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LEAN
Education, data and kanban drove
slow and steady success at Victaulic
By Dina Manoway
Lean manufacturing principles often seem like common sense eliminate waste
to boost productivity and improve quality. According to
research from the Lean Enterprise Research Centre, which estimates
that as much as 60 percent of a manufacturing operation fails to provide any
value to end customers, implementing
lean should be fairly straightforward.
But the reality is much more complex. Lean is not a starting point or a
switch that can be flipped to build a better business overnight. Being lean is the
result of a well-run operation, one that
can be achieved only with careful plan-
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FIGURE 1
Pair employee engagement with education, and dont be afraid to learn best
practices from other organizations. In
fact, lean leaders at Victaulic learned
from other companies that the best way
to communicate with employees was to
identify and train the leaders who would
execute the lean implementation plan.
These leaders were responsible for getting the plan off the ground and keeping it going. They would help create the
lean implementation plan, run events,
develop clear goals, measure progress,
address problems and perhaps most
importantly work with employees to
turn their ideas into actionable lean processes.
Selecting the right leaders was crucial.
Focus on developing a cross-functional
team, hand picking individuals with
good communication and training
abilities, forward thinking attitudes and
change management skills necessary to
drive effective change in their department. At Victaulic, these leaders also
represented different areas across the
business, including sales, quality, operations, customer care, supply chain and
finance to name a few. Ensuring key
departments were aligned made the lean
implementation more seamless and impactful.
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FIGURE 2
Customer delivery
The lean program increased on-time delivery rates to more than 97 percent for both
stock and nonstock items.
ered within 48 hours, and just 32.4 percent of nonstocked items were delivered
by their promised lead-time, as shown
in Figure 2.
Through lean initiatives, most notably the switch from a push system to a
pull/kanban system, todays delivery
rates top 97 percent for both stock and
nonstock products. Quality took center stage in a company culture shift as
employees took an active role in moving
the needle closer to customer satisfaction
by making sure products were delivered
on time, fully correct and with product
integrity intact.
Kanban:
A signal for production
Developed at Toyota and named after the Japanese word for visual signal,
kanban is a way of managing production and the supply chain. By breaking
inventory up into container quantities,
when a container is emptied, a visual
signal is generated to alert factories that
material, whether that material is a finished good at a distribution center or an
internally manufactured or purchased
component, needs to be replenished.
Additionally, in-process kanbans are
used to eliminate the long supply chain
for purchased materials and items that
go through multiple manufacturing
steps. For example, having all components for a coupling on kanban and in
a supermarket next to the assembly pro-
cess shortens the lead-time for the finished good by eliminating the upstream
manufacturing or purchasing processes
needed to make or buy the components.
Using kanban can completely transform
a companys supply chain, as it did for
Victaulic.
Prior to implementing lean, Victaulic
factories operated the same way many
others across the industry do. They estimated how many parts to produce
based on old history in monthly buckets and with poor forecasting, made
them in large batches and transferred
them between distribution locations to
keep supply levels balanced. This led to
double handling, wasted capacity and
excess labor, all things lean manufacturing is designed to identify and eliminate
because they provide no value to a customer.
In the new pull system, every time
a container quantity was emptied, it
triggered demand. This allowed for
more frequent and smaller quantities
to be produced at the factory. The factory could then manage its production
schedule far better and improve the supply chain dramatically. This improved
process, along with the implementation
of Victaulics new product delivery system, cut delivery time from 30-plus days
to three to eight days on average, enabling the company to react nimbly and
quickly to customers changing needs
around the globe.
Customer benefits
improve partnerships
At its core, lean principles are about using minimum resources to create maximum value for customers.
Victaulics supply chain transformation displays this well. For customers, a
better supply chain meant shorter leadtimes and meeting commitment dates.
Shorter lead-times meant they could
set their own schedules with more certainty. They were quick to point out to
Victaulic officials when faster parts delivery made a difference in finishing a
project on time or even ahead of schedule. As a result, Victaulic elevated its position from being a product supplier to a
problem-solver, making it a much more
valuable partner.
Once the initial product delivery
strategy of replacing push with pull/
kanban was completed (along with a basic introduction of the rest of the lean
tools), putting site leaders in place and
training employees to make lean principles part of the companys culture
brought about significant lean improvements. Known as facilities excellence
mapping, this program ensures that lean
and lean Six Sigma tools are used continuously to drive out waste in all facets
of business. This enabled Victaulic to
make dramatic changes to some of its
longtime processes.
For example, at the Victaulic Forks
Facility, one change included reconfiguring the manufacturing floor to
cut down on wasted movement and
increase employee safety by eliminating repetitive stress. This move reduced
incidents and injuries. Reorganizing entire facilities resulted in the operation of
fewer vehicles, reducing equipment and
fuel costs. Simple things like arranging
equipment together in U-shaped configurations in the order it is used, along
with bigger changes such as putting
components at their point of use, greatly
reduced the use of fork trucks.
Lean advantages began to emerge as
employees and leaders became more adept at spotting ways to improve. Three
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