Customers today want a variety of products in just the quantities they need. They expect high quality, a good price, and speedy delivery. Producing to customer requirements means getting batch processes to produce in small lots. Doing this usually creates a need to reduce setup times. The goal of setup reduction and changeover improvement should be to develop a production system that gets as close as possible to making only what the customer wants, when the customer wants it, throughout the production chain. The result being a strong, flexible manufacturing operation that is adaptable to changes.

Many companies produce goods in large lots simply because long changeover times make it costly to frequently change products. Large-lot production has several disadvantages:

• Inventory waste - sorting out what is not sold costs money and ties up company resources without adding any value to the product
• Delay - customers must wait for the company to produce entire lots rather than just the quantities a customer needs
• Declining quality - storing unsold inventory increases the chance that it will have to be scrapped or reworked, which adds cost to the product

When methods are in place to accommodate quick changeover, setups can be done as often as needed. This means you can make products in smaller lots, which has many advantages:

• Flexibility - you can meet changing customer needs without the expense of excess inventory
• Quicker delivery - small-lot production means less lead time and less customer waiting time
• Better quality - less inventory storage means fewer storage-related defects. Quick changeover methods lower defects by reducing setup errors and eliminating trial runs of the new product
• Higher productivity - shorter changeovers reduce downtime, which means a higher equipment productivity rate

You must first look at how you currently perform setup operations before you can improve them. Three preliminary steps involved in a setup analysis include:

• videotaping the entire setup operation
• asking setup personnel to talk about what they do
• studying the time and motions involved in each step of the setup

Setup improvement activities can be implemented in three stages:

• distinguishing between internal and external setups
• converting internal setups to external setups
• streamlining all aspects of the setup operation

As a broad term setup covers not only the replacement of tooling and production parts, but also other operations, such as the revision of standards and the replacements of assembly parts and other materials.

Usually, we begin by reducing setup time as an objective and rarely go further to change equipment more frequently and run smaller batches. In other words, the focus is on the technique of setup reduction rather than the objective of lean manufacturing. Setup reduction is an important technique that supports lean manufacturing, but it is lean manufacturing that is the driver for when and where you apply setup reduction.

BENEFITS OF SETUP REDUCTION / QUICK CHANGEOVER TECHNIQUES