You manufacture a part that must be within design tolerances to work properly, so you need to measure it. It costs to:
- Buy the measuring device
- Provide a space and/or utilities for it
- Develop fixtures or part-holding accessories
- Make sure people are trained to do the measurements
- Develop a system for collecting and analyzing the measurement data
- Schedule service and maintenance of the measuring device
- Arrange routine calibration
These costs are then amortized across all the parts that go through this measurement process. Like any process step, there is an associated cost. Even parts sitting in a bin waiting for the next process incur costs—inventory costs, in this case. With so much emphasis on cost reduction, it might be tempting to do away with the measuring process completely. What are the risks?
Don’t do it!
A knee-jerk reaction might be to skip the measurement step and take your chances. Machine tools are very accurate. If the part is set up properly, it should come out as expected. Or take the minimalist approach—mic the part while it’s on the machine tool (use a micrometer, an inexpensive hand gauge to measure a diameter). Close enough might be good enough.
You might modify the part drawing to loosen some tolerances so you can use simple hand gauges. Or, the machine tool’s accuracy might even be better than those loosened tolerances. Is it even necessary to measure all those dimensions? How about measuring just the “key” dimensions? Think of all the time that would save. Anybody can learn how to mic a part in minutes so there’s less training than using a separate measurement machine. Pull the part off the machine and take it right to shipping—what a savings!
It all boils down to risk. Risk has rewards and costs. Are you a risk taker or are you risk-averse?
What does “free” cost?
So, here’s this chance to save some money by skimping on the measurement step, or skipping it entirely. Might there be hidden costs from cutting costs? You bet there are. Some are tangible and easy to quantify. Others are less obvious and possibly more costly.
One obvious cost of this skimping strategy is the cost of rejection. The worst case would be rejection by your customer.
The associated cost of rejection is the cost of rework, or its sibling, the cost of scrap. Think about the costs associated with rejection. The parts are shipped back to you (probably not for free, and you may have to issue a credit to the customer). When the parts are received and routed to the proper department (handling, paperwork, time, money), the rejected parts should be rechecked to verify the reason for rejection. That will likely involve a detailed and/or lengthy measurement process to confirm that the parts are out of tolerance. Then someone has to decide whether the parts can be reworked. If so, they must be squeezed back into the production schedule (adding costs to standard production due to process-flow disruption). If the parts are found to be too far out of tolerance they have to be scrapped (along with the costs of the raw material, labor added, and the unplanned costs of re-inspecting the parts). If the customer still wants you to supply the parts, you have to decide how to build new ones, take them from current production (perhaps already allocated for a different customer—any risks there?), get creative and make them off line, or get them made by an outside supplier.
If your customer rejects parts once, you can probably recover. If the problem repeats, you may lose that customer. How much would that cost? It costs far less to keep a current customer than to find a new one. What about the cost to your reputation? Those are intangible costs—difficult to quantify—but there nonetheless.
It’s difficult to command premium pricing if your company has a reputation for delivering marginal products. If customers think you supply low-quality parts, they will expect to pay less for those parts. In other words, if they have to add incoming inspection to measure parts that you skimp on, they will be less willing to pay your asking price. On the other hand, if customers know they will always get quality parts, they might pay more for that luxury. So, you save costs by skimping on measuring, but you bring in less revenue because your quality reputation takes a hit. Think there’s a strong correlation here?
By the way, rejection not only has cost implications for you, it adds other costs for your customer, especially if the part you supply is critical to his process or is required on a just-in-time schedule. His increased costs will make your prices seem less attractive.
Measurement as added value
There is risk in skimping on measurements. Implementing a good quality program that includes appropriate measurements at the right places in the manufacturing process can minimize that risk. Of course, there are initial costs in determining what to measure, and where and how to measure it, but the recurring costs might be lower than you think.
For example, one of the costs of measurement is the person doing it. If your process requires 100-percent inspection by manually operated measuring devices, those costs can be high. However, the latest measuring machines are often partially or fully automatic. Similar to computer numerically controlled part programs for machine tools, measurement programs for automatic measuring machines take time to develop, but then can be used over and over again. Initial costs are spread over future parts that are made/measured automatically. Load parts into fixtures and let the measuring machine do the work. It can typically do far more measurements faster, at high resolution with little measurement uncertainty.
Factoring in the cost of automated measurement against the cost of rework, rejects, and the ability to make a profit clearly shows that measurement actually adds value.
You can pay me now, or you can pay me later
Someone with a short-term focus might see savings in skimping on measurement in the manufacturing process. However, someone who understands all the longer-term cost implications of such a decision would not take that risk.
Until next time: You bet, measurement matters.
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