Manufacturing Strategy & Capacity Increase Success Story
The company was already operating at capacity and needed a manufacturing strategy to take them through 2013. We were engaged to develop the plan in collaboration with the client’s staff.
We started by organizing the customer’s problem into four phases:
- Identifying the current process performance
- Developing possible solutions
- Evaluating preferred solutions for financial viability
- Devising the implementation plan
Phase 1 – Overall Process Effectiveness
We collected field data about the existing process, manufacturing capabilities, staffing, forecasts, facility, etc. The immediate concern was the existing plant’s real performance. We established a baseline using Overall Process Effectiveness (OPE) (a variation on the more commonly used Overall Equipment Effectiveness (OEE) but which includes consideration for methods, components and operators in addition to equipment). The OPE indicated that a significant improvement in performance was necessary if future demand was to be satisfied. Hence the focus of the project moved to performance enhancement solutions.
Phase 2 – Analysis of each Solution
We identified potential solutions to close the gap between the current demonstrated capacity and the desired future state. Ideas ranged from modifications to the existing automation to brand new automation.
We created a short list of options by qualitatively analyzing each solution for possible impact to a variety of business factors including:
Phase 3 – Total Cost Ownership (TCO)
We evolved the short list of options to a sufficiently detailed level that we could physically represent equipment design, size and layout, and consider material and operator movement, accessibility, etc. We generated cost estimates and input these to a TCO analysis. TCO quantitatively assesses each option over a period of years for the accumulated cost of implementing a particular solution. Conversely it identifies the contribution of an implemented solution to the unit cost of the product.
Ultimately this business analysis led to a recommended solution to the company’s capacity challenge.
Phase 4 – Implementation Plans
We developed two implementation plans taking into consideration business interruption and inventory build requirements. One plan represented minimized risk to the supply chain while the other represented low capital investment. The company was able to review the two plans in light of its critical business drivers before settling on the final plan.
The work performed provided all the information necessary for the client to justify the project and secure investment approval. Based on the confidence built in our capabilities and experience, our client placed an order for the recommended automation with ATS. We remained engaged for a seamless transition from Pre Automation Solutions to equipment design/build and moved on to perform similar work for the client at their other sites.