July 17, 2012
How to build a business case for buying SPC
When investigating an SPC system, it can be difficult to build a business case for it. As a quality engineer, the value in having easy access to data seems obvious, but this can be a hard sell to an organization focused on cost and payback opportunities for capital projects. There are a number of ways an SPC system can be used to drive improvement and reduce costs. Look in these areas to identify and then make the business case for an SPC system.
- Incoming Raw Materials / Supplies – Incoming inspection of raw materials data can be very valuable in determining the best suppliers. However, in a paper based system, the data are difficult to analyze. An SPC system can be used to quickly document the inspections and be available for analysis of the data.
- When the data are available for analysis, they can be leveraged with the various raw material suppliers to drive both quality and cost improvements.
- Compliance – An SPC system can be used to evaluate and improve compliance to procedures. As with raw material data, an SPC system can help to quickly evaluate compliance to procedures.
- An SPC system drives major savings compared to the time it takes to evaluate paper records. Further, the paper, printer, storage and retrieval costs can effectively be eliminated.
- Investigation – As in the case of compliance, complaint investigation can be much improved with an SPC system. Data can be quickly retrieved to evaluate for root cause and also to determine if other product might be affected.
- During a recall, this quick retrieval and analysis of the quality data can be invaluable not only to the products affected by the recall, but in preventing in-process materials from facing the same issue.
- Quality Improvement – The data retrieval and analysis that can be used for compliance and investigations can also be used to determine areas of improvement in the factory. This data can be used to break through preconceived ideas about problems and to direct improvements using easily compiled data.
- Reductions in scrap, rework, product giveaway, machine setup, product sorting and inspections are all improvements that impact the bottom line and are precisely the improvements that SPC targets.
Who could possibly say “No” to the improvements listed above? Often, the most difficult part of establishing a business case for SPC is quantifying how much money is currently being wasted on issues like those listed above and how much you can expect to gain from implementing a modern SPC system. This quantification will most likely require baselines of your current process, predictions based on past experiences and predictions based on current production volumes and process knowledge. Examples might include:
- Reducing product giveaway by x% will result in $y savings
- By performing a study on line 1, scrap was reduced by x% and resulted in $y savings – extrapolate these results to other lines if an SPC system is implemented
- The quality department spends x hours/week retrieving and organizing records – implementing an SPC system we expect this to be reduced by y hours/week, resulting in $z savings
- Consolidating from 3 suppliers to 2 suppliers for these materials will give us a volume increase that will allow better pricing
These examples are very general and serve only as a starting point, but they demonstrate the thoughts that every client who has driven cost down through improved quality have had.
As discussed, a modern SPC system can be used in many ways above and beyond traditional SPC. With a modern system you get all of the benefits of SPC allowing operators to quickly and efficiently make sound quality decisions about the product that they are running. Add to that, modern SPC also allows for instant product and process analysis that was very time consuming with paper based SPC and other manual data collection systems.