manufacturing current state analysis

Reduced equipment failures upon delivery to customers

PROBLEM

About 1% of EquipmentCo.’s deliveries led to out-of-box failures (OBF). OBF is the failure of equipment after it is delivered to the customer. This resulted in customer dissatisfaction and increased delivery costs. EquipmentCo. had conducted root cause analysis on the origin of OBFs and implemented corrective actions. But the OBFs had not reduced substantially. Therefore, EquipmentCo. sought to identify the root cause of these failures, identify solutions together with KPIs to measure OBFs.

Outcomes

75% Estimated reduction in the out-of-box failures
3 Solutions prototyped for process improvement

QUICK SUMMARY

EquipmentCo. manufactures products for environmental and industrial measurement usages. EquipmentCo. has a high product mix in its business. Due to its unique product offering, EquipmentCo. encounters high OBF. SCG's agile workforce utilized various LEAN method tools to identify the root cause of the problem. Finally, solutions were prototyped to address the identified issue areas.

The key questions addressed in the project:

Q1. What are the root causes of out-of-box failures in the current process?

Q2. Where are the errors occurring in the current workflow?

Q3. What processes should be eliminated or changed to effect change?

SITUATION

EquipmentCo. implemented SCG’s on-demand workforce to accelerate their understanding of equipment failures upon delivery to customers. This sprint identified the root cause of equipment failures, provided solutions and KPIs to EquipmentCo. to measure their future failure rate.

OUR APPROACH

SCG conducted a project in three phases:

Phase1: Analyse current workflow to hypothesis failure root cause

SCG’s agile workforce identified three types of OBFs: wrong product delivery, excess product delivery and incomplete order. The agile workforce then identified that the ‘wrong product’ deliveries were most common. Next, the agile workforce analyzed and mapped the current process to list all possible error areas.

Phase2: Preliminary recommendations based on listed process issues

Based on the identified issues in the previous stage, SCG’s agile workforce then outlined improvement of multiple solutions for key areas:

  • Process improvements – reorganizing the space, one order flow implementation or color-coding stickers etc.
  • Modification of documentations
  • Technical solutions – barcode scanner or RFID to scan each item

Based on these, the project management decided to pursue the technical solutions, as it would have minimum disruptions to the current workflow.

Phase3: Solution detailing and KPIs

The barcode solution was selected to detail further. Thus the agile workforce then created a new process map in conjunction with EquipmentCo.’s current process. This process map also listed additional new equipment requirements and system changes for material flow. Additionally, the agile workforce also listed possible failures and remedies for the recommended bar-code solution. Finally, both short-term and long-term KPIs were provided to monitor the new process.

RESULTS

SCG’s on-demand agile workforce identified the issue areas in EquipmentCo.’s current logistic process that led to equipment failures. Based on this study SCG’s on-demand agile workforce was able to deliver concrete change requirements to EquipmentCo.

EquipmentCo. piloted the recommended solution and it is estimated that 75% of OBFs can be reduced over the course of 3-6months.

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