Posts Tagged ‘Design for Assembly’

Product Thinking

Product costs, without product thinking, drop 2% per year. With product thinking, product costs fall by 50%, and while your competitors’ profit margins drift downward, yours are too high to track by conventional methods. And your company is known for unending increases in stock price and long term investment in all the things that secure the future.

The supply chain, without product thinking, improves 3% per year. With product thinking, longest lead processes are eliminated, poorest yield processes are a thing of the past, problem suppliers are gone, and your distributers associate your brand with uninterrupted supply and on time delivery.

Product robustness, without product thinking, is the same year-on-year. Re-injecting long forgotten product thinking to simplify the product, product robustness jumps to unattainable levels and warranty costs plummet. And your brand is known for products that simply don’t break.

Rolled throughput yield is stalled at 90%. With product thinking, the product is simplified, opportunities for defects are reduced, and throughput skyrockets due to improved RTY. And your brand is known as a good value – providing good, repeatable functionality at a good price.

Lean, without product thinking has delivered wonderful results, but the low hanging fruit is gone and lean is moving into the back office. With product thinking, the design is changed and value-added work is eliminated along with its associated non-value added work (which is about 8 times bigger); manufacturing monuments with their long changeover times are ripped out and sold to your competitors; work from two factories is consolidated into one; new work is taken on to fill the emptied factories; and profit per square foot triples. And your brand is known for best-in-class quality, unbeatable on time delivery, world class performance, and pioneering the next generation of lean.

The sales argument is low price and good payment terms. With product thinking, the argument starts with product performance and ends with product reliability. The sales team is energized, and your brand is linked with solid products that just plain work.

The marketing approach is stickers and new packaging. With product thinking, it’s based on competitive advantage explained in terms of head-to-head performance data and a richer feature set. And your brand stands for winning technology and killer products.

Product thinking isn’t for everyone. But for those that try – your brand will thank you.

Win Hearts and Minds

As an engineering leader you have the biggest profit lever in the company. You lead the engineering teams, and the engineering teams design the products. You can shape their work, you can help them raise their game, and you can help them change their thinking. But if you don’t win their hearts and minds, you have nothing.

Engineers must see your intentions are good, you must say what you do and do what you say, and you must be in it for the long haul. And over time, as they trust, the profit lever grows into effectiveness. But if you don’t earn their trust, you have nothing.

But even with trust, you must be light on the tiller. Engineers don’t like change (we’re risk reducing beings), but change is a must. But go too quickly, and you’ll go too slowly. You must balance praise of success with praise of new thinking and create a standing-on-the-shoulders-of-giants mindset. But this is a challenge because they are the giants – you’re asking them to stand on their own shoulders.

How do you know they’re ready for new thinking? They’re ready when they’re willing to obsolete their best work and to change their work to make it happen. Strangely, they don’t need to believe it’s possible – they only need to believe in you.

Now the tough part: There’s a lot of new thinking out there. Which to choose?

Whatever the new thinking, it must make sense at a visceral level, and it must be simple. (But not simplistic.) Don’t worry if you don’t yet have your new thinking; it will come. As a seed, here are my top three new thinkings:

Define the problem. This one cuts across everything we do, yet most underwhelm it. To get there, ask your engineers to define their problems on one page. (Not five, one.) Ask them to use sketches, cartoons, block diagram, arrows, and simple nouns and verbs.  When they explain the problem on one page, they understand the problem. When they need two, they don’t.

Test to failure. This one’s subtle but powerful. Test to define product limits, and don’t stop until it breaks. No failure, no learning. To get there, resurrect the venerable test-break-fix cycle and do it until you run out of time (product launch.) Break the old product, test-break-fix the new product until it’s better.

Simplify the product. This is where the money is. Product complexity drives organizational complexity – simplify the product and simply everything. To get there, set a goal for 50% part count reduction, train on Design for Assembly (DFA), and ask engineering for part count data at every design review.

I challenge you to challenge yourself: I challenge you to define new thinking; I challenge you to help them with it; I challenge you to win their hearts and minds.

