Our client is a world market leader in the production of High-Tech Advanced Engineering Plastics. Their order book is full, but customers required ever more product volume with shorter lead-times and more competitive prices, which our client had to address to firstly increase EBIT, but also to not loosing customer orders to the competition due to prolonged lead-times.
Options to increase production capacity in the short-term are limited. Investing in new machines was ruled out, as capex would have been expensive and taken at least 9 months to install. Subsequently, new production capacity had to come from the existing machine pools, the only way to respond to our client’s customer demands in the short-term. Our client has approached R&G to carry out an initial Opportunity Analysis based on process data to gauge, how much new capacity can be generated and how much extra margin this would translate into.
The Opportunity Analysis revealed a significant potential of “hidden capacity”, which would yield more than EUR 1m margin pa with approx. 20% shorter Lead-times. Our client was very happy with the opportunity and R&G started a StableOPSTM deployment at their works in Germany. R&G discovered huge variance when changing over from one process cycle to the next cycle and standards were not adhered to. By implementing R&G’s StableOPSTM Operating System in production, non value adding changeover times were significantly reduced and stabilised to new standards. Cycle times against the standards were recorded for every production cycle and in case of deviation, Root Cause Analysis interventions continuously reduced causes of variance over time, leading to more value creating production time, more output and improved productivity as well as shorter Lead-times.
During the deployment the changeover time medians have been reduced by 30% and creating the same amount of valuable new processing time, used to produce just under EUR 1m additional margin pa.