Guest Podcast

Sam Gupta  (00:23):
Hello everyone. Welcome to today's show. And if you're joining for the first time, this is part of our digital transformation series for which we meet every Thursday at 5:30 PM Eastern. We pick one topic related to digital transformation, and we always have an expert panel here for today. We are going to be talking about a very deep topic. It's manufacturing WeWork, but if you can reduce that, you can make a lot of money. Um, so we are gonna have a lot of fun discussing that. Before we do that, we are going to start with everybody's intros. I am going to start with my intro. If you don't know me, Sam Gupta, principal at Elevate iq. Elevate IQ is the independent e r P and digital transformation considering firm. On that note, I am going to move to Chris for Astra.

Chris Garrad (01:07):
Hi Sam, and if you don't know me, I'm Chris Garrad, the owner and president of Turnkey Technologies. Sam's had me on, so Tom, we're like brothers these days, but, uh, thanks for joining tonight. Uh, gen Turnkey Technologies is about a 29 year old, uh, partner organization implementing Microsoft Dynamics. So great topic tonight.

Sam Gupta  (01:23):
Amazing. Thank you so much for being here, Chris. Dave, can I move to you next for your intro?

Dave Griffith (01:28):
Absolutely. Hello everyone. Uh, my name is Dave Griffith. I run a company called Capsule Solutions. We help companies, organizations go through digital transformations that pay for themselves by focusing on executable small projects that, that turn large profits. And I'm excited to have this conversation about rework.

Sam Gupta  (01:46):
Okay, amazing. Thank you so much for being here. Dave Nara, can I ask you to introduce yourself next?

Nirav Sham (01:52):
Yeah, absolutely. My name is Nirav Sham, CEO of Eder, c r p. We are an Acumatica partner and we help implement, um, Acumatica and mid-market, um, industries, manufacturing being one of them. And this is a very important topic for manufacturers to get under control. Um, I'm excited to talk about it. Thank you, Sam.

Sam Gupta  (02:09):
Get under control. Um, amazing. Thank you so much for being here. Chuck, can I ask you to introduce yourself next?

Chuck Coxhead (02:16):
Absolutely. Chuck Coxhead. I'm also with Turnkey Technology, so what he said, and, uh, after 35 years in the manufacturing world in various capacities, this one's near and dear to my heart. How do we make money out of the things that we have to rework?

Sam Gupta  (02:31):
Okay, amazing. Thank you so much for being here, Chuck. And if you're in the audience and joining for the first time, make sure you guys, uh, post questions and comments. We typically try to cover them during the show. If you run out of time, then we'll make sure that you receive your answers. On that note, Chris, I am going to start with you. And that is going to be the whole process of rework. And I don't know how many people are going to be really familiar with what rework really is and what are going to be different trigger points for rework. Um, and from the er p perspective, if you wanna set the context, press over. You

