New competitive pressures in the marketplace took this beverage manufacturer
by surprise. They realized that they had to quickly improve their manufacturing
output, reduce waste, and increase efficiency across several production
lines and plant locations if they wanted to stay in business long-term.
They also realized that they needed outside help to achieve these goals.
They hired HMC
because of their leading-edge expertise and their proven track record
in achieving sustained, significant production improvements.
The HMC team used its trademarked Holistic
Manufacturing methodology to perform a thorough and
comprehensive diagnostic of the manufacturing operation. The goal was
to benchmark operational results and to identify production bottlenecks,
causes of variability, and key areas of opportunity to increase output
and efficiency. This diagnostic was extensive and included collecting
large amounts of data, interviewing company personnel from the shop
floor to top management, and reviewing software programs, production
schedules, operational procedures, and company training policies and
The diagnostic analysis indicated declining productivity,
poor management controls, high levels of waste, and excessive manpower.
It also identified that the company was very inflexible and was unable
to adapt to change easily or effectively. Furthermore, there was an
absence of standards and procedures, poor maintenance of equipment,
numerous machine problems, and a general lack of training. There was
also an air of pessimism over the company regarding their inability
to turn things around.
As a result of their diagnostic work, the HMC
team members were able to identify several key areas for improvement
that would yield the greatest immediate return for the business. These
areas for improvement included:
The Organizational Structure
this area required a change in focus from managing the shift to managing
the lines and an improvement in teamwork and communications. These
changes would be essential to achieving lasting improvement.
The Operational Structure this
area needed to incorporate more performance measurements, better documentation,
and standardized procedures. This would ensure that disruptions would
be handled quickly and effectively and variability would be kept to
Training Methods this area needed to be updated and
augmented to enable more mastery among machine operators and to improve
reaction time to problems and disruptions.
Tracking Systems this area required new systems to provide
more data to the shop floor in order to give operators more immediate
feedback and enable better decision-making.
The tangible results to date have been astounding. Production
efficiency is up 27% on one line, 18%
on another, and an incredible 59% on a third line! Actual output
has increased to the point where the new average is higher than the
best single day output the company had ever experienced in the past.
Manpower has been reduced an average of 38% across
all lines and material waste has been reduced
by almost $300,000 per year. Another key area that the team addressed
was the reliability of central service systems, such as the syrup room
and plant services. HMC developed and
implemented tracking systems for these services that allowed people
to track performance and maintenance data. As a result, operators and
managers can now track any deterioration in compressor or chiller performance
and detect declining trends before there is a failure.
There have been numerous indirect
benefits as well, including improved delivery
times, better workforce morale, greater production flexibility, and
higher-skilled employees. All of these have enabled the company
to become more competitive in their marketplace and more responsive
to changing market conditions and preferences.