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Better loss reasons lead to better and faster decision making

When you are looking to improve your manufacturing results, the first thing you do is look at your losses. If you've got a perfectly prioritized list of loss reasons, and you can make spending and improvement decisions in a snap, you're awesome! Most of us have a list of reasons that someone put together many years ago, and operators might (or might not) be recording downtimes in those reason categories. Your loss reason categories and lists can and should be critical to your decision making on where to spend time, money, and resources. If you aren't getting the most out of your downtime pareto charts, then keep reading. With a little bit of investment, you can make faster decisions with more actionable loss data by choosing better loss reasons and enrolling your team in the process.

Your loss reason categories are essential to your ability to zone in and drive out the right top losses.

Unplanned Loss pareto chart


We’ve created a step by step guide for you to get even more out of your loss reason categories.

Download PDF guide now


1. Loss reason names matter most to the chooser not the choice maker.

When its 2am and your operator is spending all of his mental energy on fixing an issue, the last thing you want him doing is hemming and hawing over which loss reason to select from your list. Your operators need to know exactly what each reason means and what common issues they should put under each reason. If you’ve got a new loss popping up, go ask the operator where that reason should fit in your list, and then add it just like he said. Yes, you as the leader are interpreting the data, but the person choosing the reason needs to first understand exactly what he is selecting.

2. Be more specific.

The longer the list, the more likely he is to select something that is as broad as possible. “Miscellaneous” is not your friend. You are looking for an actionable chart at the end of this process. When you apply time and missed revenue opportunities against your loss reason chart in a few weeks, you want to very clearly know where you should spend extra time, money, and resources. If you leave in broad loss reasons, you’ll end up wanting to spend your pot of money on “miscellaneous,” which isn’t going to help at all.

3. “Write in your own reason” is a bad idea.

Every operator wants to be able to write in their own reason for an issue. They will always ask for this option. They don’t want to be stuck picking from a fixed list and not be able to find the right choice. Their viewpoint is understandable here, but when they are stressed, exhausted, and short on time, they will always write in something in hopes that you’ll categorize it for them. You can’t be spending your days categorizing losses, you must spend them taking action against losses. If you let them write in text, someone has to read it. And you may think that you can read it everyday, but things will get in the way and you’ll be looking at thousands of lines of hand written losses in a month, and you’ll never get the time to go through all of them. You must force them to pick a reason from a list to save yourself time. Your loss reason tree is like a living document.

4. Loss reason categories should be ever changing

Like any good continuous improvement team, you focus on one loss for a while and you get that loss down to practically zero. Then, you focus on the next loss. Sometimes, new issues will come up with seasons changing, new hires joining the team, new products launching, etc. Your loss reason list should be flexible and ever changing to give you the most actionable data. Listen to your operators and adjust the loss reasons based on today’s issues. Your list should work for you and not the other way around.

Young creative business people at office

Now you have perspective on how to get the right loss reasons but how can you get the team to buy in?

Download PDF guide now

1. Engage the team

Get everyone in the same room at the same time to discuss the reason list. Ideally you can do this with everyone, but sometimes the business has to continue running so you’ll need to gather the leaders and don’t forget the most influential operators. Bring a proposed loss reason list and have them edit it with you. You want them to buy-in to the reasons list, and they won’t do that if you create it for them. But, you can’t start from scratch because it will take all day, and you don’t have that kind of time. 

Make sure your top losses have an obvious choice. Sometimes you may need to change a loss to be uber-specific in order to make sure everyone knows what it means. “Cartoner pick arm dropped a carton on the conveyor” is different than “Cartoner pick arm failed to pick a carton” but they both could be categorized under a more general “Cartoner pick arm.” See where I am going? If you are looking to prove that you need capital for something, give the loss reasons more time and attention in that area. 

2. Inspect what you expect

Walk around everyday and discuss yesterday’s downtimes and loss reasons with the team. It doesn’t matter if the team that selected the loss isn’t there, discuss it with whoever is there. The important thing you are trying to show is that you care and that you are going to ask about these everyday. This will get back to the other team and they will take more care about what losses they choose from the list. They really want to know that you are serious and you are going to follow up, so it will take them 10-15 times of you asking about it before they are ready to change their behavior. If you come out every day or multiple times a day, behavior change can be achieved in less than a week. You must be willing to inspect and spend your time on the thing you are expecting them to spend their time on. If it's not important enough to put your time into following up, why should it be important to them. The best operations leaders are the ones that follow up about the issues and the wins for the team.

3. Do something with the data

What are you spending all of this energy for? You want to have an actionable list of downtime losses, right? You need to be willing to do something about it. Find a way to impact one of the top issues giving the teams trouble. You might not be able to spend a million dollars to fix it, but you need to show that you are trying to do something about this. Find a loss that is "low hanging fruit" so to speak, and eliminate it first. Everyone has put in a lot of work to get good reasons, to select the right reason, and talking to you about it everyday. You need to reward them for doing this in some way, even if it is a pizza party. Be creative, you don’t have to spend a lot of money to show that you care and are paying attention. Be grateful, be impactful.


Download your free PDF version of the loss reasons guide today

Loss Reasons Guide Overview


Jennifer Biggs
Jennifer Biggs
Jennfier has a passion for leading and motivating teams through cultural transformations. She believes that people come to work everyday to be great. Through her operational experience at P&G Manufacturing, she has seen the true potential of an engaged and empowered team. She joined Ampogee in 2018 after 7 years of Manufacturing Operations experience. She has an Executive MBA from UNC Chapel Hill and a BS in Chemical Engineering from NC State University.

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