I worked with a medium-sized tool and die shop that had dozens and dozens of machines ranging from stand-up mills and drills to CNC machines, all the way up to massive 1,000 ton presses. Back in the maintenance area we had a rather large section of the floor dedicated to "obsolete" equipment. This equipment was either too worn out to provide the tolerances that we needed. Or it simply was not worth the effort or expense to fix it. Before I get to the five reasons we should have gotten rid of this equipment let me bring you up to speed on what we were accomplishing in our shop.
At this company we were in the process of going through a very successful LEAN Manufacturing program. As a result of these efforts our employees had completely transformed the Milling, Drilling and Sub-Assembly areas of the shop. In doing so they had managed to set up areas that processed the same amount or more material using a fraction of our machines and floor space. In fact many of the "obsolete" machines had been identified through our LEAN efforts.
As with any successful LEAN initiative the more waste we eliminated the more waste we found. And just like peeling back the layers of an onion, with every re-design of our equipment layout and manufacturing methods, the more the true Value-Adding process would emerge. As I described in a previous article we had managed to reduce our processing time from "an hour to mill and an hour to drill" down to less than 25 minutes to mill and drill each block.
While we were eliminating all forms of waste in the Shop we should not have used the Maintenance area as a dumping ground for at least some of this waste. I find the world is made up of two kinds of people. The first think "if it's broken, get rid of it and buy a new one." The second type of person thinks "someday I'll find a use for that." And a lot of us fell into the second category. Even though for all the reasons stated above these machines were no longer usable in their current state, there was a sense that at one point these had been very expensive and extremely capable and valuable. And since they "weren't hurting anyone back here" we should hold onto them "just in case."
So why get rid of the obsolete equipment?
1) It sends the message to employees that "waste is ok"
LEAN is all about getting rid of Waste. When these machines were decommissioned there was no doubt in anyone's mind that they represented Waste and should therefore be removed from the shop floor. However by deciding to keep them around in the Maintenance area we were saying that "it's ok to have Waste in our Maintenance process." And this message is completely inconsistent for any organization on the journey of LEAN.
2) It sends a message to customers that "waste is ok"
For the same reasons listed above this obsolete equipment graveyard must have also been sending the same message to our customers. We were so proud of our new LEAN processes, and rightly so. When touring our facility our customers could not believe how simple and elegant our manufacturing process had become compared to our old "batch and queue" layout. So why then would be simply move the "clutter" from one area and store it in another?
3) It gets in the way of "Value-Adding" assets
As we peeled back the layers of non-value-adding assets that smothered our processes we found more and more waste hidden from sight. This ranged from obvious physical obstructions, to excess set-ups and material handling. By storing our obsolete equipment in the Maintenance area who knows what other waste was being kept from sight. Maybe we could have discovered a better way to manage our spare parts inventory. Perhapse we could have better arranged the work stations to make it easier (and more efficient) for employees to perform tasks.
Anyone who has finally gotten around to cleaning out a garage or shed or basement (or office) knows what it feels like to finally have room to move. How much efficiency was hiding in and around all those machines taking up space in our building? We'll never know.
4) It Ties Up Capital
Everyone has heard the expression "one man's junk is another man's treasure." Just because this equipment was no longer of use to our company did not mean someone else couldn't have used it. Keep in mind that the tolerances required to make automotive stamping dies are quite high. But for another shop this equipment might have been more than adequate. For that matter we might have been able to sell it at a drastically discounted rate to one of our employees for use in a home shop. And if all else failed we could have simply sold it for scrap. However you look at it this "waste" represented some opportunity to raise capital and reduce our borrowing costs.
5) It Represents Other Lost Opportunities
Similar to point number four, if someone else could have made good use of this equipment then our company was passing up on the opportunity to realize some Goodwill if nothing else. We may have been able to donate this equipment to a local high school or technical college for use in their training facility. Or simply have given it to an employee willing to take a particular onion peel off or our hands.
