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Cost of Poor Quality Manufacturing

 

There is a fine line between profit and loss for a manufacturer. That line is based on volume and the efficiency of many variables in the right combination. There is no other industry that understands Cost Of Poor Quality (COPQ) as much as manufacturing. Every mistake or defective product impacts the bottom line. BITA’s experience indicates at least 20% of company’s revenue is on wasted tools, legacy systems, inefficient processes, affecting productivity and profits.

GLOBAL COMPETITION IS FIERCE

 

The second generation owner’s sons of a Canadian manufacturer were frustrated with how they could keep up with global competitors. So many of their Canadian counterparts had closed due to the strength of Chinese and Indian economies. The sons knew their hand crafted products were superior and the quality of offshore mass production was much lower. The sons had a strategy to modernize the plant including retooling the assembly lines, installing new CNC machines and hiring CAD designers to efficiently use raw materials. This provoked resistance from some of the employees who had been there for decades.

RELIABLE PAPER AND PEN

 

  • Old CNC machines were stalling and needed to be rebooted regularly.
  • Computers were on a wireless connection and could not access their network drives all the time.
  • Everyone seemed to love their job, they took pride in their work.
  • Father was not available to help with the sons succession.
  • Designs were drawn on paper and then hand carved from rubber molds.
  • Inkjet printers sat on almost every desk.
  • Custom orders were filled as they came in.

FAMILY AND STAFF UNITE

 

  • Production increased because of new CNC machines.
  • All computers were wired, accelerating the speed of data transmission.
  • CAD facilitated the reduction of raw material waste.
  • Renewed excitement was happening as older generation was getting trained on equipment.
  • Newer generation was helping to develop new markets.
  • Labour costs were lowered.
  • Print management of printers, ink cartridges and paper dramatically reduced their office supplies expense.
  • Labour cost was reduced in custom orders.