World Class Manufacturing checklist

Q1 Is your customer service (on time in full delivery to customers / product availability) better than 99% against their latest schedule or delivery agreement?

All objectives are subordinate to the requirement to ship what your customer expects, when expected, with all relevant paperwork complete. For Make to Stock companies the principle customer service measure is the percentage of orders received where stock is available at the time of receipt of the order, one out of stock item is normally only counted once in the time period under consideration and out of stock items not ordered are not counted. For other companies the measure is the percentage on time in full (OTIF) delivery of complete orders to customers on the promised date. If there are multiple lines or items on an order, one hit means all ordered item lines are delivered on time in full. If one line item is missed, this is a miss for the whole order. Re-scheduled dates agreed with the customer in advance are allowed for this measure.
*Please fill in your current OTIF % or availability % in the comments box if you would like me to rate your performance.

Ans 1 (is your customer service 99% or better?) Yes No
*Current OTIF% & comments:

Q2) Does everyone in the company know who the key customers are and what differentiates the company’s products and services from the competition?

Awareness of the strengths and weakness of the company’s product or service is a key factor in achieving the involvement of everyone in the company and improving employee satisfaction. It is not possible to achieve this objective without an employee induction process which is necessary although not sufficient to score on this question.

Ans 2 (does everyone know who your customers are and your competitive strengths?) Yes  No
Comments:

Q3 Do all staff who are in contact with customers have the authority and empowerment to resolve customer problems?

Managing the points of contact with your customers is the single most important company success factor. A company can only consider itself to be a world class manufacturing company if all its customers are confident that any problems they have will be speedily resolved and they will be kept fully informed, preferably by the person they initially contacted.

Ans 3 (are your customer contact staff empowered to resolve problems?) Yes  No
Comments:

Q4 Do kanbans control your supply chain?

Kanban control means that the authority to make or move an item is based on that item's usage unless there has been a properly approved and strictly limited deviation.

a) A world class manufacturer must be able to help their customers reduce the stock of their products by rapidly replenishing their customer's stock on a kanban basis with over 99% reliability. The kanban messages can take the form of a fax, card, empty container or require you to visit their plant to replenish their stock of your products.

b)It follows that the ability to reliably supply to customers under kanban control is crucially dependent on the control of internal manufacturing by kanbans, otherwise the final kanban control is at risk. Your speed of response will be much better when manufacture is controlled by kanban. In addition to reducing lead times, kanban control can eliminate the scheduling, kitting and issuing processes. There may be some operations which need special controls but there is no problem with operating with a mixture of kanban control and work-to lists. If all parts produced by a work area can be kanban controlled, however, then there are fewer clashes of priority.

c) The final element of kanban control is the supply of material from your suppliers. In some cases you may have to educate any suppliers who are currently unable or unwilling to supply under kanban control.

Ans 4a (could you reliably make kanban shipments to customers if required?} Yes No
Comments (e.g. current % of kanban shipments?):

Ans 4b (is 90% of manufacture controlled by kanban?) Yes No
Comments (e.g. what % controlled?):

Ans 4c (is 75% of repetitive purchases under kanban control?) Yes No
Comments (e.g. what % supplier kanban?):

Q5 Have you eliminated the central storage of direct material and is purchased material supplied to the point of use without routine inspection?

Moving material from one place to another adds cost but not value, so material should be delivered to the point of use wherever possible. The users of material should be responsible for the storage of that material, including any goods-in checks that cannot be carried out by the supplier. Users should also be able to check that replacement of stock is underway if stocks get too low. Ideally, the vendor should be responsible for delivery to the point of use and should be able to decide when to replenish material when this is practical (direct material is any material consumed in the manufacture of the product).

Only "approved" vendors can safely supply to the point of use (see Q11 below) There must be audits of quality and quantity of all supplies.

Ans 5 (has central storage and routine incoming inspection been eliminated?) Yes No
Comments:

Q6 Have you laid out the majority of your machines and equipment so as to minimise the distance between sequential operations?

