Shipulski On Design

Archive for the ‘DFMA’ Category

Last month a group of engineers met secretly to reinvent the US economy one company at a time.  Here are some of the players, maybe you’ve heard of them:

Alcoa, BAE, Boeing, Bose, Covidien, EMC, GE Medical, GE Transportation, Grundfos, ITT, Medrad, Medtronic, Microsoft, Motorola, Pratt & Whitney, Raytheon, Samsung, Schneider Electric, Siemens, United Technologies, Westinghouse, Whirlpool.

Presenter after presenter the themes were the same: double profits, faster time to market, and better products – the triple crown of product development. Magic in a bottle, and still the best kept secret of the product development community. (No sense sharing the secret sauce when you can have it all for yourself.)

Microsoft used the secret sauce to increase profits of their hardware business by $75 million; Boeing recently elevated the secret methodology to the level of lean. Yet it’s still a secret.

What is this sauce that doubles profits without increasing sales?  (That’s right, doubles.) What is this magic that decreases time to market? That reduces engineering documentation? That reduces design work itself? What is this growth strategy?

When trying to spread it on your company there are some obstacles, but the benefits should be enough to carry the day.  First off, the secret sauce isn’t new, but double the profits should be enough to take a first bite.  Second, its name doesn’t roll off the tongue (there’s no sizzle), but decreased time to market should justify a taste test. Last, design engineering must change its behavior (we don’t like to do that), but improved product functionality should be enough to convince engineering to swallow.

There are also two mapping problems: First, the sauce has been mapped to the wrong organization – instead of engineering it’s mapped to manufacturing, a group that, by definition, cannot do the work. (Only engineering can change the design.) Second, the sauce is mapped to the wrong word – instead of profit it’s mapped to cost.  Engineering is praised for increased profits (higher function generates higher profits) and manufacturing is responsible for cost – those are the rules.

With double profits, reduced time to market, and improved product function, the name shouldn’t matter. But if you must know, its name is Design for Manufacturing and Assembly (DFMA), though I prefer to call it the secret sauce that doubles profits, reduces time to market, and improves product function.

I think we can turn around the US economy, one company at a time.  Here’s how:

To start, we must make a couple commitments to ourselves.  1. We will do what it takes to manufacture products in the US because it’s right for the country. 2. We will be more profitable because of it.

Next, we will set up a meeting with our engineering community, and we will tell them about the two commitments. (We will wear earplugs because the cheering will be overwhelming.) Then, we will throw down the gauntlet; we will tell them that, going forward, it’s no longer acceptable to design products as before, that going forward the mantra is: half the cost, half the parts, half the time. Then we will describe the plan.

On the next new product we will define cost, part count, and assembly time goals 50% less that the existing product; we will train the team on DFMA; we will tear apart the existing product and use the toolset; we will learn where the cost is (so we can design it out); we will learn where the parts are (so we can design them out); we will learn where the assembly time is (so we can design it out).

On the next new product we will front load the engineering work; we will spend the needed time to do the up-front thinking; we will analyze; we will examine; we will weigh options; we will understand our designs. This time we will not just talk about the right work, this time we will do it.

On the next new product we will use our design reviews to hold ourselves accountable to the 50% reductions, to the investment in DFMA tools, to the training plan, to the front-loaded engineering work, to our commitment to our profitability and our country.

On the next new product we will celebrate the success of improved product functionality, improved product robustness, a tighter, more predictable supply chain, increased sales, increased profits, and increased US manufacturing jobs.

On the next new product we will do what it takes to manufacture products in the US because it’s the right thing for the country, and we will be more profitable because of it.

If you’d like some help improving the US economy one company at a time, send me an email (mike@shipulski.com), and I’ll help you put a plan together.

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p.s. I’m holding a half-day workshop on how to implement systematic cost savings through product design on June 13 in Providence RI as part of the International Forum on DFMA — here’s the link. I hope to see you there.

More with more doesn’t cut it anymore, just not good enough.

The behavior we’re looking for can be nicely described by the old TV game show Name That Tune, where two contestants competed to guess the name of a song with the fewest notes. They were read a clue that described a song, and ratcheted down the notes needed to guess it. Here’s the nugget: they challenged themselves to do more with less, they were excited to do more with less, they were rewarded when they did more with less. The smartest, most knowledgeable contestants needed fewer notes. Let me say that again – the best contestants used the fewest notes.

In product design, the number of notes is analogous to part count, but the similarities end there. Those that use the fewest are not considered our best or our most knowledgeable, they’re not rewarded for their work, and our organizations don’t create excitement or a sense of challenge around using the fewest.

