Stamp of Approval: Lean in the Tool & Die Industry

One of the most famous examples of lean manufacturing is the success of the “Single Minute Exchange of Dies” (SMED) methodology developed by Shigeo Shingo in 1950 within the Toyota Production System (TPS) that is the foundation for the system that we now refer to as Lean. He developed a three-stage methodology to reduce the time to complete a machine changeover to single digits (less than 10 minutes), rather than several hours or even days. Reducing changeover times helps to reduce batch sizes and produce parts according to demand, improving responsiveness to customers while decreasing inventories of both supplies and finished goods.

SMED is just one tool of many within the Lean Six Sigma system, which can be applied across all industries but especially in the tool & die industry. Companies that are not working towards implementing a Lean culture run the risk of being at a competitive disadvantage to the point that Lean has become a ‘must requirement’ as they fall behind those that do. 

What is Lean?

The lean methodology was developed with the ultimate goal of reducing costs and increasing efficiency by identifying and eliminating activities in a given process (service or manufacturing) that fail to add value and yet consume resources. In the lean terminology, value is defined as ‘what the customer is willing to pay’. As a result, lean is heavily oriented not only to efficiency and cost reduction but also to creating value to ensure customer satisfaction.

On the other hand, Six Sigma is a system developed with the goal of controlling variation and making processes more consistent and reliable to ensure the quality of deliverables. The combination of Lean with Six Sigma results in a faster creation of value at the lowest possible cost.

Lean/Continuous Improvement within the Tool & Die Sector

Tooling is a critical component of the manufacturing process, and as such it remains important for industries that manufacture durable goods, especially automotive parts, but also goods such as consumer electronics and household appliances. Indeed, the demand due to increasing car production since 2009 has led to rapid growth of the tooling industry.

However, customer expectations of levels of quality and accuracy continue to increase at the same time that tool and die manufacturers face pressure to shorten delivery lead times or lower prices. The challenge is to identify an effective and profitable method to manufacture products with the equipment and expertise available.

Those in the tool and die industry face other key challenges:

• Increasing tool complexity: as product complexity increases, tool complexity increases with it;
• Ongoing global competition
• Lack of skilled workers in the labour force: employees with machining skill and experience are scarce, and those with die-making skill are even scarcer—this shortage is increasing as the current workforce ages.

Further complicating these challenges, for example, is the complexity of sheet metal forming that relies on multiple technologies, machines, and tooling to produce a large range of products with an even wider range of dimensions, geometries, and batch sizes. Efficient and robust processes are therefore required to remain competitive, necessitating the optimization of entire process chains.

There are different types of key performance indicators (KPIs) that lean tools look to understand and use to enhance efficiency:

• Process KPI: equipment availability; overall equipment effectiveness; or labour productivity
• Supply chain KPI: on-time delivery; cost per pound; unit cost; days in inventory
• Quality KPI: defects per thousand units; customer satisfaction
• Business KPI: profitability

In addition, three areas that contribute a large proportion of inefficiencies that tool & die companies experience are speed, quality, and hardware.

Speed: one example of processing speed being negatively affected involved the lack of interoperability of multiple CAM systems. The solution was to consolidate them into a single CAM provider, where immediate benefits were gained through the use of algorithms and toolpath editing capabilities combined with machining templates and smart macros to automate the CAM programming process. Rather than a typical plate taking up to 5 hours to program, this solution was able to accomplish the same in under 15 minutes.

Quality: manual methods such as polishing not only are expensive and time-consuming but also inhibit control and repeatability, but lean offers options to replace manual operations with automated processes that enhance efficiency.

Tool and die companies that adopt lean strategies are able to differentiate themselves by implementing the right technology along with the right people. Tools such as CAD/CAM/CAE software, simulation programs, or PDM/PLM systems have allowed these companies to eliminate manual tasks while optimizing part manufacturability.

Other lean tools include, but are not limited to:

• DMAIC: the Define, Measure, Analyze, Improve, and Control process is a quality strategy that seeks to improve processes through the use of retrieved data (such as relevant KPIs).
• 5S: the 5S system (Sort, Set in Order, Shine, Standardize, and Sustain) is a methodology to ensure workplaces are clean, uncluttered, and safe—this helps to reduce waste and optimize productivity.
• Value stream mapping (VSM): this is a tool used first to visually represent a product’s production path from beginning to end and second to identify ways to optimize flow through the process.
• Visual workplace: the goal of visual workplace devices is to enhance efficiency of organizational operations while also improving safety and reliability.

In addition to this, setting up a statistical process control system (SPC) is of paramount importance to determine process capability, and indicators such as Cp and Cpk or Pp and Ppk. This powerful tool will be extremely instrumental for determining further process improvements, the Sigma Score of your process, the defects to be expected and, as a consequence of this, the financial benefits that you can expect to achieve when improving that process. Undoubtedly, this type of improvement in your process will also deliver higher rates of customer satisfaction. During our consulting practice we have observed a wide range of examples of critical to quality (CTQ) variables within the tool & die industry that need to be monitored in a process capability analysis. Some of the most common examples include geometrical dimensions, cutting accuracy, surface finish and surface hardness. However, there are further statistical tools that have successfully delivered significant benefits to operations within the tool & die industry, such as correlation analysis, regression, statistical predictions, hypothesis testing, and many more.

Lean Six Sigma Implementation & Training

At AMSaxum we help our clients with the implementation of process improvement projects and provide onsite corporate training on lean six sigma/continuous improvement methodologies. There are Government grants available in Canada and the USA to cover the cost of corporate training.

Government Funding & Assistance Options

In addition to the tangible benefits possible through lean, the research and development efforts (labor, materials and subcontracts) required in the tool & die sector could be eligible to be recovered through government funding, such as through the Scientific Research & Experimental Development (SR&ED) program in Canada.

For companies in North America, specifically, there could be applicable grants to aid in upfront costs such as capital investment and employee training. AMSaxum experts in government funding help with the application of these grants and with the preparation of SR&ED claims.

For more information on continuous improvement and Government funding within the tool & die sector call AMSaxum at +1 416-878-3437 or contact us here.