. The customer can “pull” the product from you as needed. This means that you don’t need to stockpile materials or manufacture products in advance, creating stock that is expensive to manage.
13. Seek perfection
Identifying the value, mapping the value stream, creating a smooth flow, and establishing pull are all important, but perhaps the most important step in lean manufacturing is making it part of your corporate culture. Every team member should be part of the lean strategy, reiterating processes, and continuously striving for improvement.