Upgrade Your Cutting Capabilities

Five factors reveal the value of long-term cost efficiency

By Jeff Hluchyj and Tom Stillwell

Jeff Hluchyj is marketing product manager and Tom Stillwell is product marketing manager of software at Hypertherm Associates, Hanover, N.H

Reprinted with permission: The AWS Welding Journal

With the rising cost of today’s business operations, it can be enormously challenging to determine where to allocate our often all too limited resources. Most of us likely agree that to accelerate growth, investing in innovation is imperative — in principle. When it comes down to dedicating actual dollars to new CAD/CAM software or equipment for automated plasma cutting, it can be difficult to rationalize the upfront cost of innovation, particularly if the solutions implemented don’t necessarily come with immediate returns.

While many businesses tend to think of their operations in terms of short-term expenditures, a fuller approach that centers on longer-term cost efficiency will ultimately deliver greater value. When assessing a new solution, here are the key cost-efficiency factors to consider as part of your exploratory framework.

1-Examine the Impact on Your Total Operating Costs

We don’t always have an accurate picture of where the majority of our resources are truly allocated. For instance, when considering variable operations expenses, many businesses will point to upfront expenses like consumables as major cost drivers. In actuality, consumables typically account for a relatively low percentage of total expenditures. Labor, on the other hand, drives a far higher percentage, especially when you factor in the time spent on training. Before you can make a single cut of metal, other key variables like power and gas also need to be in place.

To achieve an accurate estimate of how a specific technology or system will benefit your business, you need to consider it in the context of your broader operational expenses. Ideally, most of that work will be done for you with tools like cost calculators, which demonstrate a solution’s cost-savings potential for a variety of conditions.

2-Invest in Technology That Optimizes Material Utilization

According to a market study conducted by Hypertherm Associates, Hanover, N.H., scrap material is a significant cost factor that drives down profitability. Innovations that focus on reducing scrap waste are especially valuable and can drive significant cost savings.

Solutions like automatic nesting software can also arrange a layout of parts to maximize what you can get out of a piece of plate metal, ensuring every cut counts — Fig. 1. For example, the increased material utilization offered by Hypertherm’s PlateSaverTM technology, which combines the company’s X-Definition® plasma cutting system with software parameters that maximize the number of parts on a plate, reduces costs by 3% per year on average.

3-Opt for Intuitive Solutions That Increase Productivity

Of all the factors that contribute to the cost of cutting metal, labor is one of the most unpredictable and by far the priciest. Through customer surveys, the company found that many manufacturers struggle with high operator turnover and a lack of skilled applicants to fill those roles, leading to new hires who are more prone to inconsistencies and errors. Even with highly skilled operators, working with consumables can be complicated, and customers reported common challenges like errors in system setup, confusion about which consumables to use for a job, and questions around when to change consumables. This can result in costly delays, rework, and material waste.

When considering new tools and technology, it’s crucial to seek solutions that have been engineered with real user needs in mind and solve for specific challenges based on actual user feedback. For instance, the Powermax SYNC®, a series of plasma cutting machines, is a streamlined solution that addresses customers’ most commonly reported pain points. Instead of the standard five-piece stack-up, which takes time to assemble and can lead to errors like installing the wrong part number, the company opted to use a one-piece cartridge consumable with an automated process setup. The one-piece cartridge is color coded to make it simpler for operators to identify the part they need. Additionally, the automated process setup reduces errors by automatically setting the amperage, operating mode, and gas pressure using embedded data. The product also issues error codes to help operators ensure correct usage. With this simplified system, businesses can increase productivity in a shorter span of time while reducing costly errors and system downtime.

Another factor should be considered: The more intuitive a solution is, the simpler and quicker it is to train operators to use it. More complicated systems might require expensive on-site training, whereas for simpler solutions, online tutorials and training instructions are sufficient.

4-Automate Tracking and Reporting to Drive Greater Efficiency

If you’re not tracking variables like material costs or plate utilization, or providing these reports to your team, you’re likely missing out on opportunities to increase the efficiency of your operations. Some software programs can do the heavy lifting for you by automatically tracking and reporting your most significant cost drivers, giving you valuable data that can help optimize your efficiency. For example, if you know your arc transfer rate is normally 85% and you get a report that it’s dropped, or you notice you are suddenly getting fewer starts, you know something is wrong and can make immediate adjustments.

In one instance, a customer noticed cartridge life was shorter at night. After analyzing the data gathered by

Powermax SYNC, the customer discovered this was due to the outside air temperature being lower at night, which affected air pressure to the system. With a slight increase to air pressure, the cartridge life was back to normal.

5-Investing in the Right Solutions

Increasing profitability and growth requires businesses to rethink the way they approach the allocation of their resources. By taking a broader view of cost-efficient

operations, businesses will discover that though innovation requires a greater investment up front, the cost savings can be significant in both the short and the long term.

Solutions that optimize the utilization of high-priced scrap material, address productivity issues brought on by an inexperienced workforce, and drive new efficiencies through innovations with data reporting are poised to offer businesses considerable boosts in profitability and can help advance their future growth. With such gains on the table, the question is not whether businesses can afford to invest in cost-efficient innovations; it’s how they can afford not to.  WJ