Setup reduction in manufacturing

Setup Reduction (Often known as Single minute exchange of Die)

When we run large lots of each product, setups on that product are infrequent. Setups take skill, practice and coaching. When operators perform setups infrequently they do not learn them well.

This leads to the perception that setups are difficulty and risky.

With large lots, a fixed setup cost is amortized over a large number of units. This seems to reduce the unit cost. These are offsetting costs associated with the resulting inventories, but these offsetting costs are usually buried in the overhead. This also encourages large lots or runs.

The consequence is high inventory and complex scheduling. These give rise to a plethora costs and negative consequences.