Targeting, preventing and eliminating waste in any business process or practice is essential to long-term success, or in some cases, survival. Programs like Six Sigma, Lean and 5S are developed to help businesses follow best practices that drive waste out of every aspect of an enterprise without compromising product quality or services provided to a customer.
The goal is simple—to improve the deliverable to a customer without increasing price, while at the same time maintaining or increasing the bottom line. A company’s ability to generate profit determines its success over time.
If profit is a primary measure upon which companies are valued and on which they focus, how are companies in the packaging and label printing industry doing? And how do they compare to other industry segments?
Looking at top publicly traded companies active in our market sector, which include Bemis Company Inc, Graphic Packaging International Inc, Sonoco and Multi-Color Corp, the sector averages less than 5.6 percent net profit margin. This is against 10 percent being considered an average net profit for all North American business. Figure 1 lists top-performing industries in the US; all far more profitable than packaging and label printing companies.
Dilemma & Solution
Considering the constant downward pressure that’s put on price by print buyers and made worse by high levels of competition, it’s difficult for printers to increase what they charge—even if that increase is just to cover additional cost of goods sold (COGS) and operating expenses. The only way out of this dilemma for printers is to improve productivity by eliminating waste and reducing downtime, while increasing output. It sounds simple and in fact, it is.
While programs like Six Sigma, Lean and 5S are all excellent means to an end, they can take on a life of their own and impose a level of unnecessary complexity to what can be achieved by simply focusing on the immediate situation and acting.
Simple, Sustainable Solution
First, focus on waste and downtime reduction, then on increasing output. The checklist:
- Identify actual cost: Examine and factor in waste and downtime. If the numbers are high enough, continue…
- Identify root causes: Analyze current practices compared to basic and fundamental process standards. Verify the condition of press components, as well as the tolerance compliance of all process variables (substrates, plates, inks, anilox, holders, blades)
- Develop a plan to address and correct causes of waste and downtime: Review and revise SOPs and best practices. Implement training to meet SOPs and follow best practices. Identify a process champion for each shift
- Sustainability: Conduct frequent scheduled process compliance audits and appropriate continuous training
Waste & Downtime Cost Reduction
The following is an example of calculating the cost of pressroom waste and downtime.
- Dot gain
- Dirty print
- End seal leaking
- Anilox damage and wear
- Mid-run press stops
- Blade life
- Annual blade spend
First, focus on waste and downtime reduction, then on increasing output. Clarify the pressroom profile, including currently identified waste and concerns (see Figure 2). Then, calculate the cost of waste to be targeted. Some defects, like streaks resulting from a compromised doctor blade edge or dirty print requiring the plate to be cleaned, require a press stop (see Figure 3). Next, identify the cost of dealing with waste on press without stopping (see Figure 4, Figure 5 and Figure 6). An operator may address some defects, like starvation or end seal leaking, without stopping.
Note: The data to make these calculations must be collected press side from operator practices. Even if these numbers appear high, they make the case for conducting this simple analysis.
Based on the analysis, it seems obvious every pressroom would already be doing this—Yet many aren’t. We see pressrooms operating the same equipment, producing the same product with waste rates ranging anywhere between 8 percent at one location and 15 percent at another—sometimes within the same group.
We often find well-established flexographic standard operating procedures (SOPs) not being followed. When challenged, operators often claim not to know the basic setup of a blade and end seal to the anilox or which way to face a beveled edge. We still find operators adding unadjusted water directly from a hose to reduce viscosity, unaware of the consequences. It’s not that they don’t care; most often, it’s a matter of forgetting or not knowing. Ultimately, it’s a matter of inadequate training or ongoing compliance training.
This situation is often blamed on a lack of available skilled labor. However, it may be more a lack of managers not themselves knowing the key process variables or exact tolerances. They don’t know every process variable or exact tolerances for each. We still find pressrooms where supervisors don’t know what a key performance indicator (KPI) is, even when the list is posted in their breakroom.
How to Get Going
Many pressrooms are too busy putting out today’s fires to address these fundamental costly issues of preventing waste and downtime. At the same time, their staff is fully consumed in today’s reality, preventing them from thinking about or implementing a sustainable solution.
We have found that once people with bottom line P&L responsibilities—perhaps owners or operations managers—are made aware of the true cost of waste and downtime, they are more likely to instigate an action plan. They are also more open to inviting in a qualified partner with the experience and expertise to identify the root causes and be able to help implement specific, sustainable solutions.
Acting now to establish a simple and sustained solution to waste and downtime can be a matter of long-term survival—the difference between just getting by, and thriving.