Chris Garrad (03:04):
Sure appreciate it, Sam. So yeah, rework a lot of different ideas come to mind and you think about, okay, first of all is where, where is it occurring at? You know, what, at what point in the process that somebody said, whoops, I've got a problem. And, and if you think about what triggers the event of a rework and, and what's that mean? Well, again, it could be a customer. I got my product at home and it just doesn't work. Send it back in. That's rework. Okay? So, you know, some organizations, I gotta get an rma, I send it in and they, if they made it, then they gotta fix it, send me a new one or send me a new one. But that process alone, when it comes back from the customer, there's diagnostic initial, there's diagnostic final. There may be a work order where we put the cost, whole other conversation on that one.
(03:45):
So again, that's discovered after I shipped 'em. A finished good product comes back in. It's a different process to deal with returns where we're trying to repair them. That's a little different than rework. But, um, we still need the data from that event to come back to manufacturing so we can eliminate this particular defect if that is the cost. So then where's the other place it could occur? I'm in, I'm in the manufacturing line, and guess what happened? I dropped it. Oh, whoops. Whoops. The machine wasn't perfectly calibrated. Okay? So again, there's, that's another example where now I'm in the middle of a manufacturing process and it's not even a quality check that all of a sudden something happens. Could be equipment malfunction, could be an operator problem, right? Dropped it, broke, it just was doing it wrong. Um, it, it also could be a, again, in the same context, it could be a quality catch, which means quality's inspecting.
(04:33):
And, you know, we've got medical device manufacturers and you think about the scrutiny throughout the manufacturing process. So again, what happens is it's caught after an operation and it's a quality inspection. And they're like, Hey, this isn't, this isn't right. And again, as you think about then the diagnostic on, okay, what is the corrective action? It's a whole, and again, does it, oh, we're on the line. All right, let's just start sanding it over here a little more. Stop, right? Imagine the, imagine the complexities in the engineering. What if I'm doing an airframe piece and I discover something, right? Again, maybe I'm the worker, I find it maybe quality finds it again, maybe it came back from the customer and illuminates a bigger issue. But again, there's, uh, so now the, the, the rework, again, there's a simple rework. I got one piece that I needed.
(05:14):
It's a little rough, I'm gonna go sand it a little bit more. And, and again, in the simplest example, does that mean that, you know, the planner can add, add an operation to the manufacturing order? So that's one example of how we get rework is we're gonna add another operation with more labor time for additional sanding, for example. And that may be in that particular scenario, maybe it's that maybe it's not enough sanding, whether that impacts all production going forward, meaning the master bomb should change the route is forever changed. Now we've got an engineering management loop. So again, as we get feedback from customer sites should go to engineering, change management to see if there's a defect. Cuz then the goal is how do we resolve? But, uh, but again, it it's business process. And again, you heard me just talk about a whole bunch of places and you're like, okay, well how should you do it?
(05:57):
Well, you're always costing it to the, the production. So, and, and part of that is you need to trip the variance indicator. You need to say, Hey, why do I have a variance on this? And if I'm making 50 and I got one part, okay, that's different. If I got 50 and I gotta fix all 50, that's a bigger deal. And I'll see, we're gonna see a big variance because customer price, I guess the customer's not expecting me to come back and raise the price cuz I need more labor or, you know, I found out that the part that I ordered is the wrong part. That's, that's another one of these things that could require rework is again, it, it can't finish it. Where does it do? It has to loop. And so there, there are a lot of complexities and even how you address the transaction or create a new transaction and where's the cost? Is it all part of this production? Certainly if it's in a production run, you wanna keep the cost there cuz you illuminate variants. But again, as you heard me articulate, these feedback loops are imperative, um, just to, to fix these problems. Uh, and again, there's a lot more going on, but I thought that was a good start.

Sam Gupta  (06:50):
Yeah, that's definitely a good start. In fact, I'm going to touch on some of the comments that you made. And overall from the best practices perspective, I have seen all sort of crazy scenarios, uh, when it comes to rework. And I don't know if that is the right way of doing it. That's how they may have done it, just because they didn't probably have the rework processes supported as part of their e r P system. So they had to come up with creative ideas such as creating an operation, uh, as part of your bomb. That could be one possibility, right? Uh, the other possibility could be, I find when I look at many different businesses, if your product is not really des defined, uh, not designed, you are probably gonna have design but defined. Okay? If you are not necessarily productized from the manufacturing perspective, then sometimes it could be harder because you don't know whether this is going to be a real rework or is it going to be some sort of change order. I don't know if there is gonna be, so any sort of correlation. So, Chris, any

Chris Garrad (07:46):
Point, if you think about engineering change, and again, it depends on where the feedback comes from. So if your quality guy picks it up, typically it's gonna fail your own set. Internal tolerances, it comes back from a customer. You're right, there could be decision trees. Well, that's just the way it works. Okay? We get that out of the guys upstairs in the cloud a lot, don't we? <laugh> interesting rework. But, but again, you go back to what's the type of rework and how do I collect that cost? Because in the end of the day, rework has cost on it. And then we go back to the process as to which, how do I orchestrate it? Was I done with production? I recognize that at equality, I gotta rerun the whole batch. I gotta take the whole batch. And again, how do I do I open up that MO and add more operations and run everything through again? But I think each of the different scenarios requires the conversation

.
Sam Gupta  (08:29):
Okay, amazing insight. Thank you so much Chris for that. Uh, Dave, I'm coming to you. So obviously you bring up very, very, very important and different perspective here. That is going to be more from the shop floor perspective. And one of the things that you do as part of your day job is finding efficiencies, uh, in your manufacturing process, right? So hopefully you can talk about the best practices from the OT perspective, because now when you think from the OT perspective, then you have to think about your machines. You have to think about off your machines, you have to think about production runs. And then finally, how do you control this process? Because once you have the rework that throws off everything, uh, unless you have a process figured out for rework, that is very rare in my experience, that is all manual in general. Mm-hmm. <affirmative>. Um, so j over to you.

