Not long ago, I happened upon a list of the manufacturers of the engines that power the 200+ mph cars at the Indianapolis 500 race. Of the 20 or so listed,
Not long ago, I happened upon a list of the manufacturers of the engines that power the 200+ mph cars at the Indianapolis 500 race. Of the 20 or so listed, I could find only one with reference to Detroit, the birthplace of automobile manufacturing. Soon after, I examined the list of the top 10 cars based on quality, as compiled and published by Consumer Reports. Again, only one vehicle could call Detroit its company's origin. Hard to believe.
The companies that comprised most of those lists were practicing manufacturing techniques called Six Sigma, Lean and Lean Six Sigma whose origins were surprisingly ó American. Originated by a U.S. engineer and statistician respectively, Edwards Deming and Joseph Juran, these techniques pointed to a new way of manufacturing that aimed to reduce product defects and improve throughput or ìflowî within a manufacturing process. Now, some 50 years later, those philosophies have spread to service sectors, hospitals, retail, transportation, and even to the aggregates industry.
SIX SIGMA AND LEAN WHAT ARE THEY?
Six Sigma is a widely practiced methodology that helps reduce quality defects in product manufacturing and problem solving1. While generally accepted that Six Sigma originated in the mid 1980s by Motorola, its origins go back several decades to the writings of Deming, Juran, Taguchi, Shewhart and Shingo among others2.
In fact, the tenets of Six Sigma can be found in the quality engineering writings and explorations of the early to mid 20th century. Its early stages were based on a methodology for defining the problem, measuring and collecting data, analyzing that data with follow-up improvement ideas and (lastly) establishing a plan for controlling the process going forward. The acronym for this methodology is DMAIC: define, measure, analyze, improve and control.
Quality was the birthplace of Six Sigma, which has as its goal to produce only 3.4 defects per million products. Six Sigma can be understood holistically by considering it as a philosophy, a goal, a unit of measure and a culture. As evidenced by Asian manufacturers of automobiles, engines and electronics, Six Sigma can literally change the way managers and employees think and behave.
The production concept of ìLeanî was made popular by Womack and Jones' book, ìThe Machine That Changed the World: The Story of Lean Production.î Simply defined, Lean is about ìproducing the maximum sellable products or services at the lowest operational cost while optimizing inventory levels.î3 Lean philosophies strive to reduce waste in a manufacturing, production, distribution or similar process. Lean approaches seek to remove sources of waste directly or indirectly.
Lean thinking is sometimes called Lean manufacturing, the Toyota Production System (TPS) or other names.î4 By the early 1990s, TPS was being heralded as the world-class standard for manufacturing operations.5 There are six approaches to Lean, which are segregated into two orientations: ìflowî and ìtool.î Flow-based approaches, popularized by Toyota within its TPS, are more concerned with production leveling of product type and volume than with waste reduction. The third flow emphasis is Kanban-styled pull production. Toyota segregates waste into three categories: ìmudaî (non-value added work), ìmuriî (waste resulting from the overburden of people or processes) and ìmuraî (waste resulting from inconsistent production processes).
These flow approaches indirectly reduce waste. Tool-based approaches can utilize the methods of ìKiazenî (continuous improvement), ìPoke-Yokeî (mistake proofing) and the exploratory tool of the ì5-whysî (asking ìWhy?î at least five times until the problem's root cause is ascertained). The tool-based approach to Lean attacks waste directly. Generally, tool-based approaches experience less cultural resistance than do flow-based approaches, but both present their share of managerial challenges.
AGGREGATE INDUSTRY APPLICATION
The aggregate industry has been slow to adopt these principles, perhaps because it does not consider itself a true manufacturing industry. Instead of producing components, an aggregate operation processes larger stone into smaller stone suitable for dozens of products across multiple industries in sizes ranging from those visible to the naked eye down to microns. Consider the average quarry and its many sequential processes: shooting, load-haul-convey, primary crushing, surge stockpiling, conveying, secondary crushing, conical piling, quality testing, loading, weighing and ticketing. This sequential list (also called a value stream) represents 11 common quarry processes. Each of these processes is ripe for Lean and Six Sigma application.
Rather than attempt to apply Lean or Six Sigma principles to each of these processes simultaneously, a more prudent method is to segregate the processes into stages (or phases) according to their proximity to one another and the value stream concept. While the grouping of these processes can vary, one approach could be to divide the entire process into these commonly known groupings: load, haul and convey (Stage I), crushing and screening (Stage II) and processes that involve loading, weighing and ticketing customer trucks (Stage III).
