The application of lean manufacturing as a repositioning strategy.

1
The application of lean manufacturing as a
repositioning strategy.

• Colin Herron, One NorthEast
• Chris Hicks, University of Newcastle upon Tyne
  Business School

2
Air Bag Co.
Changed from American to French ownership in
2003. The new group manufactured similar
products. Cost were high, quality and moral were
poor and the company was threatened with closure.
The North East Productivity Alliance (NEPA)
supported the Company implement lean
manufacturing, which together with a change in
management resulted in survival with the company
becoming an exemplar within the Group.
3
North East Productivity Alliance

• Funded by One NorthEast, the Regional Development
  Agency for the North East of England.
• Objective is to disseminate lean manufacturing
  practices to improve the competitiveness of
  companies in the region.
• The methodologies used were developed in
  conjunction with Nissan and the Industry Forum.
• Companies were selected using i) Productivity
  Needs Analysis, which analysed competitive
  position ii) Manufacturing Needs Analysis that
  assessed processes and current problems to
  identify appropriate tools and metrics that could
  be used to achieve improvements.

4
Technology Transfer

• The Master Class was used as a mechanism for
  technology transfer.
• Change agents were identified and received
  structured training.
• Staff at all levels (particularly operators)
  received training leading to NVQ qualifications.

5
Selected Lean Tool

• Phase 1 Workplace management Genba Kanri
• 5Ss Seiri, Seiton, Seiso, Seiketsu, Shitsuke,
• Standard operations
• Skill control
• Kaizen
• Visual Management
• Phase 2
• Just-in-time
• Demings plan, do, check, act cycle
• Single Minute Exchange of dies
• Production led maintenance
• Workplace measurement techniques
• More advanced methods Failure Modes and Effects
  Analysis (FMEA) Poke-Yoke Value Stream Mapping.

6
Case Study Air Bag Co.

• Before intervention the Company was threatened
  with closure. Labour turnover was 30. Efficiency
  of production line was 70 c.f. 85 target.
• A young and enthusiastic management team
  addressing these issues.
• Productivity Analysis included a workshop for
  management. The outcome was a 12 month plan,
  which focused upon 4 Master Classes and the
  training of the change agents.
• Each Master Class was of 15 days duration and
  included i) setting objectives diagnosis of
  problems 5 days of hands on to make
  improvements.
• In parallel the workforce were trained to NVQ
  level 2 and the MD went on a two-week fact
  finding visit to Japan.

7
Outcomes

• 80 of the workforce received NVQ 2
  qualifications.
• Absenteeism reduced by 17.
• Productivity (parts per person) increased by
  30.5
• Parts no right first time reduced by 21.
• Stock turn ration improved by 4.
• Internal schedule achievement improved from 80
  to 100.

8
Conclusions

• NEPA has so far involved 43 companies and 74
  Master Classes.
• A new Plant manager with knowledge lean
  manufacturing, together with a dynamic HR manager
  put together a small management team that had a
  clear strategy. This driving force utilised NEPA
  to support change within their agenda.
• Air Bag Co. previously threatened with closure
  dramatically improved its performance and
  developed best manufacturing practices.
• It was considered an exemplar by the Group and
  technology is now being transferred to plants in
  Spain and Tunisia.