Dave Griffith (09:11):
No, a absolutely. And I think that there have been a lot of really good points brought up by Chris and, and also you Sam. Uh, so as you said, kind of my, my background is mostly how do we actually go implement and execute this stuff on the floor? And, and I loved how Chris laid it out. Uh, typically that, that is not my experience. Uh, typically I guess when I look at, uh, when I look at rework from, from the shop floor, it's, it's always a bad word, right? So 10, 10, 12 years ago, I, I helped design an aircraft facility, right? 200,000 square feet. We were putting together drilling riveting, the back couple of pieces of a fuselage together, and we had to have a rework station, right? And we, we, so the conversation was, well, we have to have a rework station. So the rework station was the smallest little square, uh, amongst all of our squares, because that, that typically is not a conversation, that is a happy conversation to have because we know that we're losing money and it's costing us money and, and, and it's all of, of these other issues.
(10:03):
So I would say kind of to Chris's point, um, doing some of that root cause analysis is extremely important. W when I look at rework, you know, there, there's the opportunity that, hey, we made a mistake. Maybe, maybe we hit something, a tool hit something with this piece, and maybe we can go sand it out. Maybe we've gotta go scrap this piece. But if you find that this happens over and over and over again, you have to do some amount of root cause analysis of the process to understand, hey, this is why 50 out of 50 items had issues. And hopefully you can find that before it reaches your customer. Because there, there's nothing more that upsets your customer when you go send them 50 of the same part and they, they don't work because they're not to spec or they're not to a variety o of other, uh, o of other, uh, ways.
(10:48):
Um, I will also say that I've seen the opportunity to do a bunch of rework. So I was working with a, with a beverage company, uh, who will remain nameless for, for reasons fairly, fairly soon obvious to, uh, to understand, right? So, so that they were putting their, their beverage into cartons and th this one facility, 18 lines, I don't know, hundreds of millions of dollars over the course of the year if they had an issue with carton crushing, right? It doesn't pass quality inspection through the end of the line. If it didn't, they had no ability to rework, right? And so for that organization, rework can be as simple as taking it, kind of pouring it into a bunch of food safe, uh, 55 barrel drums, if you will, and then moving it back to, to the, the front side of the line, going and pouring 'em back into the tank and going to put it back into, going to put it back into, you know, different cartons.
(11:37):
And so that was a huge opportunity for that particular organization to put in a nearly, nearly no cost to them rework station to be able to go rework the, the items. And so that becomes near a hundred percent, uh, opportunity to recoup the profit, right? I think there was probably 60 cents, uh, 60 cents a carner thereabouts that was, you know, scrap. But we were able to rework the most expensive parts of the process in order to save them a bunch of money. And that all, that all came from kind of the root cause of, Hey, why are these getting poured out? These are very expensive. Uh, some beverages are, are difficult to, to get and to continue to, uh, to make anex expensive to make. So let, let's go through the process of understanding where the problem is and then going to solve that problem. So typically in my experience, that becomes a let's go solve the problem before we worry about maybe how we get it into the system, be it in e r p or an mes or kind of any a any of these other issues that a lot of the time becomes an engineering process that we have to go solve.
(12:35):
And then we've got the ability to go take those learnings, push them in as, as Chris had talked about, and hopefully we don't get to the point of a customer returns a hundred percent of a run because it, it wasn't a spec or there weren't, there were opportunities that we missed to go solve these problems.