STAGE I - LOAD, HAUL AND CONVEY
Currently, there are two philosophies on improving productivity. One voice says to spend capital on bigger and better plants and equipment. This approach works and, provided the company has the capital, can be a viable path to take. However, this approach does not get to the heart of the problem: how employee's behaviors guide and control the operation. Generally speaking, spending more money requires no employee (management or hourly) to do anything dramatically different. There are exceptions to this rule, such as automating a plant, which does require a respectable level of change. If the organization has unlimited income or is sitting on piles of cash, then upgrading the plant and equipment every few years may be the best path to follow. If this isn't the case, then the second approach may be of interest.
There are several areas within Stage I where Lean principles can add value. Lean is concerned with flow improvements and waste reduction. Consider this example. Have you ever watched your loader-man load haul trucks? Have you ever watched those haul trucks take shot rock to the primary (or pre-primary surge pile) and return back to the loader? These are good candidates to apply a tool commonly taught in most engineering schools: cycle time. Cycle-time studies concern themselves with capturing data at various points within a cycle (i.e., the time it takes the haul truck to get loaded, travel to the primary, dump its load and return to the loader). Studying the cycle time of loading one haul truck can yield some fascinating discoveries.
Most quarry managers understand the importance of maintaining haul roads. Thus, the following questions may be of interest: Can two opposing trucks pass one another? Are the haul roads smooth and level? Have you super elevated your haul road curves? Are the haul-truck tires properly inflated? Are the drivers operating the trucks in an optimal and safe manner? Is the grade of the haul roads too steep, thus requiring long-distance travel in low gears? All of these questions seek to employ the Lean principle of waste removal. What kinds of waste? This type of waste takes the form of unnecessary labor hours, equipment hours and fuel usage. Figure 1 offers an example of cycle time improvement.
There may be opportunities to reduce waste from the pit loader as well. What kinds of waste? Have you measured the cycle time required to load one truck? Does the loader man keep a haul truck waiting while they clear away boulders? What type of shovel is the loader using (bull-nosed or angled)? Is the bucket full and waiting as the haul truck backs into position? When approaching the shot pile, what approach does the loader man use when loading shot rock ó straight on or angle in? By finding the answers to these questions, you can help sharpen your loader man's work habits, which can reduce cycle time in the pit and save your operation thousands of dollars. (Loader cycle time improvements are shown in Figure 2.)
When you consider these functions in the pit and compare them with primary crushing capability, you may be surprised to discover the capability imbalance between your rolling stock (loader and haul truck) and your plant equipment. Ideally, the two would be ìmatched,î which means that if your haul trucks and loader man can move 1,200 tons per hour, your primary crusher should be able to crush 1,200 tons per hour. Any imbalance here will result in haul trucks waiting at the primary to dump, or the crusher sitting idly, waiting for its next load. In either circumstance, you have waste that can be eliminated or product flow that can be improved.
STAGE II - CRUSHING AND SCREENING
Most quarries have a secondary plant that further crushes rock into a product more suitable for its customers. During this stage, the principles of Six Sigma can be added to Lean. Most managers are familiar with belt scales. Within the principles of Six Sigma, the act of measuring is critically important. Six Sigma is more concerned with data than with opinion or intuition. While there is nothing wrong with these familiar management tools, Six Sigma recognizes that they may be influenced/biased by familiarity, reluctance to change and an individual's ego. Six Sigma's common way of thinking is, ìIn God we trust ó all others bring data.î
The data-over-opinion mindset unmasks the lack of measurement within a quarry, specifically at the secondary plant. Equipment such as belt scales can help achieve positive results. Place belt scales on final product conveyors or anywhere measurement is necessary. Cameras, sensors and amp gauges are other examples of technology than can reduce equipment hours and electricity along with suboptimal product flow.
The ability to measure is crucial. If a manufacturer of a cone crusher says the machine can produce 500 tons per hour, are you really getting 500 tons per hour? Are your screens efficient or are they ìblinding overî? Once again, measuring can indicate whether you are making the product you most need or sending good rock into the base stone pile. Does your operator have to intentionally slow down the plant because some conveyor belt is undersized? Are you assisting your operators and their running of the plant by utilizing the latest measuring technology? A holistic examination of your plant (using industry software, Six Sigma and Lean principles) may be warranted to achieve your full return on investment.
