Eliminating Bottlenecks at Northrop Grumman
The Opportunity Cost of Complexity
The volume and velocity of change in modern manufacturing – in customer requirements, regulation, supply chains and so much more – conspire with legacy systems and heterogeneous data streams to throttle efficiency. Due to the opportunity cost of this complexity, operating efficiencies as low as 40-60% are not uncommon, while we know that best-in-class practices can fuel production efficiencies approaching – even exceeding – 85%. Get there, and you can own your market.
Next-gen Digital Production Management
As a partner to leading manufacturers for nearly 40 years, PTC has a well-established heritage helping improve how products are conceived, produced, and serviced. In a recent webinar, PTC introduced the “next generation of digital performance management (DPM).” The conversation, which included senior executives from multiple manufacturing companies, explored how the new approach is fueling productivity and helping the companies achieve productivity levels they’ve never seen before.
Northrop Grumman: Expose the Right Problems
Global aerospace and defense leader Northrop Grumman joined PTC to discuss their own experiences as early adopters of the approach. Clay Wilker, Director of Operations and Continuous Improvement, discussed the challenges of identifying and activating additional capacity opportunities. “I look at where can we attack to find the capacity we need to meet this new demand...what tools can we use to expose the problems that are keeping us from getting more throughput?”
Clay explained the need to make a strong business case for any new investment; to posit and then demonstrate a credible return on investment. PTC’s DPM “really helped us to understand the actual full potential of the machine on which we were focused. There had been pressure to duplicate that machine because it wasn’t providing enough throughput,” he said.
“Come to find out,” Clay continued, “with DPM, the operational availability of that machine was actually between 90% and 100%. That represents real capital we might (otherwise) have invested. But since we exposed the right problems, we’ve been able to get a lot more throughput out of that machine.”
Bottlenecks Equal Opportunity
While Northrop Grumman’s business is unique, the company’s DPM experience will be compelling to any manufacturer striving to provably maximize the capacity of existing assets. It’s crucial to attain that optimal state in absolute terms, but particularly before spending significant money on new lines or machinery.
When your assets are already running – at least nominally – 24 hours, seven days a week, it’s imperative to identify and resolve the bottlenecks. How, specifically, is productivity being impeded within that continuous state of operation? Every issue identified represents an opportunity with real monetary value; every bottleneck resolved a chance to improve OEE, and to strengthen the competitive position of the enterprise.
The Momentum of Multiplication
“You fix that one problem,” Clay Wilker suggested as he discussed the Northrop Grumman experience, “and you’re demonstrably generating more revenue with the same cost. It’s not like you’re adding labor, and shifts, to generate that revenue. You start on one machine, and as the results become more widely understood, you see this excitement building around the question, ‘what could happen if we applied this to other lines across the entire manufacturing enterprise?’ And the energy of this understanding starts to build on itself.”