An ounce of prevention is worth a pound of cure. Everyone knows and accepts this adage but in today’s lean global economy, not everyone has the people and the budget to walk the talk. Quantifying the answers to these questions will build the business case for manufacturing plan verification.
(1) What is the value of minimizing the seven wastes (over-production, inventory, motion, over-processing, waiting, correction, and conveyance?
o operating costs
o investment
(2) What is the value of reducing the risk of capacity shortfalls found after a new production line or business process is launched?
o lost sales
o overtime
o overmanning
o post launch trouble shooting and additional investment
(3) What is the value of predicting operational and financial metrics prior to launching a new manufacturing or business process?
o direct / indirect labor utilization
o overall equipment effectiveness (OEE)
o dock-to-dock time
o work-in-process inventory
o finished product inventory
o build-to-schedule
o total contribution margin
o cash flow
o profits
o return on investment
(4) What is the value of verifying operating plans prior to launching a new manufacturing or business process?
o direct labor
o indirect labor
o shift hours
o quality control plans
o preventive maintenance plans
o mix / sequence flexibility
o batch sizes / changeovers
o scheduling and sequencing algorithms
(5) What is the value of actively managing the constraint during the planning of a new manufacturing or business process?
o flexibility
o expansion
The answers to these questions will likely roll up into a pretty big $$$ number. With today’s commercially available discrete event simulation software, the business case for manufacturing plan verification is therefore quite strong.
The world is full of uncertainty and change. Robust manufacturing plans will stack the odds in your favor. Simulate first to drive business plan targets down to each cell. Then simulate again to verify that the system works. An ounce of prevention is worth a pound of cure. In a nutshell, that is the business case for manufacturing plan verification.
