Quality—The Essential Element for Success
Quality is a critical component of any manufacturing or service-related business. It has become the hallmark of most companies around the world. This emphasis got its start back in the 1920s, when S. Toyoda first invented an automated loom that stopped operations whenever a thread broke. Quality has now become the basic cost of entry into most marketplaces.
In Toyota’s case, emphasis on quality has had a dramatic impact on shaping both the brand and the way that the company operates. For companies that don’t share the same priorities, poor quality can have a negative impact on cash flow. When problems are detected, processes must be stopped and examined.
Shigeo Shingo1 taught:
Defects generate waste and cause confusion in the production process.
He went on to teach that we must challenge ourselves to achieve zero defects. In his view, this effort has three components:
1.Inspections—the focus of inspections must shift from detection to prevention of defects. This requires a move from sampling to 100 percent inspection—the ultimate means of assuring quality assurance.
2.Quality control—must be based on the above approach, using such methods as source inspections, self-inspections, and successive checks.
3.Poka-yoke—a technique used for avoiding simple human error in the workplace. Also known as mistake-proofing or fool-proofing, poka-yoke is a system designed to prevent inadvertent errors made by workers performing their process.
The lack of proper execution in quality can lead to devastating results. Product returns cost cash. Product recalls create bad will between companies and their customers. Worst of all, safety-related issues can impact the organization’s long-term viability. All three of these are a drain on cash flow, making it imperative that factory-fresh quality be delivered every time.
Good Manufacturing Practice (GMP)
Pharma and nutraceutical industries live in a completely different world from typical manufacturing. When you’re talking about humans ingesting your product there is absolutely no room for error: The data need to be as perfect as possible. This is a no-nonsense environment: Exceptions have to be tracked down immediately, and that is why good manufacturing practices, or GMP, became the standard.
GMPs are essential to consumer safety. According to the International Society for Pharmaceutical Engineering (or ISPE)2:
GMP is a system for ensuring that products are consistently produced and controlled according to quality standards. It is designed to minimize the risks involved in any pharmaceutical production that cannot be eliminated through testing the final product.
GMP covers all aspects of production from the starting materials, premises, and equipment to the training and personal hygiene of staff. Detailed, written procedures are essential for each process that could affect the quality of the finished product. There must be systems to provide documented proof that correct procedures are consistently followed at each step in the manufacturing process—every time a product is made.
These guidelines are global in nature and provide the minimum requirements that a pharmaceutical or food manufacturer must meet to ensure that products are of high quality, to meet labeling claims, and to not pose a risk to the consumer.
GMP guidelines provide guidance in many areas: construction of the facility, sanitation, training, manufacturing, testing, and quality assurance. All of these have been set in place to ensure that a food or drug product is safe for human consumption. Many countries have legislated that food, pharmaceutical, and medical device manufacturers follow GMP procedures: They are to create their own guidelines written to correspond with legislation.
Some of the guidelines that directly impact the cash-to-cash cycle and cycle time include:
•Manufacturing facilities must maintain a clean and hygienic manufacturing area
•Environmental and equipment controls must be in place to prevent cross-contamination of product
•Production processes must be clearly defined, controlled, validated, and audited
•Operators are to be trained in GMP and standard operating procedures (SOPs), and training is to be documented
•The distribution of food or drugs is controlled to minimize risk to quality
•A system is fully operational and verified for recalling any batch with traceability to the raw ingredients.
Testing time for quality for raw materials and finished goods must be calculated into any customer commitment and cycle time process, ensuring that the spirit of the regulations is fully met. In addition, managing the queue time into and out of quality is critical to the proper flow of the process. Finally, appropriate care has to be taken during the shipping process so that factory-fresh quality is delivered to the end-user.
Manufacturing Maintenance Control—Total Productive Maintenance (TPM)
A few years back I worked with an Operations VP who used to say that he wanted to “sweat the assets.” Now, obviously, you want to use your assets to full capacity, but building in downtime is a must too. I saw this firsthand in British Columbia while making pills, tablets, and softgel: Failing to schedule maintenance properly can be devastating to the balance sheet and cash flow. You can miss an entire market and customer commitments by not building proper lead times in for downtime.
TPM was developed by Seiichi Nakajima3 to support Nippondenso’s4 Just-in-Time supply of parts to Toyota. This concept revolves around the theory:
You can’t be lean if you don’t have reliable equipment. The relentless pursuit of root-cause analysis and elimination of defects in the operation of manufacturing equipment take total participation—from the leadership team to the shop floor. TPM is a philosophy of prevention based on autonomous maintenance, visual controls, and a Kaizen (or continuous improvement) approach. It uses the goals listed as follows, known as “5S,” to create a work environment that is clean and well-organized:
•Sorting—discarding of items not needed in the worksite
•Straightening—orderly storage of all necessary items in dedicated locations, “A place for everything and everything in its place”
•Sweeping—clean all litter, trash, and obstructions from the worksite
•Sanitize—clean or remove any unpleasant or undesirable item
•Sustain—maintain and ensure a clean and organized worksite at all times.
Three Elements of OEE
The objective of TPM is to increase overall equipment effectiveness (OEE). OEE has three elements, which are multiplied to give one measure for how the manufacturing equipment is operating:
OEE = Performance × Availability × Quality
The terms are defined as follows:
Availability
Takes into account all events that stop production (typically several minutes).
Availability = Run Time / Planned Production Time
Takes into account anything that causes the manufacturing process to run at less than the maximum possible speed when running.
Performance = (Optimal Cycle Time × Total Count) / Run Time
Quality
Takes into account manufactured parts that do not meet quality standards, including rework. Similar to first pass yield (FYP), it defines good parts as parts that successfully pass the first time without needing any rework.
Quality = Good Count / Total Count
Final Thoughts on Quality
Mistakes are costly—the lack of proper execution in quality can lead to devastating results. This is because:
•Product returns cost cash
•Product recalls create bad will between companies and their customers
•Worst of all, safety-related issues can impact the organization’s long-term viability.
All three of these are a drain on cash flow. Therefore, it is imperative that factory-fresh quality be delivered every time.
People are the same all over the world. We take pride in what we make and harbor a deep affinity for ensuring that a quality product is delivered to our customers. There are no silver bullets—just the good old-fashioned rolling-up-your-sleeves and getting-the-job-done.
Building quality in from the start is the only path a business should take.
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1Shigeo Shingo was a Japanese industrial engineer who is considered as the world’s leading expert on manufacturing practices and the Toyota Production System.
2ISPE website: https://ispe.org
3Seiichi Nakajima (1919–April 11, 2015) was a pioneering founder of the Total Productive Maintenance system.
4Nippondenso Company is Japan’s leading producer of automobile components and one of the larger international components manufacturers.