Productivity Improvement
(Precision Machining Company) Eroding margins, high WIP, and poor labor utilization prompted this firm to undertake an intensive lean manufacturing project, during which 3 work cells were completely reorganized, production was leveled, a kanban system was installed, and pull production was established throughout the plant. The results? Cell 1 - material handling and floor space required substantially reduced; $1,200/month labor-cost savings. Cell 2 - labor hours reduced by 50%; WIP cut from 2,400 pieces to only 100; 2 sub-assembly operations integrated; total savings = $15,000/month. Cell 3 - process re-engineered; $23,000/month savings. The lean process and CI emphasis generated further saving throughout the manufacturing operation. Overall - inventory turns improved 22%; scrap down 10%; indirect labor cut by 6% (while increasing machining hours by 60%); and 100% on-time delivery in the next year. The benefits of this project have now extended well beyond the shop floor.