Our client began the transfer of 22 additional injection molding presses from a plant in the USA to a plant in Mexico, which was staffed to operate only the 28 machines that were currently there. The 22 machines were repositioned to Mexico bringing the total operation to 50. Given a variety of system, process, and staffing issues, both quality and output suffered:
- OEE% bottomed out at 57%.
- FQFT% yield in the paint room plummeted to 30%.
- This resulted in daily customer outages, premium freight and other off-standard costs of approximately $5 million per month.
Within a few weeks, the CCO recovery team arrived and immediately began the implementation of our OpEx method. This included a system-wide 5S campaign that drove discipline, ownership and helped optimize the factory footprint to allow more machines to be installed.
We also set up an accountability room where plant leadership drives a daily comprehensive operational performance review. Various communication boards are placed around the room with process/data owners assigned. Each day, assigned personnel are accountable for updating their boards with previous day performance and explain any deviations. Action items are assigned, and corrective measures are confirmed before closing. The accountability room serves as the communication hub for all KPI’s related to safety, quality, cost and delivery.
30% to 80%
Additionally, there was an 84 to 48 lift truck reduction, demonstrating increased efficiency and better safety, as well off-standard cost trend reversed in 45 days (>$30M accrued in previous 6 months).
With a collaborative, get-it-done approach, we put the plans in place to ensure a successful plant transition. While most consultants put a major focus on managing cost reduction; we pursue solutions oriented to managing profit. PACE boards were used to set the cadence or tempo of the production lines. OEE% began to improve, customer outages/backlogs started to decline. Through the rapid deployment of our OpEx method, we quickly helped our client win control over their business operations.