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Electronics Industry:
Manufacturing
Performance Facilities Consolidation
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| | Client: |
| A
division of a Fortune 100 company with considerable military contracts.
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| | Problem: | | Competitive
pressures were forcing the company to reduce costs and significantly improve cycle
times. Products using similar parts, processes, skills, and equipment were being
manufactured at six different sites but were not benefiting from economies of
scale, new manufacturing methodologies or organizational concepts. Also, best
practices from one site were not always shared with other sites.
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| | Approach: | | The
plan was to consolidate operations into two regional electronic centers (RECs).
The RECs determined which components / parts would be produced, which would be
outsourced, and which site would produce them, using which best practice(s). The
equipment was inventoried, evaluated and distributed. New layouts, material flows
and inventory levels were established. New business systems were developed. An
organizational concept using empowered employees in self-directed work teams and
a flattened management structure was installed. Newly-hired employees were screened
and tested for their ability to adapt to the new environment. Everyone was trained
in the new concepts.
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| | Results:
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Average costs
were reduced approx. 30%, cycle times cut in half, inventories reduced,
and quality significantly improved. Teams of workers met daily to
manage workflow and make assignments. Flexible equipment designs and
utility installations provided opportunities to reorganize work centers
for optimum workflow on a daily basis. Manufacturing floor space was
reduced by more than 50% and most leased space at the six facilities
was eliminated. Morale was higher even though hourly rates were lower.
Point-of-use-storage of certain parts was employed, and information
systems tracked each part / component and the associated costs. |
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