March 2020
Intermediate to advanced
192 pages
4h 48m
English
Content preview from ReducedEffort® Changeover
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APPENDIX ITHE EASY WAY TO CALCULATETHE COST OF DOWNTIME
Calculating the true cost of downtime is difficult because it requires knowing all the direct and indirect costs, such as labor, power, etc. The equation, below, makes it simple by focusing on lost opportunity.
LO = 48 (a) (b) (c)
COD = (LO) (d)
KEY
Assumes 48 production weeks per year.
LO = Lost Opportunity (number of products not produced per year due to downtime)
COD = Cost of Downtime (USD per year)
a = Changeover downtime (minutes)
b = Number of changeovers per week
c = Products produced per minute
d = Revenue per product
EXAMPLE
LO = (48 wks/yr) (300 min/changeover) (4 changeovers/wk) (1980 products/min) = 114,048,000 products per year not produced due to downtime
COD = (114,048,000 ...
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