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Plastics & Resins

NEEDS-BASED RESULTS

 

Plastics & Resins

SITUATION

Plastic compounds and resins manufacturer experienced a growing number of SKUs, increased inventory costs, and increased manufacturing, warehousing and transportation costs.

DRIVER GOAL

  • Reduce customer service lead times by 50%.
  • Reduce finished goods inventory by $10 million.
  • Reduce annual freight and warehousing costs by $2 million.

RESULT

  • Reduced customer service lead time by more than 50%.
  • Reduced finished goods inventory by $11 million.
  • Reduced annual freight and warehousing costs by $2 million.
case study image, CS-114

Case Study

Reduce Inventory & Improve Cycle Time

Issue

To meet steady customer demand, an international plastic compounds and resins manufacturer experienced a growing number of SKUs, increased inventory costs, and increased manufacturing, warehousing and transportation costs. The organization sought external assistance to streamline the operation and reduce inventories and costs.

Highland Approach

Upon targeting the client’s operational and financial Driver Goals, The Highland Group led an analysis of the operation to rationalize product lines/customers and identify and focus on the disruptions in product flow that were causing wastes/costs to accumulate and cycle time to increase. With a list of key opportunities in hand, the team utilized a variety of Lean Manufacturing tools and methods to systematically address the issues. The implementation of essential program governance structures served to align the entire organization’s performance improvement activities to the high-level goals.

Actions Taken

  • Developed and implemented a goal translation and alignment process.
  • Created an overall equipment effectiveness program to support smaller batches and reduce set-up time.
  • Developed and implemented a System For Managing and created a comprehensive training program for management and supervisory staff.
  • Developed and installed a demand-pull replenishment production scheduling process.
  • Restructured support organizations in the four plants and headquarters.
  • Created and implemented a product/customer rationalization program.
  • Designed a program to reduce freight and warehousing costs through the use of direct shipments.

reduced machine changeover time by

61%

while reducing customer “re-promise” rates from 18% to 5%.

Related Information

subject matter-based

Senior Consultant

Supply Chain

Laurence has more than twenty years of industry and consulting experience in all areas of supply chain management – including inventory management and procurement – and in Total Working Capital management.

Project Leader

Sales, Marketing & Consumer Products

North America

Bill is a senior project leader with more than 20 years of hands-on experience in assisting multinational companies by deploying his expertise in Lean Six Sigma and Business Process Management tools, tactics and strategies. He has deep expertise in sales and marketing improvement, supply chain optimization, fixed-cost reduction, channel management, total production management, balanced scorecards and post-merger integration.