Performance Measurements

Mindset changes, improvement and paradigm shift will always involve re-appraisal of measurement systems, both formal and informal. A good manufacturing system can be a source of unbiased measurements that can assist the company, individuals and trading partnerships.

Some personal favorites for implementation are:

• Percentage of production shipped on time according to original promise/due date
• Same as the above but for latest date communicated to a customer
• Number (or percentage) of production orders released with insufficient lead time, or with shortages of material
• Average days late/early of work in process by depart­ment or work center
• Work in process investment (or days of work) by depart­ment, which is also a cycle/lead time measurement
• Inventory (by class) as a percentage of cost sales in same or next succeeding period
• Safety stock as a percentage of average level (i.e., investment in just-in-case)

These and similar measurements can be retrieved from a system using report writers, with trends maintained in spread sheets. Such information contributes to overall performance improvement, teamwork and improved part­nership relations.
Customization and Flexibility

Most packaged and custom developed systems are inflex­ible in transaction formats, display and report contents, etc. Users have to work with information and displays that are awkward, inefficient and wasteful in terms of the human resource. People work smarter with support from effective systems. Systems are more effective if they can match the best procedures and practices of the different departments.

For example, purchase receipt transactions use similar format and content. But it is not necessary for the receipt data for raw material, such as fiber yarn or even steel coil, to have the complexity of entries needed for a shipment of chemicals or a roll of cloth, which includes batch number, lot number, piece number and technical data. Each of these should have their own formats, to assist user accuracy and match procedures, instead of just one generic purchase receipt display.

Other examples of procedural customization will allow multiple/different types of production order, allowing dif­ferent departmental procedures and transactions. Differ­ent types of customer order, depending on type of product, allow simplification of entry and shipping data. The same principles can be applied to purchase orders, other inven­tory transactions, and so on.

Today, table approaches (i.e., question/answer input) can allow changes and tailoring of procedures without pro­gramming or re-compilation. Systems become truly user friendly, meeting local and different departmental needs. The result will be improved user performance and responsiveness.

Summary

Constraints of duration and length preclude more detailed discussion of some of these topics and their related areas that are highly relevant to the QR environment. This paper has focused on some primary aspects and functional limi­tations that have been encountered in multiple situations.

If your systems, or requirements statements, do not in­clude these needs, it is probable that your future system effectiveness will be severely degraded. We all recognize that change is constant. Only too often systems do not keep up with business changes. Systems have to accommodate the realities of today's business.

The functions of the typical MRP based system, as defined in many specifications or requirements documents, will provide only a partial solution for QR oriented manufactur­ers. In order to avoid such disappointing results, it is prudent to ensure that people involved in the systems review are representative of engineering, cost accounting, produc­tion management, and materials/master scheduling.

It is hoped that this short discussion can be useful to your company's pursuit of Quick Response—the manifestation of Just-In-Time and World Class Manufacturing for com­panies in the supply chain to the retailer.