Of all the components that make up the cost structure of manufactured products, the cost of raw materials is one of the highest for any industry since there would be no production without raw materials and components. If too much material is rejected for lack of quality, it can significantly affect a company’s profit margins. Therefore, it is of primordial importance to reduce waste in industrial manufacturing processes.
The rejected material is called scrap, and attention should be paid to rejection rates, especially if they are high. The issue is so critical that programs to reduce waste in industrial manufacturing processes, like using labor and equipment, are part of manufacturers’ continuous improvement initiatives.
Manufacturers have to consider rejection rates rather than focus on creating maximum production. Otherwise, the benefits will be different from what is expected.
Next, we will analyze what is meant by scrap and how to calculate its rate, and we will also see different strategies to reduce waste in industrial manufacturing processes.
- What are rejection and industrial scrap?
- How to measure the rejection rate in manufacturing?
- Ways to reduce scrap and rework
- Conduct process audits to reduce waste in industrial manufacturing processes
- Improve communication and change management to reduce industrial scrap.
- Review the supply of materials with technologies to eliminate manufacturing errors and rejections.
- Review and improve training to reduce manufacturing rejections.
- Document the right things to develop improvement actions against industrial scrap.
- Evaluate maintenance strategies.
- Using Data Platforms to reduce manufacturing waste
What are rejection and industrial scrap?
Manufacturing scrap is an unusable material from a manufacturing process.
Rejection can be subdivided into several categories:
Scrap rejected in raw material form: This may be because it has gone bad or because its performance characteristics are out of specification, such as tensile strength or the breaking point. No additional or partial treatment has been added to this material.
Scrap that has been partially processed: Many manufactured goods are produced in stages of a production process, and failure at any stage may mean that the part must be rejected. This is more expensive than scrapping the raw material, as the partially finished part has added some labor value.
Finished products must be scrapped for not meeting specifications: Some can be reworked by adding labor to adjust the part or turn it into something else. Others may require total scrapping if no rework can be done.
How to measure rejection in manufacturing?
Manufacturing rejection rate
Scrap rate is a measure of production quality and throughput that helps manufacturers understand the efficiency of their processes. While a low scrap rate suggests that an operation is manufacturing with high efficiency, a high scrap rate can mean the organization is experiencing quality control issues and a lower level of operational efficiency. This will result in significant waste in industrial manufacturing processes.
Calculation of scrap in manufacturing
The scrap rate formula is simply a function of the number of unusable units divided by the total units produced.
Scrap Rate = Unusable Units / Total Units Produced
Applying monetary unit values to these scrap parts allows manufacturers to perform a manufacturing scrap analysis to determine the total scrap cost incurred by the company.
Causes of rejection in manufacturing
Several factors can cause scrap, often resulting from poor processes. Typically, these processes inhibit maintenance, setup, tooling quality, and training.
All rejects increase costs and those that require more labor increase costs even more. In complex manufacturing environments, many factors lead to scrap and rework, including:
- Incorrect configuration
- Poorly maintained equipment
- Poor tool maintenance
- Poor quality of tools
- Operator errors
- Training problems
- Manual processes
- Communication errors
- Inefficient procedures
- Poor management of design/specification changes
Ways to reduce waste in industrial manufacturing and rework
Many methodologies are designed to help eliminate waste and improve processes in an operation. These methodologies provide companies with a framework and process for identifying ways to reduce scrap. Waste reduction techniques include process auditing, root cause analysis, and other formal procedures to drive change.
Many software systems help manufacturers monitor their processes to ensure higher levels of product quality and reduce waste in manufacturing processes.
Machine monitoring solutions can help capture accurate production data at the machine level to measure the amount of scrap generated.
The key to reducing waste is the involvement of managers and executives. This can happen as part of a larger continuous improvement initiative or by implementing a specific scrap reduction program. Here are six ways to get started:
Conduct process audits to reduce waste in industrial manufacturing processes
The Overall Equipment Effectiveness (OEE) of many manufacturers is much lower than they assume. For example, it is common for actual OEE to be in the 25-30% range, while managers and executives believe it is 20-30 points higher. This is because processes drift over time, and the control mechanisms to account for and adjust for these changes have always been manual.
Carrying out process audits is the first step in reducing scrap. Identifying scrap points would only be possible if the current process is known.
An Overall Equipment Effectiveness (OEE) Software for monitoring and improving industrial productivity will let us know where they come from.
