The Productivity Improvement Plan

Let’s assume you are trying to improve the productivity of your SMT assembly lines. You work at a facility that manufactures high volume products with a high mix. The first aspect of your process that you attack is stencil printing.

You find that your current paste stiffens up when the printing process pauses. So, after a pause, you have to wipe the solder paste off of the board and reprint the board.

Let’s then assume that you replace this paste with a better one that has good response to pause (i.e., you don’t have to reprint a board after a pause). Let’s also assume that this elimination of reprinting boards results in a modest increase in productivity, say 2%. In other words, you are able to process 2% more boards in the same amount of time. No big deal right? Hardly matters?

Wrong! In a typical assembly facility, a 2% increase in productivity results in more than a 6% increase in profits!

You continue working and garner 2% more increase in productivity by balancing your placement machines, improving assist time, and developing a preventive maintenance plan. You have now increased productivity by 8%, but profitability increases by more than 24%!

ProfitPro Calculation Profit vs Productivity

The calculations that support these conclusions, from ProfitPro, are shown as a graph of profitability increase versus productivity increases. All these calculations support the “Law of Exponential Profits.” This “law” (OK, it was developed by me, so maybe it isn’t a law) states that an incremental (e.g., 2%) increase in productivity results in an exponential (e.g., 6%) increase in profits. The results will vary depending on the assembly facility, but the basic idea is always true.

The bottom line: Investing in productivity always pays.Profit vs Productivity

How is your productivity improvement plan coming?

Cheers,

Dr. Ron

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About Dr. Ron

Materials expert Dr. Ron Lasky is a professor of engineering and senior lecturer at Dartmouth, and senior technologist at Indium Corp. He has a Ph.D. in materials science from Cornell University, and is a prolific author and lecturer, having published more than 40 papers. He received the SMTA Founders Award in 2003.