MAMTC MINUTES (July) - Space Versus Stuff. Three Recommendations.

I visited three facilities and in these plants the operations leaders were concerned they did not have enough space.  They each took me on a tour of their facility to show me their manufacturing process from their process from start to finish.  All three business were mature, over 25 years old, with a good history of growth. Each had about 100 employees with tenures varying from less than 5 years to over 20 plus years.

As we discussed their individual needs during and after the tours, the one chronic condition they wanted to address is running out of space. They all recounted histories of expansion and subsequent running out of space as a repetitive cycle. They asked the same question - "What can I do about my space problem?"

My answer to them was simple. I replied, "You don't have a space problem, you have a stuff problem".  I went on to explain that while there should be pride and accomplishment in the businesses for the strong history, there was no need to commemorate it by hanging on to everything that ever came through the doors.

We then retraced steps through the plant to show them examples of 'stuff problems’, not space problems. In one area, where raw materials for a process was stored, there was in most cases over 7 months’ worth of inventory. I totally get you may have gotten a great price buying in bulk, but how does it compare to a facility expansion? In addition to that, there were obsolete and infrequently used variations stored right at the point of use. In another case, there were conveyor trays stored near the inlet of the process. I asked when those trays were to be used; the response was "In a few days or so". In this case there were about 25-30 pallet locations of these trays, taking up valuable space. These trays could have been stored elsewhere and brought closer only when needed.

In another prime example, there was Work in Process (WIP) stored on the floor taking up valuable real estate, not to mention increasing the risk of damage. I inquired about this and was told, "That is because the next process can't keep up". If the next process can't keep up, then why make it at a pace they can't manage? Alternatively, investigate why that process cannot keep up.

There were multiple cases where there was clearly more material, boxes, pallets, unused or unnecessary equipment stored right near active production equipment. Taken alone, none of the instances were significant users of space. Taken together, they added up to significant users of space and came very close to the amount of space being considered for expansion.

My comment to the production leaders was make each square foot of space the most valuable resource you have.  Items should “Earn the Right” to occupy space for any amount of time. Earning the Right applies to anything and everything in a workplace.

I am not saying any of these facilities were NOT out of space. I simply pointed out the current attitude towards use of space and that adding space was not necessarily a fix to the problem. As usual, the fix is a function of looking at the process and determining what is truly necessary and reducing or eliminating the rest.

Here are three recommendations for looking at your space versus stuff and ensuring that items have earn the right to be there. 

  • The white glove inspection.  When reviewing your space, run your fingers over the top of the items on your floor.  If there is dust on the top of the item, then you need to investigate why you still have that stuff.
  • Place a disposition date on equipment, fixtures and/or tooling.  If an item is in the same spot for longer than a period to time you determine, say 3 or 6 months, then you need to examine why you still have that stuff.
  • Inventory.  Run an aging report on your raw materials, WIP and finished goods.  Decide on a reasonable disposition time frame.  Additionally, you can pick a few items to calculate how many days, weeks, months, or years of inventory you have of any item.  I am not saying you should just get rid of any excessive inventory.  However, ensure the inventory level decisions were made with your customer’s needs as the focus and the controls are in place to manage those levels.    

I am happy to provide unique recommendations for your manufacturing organization.  Reach out to me and let’s examine the opportunity to schedule a time for me to visit and assess your own space versus stuff challenges. 

CONTACT JOE

Article contributed by Joe Torrago, MAMTC's Lean subject matter expert.  

Joe has been Joe has over 25 years of industry experience in manufacturing plants in either a technical support or operations leadership role.  He has instructed hundreds of hours of Lean content to the benefit of Kansas manufacturers since 2015.

 

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