LeanSigma
– Operations Project Examples
Business
Issue: A global supplier of industrial vehicles and
portable electric power units recognized the need to combine four
manufacturing locations, all operating well below capacity, into one
manufacturing location in order to maximize their return on capital
and minimize production impact caused by large demand fluctuations
within each location. Total revenue being generated by all three locations
was slightly above $200 million
Approach
Used:
A team of Flow Consulting professionals worked with the client to:
1) Develop a vision of what the new combined site would be based
on maximizing flow and implementing flexible lean manufacturing
concepts.
2) Sell the implementation plan to the Board of Directors
3) Perform a detailed analysis of all product lines to determine
optimum operating and floor space loading. Created a 'dynamic loading'
analysis to allow us to model changes to the site as the volumes
change every year.
4) Develop the overall project plan (1800 step Gantt chart in Microsoft
Project) and trained a project team in the tools to ensure a successful
move
5) Run a series of three day Accelerated Problem Solving
sessions linked to key project milestones utilizing cross functional
teams of hourly personnel, engineers, purchasing agents, and supervisors
to lay out the new production areas with lean manufacturing frameworks
6) Project manage every step of the Gantt chart, with real time
reactions and corrections as needed
7) Provide quarterly updates to the board of directors of the firm
Results:
All
four businesses are now operating as one entity at one location with
shared resources and movement of hourly personnel as needed to support
business fluctuations. The business has achieved over $10 million
reduction in fixed costs and sold the two closed locations for $5
million. Each product line that moved experienced over a 35% reduction
in direct labor costs, over a 50% reduction in cycle time, and up
to a 65% reduction in floor space required.
Business
Issue: Microchip test equipment manufacturer felt
their manufacturing cycles were too slow and their product costs were
too high
Approach
Used: Implemented comprehensive
leadership driven Lean Enterprise principles and a series
of Accelerated Problem Solving sessions with both exempt
and hourly personnel
Results:
27%
reduction in direct labor,53% reduction in cycle time, 59% reduction
in required floor space, and 38%reduction in defects found at test.
Business
Issue: Automotive original equipment manufacturer
felt that their brake puller cycle times were far too long and their
inventories were excessive.
Approach
Used: Used Lean
principles and an Accelerated Problem Solving session, we
moved from a process centered product flow to a product focused cell
Results:
On
a $47 unit cost, reduced production cost by $6.17. Reduced in-process
and raw stock inventory from over $600,000 to $19,000. Reduced customer
response time from 30 days to 3 days.
Business
Issue: Die casting supplier in automotive original
equipment had unnecessary machine downtime caused by product scheduling
and setups
Approach
Used: Ran a series of
Accelerated Problem Solving Sessions focused on uptime, productivity,
and setup reduction.
Results:
The
uptime team uncovered an extra 22 hours of production per week netting
over $1M in additional product per year. The productivity team reduced
prep staff from 18 to 12. The setup reduction team reduced the die
changeover time from an average of 33 hours to an average of 8.2 hours
with very little investment, resulting in an additional 500 hours
of additional production time of production per month.
Business
Issue: A global manufacturer of pharmaceutical products
was experiencing frequent packaging line stoppages of a common over-the-counter
cough syrup. Production costs had risen to erode margins on this product.
Approach
Used: After a brief data
collection period in which line stoppages were recorded for cause
location and duration, a kaizen team was assembled. The team was given
the goal of increasing overall line throughput from 23,000 bottles
per shift to 35,000 bottles per shift. The team used a combination
of root cause analysis, SMED, and Standardized Work techniques to
improve line performance.
Results:
Within
the duration of the three day kaizen, several changes to the line
equipment were implemented to overcome root causes of several key
problems. Line output increased to approximately 30,000 bottles per
shift immediately. After two months of operation and incorporation
of remaining changes proposed by the kaizen team, line output has
risen to a stable output of 51,000 bottles per shift. The cost of
implemented changes was less than $5000.
Business
Issue: A technology start up division of a major US
manufacturer needed clear definition of product specifications to
meet customer needs and to better understand the timing of customer
requirements.
Approach
Used: Flow Consulting
collected extensive customer information through face-to-face and
phone interviews, as well as electronic and web-based surveys. This
database of information was used to guide a workshop of company executives
and engineers through a thorough Quality Function Deployment (QFD)
analysis to develop a detailed product specification and marketing/product
release strategy.