Sam Gupta  (12:51):
So that's very interesting. And, uh, I, I'm, I especially like your story to be honest. Okay, so when you are talking about, and I think you had a little layer there in terms of the expected rework and the unexpected rework, I guess, I don't know if that is the right term. Yeah. Uh, in terms of defining the rework, <laugh>, uh, but I don't even know if you can really configure your rework process as part of your quality processes. If you already know, uh, what could be the issues in your production line and because of which, uh, you might have your rework. So I don't know if you can configure that as part of your quality process, but in your story, uh, you sort of add that, you know, that you are getting these unexpected rework, but for some reason you don't know. So there are always going to be the variables that are going to drive whether it is a rework or not. Uh, but who sort of makes the decision in the rework process whether there is going to be a rework, uh, you know, it's going to be throwaway product, or how is that process? Dave, do you wanna touch on that?

Dave Griffith (13:48):
So, yes. So, so typically I've found if we've got the ability to rework it to, to sell it as a normal finished good, we'll absolutely rework it. Um, in, in some instances, be it like food and beverage or, or some consumer goods, we've got the opportunity to sell things as seconds. And th this is very factory dependent, so maybe not up to the normal quality, but we can recapture 70 or 80% of the, the, the typical cost by selling it as a second. So we don't lose the, the cost of all of the time and materials that, that we, that we put in. I would say when we talk about who is the correct person to kind of make that call, I think that that's super dependent. A lot of times it gets to quality, right? So there, there are a, or a number of quality checks along these processes.
(14:30):
And as we go through a number of these quality checks along these processes, it becomes, Hey, we failed. We send it to rework, or we send it to, to somewhere else. Um, and I think that the more often an organization has this style problem, the, the more kind of decision tree that they have internally as to what we do with all of these particular items, uh, what I find is most of the time, if it's a one or a two off, it becomes, maybe it gets set over to the side and maybe we think about doing it at the end of the run. Or I know some organizations that'll run 20 or 30% extra because they, they just expect there's a number to fail quality, which I should just point out is absolutely not what you should do. We shouldn't run 20 or 30% extra because we assume some of these are, that many are going to to fail quality, or our customers will buy more if we have more at the end.

Sam Gupta  (15:20):
Okay. Amazing insights there. Thank you so much, uh, Dave for that. Uh, so Nara, I'm coming over to you and the space that you operate in, that's very interesting as well, uh, you know, make to order. Uh, typically in my experience, there is always going to be a very thin line, uh, in terms of what is a real service versus what is a product. And typically when you have really defined products, for example, bombs, uh, then you are probably gonna have easy life in defining, uh, the rework. And I don't know, uh, if when you talk about, because see in the make to order space, you might have the field service as well. And I don't know if field field service could, could result into the rework processes as well. There's going to be some sort of overlap there overall, uh, you know, in terms of how field service is going to result into rework processes. So I don't know if you wanna touch on that layer and whatever else, uh, you may have, uh, too often enough.

