For small to medium enterprise (SME) manufacturers, productivity is essential to meeting
current – and future – challenges head-on. We interviewed REMAP’s Board Chair and industry
executive Brad Jackson and our Director of Innovation, Phil Dupuis to discover why productivity
is such a critical lever for SMEs looking to gain a competitive edge.
Brad: Even in the best of times, companies benefit from relentlessly pursuing productivity enhancements. But in times of great volatility and uncertainty – such as the geopolitical and trade challenges we face today – productivity becomes an even greater imperative. Boosting productivity can generate enormous benefits in the short term without requiring significant financial investments.
The good news is that much can be done with the resources small to medium enterprise (SME) manufacturers already have in hand. It comes down to making operational excellence integral to the DNA of the company. The benefits of a strong continuous improvement culture resonate through every aspect of a business.
Phil: SMEs today need to be able to react to market volatility, such as recent trade pressures and tariff threats quickly. Driving productivity improvements can provide them with a competitive advantage, fast.
By understanding how to measure productivity and how specific changes will impact those metrics, SMEs will achieve significant benefits. If your factory can do more with less, you gain the agility to pursue new sales avenues, or transition to new technologies or processes that bring about even greater business benefits. So, while productivity might be seen as ‘operational’, in many ways it is also essential to the growth of a company.
Brad: Instilling a consistent, global culture of continuous improvement presents many challenges, but one of the toughest is prioritizing and resourcing productivity initiatives while keeping up with the day-to-day pressures of producing and delivering products.
A second common roadblock is resistance to change. Driving productivity enhancements involves changing the way you do things – and as we all know – people tend to cling to how things have always been done. But productivity improvements won’t be successful without the buy-in and commitment of employees. SMEs’ leadership teams need to be aware of this and very deliberate in terms of how they deploy changes to ensure they are well received and sustained.
Phil: I would add a third roadblock to that list. In my experience, many SMEs have trouble pinpointing significant sources of inefficiency in their operations. It’s not that they don’t want to address operational challenges; they aren’t able to find them. Perhaps there isn’t a scientific mindset or capability in-house to conduct root cause analysis to identify key issues.
Even when SMEs do identify the critical sources of inefficiency, many fall into the loop of analysis paralysis –constantly analyzing potential solutions without taking action or gathering data that will help them address the problem. This is where proven tools like Lean manufacturing shine because they enable a framework for efficiency assessment, data collection, and a process for how to improve.
Brad: Depending on a company’s level of sophistication around Lean manufacturing, it’s easy to rely on 5S methodology (sort, set in order, shine, standardize and sustain) – never venturing deeper with continuous improvement initiatives. But continuous improvement can’t be treated as a one-time event or surface-level. It must be meaningful, systemic and ingrained in the corporate culture to drive the best outcomes.
Phil: Over-processing and over-production are the two that I’ve observed most frequently. For example, a factory manager may add automation tools or equipment to produce products faster, however, this might not deliver any value back to the client. If you’re just producing faster with a lower level of quality, you’re not increasing productivity; you’re just producing more scrap.
Brad: Equipment downtime is another common productivity killer. A few years ago I experienced the impact of this issue in a relatively new factory – part of a larger operating network that had a fair amount of custom manufacturing equipment. Output was a significant priority for the business and highly dependent on uptime. However, when we investigated the downtime issue, there was insufficient data to identify when or why equipment went down. Repeated issues were temporarily treated via a ‘break-fix approach’, with no attempt to determine the root cause or introduce a long-term solution. The result was lower-than-expected output, poor equipment utilization and on-going quality issues.
To address this, we leveraged the “five whys” of problem-solving – ultimately identifying that a lack of maintenance skillsets and resources were largely to blame resulting in a preventative maintenance backlog. This situation clearly proved that getting out of ‘break-fix’ mode requires a very deliberate top-to-bottom management system that relies on timely data analysis and action.
Phil: Agreed. A whole-day shutdown of a piece of equipment is expensive. Creating a management system that addresses both root cause and risk is extremely important because you can’t leave these things to chance or operator judgment calls. You need to guide your workforce on what productivity looks like and what role workers play.
Phil: Without a doubt, Lean Manufacturing – particularly Value Stream Mapping – tops the list. It quickly eliminates waste and helps to achieve the best possible efficiencies for a low cost. Once you have well-oiled processes and have removed the waste in your value stream, digitization and automation are the logical next step – with low value, repetitive activities bring performed by physical or digital machines.
Brad: Also part of the Lean Manufacturing toolkit, problem-solving methodologies such as Fishbone diagrams enable companies to go deeper to solve productivity issues. Whichever method is chosen, having a deliberate problem-solving capability is critical. It can help SMEs to solve a number of challenges, even in the absence of an overall Lean framework. Problem-solving is a powerful muscle that goes hand-in-hand with a continuous improvement culture.
Brad: Many companies think that they’re too busy for process improvement – that taking time away from day-to-day production won’t yield enough benefits. But the reality is that investing time upfront in developing and implementing new productivity processes and tools can lead to significant long-term improvements. The benefits of streamlined workflows, reduced errors, and increased efficiency typically far outweigh the initial investment.
Phil: I encounter many companies who confuse motion with productivity. They believe that increasing the amount of goods or number of steps in a process means the line is busier and, therefore, more productive. Others believe that automation and productivity are synonymous. But having a robot doing something wrong ten times faster than a human operator isn’t productive.
At the end of the day, productivity is a simple equation – the output of good product per each unit of time or resource. To improve it, we need to figure out how to increase the numerator or decrease the denominator.
Lastly, I’d say there’s a widespread misconception that technology will solve any issue. In fact, it can create more problems if not very thoughtfully applied. You need to approach the introduction of technology with intent and purpose – ensuring that it’s the right solution for your problem, and that the benefits will justify the cost of the investment.
Phil: In a couple of meaningful ways. First, our Lean Manufacturing through Value Stream Mapping (VSM) program introduces SMEs to Lean concepts that help them to better understand their process flow and enable problem-solving. Together we plot the current state and ideate a future state. We also work together to perform root cause analysis on key issues.
The results can be astonishing! One client gained a 100% increase in throughput – doubling the amount of manufactured products, by realigning resources and reducing work in process (WIP) wait times. This enabled them to be paid faster by customers, to leverage better cash flow with their suppliers and to keep their workers busier and happier. The benefits are felt all along the process chain.
Complementing our VSM program is our Smart Manufacturing for a Connected World® program which involves the creation of a digital roadmap that allows SMEs to take small, iterative steps –getting them into a position where they can successfully leverage technology to further boost their capacity.
Brad: Working from coast to coast, REMAP is a proven partner that helps Canadian SMEs take comprehensive and impactful steps to boost productivity and efficiency. Not every company has in-house Lean or Smart Manufacturing expertise to draw on. Some need help deciding where to focus or prioritizing their efforts for the best return. REMAP guides them through the entire process and supplements or complements in-house resources and can also help identify funding opportunities available for Canadian SMEs to help support the cost of their efforts.
In addition to these advisory services, REMAP drives value in many other ways. Our network casts a very wide net across the Canadian advanced manufacturing ecosystem – bringing together industry, universities and research organizations to facilitate knowledge sharing. Connecting with others opens up a whole range of opportunities and resources SMEs might not otherwise have access to -- unique lab capabilities or early-stage technologies, or expertise for example.
No matter what kind of operational challenges SMEs are facing, or how advanced or simple their manufacturing operations are, REMAP meets companies them where they are at and on their productivity journey– delivering solutions that both offset current challenges and help to achieve longer-term business goals.
