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Quality, Cost, Delivery (QCD): The Unattainable Trio of Lean Manufacturing?

January 8, 2020

 by David Collins III

Man controlling factory machinery

Clients often tell us that to achieve higher quality, they sacrifice speed or cost, or that delivery time will lead to higher costs or lower quality – this is simply not the case. We want to put the notion to rest that it is impossible to balance quality, cost, and delivery simultaneously in manufacturing. Quality, cost, and delivery are so closely tied together that it is impossible to achieve one without the others. 

Let’s dig into this. 


How QCD are interdependent in Lean Manufacturing

Achieving Quality reduces Cost

High quality is achieved by eliminating mistakes and producing each piece correctly the first time, every time. Failing to do so will create the need for rework, which is expensive, increasing cost, and time-consuming, which leads to shipping delays. 

You might be thinking, “how can I eliminate mistakes while having a near 100% first-pass yield without the extra manpower and careful inspections?” The answer is simple: use improved processes that make it nearly impossible to make mistakes, including poka-yoke and mistake-proofing

Automation may be able to help with this but is also not necessary. Every manufacturing task can be standardized and optimized so that it takes the fewest people to do the most work. 


Reducing Cost improves Delivery

Cost comes down to two things: materials and time (labor). Work-in-progress (WIP) is illiquid; every moment that product is on the production floor, and incomplete, is a hit on cash flow. By reducing the time a product is idle, you improve your cash flow. 

The same goes for the operators. Every second not spent adding value to the product is wasted. This includes, but is not limited to, moving materials between workstations, waiting for product, and looking for the right tool. Reducing any one of these time wasters can dramatically improve productivity, thus lowering your cost, and reducing production and delivery time.  


Improve the QCD feedback loop for better manufacturing

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The above are just examples of how high quality, low cost, and prompt delivery are interconnected and cannot be achieved independent of one another. Implementing the systems to bring about this efficient state does take a considerable amount of time and effort, but it pays off quickly and consistently once realized. 

The first step to achieving greater results in manufacturing is to reject the idea that you need to sacrifice either quality, cost, or delivery to achieve the other two. It is a false choice. The only choice is between achieving all three for efficient manufacturing, or not achieving any of them for inefficient manufacturing.

Looking to improve your factory's output quality while lowering costs at the same time? Click on the image below. 

How To Cut Your Factory Costs Through Quality Improvement Activities eBook Download

Topics: Lean Manufacturing, Cost Reduction, Quality

David Collins III

David Collins III

David was a Senior Strategy Consultant for Deloitte, served in Iraq as a Special Operations Civil Affairs soldier, and as a Governance Advisor to the Afghan Government with the Department of State. At CMC, David advises clients on strategy and investments.

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