Nirav Sham (16:08):
Yeah, absolutely. I think you touched on something I was gonna touch on there. Uh, but I wanna start at saying, you know, rework is just doesn't, isn't only, you know, from manufacturing, right? Rework actually come from many different places. I think Chris pointed that out, you know, nicely earlier, uh, rework is where somebody has let something gone through and it didn't meet a specification specs, right? Engineering customer, right? It could be the machine machinery, right? The machinery failed and it didn't proves the right output on it. So really there has to be a lot of checks and balances, right? When it, when it comes to rework, because it's, it's sometimes you, you, you have to try to prevent it from, you know, measuring twice, cutting once, right? Sometimes hard. What happened? Machine fail. Machine fail, you measured twice, you, you, you loaded, you know, the coal into the machine, but the machine just failed.
(16:57):
What do you do about that? Right? Well, in, in situations like that, you have to be very careful, like, you know, was it rework caused by a breakdown in the process, right? Or was it uncontrollable, right? At the end of the day. So, you know, there's, there's a couple different, uh, avenues there. And then the other side of it is outside the manufacturing floor is the fuel service side. So fuel service, everything could have been great. Now, between the transportation, you know, installation at the customer site, somebody bent the wrong corner, right? Yeah, something happened, right? And now you gotta take this whole assembly, bring it back and rework it, right? There's, there's processes and there's steps and there's a lot of cost and rework, right? What I think what gets missed is what happens to your profit margin, right? Rework comes back and typically, you know, make to order.
(17:41):
They don't apply it back to a job. They'll try to go ahead and quickly, but reprocessed it real quick and send it right back out the door. And now everyone thinking we made a margin on this particular project, but we really did not at the end of the day, right? You could really go from being profit to all the way to being a loss on a particular job because, you know, the margins could shift that easily from rework perspective. You have to be able to control that. Um, you know, the other indirect impacts that rework could have, right? Is rescheduling on the floor, right? To have too much rework. You're throwing off the standard work that's going on on the capacity, right? On the floor. R p and nps. You know, you're not really running rework through r p and nps. You're just basically on the fly trying to throw in a production order at this particular place in the plant to go through.
(18:25):
So you can now what? Now what happened? Now all those orders that were scheduled to be there are automatically linked, right? So that throws off capacity, that throws off your whole planning process, right? We had a really good discussion on that last week. Um, that has to be carefully monitored. You can't just take rework and throw it back into a plan and expect that, you know, it's not gonna have any other impact. It has a huge impact on capacity, capacity planning. And what about handling, right? Material handling, you have restocking fees, potentially you're gonna decon deconstruct something. Maybe you salvage what you could salvage out of that assembly that you already used. Now there's additional cost, indirect cost for handling that material, be putting it back to stock, maybe bringing some other additional materials out, uh, onto, onto the floor, right? You have employee morale, you have frustration, right?
(19:10):
There's people that, that, that are doing this, right? Uh, you know, you, you continuously have rework issues, right? What's happening to, to everyone that has to deal with this, right? They're like, we don't wanna deal with this. This is, this is hard for us to work. We don't even know where the rework, where the process is feeling, right? Documentation is important. You gotta be able to provide pro proper quality procedures, right? So in order to not be, what I would say reactive and be proactive on, on, on rework is to have a good quality process, right? Start from the beginning. Where are you gonna measure? Where are you gonna make sure that you're gonna inspect, right? Don't inspect, if you know that there's a high tendency of rework in a specific part or a specific cell or a specific work center, try to inspect that sooner before it goes down to the next step and the next step.
(19:56):
And before you complete it, all of a sudden you know that there was a big failure upfront in the product, you know, up in the manufacturing process, right? Try to catch it sooner. Try to isolate where it's coming from, right? What you're doing is constant quality analysis to reduce your rework, right? And you want to prevent it by building some sort of structure around your rework processes, right? Is where does it start? Start documentation preparing for where rework could potentially occur in the process. You gotta measure right? When it does occur, why is it occurring? What is a root cause of it, right? Is Chicago, right? Analysis root, you know, all these different, you know, QC terms out there, total quality management to, you know, all that stuff and communicate, right? You gotta communicate between departments. A good quality system is where you have open communication. Um, you're communicating between departments, you're focusing on process improvement, right? If we, if we look at rework, it's a lot of it is preventable, but a lot of it is, you know, some of it is not. But even then, I think if you focus hard enough on it, I think you can try to, you know, kind of minimize, minimize as much as possible and become more kind of, uh, proactive instead of reactive on a day-to-day basis.

Sam Gupta  (21:03):
Okay? So amazing insights there. And I'm actually making notes as you are talking and I have the is mc John isolate structure, uh, measure as well as communicate. So great job there. Uh, now the point I really wanna touch on your commentary is going to be related to the rework. Does not go through your M R P as well as, um, a p s process, right? Um, so now the people who might be sort of doing the M R P, but not doing the m p or maybe doing aps, but not doing aps, um, sometimes, you know, they are probably going to be doing the m p at least for the procurement, but when it goes to the shop floor, good luck with your scheduling. You know, whatever happens on the shop floor, only shop floor knows about it, right? Um, <laugh>. So, uh, you know, when you look at rework, right? Rework is definitely probably not gonna be part of that. So do you wanna touch a little bit in terms of if the people they might not be familiar with, you know, how the APS and M R P operates and how your rework sort of correlates with that? There are over to you again.