In the old days a company would lay out equipment according to its function. Thus four milling machines would put next to each other. Functional layouts must increase the distance parts have to travel because work almost never passes between machines with the same function. You should always arrange machines and equipment in the sequence in which they will normally be used. Such a process based layout will sometimes decrease utilisation but the work in progress saving alone will more than pay for this in most cases, with additional savings in quality, costs and administration. The people who are responsible for work place layout, ideally the people who work in the area, have to take the trouble to think through the work flows before laying out the work place. The value of line-of-sight communication between sequential operations cannot be over-stressed.

Ans 6 (does workplace layout follow the flow of product?) Yes No
Comments:

Q7) Have you reduced or are you reducing the set-up time between products to the point when it is economical to make your product in the quantities required for customer shipments?

If at any stage of manufacture you produce in batch quantities that are larger than the shipment quantities required by your customers due to set-up time, there should be an active set-up time reduction group. Wherever possible, equipment should be dedicated to one product to eliminate the time and cost of changing from one part to the next. Where this is not possible or economic, set-up time must be kept as short as economically possible to avoid the trap of increasing lot sizes to gain "economies of scale". The old "economic lot size" calculation should be turned on its head to work out the "economic set-up time" for the lot sizes required by your customers. You should never have, or need to have, minimum batch sizes for your customers.

Wherever possible batch sizes should be the same throughout the process.

Ans 7 (are you reducing batch sizes to no more than customer required quantities?) Yes No
Comments:

Q8) Have you an ongoing education and communication programme to inform existing employees and educate every new employee, whatever function he or she performs, in the value of world class manufacturing?

World class manufacturing is a programme of continuous change and change has to be carefully managed. It is important to take everyone along with the changes and so avoid the pockets of resistance that result from a lack of understanding of the changes and the reasons for them. It is also easy to forget new recruits who may have come from a traditional environment and so find some of the world class manufacturing ways of working difficult to understand.

Knowledge of the benefits of world class manufacturing are important for sales staff. The ability to offer kanban deliver will be lost if your customers are not told about it.

There is no better way for people to become more aware of quality issues than for everyone to understand where their tasks fit into the business. Whilst it is desirable for the same person to routinely carry out the whole process it is not always practical but it is the appreciation of the whole process that is required. Cross-training (or multi-skilling) is also very important to meet the rapid changes that will often result from being more responsive to customers' needs. Multi-skilling can be expensive unless spread over a period, so you should concentrate on your longer service personnel.

As many people as possible should have an awareness of the basic 7 tools of quality (process charts, Pareto (80/20) analysis, Ishikawa (cause and effect) diagrams, histograms, run diagrams, statistical process control and check sheets). When problems occur in a world class manufacturing environment they tend to affect everyone quickly. If everyone can help to solve them you turn this enforced problem solving to your advantage. The training must be backed up with the necessary support and authority, given appropriate safeguards, so that as soon as the solution to a problem is found it can be implemented without delay.

Ans 8 (is there on-going education and cross training for all existing and new employees?) Yes No
Comments:

Q9) Do employees take the initiative to move to the point of need?

Employees taking the initiative is a recognition of the "thinking worker" and helps reduce the level of direct supervision required by a team. Employees should never be "kept busy" doing work that is not needed.

Ans 9 (do people automatically move to the point of need?) Yes No
Comments:

Q10 Is there is a programme in place to progressively reduce non value-adding costs?

A non value-adding cost is anything which adds cost but not value to the saleable product or services provided by the company to customers. Non value-adding costs are characterised by the 7 wastes of overproduction, waiting, transporting, inappropriate processing, unnecessary inventory, unnecessary motions and defects. To answer "yes" to this question, all the wastes should be investigated from time to time and at least one under active investigation now by a team or task force. Every new product and process should be evaluated against the need to reduce waste. The decision to purchase or replace equipment must include all the factors that could increase waste, set-up time and reliability in particular, if world class manufacturing standard are to be achieved and maintained.

Ans 10 (is there a non value-adding cost reduction programme?) Yes No
Comments:

Q11) Is there a programme in place to reduce your supplier base to a small number of qualified suppliers integrated into your business?

The world class purchasing objective is a small supplier base of reliable companies working in partnership from the design stage, delivering frequently, in the quantities you need, directly to the point of use.

