Problem: The supplier's product cost had inflated, resulting in negative profit margins. At a second plant, overhead was continuously growing as management attempted to correct poor throughput times and on-time delievery rates.
Solution: PCI formed a team of client supervisors, engineers and machine operators. Under PCI's direction, they reengineered the process, rearranged the equipment into cells to acheive continuous flow and restaffed the operation based on the new work content requirements.
Results: After six weeks, the PCI Team helped reduce the component's cost by $11/unit; the client was contracted to deliver 500,000 of these units to Ford annually. At the second plant, the PCI Team helped reduce headcount and overtime while improving delivery to Chrysler in a 690-person plant. The PCI Team helped the client reduce its workforce by 90 people, while reducing overtime from 20% to nearly zero. Deliveries and quality both improved during this three-month effort.
Example 2: An Electronics and Aerospace Supplier for US Military and Fortune 500 Companies
Problem: The factory was severely outdated--operations were piece-part, batch production, machinery obsolete and labor uncertified, with low management retention rates. As a result, during 1985-1991 sales fell by 40%.
Solution: Using the PCI Model, we performed a site selection evaluation and assisted in relocating the company and constructing a facility layout that supported Cellular Manufacturing processes.
Results: Sales increased by 38% within a year after the move and start up. Their employees achieved ISO 9001 certification, opening the door to new potential clients. In addition, costly secondary operations were identified and eliminated, increasing available capital by 10 times the amount preceding the move.
Example 3:A Tier 2 Automotive Supplier
Problem: An assembly and packing line was encountering production delays, high scrap rates, and excessive overtime to meet production schedules and higher than antcipated product costs.
Solution: PCI utilized both traditional Industrial Engineering and contemporary Emplyee Involvment techniques to identify the problems, reengineer the line, rebalance the work content and sequeance at each station and restaff the line.
Results: Within three weeks, the labor content was reduced by 61%, the production rate doubled, and both overtime and in-process rejects were eliminated with minimal implementation cost.
Example 4:A Manufacturer and Importer of Consumer Baby Products
Problem:Products were manufactured at six North American locations, imported from vendors on three different continents and warehoused at seven distribution centers. Customer delivery service was declining, marketshare was shrinking, inventories were increasing and margins were evaporating.
Solution: Using the PCI Model, we helped this client reinvent their supply chain. The scope of evaluation included a wide range of alternatives: maintaining the status quo,, building a mega- plant in the US, Mexico or Pacific Rim or a complete outsourcing of all manufacturing operations.
Results: The modeling results led to a recommendation closing all manufacturing facilities and obtaining specific families pof products from the Pacific Rim and Mexico. This balanced service, inventory and cost lead to an increase of margin at over 4% annually.
Example 5:A Manufacturer of Consumer and Contractor Wood Cabinetry
Problem: Competitive pressures and consumer demand required a 50% reduction of lead times.
Solution: PCI determined that the extensive mix of cabinet styles, materials, finishes and trims increased inventory levels thus severely prohibiting the ability to improve service. Capital and cash flow constraints prohibited total modernization and process automation. Instead, PCI engineered a Continuous Flow, Cellular Manufacturing process that utilized existing equipment and facilities to increase factory throughput rate.
Result: The reduction in space requirements enabled them to reduce their facilities by four plants to five. The necessary capital and implementation spending was financed by inventory reductions and productivity improvements. The engineered throughput rate was reduced by 70%. The client elected to implement changes sufficient to achieve the 50% rate demanded by the marketplace, with the additional improvements held back for future needs.
