The Challenge
Our client is an Australian manufacturer of quality aluminium foil trays and oven-able paperboard trays. An industry leader, they operate in Australia, New Zealand and Malaysia, servicing various industries including supermarkets, food service and hospitality. Strong growth has led to exporting to South East Asia, the Pacific Rim and Pacific Islands.
Due to continued sales volume growth the business relocated its manufacturing facility to larger premises and need to upgrade production processes to meet the increased production requirements. It soon became apparent the entire supply chain system was inadequate and scheduling on the shop floor was chaotic.
Challenges facing the business included:
- Poor inventory management;
- Unreliable forecasting;
- Ineffective scheduling system;
- Manufacturing inefficiencies through excessive delays and idle time; and
- Poor client satisfaction standards including low ratings in Delivered In Full, On-Time.
Our Solution
Phalanx Consulting conducted and facilitated a full diagnostic review of the scheduling process through cross functional team workshops. Tools used included Value Stream Mapping and Cause and Effect Profiling to develop an improvement implementation plan.
Recommendations included:
- Improve the communication between all departments through formal workshops;
- Review finished goods and raw materials inventory holdings and optimise by using the Lean ‘Pull System’ tool and create a supermarket for high volume products based on historical data;
- Use ‘Kanban’ for every day scheduling and raw material ordering process;
- Improve the current scheduling process by cutting out wasteful processes;
- Define responsibility for each department to ensure accountability;
- Capture and communicate raw material quality data to improve the current quality rate; and
- Conduct team workshops to train and implement the new processes involving all relevant staff to ensure top down buy in to reduce change resistance risk.
Results Delivered
Over a 6 month period each recommendation was implemented with the following results:
- Improved scheduling process to reduce waste: 14 process steps reduced to 5;
- Scheduling process cycle time reduced by 75%: 413mins down to 101mins;
- Reduced time spent on scheduling and chasing orders by various departments:
- Customer Service: saved 4 hours a week;
- Supply chain: saved 2 hours a week;
- Production: saved 2 hours a day;
- Effective use of the existing MRP system; and
- Improved communication between departments.