Situation

A factory belonging to an industrial multinational company presents productivity and efficiency problems in its production processes, and hence profitability, below the desired standards. The lack of productivity and profitability has several causes.

For one, the processes are not standardised. As a result, the workforce is not properly sized, there is no 5S philosophy, and there is a lack of digitisation that allows obtaining real data, which affects the lack of clear and reliable KPIs to measure results. The company produces a high-quality product and has a good image in the market.

Challenges and action

After an initial analysis, the interim plant manager designs and implements a transformation plan that achieves the following results in just 6 months:

• Processes are defined and implemented, as well as controls that ensure compliance.
• A standardised training plan is implemented for plant operators so that they learn to manage all production lines correctly.
• Thanks to the training of operators in different parts of the production process, it has been proven that the same person can operate different machines at the same time. As a result, the number of production workers can be reduced by a relevant amount (around -28%).
• The plant is organised according to its workflows and is cleaned. This reduces execution times and improves productivity.
• Scrap production is reduced by almost 40%, from 8% to 5.5%. This improvement has a positive impact on production costs.
• In addition, a material recovery and reuse plan is being implemented in the production process.
• Better control over raw material inventory. This avoids large fluctuations due to perceived material losses each month.
• The purchase of auxiliary materials that are not needed has also been discontinued. An automation was discovered in the ERP that caused purchase orders to be launched that were not needed.

Results

After 6 months, significant successes had been achieved, so the company management saw an opportunity to continue generating profits and decided to give continuity to the interim manager.