
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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Additional References
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