As it is not possible for one person to maintain a good relationship and understanding with more than about 50 supply companies, single source supply is necessary. With single sources you can get the genuine, invaluable involvement and commitment of your suppliers to your business. Long term commitment to suppliers and single sourcing makes you as important as possible to your suppliers and allows suppliers to engage in a continuous reduction of costs using, for instance, value analysis techniques. Delivery to the point of use is not possible without single source supply.

There should be a systematic way to approve potential new suppliers based on their quality, costs, management, product development resources and financial health.

Performance measures in purchasing should be based on total acquisition costs rather than simply purchase price variance.

To score on this point there have to be significantly fewer direct material suppliers than last year and you should be working more closely with them. You should also have a higher proportion of approved suppliers.

Ans 11 (are you working towards a smaller number of qualified suppliers?) Yes No
Comments:

Q12) Is there a culture of Total Quality?

There must be a culture of total quality throughout the business. Getting one person to do a job and then someone else to check it is not only wasteful but de-motivating. Every person or team that has a job to do should be able to check that the job has been done correctly and should be given the training, equipment and responsibility for doing so. The role of quality control is to audit quality and feedback long term process control information. Only if very expensive equipment, a special environment and/or very specialist training is needed should the quality control department be involved with routine testing. The role of quality control in world class manufacturing is an audit role.

The principles of total quality should permeate all activities. Commercial departments are concerned about the quality of their forecasting process and monitor the accuracy of their forecasts in order to improve them. Stores monitor the accuracy of stock records, engineers the accuracy of the bills of material and so on.

There should not be an independent rework or rectification process which just legitimises faulty work. It should not be regarded as a punishment for people to put right their own defective work but part of the principle that people are expected to produce work that is correct first time. Identifying and eliminating the cause of the faulty work must also be seen as part of the rectification process. The people in the best position to rectify the causes of faults are the people doing the work. Every fault found must be seen as an opportunity to improve the quality of the product, the basis of blame free quality control.

Ans 12 (is there a culture of total quality?) Yes No
Comments:

Q13) Do you audit the product and process quality inside the test limits?

You cannot get to parts per million quality levels if your quality checks only sort the good from the bad, the passes from the failures. Everyone involved with a task that can vary must be check where the process is within the tolerance band and be able to take corrective action. By this means, operators have an early warning of possible failures so enabling the processes to be fine tuned. The technique generally used is statistical process control.

Ans 13 (do operators audit quality within test limits?) Yes No
Comments:

Q14) Does everyone have authority to "stop the line"?

If quality is crucial to your success, there is no better way to drive up the quality than to give all employees the authority to halt the job or process if they are unhappy about quality levels. An employee must always choose to stop a process rather than pass on a known or suspected defect. Anyone who finds a defect must always pass it back to the person who made it.

Ans 14 (does everyone have line stop authority?) Yes No
Comments:

Q15) Have you 'foolproofed' critical jobs?

To reach parts per million quality standards, jobs have to be made foolproof. Foolproofing (called poka-yoke by the Japanese) means that either mistakes cannot be made or, if this is not possible, the equipment will automatically identify and/or stop when a reject part is produced. Foolproofing requires imagination and commitment to quality. There is no easy way to measure your degree of foolproofing except to ask yourself if the operations that could cause faulty products rely on human judgment.

Ans 15 (do you have a culture of foolproofing equipment?) Yes No
Comments:

Q16) Are the majority of people responsible for the maintenance of the equipment they use?

You cannot afford delivery schedules to be dependent on unreliable equipment. If it is not possible or practical to have duplicate equipment then you have to do as much as you can to avoid equipment failures. The users of equipment are the best people to carry out preventative maintenance because they are the first to know when their equipment is not performing properly and should also be the best people to know when it is fixed. It follows that if they can be trained in preventative as well as corrective maintenance, this will be the most cost effective way of reducing down time. Users of equipment should have a real sense of ownership. Some people will not be suitable for such training but there should be a sufficient number of people in each group or team that are sufficiently experienced and committed. In a world class manufacturing environment the role of equipment maintenance should increasingly be to help and advise on equipment maintenance as well as auditing equipment reliability.

Unreliable equipment is one of the most popular reasons for "safety stock" or "safety time" which increase costs and lengthen lead times. You cannot solve maintenance problems and keep them solved unless you know where the problem areas are and then monitor the effects of any changes. There should be a routine report of downtime widely circulated as well as a downtime reduction teams set up if required.

