The following case histories have been selected to demonstrate some of the range of our management consulting activities. If any theme emerges from them, it is that the solutions we
provide often do not reflect the original diagnosis of the client.
We do not accept problems at face value, but look deeper to
understand the reasons why they occur. This leads to longer
term, strategic solutions.
- Plant Layout and Design
- Project Management
- Material Handling
- Warehouse Site Selection
- Operations Management
- Inventory Management
- Space Utilization
- Benchmarking
- Work Measurement
- Packaging Design
A Fortune 500 company needed a new manufacturing plant to meet
anticipated sales growth. They wished to institute a new
management style based upon high performance work groups, and they
were looking for innovative ideas for the design of their
operation.
Working closely with the management team, we studied the
operation, identified the client’s needs, and created new
designs for the workplace, plant, warehouse and material handling
systems.
Result: An innovative layout, significantly different
from the client’s established operations and designed for high
performance work groups. The new workplace design permitted
shorter runs with lower costs than in the client’s existing
plants.
Read our article about space utilization, "Space,
The Fractious Frontier"
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A major manufacturer of was using expensive public warehousing to
store finished goods. The warehouse was located 15 miles from
their manufacturing operation.
We located a nearby site, designed, planned, built and managed the
startup of a 400,000 square foot distribution center.
Result: A completed project that came in on time, below
budget and with the lowest operating costs of any center in that
corporation.
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A large paper company was planning to increase the diameter of the
rollstock that they shipped to their converting operation, 800
miles away. The expected benefits included: less waste at the
start and end of each roll; fewer rolls to handle, less frequent
roll changes; less floor space taken up with rolls. They were
about to start modifying their machinery to handle these larger
diameter rolls.
We questioned how the larger diameter would fit into the rail cars
for shipping and found that, because of the poor fit, there would
be far fewer rolls in each car. The added cost of shipping the
rolls would far outweigh the projected savings. The company stayed
with its current roll diameter.
Result: A saving in expenditure to modify all of the
machinery to handle the larger rolls.
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Our client was closing its southern operation and consolidating in
the northeast. They needed more warehouse space than the current
80,000 sq. ft. warehouse attached to their manufacturing
operation. We were asked to help them to locate a new site and set
up the warehousing there. Before looking for a new site, we
studied the operation and found that we could use the existing
warehouse space more effectively, eliminate excess inventories,
make use of other space within the building and eliminate the need
for an outside operation.
Result: A saving of $300,000 per year versus the
original plan, and no upheaval to the operation.
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A plastics company had taken on a new, multi-colored product line,
which was generating excessive scrap and regrind in many colors We
were asked for advice on the type of equipment they should
purchase to rework these materials.
Before advising on the equipment, we reviewed their operation. By
adjusting their production scheduling, we developed a strategy
which reduced the amount of scrap and at the same time allowed
them to recycle the regrind directly back to their extruders,
reducing costs and eliminating the need for any special equipment.
Result: a saving of $75,000 for the cost of the
pelletizer, less scrap and lower operating costs.
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6. INVENTORY MANAGEMENT
A large injection molding plant had recently undergone rapid
expansion. There warehouse was now overflowing and they were
considering ending a lease to a long time tenant who was paying
them considerable rent. We were asked to look at the layout
and see if we could improve the space utilization. Our
initial investigation revealed that the plant produced over 500
sku's and a typical run length for the "A" products was
one month. This led to large inventories. The plant
had 45 injection molding presses for which there were a total of
50 tools, indicating that there were few, time consuming, tool
changes, in fact most changeovers were simply packaging changes.
Further studies of ordering patterns led us to recommend a change
in strategy. By holding supplies of the major packaging
materials, it was possible to start manufacturing any product with
24 hours notice. This allowed a huge reduction in finished
goods inventory with associated financial and space benefits.
Result: savings in excess of
$250,000 per year from reduced inventories and retaining the
rental income.
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A paper company had consolidated two of its converting plants
into one location. Space was now very tight in that plant
and management was experiencing difficulties operating in the
congested environment. We were asked to review the layout
and advise on ways of better utilizing space. Our attention
focused on the warehouse, where space seemed to be particularly
poorly used. Product was picked from the warehouse on three
shifts, however shipping and receiving were done on only one
shift. This meant that product picked on the second and
third shift was staged near the loading dock doors ready to be
loaded into trailers on the first shift. Over 9,000 square
feet was being used simply for staging. By changing systems
so that trailers could be loaded on all three shifts, we reduced
this staging area to less than 1,500 sq. ft.
Similarly, three shifts worth of rolls of paper were being
delivered from a nearby warehouse on one shift, occupying space
for storage. Arranging for Just-in-Time deliveries staggered
over 24 hours freed up still more space.
Result: This plus
several other smaller improvements eased the space
"crunch" so that operations could continue without
building additional space.
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The client was buying specially designed packaging from a supplier
with whom it wished to continue its long working relationship. The
client felt that the product could be produced at lower costs.
We analyzed what the cost for manufacturing the product would be
in a world class manufacturing plant and showed how it could be
made for significantly less than the client was paying.
Result: Using the
benchmarking analysis as a reference, the client was able to work
with the supplier to reduce costs and improve the terms of his
contract.
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9. WORK MEASUREMENT
A large electronics
corporation maintains "Emergency Stocking Locations"
(ESL's) throughout the world where customers can obtain fast
service on spare parts. The corporation needed some means to
determine the staffing levels for each of these locations.
Although each location performed similar operations, the problem
was complicated by the non-recurring nature of the operations.
We constructed a series of
flowcharts that described each of the operations and used this as
a basis for time studies and informed estimates of the occurrences
of each function. From this information, we were able to
develop simple models that provided the staffing needs for each
location, based upon the activities at that location.
Result: A
simple, cost-effective, model with which the client could monitor
the workloads at each ESL and adjust the staffing levels to suit.
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The client was experiencing significant damage
during the handling and shipping of finished goods. Les Wood
Associates was asked to advise on the problem.
We recommended new handling procedures and used our own, specially
developed software to redesign the packaging to improve product
protection and better fit inside the shipping trailers. The
redesigned packaging was also less expensive than the original,
reducing the overall packaging costs.
Result: Less product damage and $100,000
per year saving in packaging and shipping costs.
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