How Incredible Finishing Companies Predict the Future

Photo Credit: LAB Midwest

Mediocre Finishing Company relies on what happened in the past in an attempt to improve in the future. Their president holds a meeting on the 15^th of every month to review the prior month’s financial performance, including revenue, cost of goods sold, gross profit, operating expenses and net income. Accounts receivable and accounts payable balances as well as the company’s cash position at the close of the prior month are considered. The prior month’s quality data is presented in this meeting, including the number of parts and orders rejected during in-process and final inspection and those returned by customers as non-conforming. The prior month’s PPMs (parts per million rejected) are tracked and charted against the performance of prior months and trends are discussed. Finally Mediocre reviews on-time delivery to the previous month’s standard lead times and company promise dates against performance over time.

While employing better practices than the finishing company whose sole indicator of performance is the balance in the checkbook, Mediocre has a long way to go. They are running their business through the rearview mirror and taking action to improve their performance weeks and perhaps even months after issues arise. In the best case, Mediocre doesn’t confirm until mid-May that it had a problem in April. It won’t take action to identify root cause and solve the problem until the second half of May and might not] benefit from the results of their actions to correct the causes of poor April performance until June.

Unlike Mediocre, Better Powder Coating doesn’t wait until the middle of the next month to review and correct performance. Better relies on real-time data to gage and improve on results. Revenue and cost information are produced each day and is immediately available to the team. Favorable trends in each are leveraged and concerning ones addressed. Every single day! The team reviews quality data daily. A quality issue at a finishing line constitutes an all-out emergency to which the entire company is expected to respond. Notification of an order being returned by a customer for a quality issue is immediately communicated and a corrective action process begins concurrently. Month-to-date on-time delivery data is reviewed daily and resources are moved about the plant to maximize delivery performance. Efficiency and productivity data are produced for every department and every finishing line every day and below-standard performance is addressed throughout the day. A decade ago and owing to its practice of improving performance in real-time, Better would have been held up as a world-class finishing operation. No more.

Unlike Better, Incredible Plating measures its future business performance in real-time. Using complex algorithms, predictive analytics, smart technology and leveraging artificial intelligence (AI) and machine learning (ML), the way that Incredible can predict the future is nothing short of, well, incredible.

Each of Incredible’s racks, tanks, controls and rectifiers are equipped with highly advanced smart technology that measures fixture condition, tank temperature, cycle time, errors, disturbances, line speed and so on. Incredible also gathers enterprise data including on-time delivery, quality performance, machine capacity and more. Incredible logs this data over time, creating huge data sets. When the rare undesirable efficiency, quality of performance issue arises it is quickly identified and addressed and that data is logged as well. Using this data and combining its internally developed algorithms with commercially available AI and ML platforms Incredible can literally predict future performance, favorable and unfavorable, based on past and current data. This entire process has created a type of distant early warning system for Incredible, such that long before quality, efficiency, delivery or performance issues arise, Incredible has predicted them and addressed them in advance so they never happen.

In similar fashion, Incredible is able to utilize customer, market and past performance data to predict future revenue, gross profit and cash flow, projecting financial performance 6 months in advance and using that data to assess risk and make superb business decisions.

Mediocre is managing its business in the past. Better is operating its business in the present. Incredible is leading its business in the future.

It’s great to be Incredible.