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True Cost of downtime
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TDC - Startup Category

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This category is a one time entry of a constant, updated annually. Like the bottleneck sub-category, this start-up cost are not considered by most. If you have previously calculated start-up cost per main category (machine, cell, line, profit center), then your existing method of calculation need only meet the TDC recommendations below.

It is common for your machine start/stop times to already be monitored if you have systems like VersaCall or Wonderware. With TDC, it is only necessary to assign a true cost of start-up for the equipment/area. That cost can then be used as a multiple factor with your existing asset software.

Once you can actually place a true cost on start and stop of your production lines, most will find the extra labor cost to run through lunch and breaks, to be insignificant.

Start up cost metrics

 

 

Energy Surge Cost: Much attention is already being given to this area, as most pay peak energy cost to their utility provider. Of course it is evident of the cost to bring an oven back up to temperature. If your one of those few who still shut down a production line, or even the entire plant, think of the surge to start it all back up. This as with the rest of the Start-up cost factors, can empower you to make some very efficient manpower decisions. Like when it comes to deciding which machine to shut down for breaks to gain a relief person. [BACK]

Set-up cost: The cost associated with product/customer changeovers is apparent. What is over looked often, is the set-up cost involved during a start up. This area just needs a second look to make sure the various cost are being weighed. Like extra material, manpower (supervisory too), product delivery, quality, etc. This category is for any special coast that are not covered in the other start-up cost areas. [BACK]

Percent of reduced production: As the machine ramps down in speed, and ramps back up, your parts per hour is affected. While it is usually a linier calculation, each shut-down and start-up reduces your ability to get parts out the door. This area has received a lot of attention with companies attempting to reduce changeovers. [BACK]

Equipment fatigue: It is surprising how many don't realize the physical limitations of a light bulb. That is in respect that they are not designed to be turned off and on (the time to heat back up uses more energy). Each time they are, the life cycle of the bulb is considerably reduced. Now consider the fatigue on a high torque motor, devices with elements, computer monitors (that's why screen savers where invented), mechanical fatigue, etc. While it's difficult to consider all the parts of a piece of equipment, and arbitrary value should be assigned. (percent of equipment replacement cost) [BACK]

Scrap Produced and Quality: After the big quality boom of the seventies, this information should be well known. You need to assign the amount of scrap cost per product, at each stage of the production. The reduction in quality associated with a standard start-up/shut-down is not considered directly in TDC metrics. This is because each facility sets, their quality standards, and the part is ether saleable or scrap. (although there may be consideration of lost potential sales do to wide quality margins.)

Calculating the actual dollar value per scrapped product, in relationship to that stage of the production is very important. A great example is the  manufacturing of Ring and Pinions in a Dana axial plant. At the forging stage of the ring production, the scrap cost would be a fraction of a percent. As the entire part can be recycled, with only loss of forging cost. But if that ring was scrapped after it had been geared and matched with a pinion, the cost would be close to the total finished product cost. [BACK]

Other Cost: Hey, did we miss something? Well this sub-category is where you place that cost. The point of these categories may appear to be micro-analyzing, but the more you use in your asset managing strategies, the closer you will be to the True Downtime Cost. Also more profitable decisions can be reached. [BACK]

In summary, you sum all these factors together, per machine. On an annual bases, you re-evaluate. Then within you asset management software package of choice, you can readily see the start-up cost for machine, cell, line, or entire facility. Remembering the key to TDC is making this information known to all employees, not just a manager in some remote office. :>) [BACK]

See Also:

Condition Monitoring in the 21st Century
An article by Sandy Dunn, of Assetivity, outlining some of the challenges and opportunities that exist for users and providers of Condition Monitoring equipment and services in the 21st Century

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