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An Automotive Lean Journey

by Chris Cooley

This is a brief story involving a business turn-round using lean, leadership, quality management and back to basics to dramatically improve an automotive supplier on the edge of extinction.

Company: Automotive components manufacturer in Rotherham, UK
Turnover: £40m
No of Employees: 800
Industry: Design, manufacture and supply of automotive parts
Main Customers: Major OEM’s including Toyota, Honda, Aston Martin

Main Processes: Project Management, Engineering, Rubber Extrusion and Injection molding

Background

The organisation is a Japanese owned UK company selling quality critical parts to demanding global customers.

This company had incurred c£3m annual losses on average since it had been set-up, had 100’s of customer rejects each day and was failing to deliver on a weekly basis. In addition the workforce was demoralized and de-motivated and there were no real systems or working management structure.

In summary there were poor processes, poor leadership and a lack of control causing a failure of quality, cost and delivery. The future was bleak, a disempowered workforce, customer demanding improvement and “offering” their services to fix our problems and the real threat of not receiving future business and therefore certain closure.

Our Solution

  • Negotiate with customers a timetable for recovery – required resilience, stubborness and a confidence of future success
  • Stabilise critical processes – 24hr operation with critical processes causing high level of rejects and downtime
  • Identify and coach middle and senior management structure – we had to develop both senior and middle management layers from nothing to cohesive and effective teams
  • Set-up daily/weekly management review process – twice daily production meetings, weekly management review and monthly senior management review
  • Prioritise problems to solve and train in problem solving techniques – essential as symptons had been treated previously with no prioritisation
  • Remove waste from all processes using lean techniques – TPS had been implemented in several processes but with poor deployment and no follow-through – using PDCA we ensured that improvement objectives were clear, implemented properly and continually checked
  • Standardise processes, systems and review constantly – implementation and use of visual control and management control

Results

  • Achieved £4m annual cost savings
  • Quality improved from 1000+ ppm to 30ppm (returns per million parts sold)
  • Delivery improved from average 1 missed delivery per week to zero missed deliveries

The company has since won business previously given to its main UK competitor (very unusual within 5-year project cycles) and has engaged new customers due to its improved customer performance.

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