Operate at 70%-80% capacity on critical resources utilizing Quick Response Manufacturing

In the world of business, time is money. 100% utilization of equipment and employees may be one of your goals. We would like to use this newsletter to illustrate how operating at 70% - 80% capacity by using Quick Response Manufacturing principles can actually reap profits and save you money.

QRM Principle number 2:

Plan to operate at 70% - 80% capacity on critical resources.

Most managers would react by saying, "We can't afford to do that. We will be wasting our resources and our costs will go up!" QRM will eradicate long lead times, growing queues and jobs spending a lot of time waiting for resources that result from the current 100% utilization policy. Capacity management and input control are goals used to keep lead time targets achievable. The need to plan for idle capacity is just as important with development resources as it is with the shop floor and the office. In fact, over commitment of capacity is more often a problem in development activities such as engineering than it is in manufacturing since there are few standards on how much time needs to be spent on a given task. Productivity is increased through efforts to reduce lead time, resulting in many improvements and reductions in non-value-added work. QRM will illustrate how idle capacity can be a strategic investment that will pay for itself many times over with increased sales, superior quality, and lower costs.

QRM - A Companywide Approach to Reducing Lead Times

QRM Robotic Machining Cell

Real-time QRM Examples

70% capacity with 100% on-time deliveries

Alexandria Extrusion Company's major machining center previously had an eight week lead-time with sub par delivery performance.

Currently with the implementation of QRM principles, lead-time on this particular machining center has been reduced from eight weeks to two weeks. The work center is now running at 70% capacity with 100% on time deliveries. This has increased our business opportunities and allowed us to be more responsive to our customers' needs, while reducing their levels of component inventories.

Capacity reduction improves on time deliveries!