Fix The Economy – Connect The Engineer To The Factory

Rumor has it, manufacturing is back. Yes, manufacturing jobs are coming back, but they’re coming back in dribbles. (They left in a geyser, so we still have much to do.) What we need is a fire hose of new manufacturing jobs.

Manufacturing jobs are trickling back from low cost countries because companies now realize the promised labor savings are not there and neither is product quality. But a trickle isn’t good enough; we need to turn the tide; we need the Mississippi river.

For flow like that we need a fundamental change. We need labor costs so low our focus becomes good quality; labor costs so low our focus becomes speed to market; labor costs so low our focus becomes speed to customer. But the secret is not labor rate. In fact, the secret isn’t even in the factory.

The secret is a secret because we’ve mistakenly mapped manufacturing solely to making (to factories). We’ve forgotten manufacturing is about designing and making. And that’s the secret: designing – adding product thinking to the mix. Design out the labor.

There are many names for designing and making done together. Most commonly it’s called concurrent engineering. Though seemingly innocuous, taken together, those words have over a thousand meanings layered with even more nuances. (Ask someone for a simple description of concurrent engineering. You’ll see.) It’s time to take a step back and demystify designing and making done together. We can do this with two simple questions:

  • What behavior do we want?
  • How do we get it?

What’s the behavior we want? We want design engineers to understand what drives cost in the factory (and suppliers’ factories) and design out cost. In short, we want to connect the engineer to the factory.

Great idea. But what if the factory and engineer are separated by geography? How do we get the behavior we want? We need to create a stand-in for the factory, a factory surrogate, and connect the engineer to the surrogate. And that surrogate is cost. (Cost is realized in the factory.) We get the desired behavior when we connect the engineer to cost.

When we make engineering responsible for cost (connect them to cost), they must figure out where the cost is so they can design it out. And when they figure out where the cost is, they’re effectively connected to the factory.

But the engineers don’t need to understand the whole factory (or supply chain), they only need to understand places that create cost (where the cost is.) To understand where cost is, they must look to the baseline product – the one you’re making today. To help them understand supply chain costs, ask for a Pareto chart of cost by part number for purchased parts. (The engineers will use cost to connect to suppliers’ factories.) The new design will focus on the big bars on the left of the Pareto – where the supply chain cost is.

To help them understand your factory’s cost, they must make two more Paretos. The first one is a Pareto of part count by major subassembly. Factory costs are high where the parts are – time to put them together. The second is a Pareto chart of process times. Factory costs are high where the time is – machine capacity, machine operators, and floor space.

To make it stick, use design reviews. At the first design review – where their design approach is defined – ask engineering for the three Paretos for the baseline product. Use the Pareto data to set a cost reduction goal of 50% (It will be easily achieved, but not easily believed.) and part count reduction goal of 50%. (Easily achieved.) Here’s a hint for the design review – their design approach should be strongly shaped by the Paretos.

Going forward, at every design review, ask engineering to present the three Paretos (for the new design) and cost and part count data (for the new design.) Engineering must present the data themselves; otherwise they’ll disconnect themselves from the factory.

To seal the deal, just before full production, engineering should present the go-to-production Paretos, cost, and part count data.

What I’ve described may not be concurrent engineering, but it’s the most profitable activity you’ll ever do. And, as a nice side benefit, you’ll help turn around the economy one company at a time.

A Recipe for Unreasonable Profits

There’s an unnatural attraction to lean – a methodology to change the value stream to reduce waste.  And it’s the same with Design for Manufacturing (DFM) – a methodology to design out cost of your piece-parts. The real rain maker is Design for Assembly (DFA) which eliminates parts altogether (50% reductions are commonplace.) DFA is far more powerful.

The cost for a designed out part is zero.  Floor space for a designed out part is zero. Transportation cost for a designed out part is zero. (Can you say Green?) From a lean perspective, for a designed out part there is zero waste.  For a designed out part the seven wastes do not apply.

Here’s a recipe for unreasonable profits:

Design out half the parts with DFA.  For the ones that remain, choose the three highest cost parts and design out the cost.  Then, and only then, do lean on the manufacturing processes.

For a video version of the post, see this link: (Video embedded below.)

A Recipe for Unreasonable Profits.


