How can you use defect rates to optimize lean performance in manufacturing?
Lean manufacturing is a philosophy and a set of practices that aim to eliminate waste and maximize value for customers. One of the key aspects of lean manufacturing is to monitor and improve the quality of the products and processes, and to prevent and reduce defects. Defects are any deviations from the specifications or expectations of the customers, and they can have a negative impact on customer satisfaction, profitability, and competitiveness. In this article, you will learn how to use defect rates as a metric to optimize lean performance in manufacturing.
Defect rates are the percentage of defective units or outputs in a process or a batch. They can be calculated by dividing the number of defects by the total number of units or outputs, and multiplying by 100. For example, if a process produces 500 units and 10 of them are defective, the defect rate is 10/500 x 100 = 2%. Defect rates can be measured at different stages of the production cycle, such as incoming inspection, in-process inspection, final inspection, or customer feedback. Defect rates can also be expressed in terms of parts per million (PPM), which is the number of defects per one million units or outputs.
Defect rates are important for lean performance because they indicate the level of quality and efficiency of the processes and products. High defect rates mean that there is a lot of waste, rework, scrap, and customer dissatisfaction, which can increase costs and reduce revenues. Low defect rates mean that there is a high level of quality and customer satisfaction, which can improve productivity, profitability, and competitiveness. Defect rates can also help identify the root causes of quality problems, and guide the improvement actions and decisions. By tracking and analyzing defect rates, you can optimize lean performance in manufacturing.
To measure defect rates, you need to define the criteria and standards for what constitutes a defect, and how to detect and record it. You also need to collect and organize the data on the number of units or outputs and the number of defects for each process or batch. You can use different tools and methods to measure defect rates, such as checklists, control charts, sampling plans, or statistical process control (SPC). You should also ensure that the data is accurate, reliable, and consistent, and that the measurement process is standardized and documented.
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The criteria is simple, form the manufacturing perspective: What is the spec? Most B2B manufacturers are build-to-spec, meaning they don't/can't assume downstream effects or suitability and must concentrate on meeting the applicable specifications. Therefore, a part that meets the specifications, i.e. sellable is OK, period. First Pass Yield: A part must be OK as it comes out of the process. Any rework, handling or sorting not paid by the Customer (NVA) is considered defective. The Defect Rate is therefore the inverse of First Pass Yield, Bad Parts / Total parts produced.
To reduce defect rates, you need to identify and eliminate the sources and causes of defects, and implement corrective and preventive actions. You can use different tools and techniques to reduce defect rates, such as root cause analysis, 5 whys, fishbone diagrams, Pareto charts, or failure mode and effects analysis (FMEA). You should also involve and train the employees, suppliers, and customers in the quality improvement process, and foster a culture of continuous improvement and learning. You should also monitor and evaluate the results and impacts of the actions, and make adjustments as needed.
To benchmark defect rates, you need to compare your defect rates with those of your competitors, industry standards, or best practices. Benchmarking can help you identify gaps and opportunities for improvement, and set realistic and achievable goals and targets. You can use different sources and methods to benchmark defect rates, such as industry reports, surveys, trade associations, or site visits. You should also ensure that the benchmarking process is fair, ethical, and relevant, and that you use comparable and valid data and metrics.
To communicate defect rates, you need to present and report the data and information in a clear, concise, and meaningful way. You also need to tailor the communication to the needs and expectations of the audience, such as managers, employees, suppliers, or customers. You can use different tools and formats to communicate defect rates, such as dashboards, scorecards, charts, graphs, or tables. You should also use appropriate language, terminology, and visuals, and provide context and interpretation for the defect rates. You should also invite and encourage feedback and suggestions for improvement from the stakeholders.
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KPI reviews: In addition to periodic (weekly) staff reviews, you have the daily Gemba walks. It is useful to couple it with a MRB or Defect Supermarket for team review. For the external rates (escapes) you have teh Customr Scorecard review (as a KPI) Then, the most significant ones get attacked as part of your Corrective Actions process.
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I have found that defect maps are very helpful to see if there is repeating defects in a specific area of the “widget” being built. This can be very helpful in problem solving. A3’s blended with Kata coaching is a great way to understand target condition, current state and then PDCA cycles through potential root causes for 5Y’s. Once root cause is identified and countermeasures / standards are in place, follow up daily for 3 months to ensure the problem doesn’t arise again. If it does, you did not find root cause or standard is not being followed.
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