Michigan Manufacturing Technology Center

Transcription

1 National Institute of Standards & Technology (NIST) Manufacturing Extension Partnership (MEP) Michigan Manufacturing Technology Center Michael McGray, Director of Information Services MICHIGAN MANUFACTURING TECHNOLOGY CENTER

2 Michigan Manufacturing Technology Center Manufacturing Extension Partnership for the State of Michigan Supported through Michigan Economic Development Corp and NIST through US Dept of Commerce Created for the sole purpose of serving small and medium-sized manufacturers (< 500 employees) Organization of full-time professionals, statewide coverage network through regional offices Our website 2

3 MEP Centers national network 60 MEP Centers 373 Locations 3

4 MEP Network 4

5 Our Mission To enhance the global competitiveness of small and medium-sized manufacturers. Our Goal To make a SIGNIFICANT POSITIVE IMPACT on our clients, resulting in increased profits by reducing costs, increasing sales and creating new jobs. 5

6 Transformation Planner Gross Margin Inventory Turns Scrap and Rework Premium Freight Days Receivables On-Time Delivery Machine Available versus Run Hours Schedule Bumping Employee Turnover Value per FTE

7 Benchmarking Service The Michigan Manufacturing Technology Center is a leading source of performance benchmarking data for manufacturing. Since 1992, MMTC has collected vital operating data on small to medium sized manufacturers across North America. Measuring more than 40 key metrics, our database now exceeds 11,000 records. All individual company information (input data and outputs reports) are kept strictly confidential. 7

8 Average SFSA Member Average SFSA Value -Added / FTE $ 128, Inventory Turns 8.29 Machine Utilization 85.50% Scrap and Rework 6.77% Gross Revenue 22.27% 8

9 Amazingly, few companies really know how they stack up to their competition! 100 Cumulative % Answering Perception Reality Cumulative % Self-Ranking

10 Benchmarking: Estimating the $ VALUE of Improvement and Growth Compares your facility to your competition defined by: Industry sector Customer Market Order Volume and Repetitiveness

11 11

12 12

13 How did the SFSA Companies Stack up? Average Foundries SFSA Value -Added / FTE $ 74, $ 128, Inventory Turns Machine Utilization 77.50% 85.50% Scrap and Rework 5.47% 6.77% Gross Revenue 15.91% 22.27% 13

14 Benchmarking results will help answer the question Where do we start?. Attack scrap & rework? Change payment terms / reengineer collections? Cut inventory levels? Stick to schedule? Less bumping Lower premium freight Attack late deliveries? Attack machine downtime? Attack energy use? Attack employee turnover? Get Lean in the office?

15 Developed in the late 1990 s Proprietary tool of MMTC Opportunity Assessment Licensed for use only to other MEP s Projects monetary impact of improvements Uses benchmarking to enable realistic goal setting 15

16 Opportunity Assessment: Estimating the $ VALUE of Improvement and Growth Compares your facility to your competition defined by: Industry sector Customer Market Order Volume and Repetitiveness Places a $ value on feasible levels of improvement Using data, it shows you the likely payoff of recommended improvement efforts and growth

17 Opportunity Assessment Evaluates: Gross Margin Inventory Turns Value-Added per Full Time Equivalent (FTE) Machine Utilization Order Bumping / Expediting Scrap and Rework / COGS Utilities Expense / Sales Premium Freight / Sales On-Time Delivery Days Receivable

18 Opportunity Assessment Provides Benchmark comparison to companies in your industry sector Ability to set realistic improvement targets for clearly understood performance metrics Calculates one-time and recurring annual financial benefits

19 19

20 How did the SFSA Companies Stack up? SFSA 25% 50% 75% 90% Value -Added / FTE $ 128, $ 53,000 $ 4,284 $ 104,431 $ 170,946 Inventory Turns Machine Utilization 85.50% 67.75% 77.50% 87.48% 93.68% Scrap and Rework 6.77% 10.72% 5.47% 3.14% 1.30% Gross Revenue 22.27% 8.85% 15.91% 30.29% 35.81% 20

21

22 Impact of a Single Inventory Turn? 8.29 to 9.29 One-Time Benefit: $1,604,030 Recurring Benefit: $240,604 Nine weeks of sales in Inventory reduced to seven weeks. Increase of 2.5% to Gross Revenue. 22

23 Increase Machine Utilization by 5%? 85% to 90% 71 st to 81 st Percentile Recurring Benefit: $247,024 Increase of 2.5% to Gross Revenue. Increased ability to process backlog using same resources. Six percent revenue growth. 23

24 Decrease Scrap Rate by 2%? 6.77% to 4.77% 42 nd to 55 th Percentile Recurring Benefit: $242,478 Increase of 2.5% to Gross Revenue. Increased ability to process backlog using same resources. One percent revenue growth. 24

25 for more information... Michael McGray Thank you. 25