10 Questions Every Manufacturing Executive Should Be Able to Answer on the Fly…
The following questions and their associated answers can have a far greater impact on your organization than most manufacturing executives realize. Think about these questions as you go through this list and take the time to answer each. If you do not know the answer, ask someone who reports directly to you. If you and your direct report do not know the answer, your company may have an opportunity to add between $10 to 100 million directly to your company’s bottom line.
DATAForge™ LLC believes executive management, operations and plant management, engineering management, maintenance management, and procurement should be able to answer the following questions with relative ease:
1.
What is your company’s annual indirect material spend?
2.
Does the indirect material spend comprise more than 50 percent of your company’s total costs?
3.
Does your company have a strategy in place to manage and reduce the indirect material spend?
4.
Which specific person in your company ultimately owns the strategy and is accountable for its success or failure?
5.
Does your financial and Enterprise Resource Planning (ERP) systems combined with your operational processes allow for global visibility into plant level indirect material information?
6.
Approximately how many people out of your total employee population interact with indirect material information? More specifically:
With "What is the number of manufacturing engineers designing equipment and machinery who are responsible for creating and managing Bill of Materials (BOMs)?
What is the number of plant engineers installing and setting up equipment and machinery and designating minimum and maximum spare part counts to be kept on hand to ensure maximum production outputs?
What is the number of maintenance personnel utilizing those stocked indirect materials to maintain plant level equipment and machinery?
What is the number of facilities personnel using stocked indirect materials to maintain plant infrastructure?
What is the number of procurement professionals responsible for continuously purchasing indirect materials for maintenance and facility inventory?
7.
Has production ever stopped as a result of indirect materials? More specifically:
Has a critical spare part required for ongoing production never been stocked or out of stock?
Was plant engineering processes or required maintenance slowed or halted all together because of complications related to indirect material information?
Was a new product launch or plant start date pushed back as a result of complications tied to indirect material information?
8.
Do processes and policies exist to ensure excess or duplicate purchases of indirect materials are not made?
9.
Do processes or policies exist to ensure indirect materials are always purchased at the absolute lowest price negotiated by your company’s purchasing department?
10.
If your company was able to reduce indirect material spend by 10 to 15 percent annually, how would that equate to savings straight to your company’s bottom line?
