Conversion cost reduction using advanced process control (SPC) and real-time data analysis with ERP linkage [SMT assembly]

Electronic manufacturers worldwide are currently facing a big challenge to reduce conversion costs in order to be competitive in the market. With rising labor costs, surface mount technology (SMT) machine capital costs and, cost of scrap and poor quality, all SMT manufacturers need to focus on efficiently utilizing their fixed assets, controlling cost of quality and scrap, and utilizing out-of-the-box techniques to reduce conversion costs. This paper discusses some of the Six Sigma methodologies and tools used to achieve business results of reducing scrap costs by as much as 46% and, increase utilization of fixed assets (SMT machines) by as much as 30%. The paper also gives details on how enterprise resource planning (ERP)/material resource planning (MRP) integration of factory data has helped engineers think out-of-the-box and helped deploy Six Sigma techniques to control scrap costs in real time. Motorola's Manufacturing Pulse/spl trade/ equipment monitor software was used as the 6-Sigma tool to achieve business results and reduce conversion costs in a short time period at different SMT manufacturing sites worldwide. This paper discusses in detail statistical process control (SPC) charts and methodology used for real-time process control. Several examples of realworld data are included in the paper.