By: Jarrod Dizazzo, Vice President on August 6th, 2020
How Much Is Your Packaging Line Downtime Really Costing You?
Equipment | Technical Service and Support | Packaging Psychology
When you think about downtime, I bet a few things come to mind.
Lost productivity, your workforce standing around, scrap packaging materials or finished goods, and missing deadlines you have agreed to meet.
And while all those are true, there are a few more negative side-effects that carry as much, if not more, weight when it comes to downtime.
One of our top priorities is making sure our customers can avoid unexpected downtime on their packaging lines.
At Industrial Packaging, we "eat our own dog food" and maintain regularly scheduled maintenance on our packaging machinery. By doing so, we can maintain the supply line for our customers, and we help them do the same in their facilities.
We know what it takes to succeed, and we know how to combat unwanted downtime. In the article below, we will explore the real cost of downtime and explain how to prevent it.
The Human Toll Of Downtime On Your Packaging Line
Have you thought about the toll that downtime has on your people? If you have a machine operator, line lead, or team lead running these lines, what effect does it have on them?
Most team members in organizations that drive results maintain a sense of pride and ownership in their work. They know their targets, and they know what it takes to hit them.
When you begin to experience downtime, it's natural for you to feel that you have let the team or company down. I have had employees come up to me and apologize for downtime on a line that they could not have prevented or controlled.
This downtime can erode morale and frustrate good people to the point where they will look for work elsewhere. Consider the cost that losing quality employees can have on your business due to poor morale. Having to replace one employee can cost between one-half to up to two times that employee's salary!
Overtime Due To Downtime On Your Packaging Line
Do you ever work on weekends or extended shifts and wonder why? Maybe demand is up a little, but you still show you have the capacity. Your team keeps coming to you saying they are falling behind and need to work this weekend.
You run the numbers, but they do not add up. Once again, the evil monster known as downtime has reared its ugly head. The cause often stems from poorly maintained machinery, which causes your lines to stop production until you address it.
While people often think of downtime as an instance that happened once for an extended period, it is the death by 1,000 cuts that can be more costly.
Not only do you have to deal with the cost of the downtime, now you are paying overtime to make the goods that you should have been able to produce during regular business hours.
Those key team members who want to do a good job and get positive results are now coming in on Saturday to run these lines instead of spending time with their family. How does this help your work environment?
In the end, downtime can cost you large amounts of money, time, and employee morale.
Want To Beat Unwanted Downtime? Take the Machinery Assessment to determine what your next steps should be for your packaging machinery
How Downtime Affects Packaging Machinery
What happens when a machine goes down? I'll venture to say you start up another line, split the labor up between lines, or put people on tasks that don't generate revenue.
Do those lines run better with those additional people? Adding labor to a line does not mean that it is running faster or more efficiently. There is also a higher risk of quality defects.
By putting someone on a line to "help out" while their line is down, many assume they will produce more. Even if you don't think there's a direct correlation between adding more workers and producing more products, most managers believe anything is better than nothing.
But, do these additional people have the correct training for the product you are running? Will they allow the rest of the line to function as it was, or are people slowing down to teach the new additions?
What does your rejection rate look like? While we can't speak for other companies, here at Industrial Packaging, we see efficiency decrease, and our QC team will cull out more defects with more people. Now you have another line not running well, and your downtime issue will compound.
The Byproducts Of Packaging Line Downtime: Rework And Scrap
I would be remiss if I did not talk about the items we all know and see when a line goes down. Scrap, parts, cost of labor, and that run time that we will never get back.
Rework is like paying twice as much to make the same package one time. You lose the materials that it takes to make the package, and then you lose the labor to create the finished product. If scrap and rework start to mount up, you need to stop the line to reassign labor to put it back into WIP.
Scrap and rework are the two most detrimental items in a manufacturing plant. Managers like to see lines running, even if they are running poorly. I urge you to ask yourself, is your line running well?
You will know if your line is running well when there is little to no rework, the smallest percentage of defects possible, your getting your client's products to market fast, there is little to no downtime, and employee morale is high.
Identifying Issues In Your Packaging Line
Ask your team members where the issues are with your packaging lines. They are positioned to hear when something does not sound right or when something just doesn't feel right.
They spend more time on this equipment than your service techs do. We all have preventative maintenance programs in place, and we do our best to adhere to them.
However, making these PMs paramount will not only allow you to keep more money in your pocket, but it will also allow you to keep and retain good people.
Do good people want to work where equipment is always breaking down and have no way of meeting their metrics? Or would they rather go somewhere where equipment is kept up, and they can have a positive impact on results?
The Bane Of Downtime: Preventative Maintenance
When it comes to combating unwanted downtime, you have one tool in your arsenal to truly fight it. And that tool is preventative maintenance. With the proper preventative maintenance program in place, you will reduce downtime to a bare minimum.
A quality preventative maintenance program will ensure that you are continually hitting your KPIs, running quickly and efficiently, and producing a level of quality that you can be proud of.
Failing to have a robust preventive maintenance plan in place will result in unwanted downtime. Not only that, but downtime will likely be significantly longer without a preventative maintenance plan in place.
Preventing Downtime Through Refurbishing Or Upgrading Packaging Machinery
When it comes to the battle against downtime, various tactics may help you to achieve victory. And while you can implement any one of these tactics, if you really want to stop downtime dead in its tracks, you will want to consider three options seriously.
On one hand, you could have your packaging machinery refurbished. Depending on the age and condition of your equipment, this may be a cost-effective way for you to keep downtime to a minimum.
On the other hand, you could repair your broken or run-down machinery and continue to run as-is. But, without refurbishing this machinery, you run the risk of additional breakdowns, which would lead to more downtime.
Finally, if you truly want to limit downtime to the lowest possible probability, there is no better way than upgrading to new packaging equipment.
But, which option is right for you? Upgrading, repairing, or refurbishing your current packaging line and machinery? Discover if you are better off to repair, refurbish or buy new packaging machinery with this quick quiz!
About Jarrod Dizazzo, Vice President
Vice President at Industrial Packaging I believe that the strength of one is shown by looking at those around them. We've got a wonderful team in SCS and coming to work for IP is a joy every day. When not in the plant, you can find me fishing, hiking, or being goofy around the house with my 2 daughters and my wife.