Introduction

Many companies struggle with production optimization in the journey to Operational Excellence. Facilities constantly look for ways to remove bottlenecks and improve capacity. Companies must identify the causes of production interruption, associated costs to address the problems, and expected profit loss during downtime.  To eliminate potential losses in the future, past losses and patterns of failures must be identified to eliminate the losses.

Production Loss Analysis (PLA) provides an overall framework for understanding true production capacity over time and the sources of deviation–or loss–from that capacity. Understanding actual capacity is a necessary first step in order to systematically take improvement actions that remove the causes of actual and future losses.

In large part, the ability to improve PLA depends on how we deal with defects. Defects can be caused by equipment failures and by human error. To reduce human error, the focus needs to be on realigning or designing organizational culture along with reducing human factors. For asset-intensive industries, human error typically causes 60-70% of events that lead to production losses. Significant production improvements can be made by successfully tackling human error.