Cost Avoidance
- Increase in overall equipment effectiveness saves the organization from purchasing new equipments
- When purchase of new equipments are deferred or cancelled, potential cost of cost of depreciation is avoided
- Other overhead coast is also avoided because space required for new equipments is avoided
- Manufacturing overhead is avoided because no additional operators are required since additional equipments are no longer required
Cost Savings
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- Increase in yield or quality rate reduces the material usages leading to cost savings in material cost and inventory cost
- Improvement in the performance rate allows the employees to produce more quality outputs from the same number of equipments operated and operating hours worked. Thus unnecessary overtime is no longer required which has a significant impact on cost saving of the manufacturing overhead cost.
- Increase in performance rate allows the operations to be operated with higher operator to equipment. This is a cost saving on the manufacturing overhead. The excess operators can be reassigned to other operations where they are most needed.
- At 95% or higher availability rate, the equipments are operating at maximum effectiveness. Minor / major breakdown is minimal and this has positive impact on the cost saving of spares.
Meeting Organizational Objectives
The adoption of the TPM Philosophy can be a platform for organization to achieve operational excellence in line with its strategic direction, the four perspectives of the balanced scorecard initiatives and operational objectives both in the long and short term. It is a top down approach that drives the entire organization towards achieving the next level of excellence and ensures its competitiveness with regard to quality, cost, speed, dependability and flexibility in the industry.
Through the total involvement of employees in TPM, it has enabled the organization to mobilize the entire organizational resources towards meeting the organizational objectives.
Level of excellence achieved would be difficult to sustain unless the organization has a sound structure in place to maintain it. TPM provides organization with such a structure. That role is played by the Autonomous Maintenance Small Group Activities who form the backbone of the TPM organization. It should be noted that they are the biggest population in the origination and their contribution will have significant impact towards the organization. They will be the one who will be resuming that role of sustaining the gains made at each level of excellence in the operations. Simultaneously they too are playing an active role in the continuous improvement activities at their workplace.
Nurtures and Cultivate a Quality Culture
The strategic implementation of TPM alleviate the organization toward achieving a World-Class quality culture (Level 6) where the intellectual capability, creativity and innovativeness are used to the fullest potential and highly orientated towards the customer.
Common characteristics of a World-Class quality culture are:
- Total ownership of quality where the workforce on the shop floor not only operate the machine but has accountability of the overall performance of the equipment with respect to quality, cost, maintenance, cleanliness and safety
- The customer care-abouts is strongly embedded in the heart and minds of the employees. They relate their daily routine activities to quality, cost, speed, dependability and flexibility.
- The organization possesses a strong teaming culture. Teamwork is strengthened and it operates as a strong cross functional cohesive team using their tacit knowledge, creativity and innovativeness in making a better organization through continuous improvement.
- The employees and teams are highly motivated and empowered in executing their roles and responsibilities in supporting the strategic direction, strategic initiatives and operational objectives of the organization. TPM creates an favorable environment which organization to utilize their human potentials fully.
