Case Study 3-07667
Simplification, the total production strategy.
IET provided leadership and team support addressing a total production improvement philosophy centered on simplification of product mix, production planning and scheduling, and process measurement and control.
The Customer
A world-supplier of vehicle tires with facilities in North America, Europe and Asia facing the challenges of global competitiveness.
The Challenge
To develop a production and inventory strategy that reduced the total costs of all products (80 million dollars annually), and ensure a significant improvement in customer on-time delivery performance (drive to 99.8%).
The Solution
IET worked with the entire production team and crossed functional lines to include sales and marketing, new product development, finance, and material control to understand the bottom-line impact of various change initiatives. IET worked with the top management to develop a strategy of simplification to significantly reduce annual operating costs while ensuring no significant increase in working capital and improved on-time delivery. This strategy ensured sales and marketing support as product mix was reduced by 30%, individual item working capital for finished goods inventory was adjusted with a net result of no increase, and production run-sizes were adjusted based on levels of demand. The OEE improvement rose by 30% and the original objectives of this strategy were exceeded in the following two years.
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