Increasingly, to remain competitive on the global stage, businesses are looking to save money and reduce overheads. One of the most effective means by which to bolster the bottom-line, particularly for manufacturing and industrial sector companies, is to undertake operational efficiency improvements. Ideally, implementing these efficiency improvements should help reduce—or even eliminate—redundancies, errors, bottlenecks and waste. Properly implemented, efficiency improvements should therefore help manufacturing companies save money.
Advanced technology can play a pivotal role in improving operational efficiency, particularly its ability to create lean processes. The right type of technology can help reduce or eliminate duplications and workflow delays, and speed up processes by automating individual tasks.
We recently spoke to Brad Lucas (Principal Consultant, Enertec SA)—an expert on operational efficiency with a particular focus on mid-stream processing in the oil and gas industry—and Adam Poole (Director Sales & Commissioning, K-TIG)—an expert on workshop and process efficiency—about how companies can use advanced technology to help improve operational efficiency.
How To Determine If There Are Efficiency Gains To Be Made
Often, it can be difficult for a company to know whether they are really operating to their true potential. Management can find it challenging to determine if there are efficiency gains to be made, or if their way of operating simply ‘is what it is’.
Lucas believes that this situation is exacerbated if the company does not have asset management program in place. “If a company doesn’t have an asset management program in place, it will be difficult to gain a comprehensive understanding of what their true potential could be—there will simply be too many areas that are not being measured or improved against,” said Lucas.
“An operation needs to start by benchmarking against best practices and industry standards so that they have an in-depth understanding of where and how they are currently operating—they need a baseline against which to measure. This baseline can then be compared to industry best practice, making areas of improvements clear. Unfortunately, the problem is that many operations lack the resources or knowledge required to establish and then implement an ongoing asset management program.”
There are specific factors that should be considered when determining how to improve a company’s operational efficiency.
Lucas explains that the first step in determining where operational improvements can be made is a thorough audit. “We look at what established asset management systems are currently in place, as well as any existing processes and procedures. We also consider the availability and reliability of critical assets, as well as production performance and quality. All this begins with a detailed audit of their asset and operational systems,” said Lucas.
Workflow and Bottlenecks
Workflow and bottlenecks can greatly affect efficiency. In manufacturing, a bottleneck is a constraint or choke point that restricts overall production, productivity and output, and therefore profits.
Bottlenecks can become particularly pronounced when automation or advanced technology is first introduced to a manufacturing process, particularly if the entire process has not been holistically assessed prior to the introduction of automation. But there are ways around this.
“Good planning and scheduling are critical, as well as making sure the resources are available to execute the task. Many operations struggle with this when they lack the resources or capability to effectively plan and schedule,” said Lucas.
According to Poole, “Automation is a series of events. Controlling the input is just as important as controlling the output. You really need to assess your entire manufacturing or welding process prior to the delivery, commissioning and set-up of your new automation or advanced technology system. You really need a detailed plan that includes factors such as how to redistribute your staff and reconfigure your shifts.”
For more information, read Managing Bottlenecks in Manufacturing.
Internal Politics, Processes and Policies
Internal policies, processes and procedures are vital to improving operational efficiencies. In fact, according to Lucas, they are critical. “People need to be working to the same standards, provided that these processes and procedures are developed in a way that ensures operational efficiencies are gained. Operational employees must be aware that these processes and policies exist, and they must be trained against them. All these types of internal documents should be considered ‘living documents’ and should be reviewed periodically for relevancy and improvement.”
Poole takes this one step further, asserting that processes and policies should also form a part of a successful company’s continuous improvement program. “Policies and procedures are essential – without them, there is simply no operational efficiency. If you don’t measure what you do, or have some kind of feedback system in place, how do you know where or how to improve.”
“If you measure outcomes purely based on profitability, you will never really know where your weak spots are. You might have great profitability levels of, let’s say, around 50%. But, if you implemented steps A through D, for instance, your profitability could skyrocket to 80%. Having documented processes and policies in place allows a company to implement a more well-defined continuous improvement program. It allows a company to pinpoint their weak spots and by fixing one weak spot, the company will inevitability uncover another, achieving ever better rates of productivity,” said Poole.
