The Traditional Yield is taken at the final step of a process to measure the effectiveness of the overall process. Specifically, it shows you the percentage of products or information that are acceptable at the end of a process. This can be calculated by dividing the final output quantity by the initial input amount and converting that calculation into a decimal or a percentage. This type of measurement does not take into account scrap, rework or any other inefficiencies in a process it only looks at what goes in and what comes out. With this in mind yield may be a good initial measurement to start with but keep in mind that it does not reveal the hidden factory.
For example, many planning and control systems will use yield to calculate how many of an item should be produced to meet a specific number of finished goods. Here is an example: if I were molding bottles for a company and I needed to complete 100 bottles but my yield percentage was only 70%, I would need to produce 143 bottles to get the required 100 bottles. That’s right the system would not correct the actual cause of the defects, it would simply add a scrap factor and produce more to meet the demand. When companies realize this they often begin to use metrics like first time yield or rolled throughput yield, which are better indicators of the hidden factory.
John is machining 5 parts today. During the machining phase 2 parts are oversized. John goes back and machines the parts down to size and they pass inspection giving him 5 good parts. His yield on the 5 piece run was 100%.
Let’s say that Samantha is putting holes in her company's bowling balls. She begins with 100 bowling balls as her input. During the process, 12 balls are drilled incorrectly. She is able to fix 6 of the 12 balls and her output is 94 complete bowling balls. What is her yield? Place your answers in the comments section below and receive a coupon for one of Lean Strategies International LLC's Training Courses.
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