Breakaway Lean Kaizen Events|Case Study
driving worldwide business excellence
 
Kaizen Events

3 Breakaway Lean Kaizen Events - The Details

Kaizen Event A

Mold equipment tooling (Injection Molding) manufacturer (High Variety - Low Volume)

  • 2200 team members worldwide
  • $600 Million sales
    • Kaizen Event - Order Entry and Sales Process
    • 5 day Kaizen event with 18 cross functional team members

Results:

  Metric Results
1. "Order to Ship" lead time Reduced from 42 days to 7
2. Number of tasks Reduced from 109 to 21
3. % of Value Added tasks Increased from 11 to 32%
4. Distance traveled Reduced from 4000 feet to 180 feet
5. Number of Process Handoffs Reduced from 18 to 2
6. Number of Queues Reduced from 10 to 1
7. Queue size Reduced from 46 to 3

As a result, revenue increased from $1.3 million per quarter to $4.2 million with no increase in labor inputs.


Kaizen Event B

Tier 1 automotive electronics parts manufacturer

  • Supplier to DCX, GM, Honda, Ford world wide
  • 474 team members at the Canadian plant
  • $340 Million sales
    • Kaizen Event - Engineering Change Notification Process
    • 5 day Kaizen event with 18 cross functional team members

Results:

  • ECN types rationalized - Number of ECN types reduced from 6 to 4.
  • ECN is approved by directly - responsible team members, with notification sent to associated personnel - Number of signatures required for ECN approval decreased by over 50%.
  • “Loop is closed” by revised ECN process (refer to Team II presentation - ECN can be closed only when all applicable checklist tasks are completed) - Reduced the number of checklist tasks by an average of 40%.
  • Any ECNs related to an “original” ECN will be assigned the same ECN number with a suffix (i.e. 06230,06230a, 06230b) - Enables easy tracking and linkage.
ECN Types & Approval Original Count Kaizen Count Reduction in count % Reduction
ECN Types 6 4 2 33
Approval Signatures
Type 1 28 13 15 54
Type 2 21 10 11 52
Type 3 11 2 9 82
Type 4 15 10 5 33
Type 5 19 13 6 32
Type 6 19 8 11 58
Total 113 56 57 52
 
Checklist Original Vs Kaizen Original Count Kaizen Count Reduction in count % Reduction
Number of Check Lists 16 14 2 13
Check list Items
Manufacturing Engineering 11 9 2 18
Quality 9 8 1 11
Test Engineering 3 2 1 33
Customs 4 0 4 100
Sales Administration 3 1 2 67
Assistant Production Manager 7 5 2 29
Buyer 11 4 7 64
Master Scheduler 11 8 3 27
Cost Accountant 3 1 2 67
Designer 4 6 -2 -50
Product Eng. Electrical 8 5 3 38
Product Eng. Mechanical 8 3 5 63
Product Eng. Software 8 4 4 50
Information Systems 4 0 4 100
Engineering Supervisor 2 1 1 50
Program Manager 14 10 4 29
Total 110 67 43 43

Kaizen Event C

Project and Scope

  • Review current process for improvement opportunities and NVA elimination.
  • Improve Procurement Approval Process and work flow.
  • Initiate migration to electronic forms and processes.

Measures of Success:

  • Increased Speed of Procurement
  • Reduction in Paper Records
  • Elimination of duplicate activities
  • Streamline Approval Process
  • Cost Savings (Forms, Labor) Time = $$

CURRENT MRO PURCHASES BASED ON FY2006 - $24,176,652

CDN TRANSACTIONS 4952 (Cheques)

Approx. 2000 Purchase Orders issued

Present State:

  • Manual system, Purchase Reqs travel throughout the organization to various approvers
  • Mgmt approval required on every order
  • Large Inventory of paper documents, files etc.
  • Many POs have to be typed and mailed
  • Long wait times for approvals
  • Numerous NVA, faxing, copying documents, filing etc.

Proposed State: (next 4-6 wks)

  • Daily meeting for Mgmt Purchase Req Approvals
  • No Mgmt approval required for orders less than $500
  • PR can go direct to Purchasing
  • Engagement of up to approx 50 additional Suppliers on Blanket Pos, no additional records required. Can be activated via phone call etc.
  • AP will track spend against purchase orders

Future State: (10-12 wks)

  • Move to electronic Purchase Req and Purchase Order
  • Electronic work flow Tracking via Intranet portal
  • Significant increase in speed of processing and approvals
  • Elimination of all hard copy records and forms
  • Full spend history and record retention capability
  • To be designed in-house by IT Dept.
SCORECARD Present State Proposed State Future State
Cycle Time (Days) 4.5 2 1
Value Added Time (Minutes) 32 27 15
Number of Team members 8 4 4
Number of touches 11 4 4
Number of steps 15 11 4
Inventory of orders 10 10 10
Distance traveled (Feet) 800 750 0
Value Added time 1.42% 2.81% 3.10%
Avg Processing Cost per order $94.05 $40.30 $20.00
Annual cost for order processing $188,107.00 $80,607.00 $40,607.00
Savings $0.00 $107,500.00 $147,500.00

Average Number of orders per year = 2000

Number of cheques issued per year = 4990

Average salary is $25/hr

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