Skip navigation
All Places > Keysight Blogs > Insights Unlocked > Blog > Authors Duane Lowenstein

Insights Unlocked

4 Posts authored by: Duane Lowenstein Employee

Nearly every manufacturing executive I talk to is looking for ways to improve product quality and reliability, and they often think that drastic measures are required. They assume they’ll have to reinvent their engineering design processes, implement expensive upgrades on the manufacturing floor, or restructure their supply chain. They’re often surprised to learn that the key to improving product quality is already in place in their organization, and it can be summed up in one word:  Accountability.   

                     

For most large manufacturers, the responsibility for designing and building a product often rests with one part of the organization while the responsibility for providing warranty support lands elsewhere. Each area has its own budget and reporting structure, so costs incurred in warranty support are rarely traced back to the design/build process where defects often originate. By creating a culture of shared accountability between upstream and downstream teams, you can dramatically improve product quality using the people and processes you have in place today.

 

The concept is simple, intuitive, and nearly free to implement. But putting it in place takes three key steps.

 

 

1. Identify exactly where your costs are.

When a product fails under warranty, you might repair it, replace it, or even provide a discount on a future purchase to secure your customer’s business. Who covers those costs? Many manufacturers have corporate accounts that are funded annually to cover warranty service—that was Keysight’s approach up until a few years ago. Other manufacturers track warranty expenses at the business-unit level or the product level. The problem is, those costs are often hidden from view. In fact, many of the executives I work with have only a vague idea of who actually pays for warranty service. The first thing I encourage them to do is follow the money: Trace warranty expenses to the payer so you know exactly who’s footing the bill and what it’s really costing the company. The next thing I have them do is look upstream and identify the source of the problems that are costing them money. Typically, when a product is returned under warranty, the issue can be traced to a design flaw, a manufacturing process, or a perceived flaw—meaning the product is functioning exactly as intended but does not meet the expectations of the buyer. Each scenario is expensive for manufacturers. By looking upstream and downstream, you get a clear understanding of where problems come from and who pays, so you know where to focus your efforts in the next two steps.

 

2. Empower your teams to fix the problem. 

Product teams are under dire pressure to meet schedule and cost targets. They’re probably also thinking about sales targets, competitive threats, supply chain logistics, environmental issues, you name it. It’s no surprise that product reliability sometimes falls off their radar, especially if a product can pass inspection and ship on time. But here’s the thing. When product teams are held financially responsible for warranty repairs that occur a few years down the road, product quality becomes a priority. Give them the power to solve the problem. Let them decide how to allocate budgets and resources, and make the process changes and business tradeoffs that need to be made. Ultimately, their goal is not to ship a product on time or on budget but to make the company more profitable and successful. In that sense, empowering product teams is a lot like parenting teenagers: instead of telling them exactly what to do, tell them what the goal is, make sure they understand the consequences, then let them figure it out.    

 

3. Extend P&L accountability across the product lifecycle.

In many OEM environments, R&D designs a product, manufacturing builds it, the support team fixes it, and everyone’s responsible for their own budget. If you’re serious about improving quality, that model needs to change. Have all teams operate under a single P&L structure that spans the entire product lifecycle, from design and build through end of warranty. With a unified accounting structure, everyone shares the cost of repairing a faulty product, and everyone gains when quality is improved.

 

This isn’t theoretical. At Keysight we implemented a companywide accountability program in the mid-2000s. Most divisions were able to make the transition in less than a year, producing a 50 percent reduction in failure rates across the company. In fact, warranty repairs declined so dramatically that we were able to extend our standard warranty coverage from one year to three years, creating a powerful competitive advantage at zero cost to our company.

 

It’s never easy to change corporate culture. It takes vision and fortitude in the C-suite and buy-in down the line. But changing your company’s culture of accountability is one of the best competitive moves you can make, and it’s available to any manufacturer.

 

DuaneLowenstein is a Test Strategy Analysis Manager for Keysight Technologies.  Read his bio.

Upgrading consumer technology is often advertised as being “easy,” and sometimes it is. But it’s the things they don’t tell you that can drive you crazy. That new cell phone looks sleek and perfect—until you realize you now have a drawer full of charging cords you can’t use. That high-resolution, eight-inch display in the new car is beautiful—except now you have to pull over to the side of the road to change the radio station.

 

Refreshing test technology can be like that, too. There are advantages and pitfalls, but a basic truth is this: No matter how much better your test floor will run after a technology deployment, getting there requires some disruption. The key is to minimize it. In test environments, that means addressing at least the following four things before you sign the P.O.