What is Design for Manufacturing and Assembly?

Design for Manufacturing (DFM) is all about reducing the cost of piece-parts. Design for Assembly is all about reducing the cost of putting things together (assembly).  What’s often forgotten is that function comes first.  Change the design to reduce part cost, but make sure the product functions well.  Change the parts (eliminate them) to reduce assembly cost, but make sure the product functions well.

Paradoxically, DFM and DFA are all about function.

Here’s a link to a short video that explains DFM and DFA: link to video. (and embedded below)


We must broaden “Design”

Design is typically limited to function – what it does – and is done by engineering (red team).  Manufacturing is all about how to make it and is done by manufacturing (blue team).  Working separately there is local optimization.  We must broad to design to include both – red and blue. Working across red-blue boundaries creates magic.  This magic can only be done by the purple team.

Below is my first video post.  I hope to do more.  Let me know what you think.



Cover Story IE Magazine – Resurrecting Manufacturing

Resurrecting Manufacturing Cover ImageFor too long we have praised financial enterprises for driving economic growth knowing full well that moving and repackaging financial vehicles does not create value and cannot provide sustainable growth. All the while, manufacturing as taken it on the chin with astronomical job losses, the thinnest capital investments and, most troubling, a general denigration of manufacturing as an institution and profession. However, we can get back to basics where sustainable economic growth is founded on the bedrock of value creation through manufacturing.

Continuing with the back-to-basics theme, manufacturing creates value when it combines raw materials and labor with thinking, which we call design, to create a product that sells for more than the cost to make it. The difference between cost (raw materials, labor) and price is profit. The market sets price and volume so manufacturing is left only with materials and labor to influence profit. At the most basic level, manufacturing must reduce materials and labor to increase profit. We can get no more basic than that. How do we use the simple fundamentals of reducing labor and material costs to resurrect U.S. manufacturing? We must change our designs to reduce costs using Design for Manufacturing and Assembly (DFMA).

The program is typically thought of as a well-defined toolbox used to design out product cost. However, this definition is too narrow. More broadly, DFMA is a methodology to change a design to reduce the cost of making parts while retaining product function. Systematic DFMA deployment is even broader; it is a business method that puts the business systems and infrastructures to deploy DFMA methods in place systematically across a company. In that way, it is similar to the better known business methodologies lean, Six Sigma and design for Six Sigma.

Click this link for the full story.


Click this link for information on Mike’s upcoming workshop on Systematic DFMA Deployment

Fasteners Can Consume 20-50% of Assembly Labor

The data-driven people in our lives tell us that you can’t improve what you can’t measure.  I believe that. And it’s no different with product cost. Before improving product cost, before designing it out, you have to know where it is. However, it can be difficult to know what really creates cost.  Not all parts and features are created equal; some create more cost than others, and it’s often unclear which are the heavy hitters. Sometimes the heavy hitters don’t look heavy, and often are buried deeply within the hidden factory.

Measure, measure, measure.  That’s what the black belts say.  However, it’s difficult to do well with product cost since our costing methods are hosed up and our measurement systems are limited. What do I mean? Consider fasteners (e.g., nuts, bolts, screws, and washers), the product’s most basic life form. Because fasteners are not on the BOM, they’re not part of product cost. Here’s the party line: it’s overhead to be shared evenly across all the products in a socialist way.  That’s not a big deal, right?  Wrong.  Although fasteners don’t cost much in ones and twos, they do add up. 300-500 pieces per unit times the number of units per year makes for a lot of unallocated and untracked cost.  However, a more significant issue with those little buggers is they take a lot of time attach to the product.  For example, using standard time data from DFMA software, assembly of a 1/4″ nut with a bolt, locktite, a lockwasher, and cleanup takes 50 seconds.  That’s a lot of time. You should be asking yourself what that translates to in your product. To figure it out, multiply the number nut/bolt/washer groupings by 50 seconds and multiply the result by the number of units per year. Actually, never mind.  You can’t do the calculation because you don’t know the number of nut/bolt/washer combinations that are in your product. You could try to query your BOMs, but the information is likely not there.  Remember, fasteners are overhead and not allocated to product. Have you ever tried to do a cost reduction project on overhead?  It’s impossible.  Because overhead inflicts pain evenly to all, no one is responsible to reduce it.