Ans 16 (is equipment reliability audited and most users responsible for their equipment?) Yes No
Comments:

Q17) Do you have an active policy to help keep work areas clean, tidy and uncluttered?

It has been shown time and again that tidy work areas reduce the frequency of errors and delays. Most world class manufacturing companies have regular inspections of their work areas and continually look for ways to tidy up their processes. Housekeeping must be the responsibility of the people who work in the area. A clean and tidy workplace will also give people working in it a sense of pride. You could not imaging a world class company being a mess now could you?

Tidy workplaces applies to administration as well as manufacturing areas.

Ans 17 (do you have tidy work places?) Yes No
Comments:

Q18) Does the design of products include a consideration of the manufacturability of the product?

The design of all products and processes should include manufacturing considerations such as current equipment, suppliers, existing parts, subassemblies and ingredients. In many cases manufacturing, marketing and purchasing functions should be involved at the design stage to ensure, as far as possible, designs are manufacturable.

In most businesses it is impossible to optimise designs unless the suppliers of material or components are involved at the design stage of your products. Improvements to materials and components you are currently purchasing should be evaluated also to see if your end product can be improved so that you keep your products competitive.

A key element in design for manufacture is an evaluation of existing designs. Unless designers are aware of changes required to current designs, future designs cannot benefit from the lessons learnt in the past. Self-inspection and rectification of your own mistakes is just as important in design areas as it is anywhere else.

Ans 18 (are new products designed for manufacturability?) Yes No
Comments:

Q19) Is there a culture of continuous improvement in customer service?

The one universal truth in all manufacturing companies is that customers are demanding higher and higher levels of service which include higher quality and shorter lead times. It is also true that in most industries suppliers are responding. If you do not keep improving your customer service and your competitors do, you will lose out.

No matter how good you think your customer service is, it is vital that you ensure you are addressing the changing needs of your customers and the market place. You can be sure some or all of your competitors will be striving to exceed your current level of customer service. World class manufacturing companies are characterised by continuously improving their customer service. There should be an active customer service improvement group looking at all the tools and techniques available to be more responsive to customers. Significant lead time reductions, for instance, involves most functions in the company working together so will seldom happen spontaneously.

No reason or excuse is good enough for failing to allocate the resources necessary to achieve customer returns measured in parts per million. The cost of your rejects to the customer is far more than just the cost of replacing faulty parts. The damage to your reputation of poor quality can never be repaired. This quality target applies also to mistakes in the shipping and packing departments, invoicing and even such things as order confirmation.

Improving customer service must also include reducing the time it takes to move from the start of a design to the first shipment of reliable product which meets the specification. The time to market must be monitored.

Ans 19 (do you have an active customer service improvement group?) Yes No
Comments:

Q20) Is there a mechanism to quickly and effectively receive and evaluate suggestions from all employees?

Everyone must feel that any ideas they have for the improvement of any task they perform or are familiar with will be welcome, and resources made available to evaluate their ideas if necessary. A formal suggestion scheme is neither necessary nor sufficient to score on this point neither is a reward scheme. It is an attitude which encourages innovation and involvement of everyone which is important. A company will score on this point if there is a regular flow of implemented ideas from the majority of employees.

Ans 20 (are employee suggestions rapidly evaluated and implemented?) Yes No
Comments:

Please complete some general details about the part of your company about which you have answered the above questions (* required):

Do you make to stock?	Yes No
Do you make to order?	Yes No
Do you configure or assemble to order?	Yes No
Do you engineer to order?	Yes No
* Product or service offered
Your name
Job Title
* Company name
Town
* Country
Phone no.
*(required) Your e-mail address
* Number of people employed in this section or division

Planning Method

How do you currently plan? (e.g. manual, spreadsheets, planning software) if you currently use planning software please state the name of the package and release number if known.
If you are using planning software, how frequently do you run the MRP or Bill of Material explosion? (e.g. daily, weekly, monthly)
Final comments and overall impression

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If filling in the checklist has helped you identify some business improvement opportunities, please have a look at our World Class Manufacturing starter pack