Most of the waste will be related to waste that can be identified in the six significant losses:
- Commissioning and adjustments
- Small stops
- Speed reduction
- Start-up reduction
- Production rejects
A root cause analysis can be performed for each type of scrap loss and process changes applied to reduce waste in industrial manufacturing.
Improve communication and change management to reduce industrial scrap
Manufacturing is a fast, noisy, and lengthy process. Communication is sometimes non-existent between upstream and downstream processes, and errors can escalate. The same goes for handwritten notes and labels, where the quality of the writing, lack of clarity, and other defects can affect the following production phase.
Complex Bills of Materials ( BOMs ) are also a culprit in communication chains on the shop floor. If these must accompany the parts, there is the possibility of errors that result in waste in industrial manufacturing. Again, this is true at the plant level, where training can differ from one operator to another in interpreting the bill of materials.
It is also true when design or bill of materials changes have yet to be communicated or are delayed due to manual processes. Accurate communication of BOM changes is as critical as having a clear BOM for all production phases.
Review the supply of materials with technologies to eliminate manufacturing errors and rejects
A manufacturer’s quality depends not only on the quality of the material and components used to make the products but also on the quality of the material used in the production tools. In the case of the former, rigorous selection of materials, such as tensile strength, alloy consistency, and supplier production methods, can make a company’s quality higher or lower when those materials are in production.
In the second case, cutting dies, milling heads, and other hardened tools must be guaranteed to cut the material they intended to cut. If the performance characteristics of the tool are inferior, this can lead to waste in industrial manufacturing.
Their quality audit and the certification of materials and tools will help reduce waste in manufacturing processes. Changes to these materials, such as bills of materials and design change notifications, must be carefully monitored when they are introduced.
Review and improve training to reduce manufacturing rejects
Traditional manufacturing in industries such as precision CNC part machining relied on years of learning and training to get an operator up to speed. Much of what the operators knew was based on intuition. The problem with this method is that it is only sometimes a good enough tool to avoid waste.
On the other hand, training new operators in the same unaudited processes, with inadequate change management processes and poor material selection, places the burden on the shoulders of the operator, which means that the chances of producing waste are virtually guaranteed.
In addition to the steps above, operators need real-time data and machine status access to make decisions and take action. Using software to monitor condition and production means operators continue to be trained in the operation of the equipment and in the craft skills needed to produce precise parts. They are also trained to monitor and respond to potential scrap events proactively.
Document the right things to develop improvement actions against industrial scrap.
Many manufacturers have too many written manual procedure documents, yet they still need to be included when it comes to the most critical aspects of documentation. Active product design iterations should always have defined and traceable access. This includes CAD and CAM drawings and any other engineering specifications.
Bills of materials, quality documents, and other critical items must be rigidly structured. They must also be part of an audit process to ensure compliance and to reduce waste in industrial manufacturing.
Evaluate maintenance strategies to reduce waste in industrial manufacturing
Preventive maintenance strategies have served to overcome the don’t fix if something ain’t broken approach. Still, the scrap rate remains higher than desirable when using preventative methods, and most manufacturers have yet to go further.
This is because manual condition monitoring is labor intensive, manual checking and measurement of temperature, wear, abrasion, etc. As a result, tool wear and failures may go undetected with a manual preventive maintenance strategy, and data may be omitted due to error, bias, or training issues. In addition, traditional maintenance does not predict subtle and deeply embedded data such as vibration, oil and lubrication consistency, particle content, and other factors.
Using Data Platforms to reduce manufacturing waste
The use of data platforms for machines helps to monitor and automate production operations to reduce waste in manufacturing processes, as well as significantly improve said processes. These platforms include production monitoring, condition monitoring, predictive maintenance, and process optimization.
Automating manufacturing operations with a machine data platform offers many benefits, helping to reduce scrap and rework. The information provided by the platform allows operators and managers to take quick action as soon as it occurs or even before it occurs. In addition, information is contextualized and made available to all who need it through alerts, notifications, and dashboards.
This automation allows you to streamline processes and have confidence that issues will be proactively addressed using real-time data and advanced analytics. In addition, documentation is digital and instantly accessible in its most current and accurate form to avoid using out-of-date information.
The use of machine data platforms to reduce industrial waste in manufacturing processes is part of the wide range of benefits of the platform. For example, companies can rely on accurate machine and production data to analyze problems, develop faster root cause analysis, and prevent scrap and rework at levels unimaginable just a few years ago.