When it comes to assessing a manufacturer’s performance, productivity is often one of the first things we look at. Productivity can affect everything from profits to product quality, and countless factors contribute to a manufacturing operation’s productivity. Optimizing your productivity is a significant part of maximizing profits, but it’s a complex process. Many manufacturers even hire specialists for the job.
What can you do to improve productivity in manufacturing operations, and how do you assess it in the first place?
Manufacturing Productivity vs. Efficiency
We often conflate the words “productivity” and “efficiency,” but the two are distinct measurements that manufacturers need to keep separate.
Productivity is the ratio of output to input. Input can include any resources used in production, such as labor, energy, money, expertise and time. Output refers to the goods and services produced. Productivity is primarily focused on quantity, whereas efficiency has a greater focus on quality. Efficiency is about producing items without wasting materials, energy or time and is often expressed as a percentage, with 100% representing maximum efficiency.
A company could have incredible productivity, but if half of their products come back defective, they’re experiencing low efficiency. Manufacturers need to find a balance between the two, ensuring that their productivity supports overall efficiency.
Measuring Productivity in Manufacturing
Improving your productivity requires careful assessment of your operations, so knowing what goes into productivity and how to measure it is key. We’re trying to measure how well a company can take its resources — like raw materials, employees, equipment and utilities — and turn them into useful goods or services. Producing more with these limited resources gives you higher productivity.
Although labor is one of the easiest ways to measure productivity, you need to look beyond it. It can be tempting to view productivity as how much money you’re paying your employees per hour, but many other factors go into productivity. If you improve productivity at the expense of quality, you aren’t factoring in efficiency and may incur greater costs. You also need to consider the value of hard-to-quantify aspects, like the length of the production cycle or the quality of the product.
To better measure productivity, we can look at various factors of manufacturing:
- Production: How well is the production process organized and controlled? Are logistics handled effectively? Consider stock practices, raw material quality and the processes used.
- Assets: Are your equipment and facilities contributing to optimized productivity? Old or poorly maintained machinery could be holding you back, along with a disorganized workspace.
- Staff: Does your team have the right level of experience and the training required to work efficiently? Is management making the most of their resources, building strong relationships with employees and staying up-to-date on industry trends? Maintain a constructive work environment and attractive wages to pull in skilled workers and ensure clear roles.
- Finances: Do you have a hold on financial planning? Controlling expenditures and making strong investments are essential.
- Location: Are there factors related to your location that pose special considerations? These might include geopolitical issues, proximity to raw materials or energy sources, labor availability and infrastructure options.
How to Increase Manufacturing Productivity
Now that you have an idea of what you’re working with, we can look at some strategies for increasing manufacturing productivity. Boosting productivity can have some significant effects, from the obvious — reducing costs — to the more subtle — creating opportunities to focus on other endeavors with the time and money you save.
Here are some steps you can take to improve your productivity:
1. Update Your Technology
Make sure your systems are modernized and efficient. Use the information gathered in the last step to pinpoint problem areas and bottlenecks that could use improvement. New equipment isn’t the only way to update your tools. You can also look for ways to automate various processes or update your software. With any of these solutions, you’ll need to consider the overall cost of ownership to make sure they’ll be profitable.
Still, modern systems are often vital to improving productivity in manufacturing and keeping pace with technological advances. Productivity goals are cited as drivers of new technology strategies for 44% of respondents in an Industry Week manufacturing report.
Artificial intelligence is a big part of modernization and can help add efficiency to many different tasks, from predictive analyses to alerts about equipment functioning.
2. Commit to Scheduled Maintenance
Avoiding equipment downtime is essential for maintaining high uptime and productivity. Preventive maintenance allows you to fix equipment problems before they occur. Set up a preventive maintenance schedule and determine the best time for planned downtime that won’t interrupt operations.
3. Continuously Train Employees
Provide your workers with all the appropriate training to work effectively and efficiently. Be sure to enact ongoing education, training for new equipment, refreshers as needed and updates on industry best practices.
4. Remove Unnecessary Equipment
How organized is the workday? Does each piece of equipment or tool in the facility contribute to productivity? Consider creating a value stream map. This lean tool lets you make flowcharts that document each step in the productive manufacturing process, allowing you to identify areas of inefficiency. If you find equipment that’s not as valuable as it could be, consider replacing it.
Consider how much movement occurs during the workday. Are there areas on the shop floor where you can shorten the distance between stations to keep movement to a minimum? You’ll also want to make sure it’s easy for workers to find what they need by eliminating unnecessary tools and organizing storage spaces. Lean inventory practices can also help.
5. Create a Collaborative Culture
Communication is a crucial component of any productive workspace. Establish policies for open and honest communication, and ensure that management is supportive of employees. You may want to enlist digital tools like messaging apps to improve discussions between workers. Make sure that employees have easy access to processes and schedules.
6. Set Realistic Goals and Expectations
Some employers try to overwork their employees or cut corners regarding safety in an attempt to boost productivity, but these practices can backfire with higher turnover rates and more expenses in the long run. Control your expectations and understand that there are many factors at play besides a worker’s speed. Training and rehiring are costly endeavors, and retaining employees helps you build up their experience. Keeping employees around helps boost productivity through experienced, skilled work.
Outsourcing Manufacturing to Boost Your Productivity
For many manufacturers, the cost and time commitment that high productivity requires can make it cost-prohibitive or hard to achieve. In these instances, outsourcing manufacturing can offer significant savings without sacrificing quality or productivity. Here at Pro-Cise, we’ve invested considerable resources into achieving high productivity and are able to pass those benefits onto our clients.