Losses in Production System

Figure 2.1 shows the structure of the losses inherent in a typical production system. These losses can be split into three main categories: those preventing equipment from being used as efficiently as it could (The 8 Big Equipment Losses, at the upper right of the diagram), those preventing labour from being used as efficiently as it could (The 5 Big Labor Losses, at the upper left of the diagram), and those preventing resources from being used as efficiently as they could (The 3 Big Resource Consumption Losses, at the bottom of the diagram). These sixteen losses are collectively referred to as The 16 Big Losses.

1. Making Plant and Equipment More Efficient

The losses holding back the efficiency of a fabrication, assembly or packaging operation employing mainly non-process-type equipment will be different from those in an operation that employs mainly storage tanks, columns, heat exchangers and similar process plant. The two types of operation will therefore be discussed separately, beginning with the former.

1.1 The 8 Big Equipment Losses and OEE (Overall Equipment Effectiveness)

Maximizing equipment efficiency means making it work as well as it possibly can. Looked at the other way round, this means that it can be made more efficient by eliminating all the losses that prevent it from working as well as it possibly can. Eight major equipment losses (described below) have been identified. It is essential to improve our companies’ business performance by eliminating these losses and thereby maximizing the efficiency with which we utilize our equipment. Table 2.1 defines these losses.

(1) Breakdown Loss

Breakdown loss is the greatest hindrance to making equipment more effective. Some equipment failures bring the equipment to a complete standstill (called ‘function- stoppage failures’), while others merely make it under perform (called ‘function-reduction failures’). The former happen suddenly, while the latter arise insidiously, progressively making the equipment function further and further below its true capability.

(2) Setup and Adjustment Loss

This is the downtime loss that occurs when a changeover is carried out. Changeover time is the total time required to switch from one product to another (from when the last good product of the previous run has emerged to when the first good product of the next run comes off the line). Adjustment is the most time-consuming element of changeover.

(3) Cutting-Tool Replacement Loss

Cutting-tool replacement loss is the loss incurred by stopping a machine in order to change a cutting tool such as a grindstone, saw blade, cutter wire or lathe tool when it has become worn out or damaged.

(4) Startup Loss

Startup loss is the loss incurred when production starts. It begins when the equipment is activated, and continues during the run-up to steady-state operation until processing conditions have stabilized.

(5) Minor Stops and Idling Loss

Unlike equipment failures, minor stops result in stopping-and-starting, and transient problems that require the machine to be paused or idled for short periods. They typically occur when a product gets stuck in a chute, so the machine starts idling, or when a defective product activates a sensor and temporarily halts the machine. In such cases, the product only has to be removed and the equipment reset for it to resume normal operation, so the situation is fundamentally different from equipment failure…

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