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Problem

Heavy fabrication business suffered multi-year losses since its acquisition. A turn-around in the profitability was crucial to their success and continued operation.

Approach

  • Understand through gemba walks the excessive part travel (7.5 miles in some cases for a shop ~1000′ long), high inventories (15+ large part pile-ups), and poor flow (frequent starts and stops).
  • Improve the uneven process tension due to the few bottleneck processes using Theory of Constraints with lean table-top simulations.
  • Focused on a Plan For Every Part (PFEP) to avoid inventory build-ups.

Recommendations

  • Schedule and synchronize with suppliers for Just In Time (JIT) delivery of contracted operations.
  • Implement the hourly team’s spot welding innovation for multi-head array to reduce this critical operation’s cycle-time.
  • Rearrange the sub-component fabrication in a flow line with standard kits and standard work deployment.

Results

  • $264k variable cost reduction (labor productivity) vs. 50%+ cost overruns previously.
  • 25% spot weld cycle time improvement from innovative design change.
  • 50% part travel reduction.

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