Buy-in from the entire team is just as important as documented policies and procedures, particularly when there are major changes being made to workflow and processes. According to Lucas, “Nothing can be successfully implemented without ‘buy-in’. Operational employees have to be involved and engaged—and their contributions taken into account—from the very beginning.”
The problem is that securing this buy-in can be challenging.
“It is great when the CEO of a company discovers K-TIG and understands the speed, efficiency and quality improvements that this advanced technology could bring to their business. However, if lower levels of management and operational employees are not aware of the CEO’s vision, or don’t understand the motive for change, then there can be a distinct lack of engagement and support. To meet the objective and support the change desired to reach improvement goals means open communication within the organisation is essential,” said Poole.
So then, what is the solution? How do you ensure that buy-in is secured?
Poole and Lucas both agree that to ensure buy-in, operational employees need to understand the ‘why’, as well as the benefits that operational efficiency improvements (such as the introduction of advanced technology) will provide them and the company as a whole.
“Employees need to have complete, top to bottom understanding of what, why, and how any changes will be implemented. The best way to achieve this is through transparency. The dictatorship style of management, where a boss or CEO says, ‘Jump!’, and the employees say, ‘How high?’ is gone,” said Poole.
“When K-TIG is preparing to install and commission a new system, we always try to work with employees throughout the business. We’ll liaise with the manufacturing supervisor, and demonstrate how the advanced technology is it going to make their job easier, and we’ll provide statistics and data that might appeal to senior management. We organise meetings with all key stakeholders, in which we explain what K-TIG is, how it works, and the benefits that it will likely deliver. Including everyone involved in the process and impacted by the changes is critical to securing buy-in, which is essential to ensuring the overall success of the program.”
Efficiency Versus Quality: Are The Two Mutually Exclusive?
A common misconception is that improving efficiency means losing out on quality. This couldn’t be further from the truth.
“Operational and efficiency improvements should always be underpinned by quality. If a process improvement increases speed or efficiency, but not product quality, this is simply not good enough. Quality must underpin every process improvement decision,” said Poole.
“It’s also important to keep in mind that quality should be defined as fitness for purpose. For instance, if you are making a stand for your toolbox to sit on, the tolerances and standard you would apply would be much lower than producing ASME Coded Pressure vessels or components for Gas turbines. As such, any operational efficiency improvements must measure up to pre-defined quality standards that ensure the end product is fit for use.”
Lucas agrees that operational efficiency improvements cannot impede product quality. “If any improvement program has a negative affect on quality, then it’s not considered an improvement program. Any negative affect on quality will have the reverse affect on efficiency, reliability and costs and also increase risks of incident and injury. While improving efficiency, all other aspects of the business, such as quality, reliability and costs must be continuously monitored and revised to achieve the desired results,” said Lucas.
The Role of Advanced Technology
“You can’t do today’s job with yesterday’s methods and be in business tomorrow.” ~
George W. Bush
Advanced technology has a major role to play in any continuous improvement program. “Technology has come a long way and will continue to support the efficiency and safety of operations. Technology has reduced the need for personnel to be exposed to risk and better safely manage their operations. They key is to find the right balance between technology and people,” said Lucas.
For instance, investing in advanced welding equipment is a highly effective way for fabricators to increase productivity. By lowering cycle times and improving yield rates, production costs can be slashed. Advanced equipment can process welded components much quicker than humans, with greater arc on times and continuous operation.
In the case of K-TIG, you can expect order-of-magnitude increases in productivity, with welding speeds up to 100x faster than conventional TIG/GTAW welding. The K-TIG system performs welds of up to 5/8 inch (16mm) thickness in a single full penetration pass. For example, a conventional 6-hour TIG weld in 10 inch, Schedule 40 (3/8 inch, 9mm thickness) stainless steel pipe is completed in less than 3 minutes when using the K-TIG system.
“K-TIG is in a place of its own, more affordable that laser welding and much more efficient that conventional welding. K-TIG compared to conventional welding is faster, safer and provides greater quality welds. It produces less waste, reduces energy costs and the need for heavy grinding,” said Lucas.
For more information, read ‘Buy Nice or Buy Twice': Why You Shouldn't Be Afraid To Invest in Advanced Welding Equipment.