Case Study - Process Review at a Large European Manufacturer & Distributor

  • 23 November 2016
  • Number of views: 5373

The Scenario

WBS was asked to provide operational support to a large European manufacturer and distributor supplying the European entertainment market. 

This assignment involved recruiting an interim Operations Manager and a team of supply chain specialists to assist with data analysis, strategy, process improvement and project management in both distribution and manufacturing.

Peak season had just started and several time critical processes required immediate attention to ensure on-time and in full delivery to customers.

41 key processes were initially identified and selected for review, which covered Customer Services, Purchasing, Manufacturing, and Distribution.

The Work – Tactical Short Term Improvements

Two new territories had recently been on-boarded but no robust operational processes established. WBS set up a sub-team with client representation from management, planning and the shop floor. Together we designed and set up two new physical picking areas and related processes covering the end-to-end activities from order release, through picking to dispatch.

Significant growth, over and above seasonality, of one product group required a complete review of processes and layout in order to meet customer demand. The physical redesign of an existing pick face and a new set of processes were developed and implemented to ensure optimal product location in the pick face, timely replenishment and batch picking to reduce pickers’ walking distances. A new requirement for the application of tax stickers was added to the packing part of the process, which eliminated several hours of waiting time thereby removing one root cause for shipping backlog. The efficiency gain was equivalent to two full time operatives.

Similarly, a total overhaul of the physical and IT processes for another client serviced from the warehouse also resulted in an optimised pick face and faster processing of incoming goods. Shop floor involvement and client support to work with suppliers were instrumental in achieving simpler and shorter processes.

The Work - Strategic Review and Recommended Improvements

At the end of peak season, a full scale review of the end-to-end supply chain was undertaken. Again, client representatives were involved including manufacturing, distribution, planning, finance, and customer service.

A series of workshops were scheduled during which the end-to-end value stream map was created as a brown paper exercise using Post-It notes and other visual effects to ensure clarity and understanding by everybody involved.

Further workshops and interviews identified sub-value streams and related processes. All processes identified and reviewed were process mapped and used as a starting point for simplification and optimisation. Product families were streamlined through the production processes eliminating the need for the night shift. Batch quantities and internal transport were challenged to bring manufacturing and distribution closer together.

This collaborative exercise demonstrated that the end-to-end lead time which was currently 11 days on average could initially be shortened by at least 24 hours and optimally to 24 hours.

Key process indicators were identified and will be used to monitor progress. These included lead times, cycle times, stock and WIP levels and people utilisation. Action plans were drawn up and prioritised and business cases prepared for each initiative for approval by senior management.

WBS chose our very interactive Process Minimalism® methodology to involve everybody and it soon became clear through the workshops that a common understanding of the organisation’s processes was lacking. It was critical to bring everybody to the same level of understanding of the end-to-end processes as they were going to be more closely connected and interlinked.

Implementation work is ongoing

To find out more about Process Minimalism® and how our Supply Chain Specialist Consultants can help you contact us today.