Nirav Sham (22:04):
Yeah, absolutely. I'm a big proponent of color coded type of documentation, okay? Right? Depending on what's being released to the floor, right? You have green, that means it's, you know, at the right schedule and it's being released. If there's a rework, have a red traveler out there, right? Saying, Hey, this is urgent potential, there's a rework. So everyone understands, right? That this has come in because of a specific reason that it's defective. Instead of just kind of someone tell, tell somebody back office, Hey, create a production order for me here and I'm gonna release and throw it into the floor. It should be no on the plan that this is a rework that's coming in. Is it coming in from a manufacturing defect? Is it a customer return order that's causing this, right? What's causing this rework? So there's all eyes on it. They're actually taking this document, they're making notes on it, trying to figure out how the re you know, how the defect happened in the first place, trying to identify exactly where the defect is.
(22:56):
And now you're using that as a quality measure to in the back office. Understand, okay, why did this happen? Right? Here are all our documentation. Here's our notes on this red traveler that we released out there, and now let's use that for our analysis. Let's take it to engineering. Let's real, let's kind of talk, talk through this. Now let's figure out, was there an issue with the bomb? Was there an issue with the routing, right? To make sure this doesn't happen again, instead of it just being kind of going through the shop as a regular production order. Cuz it's really not, at the end of the day, it really isn't right? That it starts there. You have to treat this as a very unique entity on the floor that where all eyes are gonna be on it in order to make the right outcome, uh, for this rework order, it doesn't happen again.

Sam Gupta  (23:36):
Okay? Amazing insights there. Thank you so much Nara for that. So Chuck, I'm, uh, coming over to you and I think love made a little controversial comment there, to be honest. Okay? And that is going to be in the world paperless <laugh> in two, he's talking about paper. So I don't know Missy, everybody's gonna have probably different opinion. Uh, okay, so Chuck <laugh>, uh, in your case, what do you think? I mean, should we go paper paperless? Uh, and where does overall, uh, rework fits

Chuck Coxhead (24:00):
Regardless? I mean, I, I think we, we don't need to talk about the travel. You can certainly do identification in the absence of a traveler, but quarantine, quarantine, quarantine, <laugh>, okay? It needs to come out of the product flow and it needs to go into another product flow. Uh, we put it off to the side. Oh, we took it over there. Okay, now it comes back to the product workstation. Where is it in the product flow? Ah, we'll get to it. Well, what's the priority? Truth be told, an e r p world that ought to be injected in by some sort of rework work order that's give it that some sort, that give it that priority once it comes back in how you identify it. I mean, depending on the size of the product, there might be a different handling, uh, material handling container or something to that effect.
(24:39):
So quarantine, quarantine, quarantine, I think is the, is the issue there, regardless of whether your paper or paperless. So both can work. What comes to my mind in this? I mean, all the building on the other comments is interior, uh, inventory planning and engineering is a direct labor cost as opposed to an indirect labor cost. Okay? Depending on the scope of the work, typically you're gonna classify, you might classify those employees as indirect labor. And, and those hours are, you know, brought in that way. Now you're bringing him to a timekeeping function, okay? Depending on the failure mode analysis that they have to perform the testing that they have to perform different skill sets. You may not have technicians, manufacturing workers do that. Okay? You have that accounting you have to care for. And my really big concern in rework is inventory planning. It's super easy when you've got 50,000 parts in inventory and you've got a stake, uh, uh, uh, uh, safety stock and you're planning for that and you're using some percentage of those for rework. Not a problem. You consume faster, you cost it against rework jobs, end of problem. What happens when you've got one? What happens when you're make to order buys one part. You know how I know did it, did some C A C C machining earlier in my career. Great big stainless steel forging. This was really expensive and we bought fricking one and guess who messed it up? <laugh>.
(26:06):
Now that's an extreme example. The good news is, the good news of the story is that we were able to take it back to engineering, fix the mistake, and I remachine it and everything was good. But that's an extreme example of one. But when you look at your supply and your material planning, when you have very, very high inventory quantities, it's easy. When you're stocking things in small quantity, it's hard to plan for rework. And as was mentioned, that will heavily impact your mat, your production schedule as well. It's not just a labor issue, it's also material issue. You could have a 12 re 12 week replenishment, replenishment time and orders due in four weeks. Now what? So the question is, how do you plan for these things? And it requires some foresight. It requires really when you take a look at your requirements, say, okay, what is my real situation?
(26:52):
No, I don't wanna plan for 20% rework. That's really, really bad. I will tell you we've spoke in another earlier panel in a semiconductor business that actually might be a pretty valid thing because it's just simply not achievable, right? So you do plan for additional wafer material and time and planning to do that. But no, in general, we don't wanna do that. We want a hundred percent yield, a hundred percent output. But how do you plan your inventory if you're kidding yourself and you're not considering, what are your impact part the parts you're gonna be impacted, particularly the lower quantity stock parts, where are you gonna be? And we just gloss over that. We'll, we'll deal with it when we get there. No folks, there's customer at the other end. You've gotta do that in your inventory planning.