With fasteners, it’s like death by a thousand cuts.

The time to attach them can be as much as 20-50% of labor. That’s right, up to 50%.  That’s like paying 20-50% of your folks to attach fasteners all day. That should make you sick.  But it’s actually worse than that.  From Line Design 101, the number of assembly stations is proportional to demand times labor time. Since fasteners inflate labor time, they also inflate the number of assembly stations, which, in turn, inflates the factory floor space needed to meet demand. Would you rather design out fasteners or add 15% to your floor space?  I know you can get good deals on factory floor space due to the recession, but I’d still rather design out fasteners.

Even with the amount of assembly labor consumed by fasteners, our thinking and computer systems are blind to them and the associated follow-on costs. And because of our vision problems, the design community cannot be held accountable to design out those costs.  We’ve given them the opportunity to play dumb and say things like, “Those fastener things are free. I’m not going to spend time worrying about that.  It’s not part of the product cost.”  Clearly not an enlightened statement, but it’s difficult to overcome without cost allocation data for the fasteners.

The work-around for our ailing thinking and computer-based cost tracking systems is simple: get the design engineers out to the production floor to build the product.  Have them experience first hand how much waste is in the product.  They’ll come back with a deep-in-the-gut understanding of how things really are. Then, have them use DFMA software to score the existing design, part-by-part, feature-by-feature.  I guarantee everyone will know where the cost is after that. And once they know where the cost is, it will be easy for them to design it out.

I have data to support my assertion that fasteners can make up 20-50% of labor time, but don’t take my word for it. Go out to the factory floor, shut your eyes and listen.  You’ll likely hear the never ending song of the nut runners. With each chirp, another nut is fastened to its bolt and washer, and another small bit of labor and factory floor space is consumed by the lowly fastener.

DFA and Lean – A Most Powerful One-Two Punch

Lean is all about parts. Don’t think so? What do your manufacturing processes make? Parts. What do your suppliers ship you? Parts. What do you put into inventory? Parts. What do your shelves hold? Parts. What is your supply chain all about? Parts.

Still not convinced parts are the key? Take a look at the seven wastes and add “of parts” to the end of each one. Here is what it looks like:

  1. Waste of overproduction (of parts)
  2. Waste of time on hand – waiting (for parts)
  3. Waste in transportation (of parts)
  4. Waste of processing itself (of parts)
  5. Waste of stock on hand – inventory (of parts)
  6. Waste of movement (from parts)
  7. Waste of making defective products (made of parts)

And look at Suzaki’s cartoons. (Click them to enlarge.) What do you see? Parts.

Suzaki photos large

Take out the parts and the waste is not reduced, it’s eliminated. Let’s do a thought experiment, and pretend your product had 50% fewer parts. (I know it’s a stretch.) What would your factory look like? How about your supply chain? There would be: fewer parts to ship, fewer to receive, fewer to move, fewer to store, fewer to handle, fewer opportunities to wait for late parts, and fewer opportunities for incorrect assembly. Loosen your thinking a bit more, and the benefits broaden: fewer suppliers, fewer supplier qualifications, fewer late payments; fewer supplier quality issues, and fewer expensive black belt projects. Most importantly, however, may be the reduction in the transactions, e.g., work in process tracking, labor reporting, material cost tracking, inventory control and valuation, BOMs, routings, backflushing, work orders, and engineering changes.

However, there is a big problem with the thought experiment — there is no one to design out the parts. Since company leadership does not thrust greatness on the design community, design engineers do not have to participate in lean. No one makes them do DFA-driven part count reduction to compliment lean. Don’t think you need the design community? Ask your best manufacturing engineer to write an engineering change to eliminates parts, and see where it goes — nowhere. No design engineer, no design change. No design change, no part elimination.

It’s staggering to think of the savings that would be achieved with the powerful pairing of DFA and lean. It would go like this: The design community would create a low waste design on which the lean community would squeeze out the remaining waste. It’s like the thought experiment; a new product with 50% fewer parts is given to the lean folks, and they lean out the low waste value stream from there. DFA and lean make such a powerful one-two punch because they hit both sides of the waste equation.