For other work, the number of notes is analogous to complexity. Acknowledge those that use the fewest, because their impact ripples through your company, and makes all your work easier.

If you’re reading this you’ve probably survived the great recession. You had to do some radical stuff, but you pulled it off. You cut to the bone as demand fell off, but you managed to shed staff and capacity and kept your company alive. Congratulations. Amazing work. But now the hard part: increased demand!

Customers are ordering, and they want product now. You’re bringing on capacity, re-hiring, and re-training, and taking waste out of your processes with lean and even extending lean to your supply chain and logistics. You’re pulling the levers as hard as you can, but you know it won’t be enough. What you need is another lever, a big, powerful, magical lever to make everything better. You need to pull the product lever.

So, you’re telling me to look at my product as a way to meet increased demand? Yes. To get more products out of few factories? Yes. To make more products with a short staff? Yes. To reduce supply chain complexity? Yes. Pull the product lever, pull it hard, and pull it now.

But meeting increased demand is a manufacturing/supply chain problem, right? No. What about flogging suppliers for unreasonably short lead times? No. What about quickly bringing on unproven suppliers? No. What about bringing on a totally new factory by next week? No. What about using folks of the street to make the product? No. Pull the product lever, pull hard, and pull it now.

Dust off the value stream map of your supply chain and identify the three longest lead times, and design them out of your product. Dust off your routings and identify the three largest labor times, and design them out of our product. Dust off your BOMs and identify the three highest cost parts, and design them out of your product. Pull the product lever. Then, identify the next three, and pull it again. Then repeat. Pull it hard, and pull it now.

Meeting increased demand will be challenging, but your customers and stockholders deserve your best. So, pull hard on all your levers, and pull them now.

There’s a huge untapped source of profits out there – a virtual gold mine – with profit opportunities so large you can’t see them, and if you do see them, too large to believe. These profits larger than you’ve achieved with your traditional lean work. (Actually, what I’m talking about the next evolution of lean.) Want to see what I’m talking about? Go to your factory and watch. The gold mine will be hiding in plain sight – it’s your product.

Huge savings blah, blah, blah. How significant? Here’s the formula:

material cost x volume x 50%.

Now, for your highest volume product, do the calculation. Go ahead. Do it. Humor me. It’s worth it.

Go get your best pen, and calculate by hand. Write down the number. Go ahead. Write it down, but make sure you put the dollar sign in front, and, please, put in the commas. Don’t abbreviate thousands, millions, or billions (or trillions, Mr. Gates) – write the zeros.  All of them.

There. You did it. Not so hard. Now, sit quietly, and contemplate the number. Look at it for an hour. Don’t say anything, just sit with it.

Now, get bigger piece of paper, and re-run the calculation, but this time write big. Repeat with a poster board, and finish with your biggest whiteboard – big zeros, lot’s of them. (Don’t forget the commas.) Marinate for an hour. Don’t say anything, just sit.

Now that you appreciate the significance of the number, go make something happen.  If you’re a CEO, tell your engineering leader to do DFMA; if you’re the manufacturing leader, grab your engineering leader by the ear, and walk to the whiteboard; if you’re the engineering leader, do DFMA.

You likely don’t believe the number. I know. It’s okay. But, a number that big at least deserves a Google search: save 50% with DFMA.

I will be running a half-day workshop on Systematic DFMA Deployment on June 13 in Providence, RI.  The workshop will kick of BDI’s 2011 International Forum on Design for Manufacturing and Assembly and will focus on how to incorporate DFMA into your product development process.

The Forum (June 14, 15) is the yearly gathering of the world’s leading DFMA experts.  It is THE place to learn about DFMA and see examples and results from leading companies.

I urge the product development community to attend.

I am also presenting at the Forum and hope to finally meet you in person.

What if you could double your factory throughput without adding people?

What if you could reduce your product costs by 50%?

How much money would you make?

How many jobs would you create?

Why aren’t you doing it?

What are you afraid of?

Your product costs are twice what they should be. That’s right. Twice.

You don’t believe me. But why? Here’s why:

If 50% cost reduction is possible, that would mean you’ve left a whole shitpot of money on the table year-on-year and that would be embarrassing. But for that kind of money don’t you think you could work through it?

If 50% cost reduction is possible, a successful company like yours would have already done it. No. In fact, it’s your success that’s in the way. It’s your success that’s kept you from looking critically at your product costs. It’s your success that’s allowed you to avoid the hard work of helping the design engineering community change its thinking. But for that kind of money don’t you think you could work through it?