STAGE III - LOAD OUT, WEIGHING AND TICKETING
How often do you get the blame for a construction crew having to wait (and costing that company money) because their stone trucks are waiting in line to get loaded, weighed and/or ticketed at your quarry? Six Sigma teaches a concept called ìvoice of the customer.î Together with your sales professional, visit your customer's site and discuss the buying experience that you create. Take a script with you that can help direct your conversation to pertinent areas of your process. Listen to the drivers visiting your quarry as well. Ride with them. While they are waiting in line to get loaded, weighed or ticketed, ask them about their interactions with your quarry. Is this interaction satisfactory? Do they have any ideas for immediate improvement? The answers may shock you.
This voice-of-the-customer data can help initiate a cycle-time study. To uncover hidden possibilities for improvement, start by breaking the customers' truck cycle time into its components (see Figure 3). Study the traffic flow of trucks within your yard. Does it flow like it should? Are there bottlenecks? What are the processes in place for yard loaders to follow in loading fairly? Does your operation use technology to its fullest advantage? What about ticketing? Is there a lot of time wasted by drivers talking to one another, getting coffee or chatting with the scale office clerk(s)?
Everything is governed by a process, and this stage of the value stream within a quarry is no different. The challenge is to examine it, study it, improve upon it and control for slippage (reversal back to the older, less efficient practices) once the project is completed.
The final step within a Six Sigma project is called ìcontrol.î It is here that employees sign on the dotted line that they understand and agree to follow procedures. It eliminates the oft heard, ìOh, is that what you meant? I didn't understand,î which can occur weeks later and at your expense. Also, having truck cycle data from the yard serves as ammunition to respond to complaints such as, ìI spent 45 minutes in the quarryÖî Without such data, the argument becomes a ìhe said/she saidî scenario. From a customer satisfaction perspective, it is a ìlose-loseî situation.
QUALITY = MONEY, MARGIN AND MARKET SHARE
Six Sigma proposes a challenge: no more than 3.4 defects per million units produced is required to arrive at a Six Sigma level. But can you achieve a lower level of Six Sigma such as a Three Sigma or Five Sigma? Yes, you can, but with added, unnecessary cost. Most quarries test for aggregate gradation, density and/or chemical composition based on their customer's demands or specification limits. With any of these pertinent tests, let's assume that the rock tests positively and passes, or tests negatively and fails. In this example, your Six Sigma level can be calculated by comparing the number of test cases that failed versus the number of test cases in total (both failed and passed). Once you determine the Six Sigma level, you can move on to calculating the cost of poor quality (COPQ), and the financial impact on your operation.
AN EXAMPLE OF TWO COMPANIES - ìSî AND ìTî
Both companies mine from different sides of the same mountain while processing from the same formation. The stone accessed by both companies has the same density and chemical composition. The difference is in the gradation. Let's assume that 57s sell for $11.00 a ton and base stone sells for $5.75 a ton (See Chart 1.)
As this example demonstrates, testing and applying Six Sigma improvement methodologies can produce a handsome reward. But how does this equate to market share?
Suppose you have a customer who is bidding for a select stone (based on chemical composition) and is very particular about its consistency. One approach is to use marketing/sales efforts to win the contract. Yet, this customer would be more impressed to learn about your quality testing procedures to validate high quality claims.
Once in place, Lean processes and Six Sigma principles can have a positive impact on your company, people and profits (see figure 4). As those in other industries will attest, these approaches give a certain segment of the industry a competitive edge.
Larry Smith, ìBack to the Future at Ford,î Quality Progress, March 2005
Jim Folaron, ìThe Evolution of Six Sigma,î Six Sigma Forum Magazine, 2003.
Stephen Rooney and James Rooney, ìLean Glossary,î Quality Progress, June 2005
Dave Nave, ìHow to Compare Six Sigma, Lean and the Theory of Constraints,î Quality Progress, March 2002.
James Womack, Daniel Jones and Daniel Roos; The Machine That Changed the World: HarperPerennial, 1991.
THE THREE DISCIPLINES
Six Sigma is all about reducing product defects and reducing variation in a process. Lean is about reducing/eliminating waste and improving product flow. Lean Six Sigma is a combination of all the above.
|COMPANY ìSî||COMPANY ìTî|
|Number of tests||450||500|
|Number of failures||68||12|
|Six Sigma level||2.5||3.45|
|COMPANY ìSî||COMPANY ìTî|
|Monthly production||25,000 tons of 57s||25,000 tons of 57s|
|Six Sigma level||2.5||3.45|
|Tonnage not meeting specs||3,778||600|
|Monthly COPQ Tonnage ◊ (11.00 - 5.75)||$19,835||$3,150|
|*This example assumes that because of gradation issues, the stone had to be sold at base stone prices, rather than at the premium price.|