Bill Gaw's, Best-in-Class,
Basic No. 4: Information Integrity
MRP/ERP and lean manufacturing
objectives cannot be achieved when day-to-day production and
manufacturing control systems are driven by inaccurate, untimely and
uncontrolled data and/or documentation.
In many company today, you’ll find that converting the monthly financial
forecast into reality still requires overtime, costly expediting,
expensive "on-the-run" product changes and even a little
"smoke and mirrors". With all the available sophisticated
computerized systems, why is it so?
The answer lies in
what’s missing and has little to do with the quality of the
system designs. Like Vince Lombardi, who focused his team on the
mastering of football basics – we need to focus our teams on the
mastering of business basics. When it comes to improving systems
performance, "Information Integrity" is critical. I call it
– the ability to communicate data and documentation completely,
accurately and in a timely manner. Like blocking and tackling in
football, it’s not glamorous -- but without
tenacious and flawless execution,
success will never exceed expectations.
Infotegrity is crucial to
scheduling and MRP computations. Excessive MRP rescheduling of
released orders is costly and disruptive and is usually driven by
poor input data. To improve the quality of MRP
"rescheduling" messages, one materials manager focused on
improving the integrity of MRP inputs. She reduced the frequency of
their MRP "re-generation" and implemented a mandatory
weekly review/purge/reset of all purchase and production
"open" order status. The results were amazing; reschedule
messages were reduced by 85% and her planner/buyers gained time to
do additional proactive parameter maintenance. Because of increased
scheduling stability, there was a significant improvement in both
supplier and shop on-time deliveries.
A good example of the
importance of Infotegrity is the "eye-opening" result of
the cumulative effect of data inputs in a computerized order release
and scheduling system such as MRP. There are at least ten data input
files that drive such systems with data accuracy indexes varying
between 90% and 100%. Statistically, their cumulative effect (the
product of their values) could yield a devastating, order
release accuracy of 68.2%. That translates into a cumulative 31.8%
error rate in the order release and scheduling process. In spite of this
huge constraint, American ingenuity and energy still gets the job
done – but at what costs?
Although many business gurus have identified data accuracy as important in the implementation of computerized systems, their message has been lost in the mania of systems sophistication. To remain competitive in the future, manufacturers must improve the results gained from their business systems investments – to do this, the fine-tuning of Infotegrity is a "must do". How does a company accomplish this task? Here are a few "must dos:"
data bases – making it easy
and routine to keep data
correct and up to date
* Establish the right
mindset – the quality of decision-making is dependent on
Competition is getting tougher and tougher as each year passes. If we don’t want our competitors to close in on our markets, we need to continuously improve product/service quality, increase productivity, lower costs and increase speed of new product introductions.
To maintain ones competitive edge into the future, management’s focus must be shifted from systems sophistication to systems Infotegrity. In short, its time to put the "horse before the cart". Information Integrity is no panacea, however, I'm convinced that a company with simple, unsophisticated systems and a high level of Infotegrity will outperform a company that has sophisticated systems and low Infotegrity.
What about those company that have both? I buy their stock!
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