Even if you don’t believe 50% cost reduction is possible, for that kind of money don’t you think it’s worth a try?

The notion of a unifying theory is tantalizing – one idea that cuts across everything. Though there isn’t one in manufacturing, I think there’s something close: Design simplification through part count reduction. It cuts across everything – across-the-board simplification. It makes everything better. Take a look how even HR is simplified.

HR takes care of the people side of the business and fewer parts means fewer people – fewer manufacturing people to make the product, fewer people to maintain smaller factories, fewer people to maintain fewer machine tools, fewer resources to move fewer parts, fewer folks to develop and manage fewer suppliers, fewer quality professionals to check the fewer parts and create fewer quality plans, fewer people to create manufacturing documentation, fewer coordinators to process fewer engineering changes, fewer RMA technicians to handle fewer returned parts, fewer field service technicians to service more reliable products, fewer design engineers to design fewer parts, few reliability engineers to test fewer parts, fewer accountants to account for fewer line items, fewer managers to manage fewer people.

Before I catch hell for the fewer-people-across-the-board language, product simplification is not about reducing people. (Fewer, fewer, fewer was just a good way to make a point.) In fact, design simplification is a growth strategy – more output with the people you have, which creates a lower cost structure, more profits, and new hires.

A unifying theory? Really? Product simplification?

Your products fundamentally shape your organization. Don’t believe me? Take a look at your businesses – you’ll see your product families in your org structure. Take look at your teams – you’ll see your BOM structure in your org structure. Simplify your product to simplify your company across-the-board. Strange, but true. Give it a try. I dare you.

Some sobering facts: (figure and facts from Matt Slaughter)

• During the Great Recession, US job loss (peak to trough) was 8.4 million payroll jobs were lost (6.1%) and 8.5 million private-sector jobs (7.3%).
• In Sept. 2010 there were 108 million U.S. private-sector payroll jobs, about the same as in March 1999.
• It took 48 months to regain the lost 2.0% of jobs in the 2001 recession. At that rate, the U.S. would again reach 12/07 total payroll jobs around January 2020.

The US has a big problem. And I sure as hell hope we are willing do the hard work and make the hard sacrifices to turn things around.

To me it’s all about jobs.  To create jobs, real jobs, the US has got to become a more affordable place to invent, design, and manufacture products. Certainly modified tax policies will help and so will trade agreements to make it easier for smaller companies to export products. But those will take too long. We need something now.

To start, we need affordability through productivity. But not the traditional making stuff productivity, we need inventing and designing productivity.

Here’s the recipe: Invent technology in-country, design and develop desirable products in-country (products that offer real value, products that do something different, products that folks want to buy), make the products in-country, and sell them outside the country. It’s that straightforward.

To me invention/innovation is all about solving technical problems.  Solving them more productively creates much needed invention/innovation productivity. The result: more affordable invention/innovation.

To me design productivity is all about reducing product complexity through part count reduction. For the same engineering hours, there are few things to design, fewer things to analyze, fewer to transition to manufacturing. The result: more affordable design.

Though important, we can’t wait for new legislation and trade agreements.  To make ourselves  more affordable we need to increase productivity of our invention/innovation and design engines while we work on the longer term stuff.

If you’re an engineering leader who wants more about invention/innovation and or design productivity, send me an email at

mike@shipulski.com

and use the subject line to let me know which you’re interested in. (Your contact information will remain confidential and won’t be shared with anyone.  Ever.)

Together we can turn around the country’s economy.

The chase for low cost labor is still alive and well. And it’s still a mistake. Low cost labor is fleeting. Open a plant in a low cost country and capitalism takes immediate hold. Workers see others getting rich off their hard work and demand to be compensated. It’s an inevitable death spiral to a living wage. Time to find the next low cost country.

The truth is labor costs are an extremely small portion of product cost. (The major cost, by far, is the material and the associated costs of moving it around the planet and managing its movement.) And when design engineers actively design out labor costs (50% reductions are commonplace) it becomes so small it should be ignored altogether. That’s right – ignored. No labor costs. Free labor. What would you do if labor was free?

Eliminate labor costs from the equation and it’s clear what to do. Make it where you can achieve the highest product quality, make it where you can run the smallest batches, and make it where you sell it. Design out labor and you’re on your way.

Design engineers are the key. Only they can design out labor. Management can’t do it without engineers, but engineers can do it without management.

A call to arms for design engineers: organize yourselves, design out labor, and force your company to do the right thing. Your kids and your economy will thank you.