Lowering capital investment requires technical skills

In this article, I'm going to talk about "Lowering capital investment requires technical skills". When you're a production engineer, you often invest a lot of money in equipment. You will see some people were willing to invest a lot of money in worthless equipment. If I was involved in the project, I checked prices and specifications. On projects I wasn't involved in, I looked at the finished equipment and thought it was a waste of money.

【contents】

  1. The concept of capital investment ( technical skills determine everything)
  2. Summary

1.The concept of capital investment ( technical skills determine everything)

When I was a project leader, the total investment for all projects was about 30 million dollars. After installing a number of production lines, I gradually got the point. Here are some of my thoughts at that time.

The points are as follows


The inability to save on equipment prices is second rate engineer

There is no upper limit to the price of equipment if you want to raise it. The more accurate equipment and more automation, the higher the price will be. However, expensive equipment is not always good equipment. Every production line is a custom-made equipment. If the specifications of the equipment are not well reviewed, it may not be easy to use, may not be consistent with other equipment, or may not have the expected operating rate.

How to reduce unnecessary specifications and create equipment with the minimum necessary specifications at a reasonable price is the part that requires the engineer's technical skills. Ideally, the equipment should be inexpensive, operate stably, and be free of maintenance costs and labor. Needless to say, this requires a high level of technical expertise to achieve this.

It is important to understand the price of equipment components, the accuracy required for the equipment and the accuracy of the components to be selected, and to assume the overall operation flow of the equipment and the problems that may occur. In addition, considering the operational aspect, it is necessary to standardize the specifications of equipment and software used with other equipment to some extent. In other words, we have to consider the macro and micro aspects of the project, looking at the entire line and focusing on the details of each equipment.



Invest within budget and put the extra money into other improvement activities

Every company has a fixed capital investment budget for new production lines. A good engineer will be able to keep it all within the budget. However, if you're not a good engineer, you'll run out of budget and apply for additional budget. Also, if you have no room in your remaining budget at the end, it's harder to work with tied up money. To prevent this from happening, make accurate price assumptions when you apply for a budget, and have a spare budget somewhere in case of unexpected expenses.

As you move up in the position, you will have more and more of these management tasks. The primary job of production engineer is to work on technical jobs. For those who can do it well, it's fine. Those who don't will lose time exchanging money and applying for additional budgets, which will prevent them from doing the work of production engineering. It's a negative spiral.

In order to prevent this from happening, we reduce capital investment as much as possible to make room in our budget. If you have a $200,000 equipment budget, optimize your equipment specifications so that you can buy it for about $170,000. If the entire production line is well below the investment budget, remaining can be invested in other improvement activities.

For example, you can replace human operations with robots, or modify a piece of equipment that you want to improve. When you are able to put money into these improvement activities, it creates a positive spiral.



Reduce risk with the simplest possible structure (*technical skills required)

A complex structure makes mechanical adjustments and control complicated. A lack of reference surface for positioning or program that is difficult to understand for others to see is a major operational risk. Particularly in recent years, automation has been progressing, and multi-axis robots and 3-axis actuators are often used in the transfer section. It's easy to use, but the controls can be complicated and the price will not be cheap. Suppliers will also take a risk with such automated structures and give you a slightly higher quote.

Where it is absolutely necessary, such a structure should be adopted, but where it is not necessary, cheaper alternative methods should be used. We tend to think that "complex structure = high technology", but that's not true. It is "high level of engineering makes simple structure possible". Here are a few bad examples.

Case Study 1) Metal parts washing machine

I have purchased a washing machine before. The price was about $140,000. This equipment is used only to clean metal parts to remove the anti-rust oil. The equipment's only job is to clean the metal parts in trays by dipping them in a cleaning solution. The equipment simply sends the process of washing-->rinsing-->drying in a gondola.

In the first place, the equipment was unnecessary if the metal component supplier was not far away. Since they were an overseas supplier, we only had to do the anti-rust treatment for the metal parts, and if we had a parts supplier in the same country, the transportation time would not be so long, so the anti-rust treatment itself was not necessary. In other words, the equipment was needed due to the use of overseas suppliers in order to reduce the price of parts.


Even with this kind of non-value-added equipment, when the person in charge of the project asked me to approve it, the quotation was $400,000!! It wasn't originally in the budget and we didn't have the luxury of investing $400,000 in non-value-added equipment. So, of course, I reject it.

In the end, we worked out the specifications and eventually got it down to about $140,000. We still felt it was expensive, but we settled on that price, taking into account the 10s cycle time requirement, equipment size, and quotes from other suppliers.

Case Study 2) Solvent Dispensing Machine

Another case. There was equipment which only applies solvent to palm-sized product, and one engineer had purchased a large piece of equipment that was up to 1500mm wide. The equipment job was to apply by drawing a path in a flat field.
In contrast, the equipment was outlined as follows.
- Multi-axial robots (station-to-station transfer)
- Camera (for application detection)
- Automatic nozzle compensation function

It was just an application machine, but it was an investment of about $200,000.
I felt it was a wasteful investment. A dispenser and pressure tank alone would cost about $10,000. The investment could have been reduced with a simpler structure if the application operations had been reviewed.

It's completely designed to be used only for that process of that product, and there is no possibility of converting that equipment to other models after production is finished. At best, it will end up with taking parts from the equipment. This is a bad example of placing a multi-axis robot in a small piece of equipment, complicating the control, and making the equipment expensive for the work it is doing.



Summary

This time, I talked about line concept and management rather than technical side. I hope that you will take this as an idea for doing a higher level of work than "just make sure the equipment is on time".

Try to keep these points in mind as you work.

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