TL_1.png

 

Measurement capability

In my experience, customers who purchase new test equipment usually fall into one of three categories. Some buy too much functionality and end up overpaying for their particular needs. Others buy too little functionality and then need to allocate more funds to either upgrade their system or trade it in on a more powerful instrument. The third group—those who buy exactly the right amount of functionality and measurement accuracy for their unique needs—are in the sweet spot. To make sure you fall into that third category, take a fresh look at your products and development plan. Understand exactly what you need to be able to test today, and try to anticipate your test needs 18 to 24 months down the road. Chances are, your new test system will be faster, smaller, and maybe even simpler to operate, but if it can’t measure what you need it to measure today and a year from now, with the accuracy you need, nothing else matters.

 

Code compatibility

I’ve been told that the cost of creating new code for test sets can be up to three times the cost of the instrument. That’s a sobering thought. What’s more, the speed with which code is deployed affects how quickly you can get equipment up and running. Although many instrument suppliers claim to have code-compatible equipment, be careful and read the fine print. Many companies simply transfer existing commands to the new equipment, so your old programs run the same way on new equipment that they did on your old systems. Even though you purchased state-of-the-art equipment, performance stays the same. It’s like buying a new hybrid car and disabling the EV battery, so you’re getting the same gas mileage that you got with your old car. An even worse outcome is if performance degrades. With old programs running on the new equipment, measurements might not perform the same way, giving you inaccurate or misleading results.

 

Physical envelope

Does a new instrument need to fit into an existing rack? Is floor space limited or being reallocated? This is a case where a little planning goes a long way. Just as you measure the doorways at home before buying a new couch or a high-tech workout machine, make sure your new equipment fits the physical space you’ve allocated.

 

User interface

Does your new equipment have the right connections on the front and back panels? If not, there’s usually a workaround, so it’s not a showstopper. But like the new cell phone that has a completely different charger interface, it’s a good idea to avoid surprises—and deployment delays—whenever you can.

 

The good news is, there will always be newer technology. That’s the challenge, too. But with a little planning, your next technology refresh can be smooth and even transformative for your test floor. I won’t describe it as “easy,” but done right, it can be surprise-free.

 

What about you? What’s the most interesting surprise you’ve had when updating equipment in your test environment? I’m always interested to know what my fellow technologists are up to.

 

Duane Lowenstein is a Test Strategy Analysis Manager for Keysight Technologies. Read his bio.

During our annual spring-cleaning, my wife commented that we have not made any upgrades to our home since we bought it nearly ten years ago. I mentioned that we had the exterior painted, had the driveway sealed, replaced appliances, and got new floor coverings. Those count, right? Sure, she said, but those are maintenance items. She’s ready to renovate: New kitchen, new bathroom, new fixtures, new floors. She was looking at our house through a 10- to 20-year lens, and making a long-term investment in a house we like and a neighborhood we love. I was looking just a few years out, thinking wshutterstock_417005893.jpge might downsize to a new home in two or three years when we’re empty nesters. Both are valid points of view whether you’re talking about renovating a home or a test environment.

 

At work the following day, I was discussing options with my team for dealing with aging test stands and test equipment that was approaching obsolescence. Should we spend our budget extending the life of the current technology, migrate incrementally to newer technology, or start from scratch with a fully modern test floor? Each strategy is viable, each has its pros and cons, but like the home discussion I had with my wife, there are considerations that go beyond purchase price.

 

Short view? Extend.

How long do you need to use the equipment you have? If you just need two or three more years out of it, then extending the life of your equipment is the easiest way to go. You just need to keep the equipment running—there’s no need to research new technology, write new software, or re-validate and requalify measurements. There are drawbacks, of course. As I mentioned in a previous post , it gets harder to find replacement parts for older equipment, downtime tends to increase, and the speed and accuracy of older equipment tends to lag behind newer equipment. Some companies use what I call the “eBay strategy” to cope: they stockpile older instruments for spare parts. It can work for a few years, but after that, the test systems and stockpiles often return to eBay.

 

Long view?  Modernize.

New technology is faster, more accurate, and can revitalize your test program with more capability, more features, and equipment that’s covered under warranty. It comes at a cost, though, and not just hardware. You’ll also need to address software, measurement verification, racking and stacking, training, code compatibility (if needed), and new processes on the test floor. Modernization works great when there is an inflection point in the technology you need to test on your product. It’s also a compelling strategy if there’s a breakthrough in test technology that will make you more competitive, or if you have long-term production needs that require an upgrade in throughput or capacity. Like renovating a house, modernization can be daunting. But many times I’ve seen companies achieve a 100 percent return on investment in as little as six months, and the competitive advantages can be dramatic.

