Remedy for Hair Loss!
by Dave Biggs
starter motors that were purchased for a new product are being scrapped.
The purchased items scrapped during the year are part of Cathy's performance
review, and this latest event is not going to help. These particular items
cost $1500 a piece and she knows this is definitely going to become a discussion
topic and an embarrassment in this week's meeting. These events are causing
her to pull out her hair by the handful!
is a planner/buyer for Ajax Company, and she is between a rock and a hard
place. The rock is the need to get new products to the marketplace quickly.
The hard place is long lead time purchased parts. Ajax's marketplace is
demanding that new products be delivered within a month of the time when
the design is completed. The new purchased items like starter motors can
have lead times of 12 weeks. The dilemma is long lead time items have to
be purchased before the design of a new product is complete.
items before the design is completed carries the risk of scrapped parts.
Communication/coordination problems and the design being changed after
it was thought to be complete are the two major contributors to scrap items.
There are ways to minimize design stability issues and they are a topic
of a different article, but scrap caused by communication/coordination
problems is a totally unnecessary waste!
our story company, Ajax, to review how the bills of material and materials
management should be managed during product development shows how to avoid
communication and coordination problems. Ajax builds large diesel engines
and early in a project engineering and manufacturing should plan the product
structure and load skeleton bills of material. They know even before a
project is started that the engine is going to have a block, pistons, connecting
rods, valves, and so on. Past experience building engines gives them a
pretty good idea of how the engine will be manufactured, so they know what
the product structure should look like even before the individual parts
are actually designed.
"early" bills of material have dummy part numbers, like "piston," loaded
for the items that are not designed yet. As parts of the design are completed,
Engineering loads real part numbers and completes the bills. This practice
is common and has given a competitive edge to the companies that use it.
order to avoid problems, it has to be clear to both engineering and manufacturing
which parts on the bills of material are complete and ready to order. The
need to quickly get to the marketplace means that you can't wait until
the entire project is production released, and it is too cumbersome and
ineffective to go through a production release process for every part as
it is finalized.
answer is a "futures flag" on the parts in the bills of material. Depending
on the software a company uses, the futures flag may by part of the item
master file, but most likely, it is part of the revision control system.
When the revision control system is used, a revision status such as NR
can be used to clearly indicate that the part is not released for production
activities. The idea is for engineering to use the "futures flag" to warn
material planners that parts of the design are not stable enough to procure
parts yet. So in Cathy's company, the starter motors are marked with a
"futures flag" when the skeleton product structure is first loaded. When
engineering feels that the design is stable enough, they change the "futures
flag" to let the material planners know they can procure the parts.
skeleton product structure technique has a second benefit in reducing confusion.
Since the "early" bills of material are in place early in the project,
the materials management people can use the formal information system to
tell when it is time to order parts. If a futures flag has not been removed
when it's time to buy the parts, the planners know to immediately have
a discussion with engineering.
the "futures flag" technique eliminates the need for complex production
release forms and procedures, which usually don't add value. In effect,
the product design is released one item at a time and manufacturing has
the maximum time to procure the items required for the first built units.
the best offense is a good defense. That's the case for material planners
and buyers who pull their hair out during new product development. A "futures
flag" is one of the better hair loss remedies!