Goal of the analysis:
The goal of this analysis is to maximize product yield in the production process while minimizing waste. By improving yield and reducing waste, a company can lower production costs, enhance environmental sustainability, and optimize resource utilization, making the entire operation more profitable and sustainable.
Data required:
- Total raw materials input (in weight or volume) for the production period
- Total product output (in weight or volume) for the same period
- Waste generated (in weight or volume), including unusable by-products or residuals
- Material costs associated with raw inputs and waste disposal costs
- Industry benchmarks or standard yield percentages for similar processes
Detailed step-by-step instruction on how to conduct the analysis:
1. Calculate Product Yield Percentage:
Product Yield (%) = (Total Product Output / Total Raw Materials Input) x 100
For example, if 1,000 tons of raw materials result in 850 tons of final product, then:
Product Yield (%) = (850 / 1,000) x 100 = 85%
2. Determine Waste Percentage:
Waste Percentage = (Total Waste Generated / Total Raw Materials Input) x 100
For example, if 1,000 tons of raw materials produce 100 tons of waste, then:
Waste Percentage = (100 / 1,000) x 100 = 10%
3. Calculate Cost of Waste:
Multiply the waste percentage by the material cost and any disposal costs to find the financial impact of waste.
Cost of Waste = (Total Waste Generated x Material Cost per Ton) + Waste Disposal Cost
4. Analyze Sources of Waste in Production Process:
Review each step of the production process to identify where significant waste is generated. Focus on stages with the highest waste ratio or deviations from target yield percentages.
5. Benchmark Against Industry Standards:
Compare the facility’s product yield and waste metrics with industry benchmarks. Low yield or high waste relative to competitors may suggest opportunities for process optimization.
6. Evaluate Yield and Waste Patterns:
Track product yield and waste over time to identify any seasonal trends or shifts linked to process variations, raw material quality changes, or other operational factors.
Format of the output of analysis:
- Product Yield (%) – single metric
- Waste Percentage (%) – single metric
- Cost of Waste – financial impact summary
- Process map indicating waste sources and yield losses
How to interpret results:
- High product yield (close to industry benchmarks or above): Indicates efficient use of raw materials with minimal waste generation.
- High waste percentage: Suggests inefficiencies within the production process that could benefit from improvement efforts.
- Cost of waste: Highlights the financial impact of waste, indicating potential savings from yield improvement initiatives.
Steps a company can take to improve on this measure:
- Optimize Raw Material Use: Experiment with different raw material formulations or suppliers to find higher-yield materials.
- Invest in Process Improvements: Evaluate and adjust production parameters (e.g., temperature, pressure) to reduce waste generation and improve yield.
- Implement Real-Time Monitoring: Use sensors and analytics to monitor production in real-time, identifying deviations from optimal yield that can be corrected immediately.
- Enhance Staff Training: Train operators on yield optimization techniques, focusing on waste reduction and careful handling of raw materials.
- Focus on Waste Reuse or Repurposing: Identify opportunities to recycle or repurpose waste by-products in other parts of the production process or sell them as secondary products.
Request the PDF Download of How to Analyze a Chemicals Company