 

Mid-range view? Migrate.

With an incremental migration, you replace only the underperforming assets—the oldest, slowest, least accurate, or least reliable instruments. This allows you to minimize hardware and software changes, and incrementally increase reliability, reduce test time, increase accuracy, and minimize downtime. You’ll have some capital costs for new equipment, and you may have to address code compatibility, requalify some of your products, and continue to deal with occasional unplanned downtime. But for production lines that need to keep running without interruption for four to ten years or more—typical of the aerospace and defense industry, for example—this can be a good strategy.

 

There’s no one-size-fits-all answer to building the right test environment, but there is a common set of questions that should be asked. How well is your current environment working? How long do you need it to work? What are your competitors doing? What products are coming? What do your budgets look like today versus next year? What’s your total cost for testing your products? How much could you improve test results by replacing one, two, or three instruments? The key is to look at your test investment from all angles, move forward with a plan, and be willing to re-evaluate as conditions change.

 

Duane Lowenstein is a Test Strategy Analysis Manager for Keysight Technologies.

 


 

I have a friend who owns a classic old BMW. He loves that car. It’s fast, reliable, and fits him like a glove. It has plenty of bells and whistles—nothing like the newer models, of course, which are rolling data centers. But that’s part of the appeal. There are fewer parts to break. Except that now, when they do break, it’s an odyssey. Replacement parts are getting harder to find and can be shockingly expensive. And it’s harder to find technicians who know the model and can diagnose problems. The numbers just aren’t what they used to be. A car that for years was inexpensive to operate and easy to own is suddenly throwing big, unbudgeted expenses at its owner.

BMW_Duane_Article.png

 

Test systems are a lot like that old BMW. With steady maintenance, they can run flawlessly and improve your bottom line—until they don’t. At some point, even the best-maintained systems give way to repairs that cost a little more, take a little longer, and leave you with unplanned downtime. As you begin to see increases in maintenance costs and downtime, you’ll know it’s time for a technology refresh. The good news is, you can expect to see four bottom-line impacts almost immediately when you upgrade your test systems.

 

1. Higher throughput

Technology keeps advancing, so newer test systems are not only faster but also more accurate. The cost savings here are compelling. If you currently need, say, nine test stations for your product line, and new test systems are 33 percent faster, you can get the same throughput with six test stations that you’re currently getting with nine.

 

2. Lower OPEX and maintenance

To carry the example further, some would argue that it costs less to own nine fully depreciated test stations than to purchase six new test stations. I would argue the opposite. Nine test stations require nine operators whereas six test stations require six operators—a recurring annual savings that continues every year. Six test stations also means you’re consuming one-third less floor space, one-third less power for heating and cooling, and one-third less electricity to run the systems.

 

What’s more, older systems typically need to be calibrated every year whereas newer models have a two- or three-year calibration cycle. So you’re reducing not only the number of systems you’re maintaining but also the amount of maintenance required for each.

 

3. Less downtime

Unplanned downtime is a special kind of misery and an expense that’s hard to control. It upends manufacturing schedules and deadlines, interrupts nights and weekends, jeopardizes commitments, and bleeds profit. Some companies never recover. Newer equipment tends to be more reliable, and repairs are covered under warranty. In some cases—as with Keysight instruments, for example—a standard three-year warranty can be extended up to ten years, so you can know exactly what your maintenance costs will be for the life of the equipment.

 

4. Lower CAPEX

New equipment triggers a near-term increase in capital expenses, but after the initial bump, CAPEX trends lower over the life of the equipment. And remember that a spike in CAPEX is offset almost immediately with lower OPEX, overhead, and tax deductions. Many of the companies I work with see 100 percent payback on a modernization investment within a few years, then ride a downward slope on CAPEX for the rest of the time they own the equipment.

 

It’s a fact that every machine reaches end-of-life at some point. Having consulted with over 100 companies on major technology upgrades, I can attest to a simple truth: Planned upgrades cost less and provide better outcomes than emergency fixes. Your mileage may vary, but in general, newer test systems are faster, more reliable, more accurate, and have a lower total cost of ownership. And let’s face it, that new-car smell is pretty nice once in awhile.

 

What business benefits could a technology refresh have for your company?   What is stopping you from starting a modernization initiative?

 

Duane Lowenstein is a Test Strategy Analysis Manager for Keysight Technologies.