DFA eliminates parts, and lean reduces waste from the ones that remain.

There are no technical reasons that prevent DFA and lean from being done together, but there are real failure modes that get in the way. The failure modes are emotional, organizational, and cultural in nature, and are all about people. For example, shared responsibility for design and manufacturing typically resides in the organizational stratosphere – above the VP or Senior VP levels. And because of the failure modes’ nature (organizational, cultural), the countermeasures are largely company-specific.

What’s in the way of your company making the DFA/lean thought experiment a reality?

DFA Saves More than Six Sigma and Lean

I can’t believe everyone isn’t doing Design for Assembly (DFA), especially in these tough economic times. It’s almost like CEOs really don’t want to grow stock price. DFA, where the product design is changed to reduce the cost of putting things together, routinely achieves savings of 20-50% in material cost, and the same for labor cost. And the beauty of the material savings is that it falls right to the bottom line. For a product that costs $1000 with 60% material cost ($600) and 10% profit margin ($100), a 10% reduction in material cost increases bottom line contribution by 60% (from $100 to $160). That sounds pretty good to me. But, remember, DFA can reduce material cost by 50%. Do that math and, when you get up off the floor, read on.

Unfortunately for DFA, the savings are a problem – they’re too big to be believed. That’s right, I said too big. Here’s how it goes. An engineer (usually an older one who doesn’t mind getting fired, or a young one who doesn’t know any better) brings up DFA in a meeting and says something like, “There’s this crazy guy on the web writing about DFA who says we can design out 20-50% of our material cost. That’s just what we need.” A pained silence floods the room. One of the leaders says something like, “Listen, kid, the only part you got right is calling that guy crazy. We’re the world leaders in our field. Don’t you think we would have done that already if it was possible? We struggle to take out 2-3% material cost per year. Don’t talk about 20-50% because is not possible.” DFA is down for the count.

Also unfortunate is the name – DFA. You’ve got to admit DFA doesn’t roll off the tongue like six sigma which also happens to sound like sex sigma, where DFA does not. I think we should follow the lean sigma trend and glom some letters onto DFA so it can ride the coat tails of the better known methodologies. Here are some letters that could help:

Lean DFA; DFA Lean; Six Sigma DFA; Six DFA Sigma (this one doesn’t work for me); Lean DFA Sigma

Its pedigree is also a problem – it’s not from Toyota, so it can’t be worth a damn. Maybe we should make up a story that Deming brought it to Japan because no one in the west would listen to him, and it’s the real secret behind Toyota’s success. Or, we can call it Toyota DFA. That may work.

Though there is some truth to the previous paragraphs, the main reason no one is doing DFA is simple:

No one is asking the design community to do DFA.

Here is the rationalization: The design community is busy and behind schedule (late product launches). If we bother them with DFA, they may rebel and the product will never launch. If we leave them alone and cross our fingers, maybe things will be all right. That is a decision made in fear, which, by definition, is a mistake.

The design community needs greatness thrust upon them. It’s the only way.

Just as the manufacturing community was given no choice about doing six sigma and lean, so should the design community be given no choice about doing DFA.

No way around it, the first DFA effort is a leap of faith. The only way to get it off the ground is for a leader in the organization to stand up and say “I want to do DFA.” and then rally the troops to make it happen.

I urge you to think about DFA in the same light as six sigma or lean: If your company had a lean or six sigma project that would save you 20-50% on your product cost, would you do it? I think so.

Who in your organization is going to stand up and make it happen?

Successful Design For Assembly

Successful Design For Assembly

Each company works with design for assembly (DFA) methods for different reasons. Some companies want to take cost out of their products, some want to make more products in their factories, and some want to simplify the product to increase quality and reliability.

In a growing market, a company wants to reduce labor content to get more products through the factory and to meet demand without adding assembly workers. In a growing market, a company also wants to reduce the floor space required to meet demand without building another factory. Read the rest of this entry »

Mike Shipulski Mike Shipulski
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