| With the cost of raw materials apparently not going | | | | historical production output. With a |
| down any time soon, scrap reduction has never been | | | | good-established-historical baseline in place, material |
| more important for manufacturers. To ensure the | | | | loss trends can be much more easily measured and |
| maximum use of materials, precision laser-cutting and | | | | acted upon as quickly as possible. |
| water-jet machines have been developed. | | | | Second, a proper method of recording production |
| Computerized metal stamping can bring out parts and | | | | data is necessary for employees to reveal material |
| pieces to the very edge of the stock. In | | | | use efficiencies. In other words, employees have to |
| manufacturing, materials management has been made | | | | have a way, and a requirement, to input good output |
| better because both machining technology and | | | | versus bad product production numbers. Defect |
| management through cost accounting have been | | | | issues and other material waste are production data |
| improved. In short, accountability is in place on the | | | | that are not often or easily volunteered. However, |
| shop floor and in the front office, and this means | | | | when material use is accounted for through a series |
| that tracking scrap is part of the production process. | | | | of reporting mandates, particularly in the easy to use |
| Of course, the relationship between shop floor and | | | | formats of some ERP software systems, there is a |
| front office has always been one made through data, | | | | greater likelihood of scrap/waste data being collected |
| and it is through data that the root causes of scrap | | | | for later analysis. For example, barcoding and the use |
| and the methods for its reduction are found. | | | | of graphical interface terminals around the shop floor |
| In short, scrap rate (or yield quality) is a function of | | | | provide convenience to workers in being able to input |
| production standards and the cost of quality itself: | | | | scrap data. In addition, the best reporting techniques |
| process settings, raw material lots, maintenance | | | | will employ a variety of scrap codes and code |
| activity, operator focus, and so forth. Better working | | | | grouping levels to facilitate analysis. |
| processes and more cost effectiveness in materials | | | | Finally, a robust, routine, and continuous analysis of |
| management, especially in the creation of scrap, can | | | | scrap data is required in order to bring about both |
| enhance a manufacturer's competitive edge. And, | | | | improvements in quality and a subsequent reduction |
| competitiveness today is measured in terms of | | | | in wasted material. This is truly where a quality ERP |
| on-time delivery and yield qualities that meet or | | | | software system can be of great benefit. Assuming |
| surpass customer requirements. In the | | | | there is proper recording of scrap data at the shop |
| not-too-distant past, just about any level of scrap | | | | floor level, management should be able to analyze |
| was considered the necessary result of the | | | | the information in order to monitor material use and |
| manufacturing process; the quantity of scrap was | | | | ascertain scrap trends. An ERP software system that |
| not the issue it would become later when | | | | collects real-time data from all areas of production |
| competition arose in the supply chain for diminishing | | | | facilitates scrap analysis in the most useful and rapid |
| raw material stocks. With the introduction of lean | | | | way possible. |
| manufacturing and mandates for the reduction of | | | | To add that extra amount of profitability to a |
| scrap waste through continuous improvement, | | | | manufacturing operation, look at when, where, and |
| enterprise resource planning software (ERP) has been | | | | how materials are being used. It is in the increasingly |
| developed to strengthen the data-flow between the | | | | important area of scrap analysis where |
| shop floor and the front office. | | | | manufacturers are finding more profit located in the |
| To get a good start on scrap accountability, three | | | | margins. That is to say, by reducing material costs a |
| things must happen. First, you must identify when | | | | manufacturer becomes more aware of the use of |
| loss is happening. Only in marking the moments when | | | | material in production, and in turn more aware of any |
| material loss occurs can you ever see a trend in | | | | disruptions in the material flow patterns and the |
| motion. The identification of loss is both a factor of | | | | quality of output. |
| good inventory management, and an awareness of | | | | |