An automotive supplier company produced an ever-increasing variety of products in a fatctory that has grown for the last 50 years. Today, these specific premises have an annual turnover of 370 million euros and 1,400 employees. They inhabit a partially very sophisticated manufacturing and process technology. This led to a situation of several years without meeting the target results. Different initiatives for continuous improvement (CIP measures) were also insufficient to close the gap. Therefore, ConMoto was commissioned to plan and implement a sustainable cost-cutting program.
Initially, the project team put all influenceable costs to the test. Production, logistics, inventory and work-in-progress, maintenance as well as product contribution margins and material costs were analyzed. Based on the detected waste and a comparison with best practices, ambitious but feasible potentials were identified – especially for direct and indirect personnel, as well as in inventory, material and maintenance costs.
Savings and increased efficiency in production, logistics, maintenance
During the six-month implementation phase, five project teams redesigned the individual production areas along the entire value chain according to lean principles and developed levers to reduce inventory costs. The alignment of capacities to requirements, process optimization and the comprehensive introduction of tugger trains significantly increased the effectiveness and efficiency of logistics. The tugger trains also enabled a forklift-free production, which also improved qualitative factors such as occupational safety.
Due to the optimization of processes and organization as well as the introduction of TPM (Total Productive Maintenance), maintenance was reframed, and the availability of capacity-critical systems in particular was a considerably enhanced. Applying the linear performance pricing method contributed to a significant reduction in material costs.
By means of consistent program management, the measures of all project teams were systematically evaluated and consequently implemented, aided by a hardness model. Thus, the target values defined in the potential analysis could even be exceeded: total savings of 13.75 million euros, which equals 3.7 percent of the turnover, where achieved. With this effective project, the ConMoto consultants also laid the foundation for a successful cooperation with the client, sustained for years now.
Spotlight: the project results
- Reduction of personnel costs (direct and indirect) by 15%
- Reduction of logistics costs (except staff) by 23%
- Stock reduction by 50%
- Savings regarding the examined material costs of 6%