“Rework” tends to pose major challenges with steel businesses involved in manufacturing, fabrication and building. Having a direct impact to the bottom line, quality defects resulting in rework or scrap are a tremendous cost to steel businesses. Associated costs include quarantining inventory, re-inspecting, rescheduling, and capacity loss. In many steel businesses the total cost of defects is often a significant percentage of total manufacturing cost. Through employee involvement and Continuous Improvement we have found there is a huge opportunity to reduce defects for our customers.

The Steel Efficiency Review® process recommends operations and productions teams to make what the customer wants driven by standard procedures and controlled by quality standards. This will help eliminate rework and all costs associated with having to correct repeating issues and faults.

COMMON CAUSES OF  REWORK:

  • Unclear Standards And Design Specifications
    Many operators will try to do the best job possible and will not always be aware of specific customer tolerances and requirements. They will often produce the end product and not identify the faults the customers will identify and not pay for. This causes rework and associated costs back to the business – needing to pick up the product, rework it and fix it this issues or faults and then re-deliver. If a standard process built on a quality standard is not implemented this problem will repeat itself and multiply.
  • Non-Standardised Work Practices
    Unless steel businesses have standardised working then they will have differences in methods between different shifts and different people. This will allow for differing levels of quality and performance. Customers very quickly identify these differences – mostly “bad” and in most cases are not willing to pay for them either way. This causes rework and escalating costs to fix product faults and inconsistencies.
  • Training And Culture
    If a steel business does not have a culture that empowers and makes operators confident enough to highlight problems and allow them to be solved, they often continue and make the best of a bad product rather than stopping to have it corrected.
    Training is critical to ensure we don’t throw workers straight in at the deep end. Rewarding the wrong behaviours by paying for quantity rather than quality encourages workers to work as fast as possible with little thought to the consequences on the quality of the end product.

 

RECOMMENDED SOLUTIONS FOR REWORK:

Utilising the Steel Efficiency Review® to better understand businesses serving diverse industries, our SER® consultants have recommended the following 3 key solutions to help with Rework:

  1. ENABLING 5S IN YOUR OPERATIONS
    5S implementation with the use of Standard Operating Procedures to provide written instructions for all of your employees. These procedures will ensure the standardisation of methods across shifts and workers, combined with on the job training they are an highly effective way to improve the quality of your product as well as ensuring the reduction in Rework.
  2. MEASURING QUALITY AS DETERMINED BY THE CUSTOMER
    Implementing quality standards measured and determined by customer satisfaction and requirement. This will help with clarify specifications and acceptance standards by customers and projects – determining how to produce what’s needed without adding the cost of Rework.
  3. MOVING TO A LEARNING CULTURE
    Rewarding the right behaviours by paying for quality rather than quantity will encourage to worker smart and learn to improve processes and product quality. This will reduce Rework and improve the likelihood of better products customers are willing to pay for and appreciate their value.

 

We have found if you could eliminate or possibly reduce Rework the savings would go straight back on your bottom line. The Steel Efficiency Review® aims to provide recommendations to change and improve our customer’s business and at the same time our product and service offer.

Download our State of Market Reports for our insights and learnings after completing 1,011 Steel Efficiency Review® consultations on businesses of all shapes and sizes across Australia. To register for your own FREE Steel Efficiency Review® click here.