Results:
The
team successfully developed and launched two new products in less
than 12 months with positive customer acceptance, instead of the single
product planned for 18 month delivery. The analysis uncovered a potentially
fatal flaw in their product release strategy that would have brought
the wrong product to market too late for a key "benchmark"
product comparison contract by the number one customer. The analysis
resulted in defining two customer groups with significantly different
product requirements and price points. The customer interviews also
determined that an extremely negative perception existed of companies
using the original product and marketing strategies.
Business
Issue: Very successful producer of kitchen gadgets
and household tools experiencing lengthening product development cycle
times and slowing rate-of-sales growth.
Approach
Used: Carried out Business
Baseline to analyze key contributors to the problem, and redesigned
organization structure into product development teams, facilitated
streamlining of new product development process, coached on teamwork,
scheduling, and communication skills and tools.
Results:
Early
indications that cycle times are shortened by 25 percent, significant
reduction in errors and rework, and 20 percent increased capacity
for new products (expected to increase rate of sales growth by 25
percent).
Business
Issue: Pharmaceutical company facing significant challenges
to cut manufacturing costs
Approach
Used: Accelerated
Problem Solving workshop implemented to analyze process and quickly
find and deliver opportunities for yield improvements in mixing and
packaging processes.
Results:
Within
two weeks delivered $75,000 in annualized savings and designed relatively
simple and inexpensive equipment and procedural improvements that
would deliver an additional $500,000 in annualized savings within
one month.
Business
Issue: Chemical producer needed significant increases
in production capacity to meet demand.
Approach
Used: Ran an Accelerated
Problem Solving session to identify and deliver inexpensive capacity
increases.
Results:
Cross-functional
team identified inexpensive equipment modifications, scheduling changes,
and procedure changes that generated 15 percent capacity increases
within the APS week with no significant capital investment required.
Business
Issue: Pharmaceutical producer suffered from limited
capacity and erratic schedule compliance requiring significant safety
stocks to assure supply.
Approach
Used: Using Six Sigma
tools, focused on cycle-time variability. Analysis showed variation
in delivery of utilities (vacuum, refrigeration) contributed greatly
to cycle time variation.
Results:
With
only minor modifications to equipment, and using available process
data for careful cycle-time monitoring, cycle-time variation was reduced
significantly. Consequently, the average process cycle time was reduced
from 12 to 9 hours, increasing capacity by 33 percent. Safety stocks
could be reduced by 25 percent.
Business
Issue: Manufacturer of replacement parts for oil producers
had lengthy manufacturing cycles, excess inventories, and slow response
time to emergency customer outages.
Approach
Used: Ran an Accelerated
Problem Solving session with a cross-functional team of exempt
and hourly employees using lean manufacturing principles.
Results:
Reduced
manufacturing cycle from eight weeks to one week, with a 60 percent
reduction in work in process inventory.
Business
Issue: Power generation equipment manufacturer had
divested a portion of their business. Plant facilities were vacated
and client needed to align the facility to meet expected growth.
Approach
Used: Utilized Simplified
Systematic Layout Planning (SSLP) techniques to strategically
align plant site utilization with product line growth and technical
requirements.
Results:
Relocated
low-tech subassemblies to low cost facilities and utilized premium
floor space for high-end production and assembly. Allowed client to
position itself for growth and addition of new product offering.
Business
Issue: Repair and Overhaul shop for aircraft brakes
needed to reduce cycle time to remain ahead of the competition.
Approach
Used: Utilized Lean
Manufacturing and Set-up Reduction techniques to structure
manufacturing processes into production cells focused around product
families.
Results:
Work in process inventory was reduced, lead times were reduced and
delivery times stabilized to a consistent time frame as a result of
Lean implementation.
Business
Issue: Manufacturer of soft ice cream delivery systems
was experiencing long manufacturing lead times and poor inventory
control.
Approach
Used: Implemented a Flow
Technology production line including implementation of Kanbans
for reordering material from suppliers.
Results:
The implementation of Flow Manufacturing by the process improvement
team achieved a 75 percent reduction in lead time (four weeks to one
week) and a 27 percent reduction in touch time (from 550 minutes to
400minutes). Utilization of Kanbans resulted in an improvement in
inventory turns from five turns to 12 turns and improved inventory
control.