Sam Gupta  (27:37):
So some very interesting insights there. So number one, I mean, inventory planning. I'm glad that you brought it up because obviously that's where the real plays of rework because uh, that is going to throw off the entire equation. Uh, overall from that. So you did mention some strategy there in terms of how to plan. Obviously you need to have foresight, but I don't know what you are going to do when you are gonna have Dave's situation, which is going to be just unexpected, uh, <laugh>. And in some cases we could have, uh, you know, a lot of things that are going to go unexpected. But the point that I really want to touch is going to be related to your direct versus indirect labor. Mm-hmm. <affirmative>, and I don't know how many people are really going to be familiar with this whole direct versus indirect, and how many people do the costing appropriately to be honest, okay? Mm-hmm. <affirmative>, uh, if you are going to be doing your scheduling on paper, then, you know, scheduling and costing both are probably going to be all over the place in my mind. Mm-hmm. <affirmative>, uh, so check over to you. Any, any follow up comment based on my commentary?

Chuck Coxhead (28:35):
Well, I, I think the, the, the issue is how do you classify those workers? Is your system lock you into the, you know, this engineer is indirect labor, this engineers direct labor. After that, we just, oh, well just send you over near, I'll just have Dave go over or I'll have Cheryl go over there, she'll retest it and it's gonna be no problem. And we'll just, but are we actually accounting for that? Does that actually, you know, to Chris's point earlier, does that actually get captured in a, in a a rework work order? We're actually costing that. Okay? And capturing that variance from engineering. If we just sync engineering costs and everything, we burden the entire product line. But in truth, one of the reasons we affect continuous improvement is by recognizing the variances. Where are we having these cost variances? And if we just never capture that labor, we spread it over the product line, we don't know that a product or a product line is causing a particular problem.
(29:25):
So what do we do? We have to capture that labor up until the point mean every manufacturing situation is different. Sometimes the, the cost of capturing the labor exceeds the amount of labor. Okay? If you're, if, if you're, if that cost of data entry is a cost that, okay, forget everything I just said. Yeah. All right. Spread it across your entire product line. But most of the time that's not the case. Make sure that you're capturing that direct labor because it can really go crazy. I mean, I've seen failure mode analyses that just go on for hours and hours and hours. At what point, what's your decision? You know, what's your decision process? Chuck it over your shoulder and move on. Right? You know, how many hours am I gonna plan for in this work order? How many am I schedule? Okay, it's gone more than an hour.
(30:12):
Do I stop? Okay. And that's part of your planning. What is your routing for that change order? What is your default routing? Are you do have a check-in, you know, of red flag that goes off when you've exceeded the planned number of hours so that someone can make a decision? You know? And then from a people management standpoint, do you empower the people on the floor to make that decision? Okay. Or in an hour and a half, move this one on and then, you know, it goes back to production and you feed back through e r p, the need for, you know, you scrap it and then that sends a signal back for somebody to create a new manufacturing work order. Um, you know, that's, you know, so there's a people aspect of that as well.

Sam Gupta  (30:50):
Yeah. Could not agree more. There is always people aspect in everything that you do related to e R P. Okay. <laugh>,

Chuck Coxhead (30:56):
Thank you so much Absolutely. To that,

Sam Gupta  (30:57):
Um, Chris coming over to you, um, you know, the next round that we agreed to, um, any stories, any comments over comments, Chris?