Implementing Lean to meet the challenge of sales surge
Client: Taizhou Henry Technologies
Location: Taizhou, China
Taizhou Henry Technologies and Heldon Refrigeration are leading designers and high quality manufacturers in industrial refrigeration components, producing a wide range of filters, receivers and other products used in refrigeration systems.
Its sales grew from 50,000 units in 2012 to 360,000 in 2013.
In the next few years, the sales were expected to increase to 750,000 units per year. Facing the great challenge of a significant increase in customer orders, Henry technology encountered many problems, including:
- A large number of WIPs in production areas
- Poor visualization status on the site
- Unbalance between raw material and part of assembly processes
- Long lead time and low on-time delivery
TXM worked with the technical team of Taizhou Henry Technologies to customize the Lean implementation program, including:
- The training of the basic principles of lean production and lean tools. TXM developed the current state and the future state of the value stream map, as well as the improvement action plan together with the Henry Technologies team.
- TXM worked alongside a cross functional team using the “Manufacturing Agility Process®” to redesign and map the end-to-end process for sealed filters line to reduce the lead time and eliminate waste.
- Improved the product strategy and order fulfillment status, the information interaction between production planning and materials planning, and the information transmission between sales order and production order.
Through the implementation of the Lean improvement program, Taizhou Henry Technologies achieved significant improvements in KPIs, including WIP inventory, lead time and on-time delivery together with a 49% increase in daily output, a 24% reduction in lead time and a 40% increase in on-time delivery.
The department managers and the front line supervisors at Taizhou Henry Technologies became “lean leaders”. A good atmosphere of continuous improvement has been established in the company, and also the communication efficiency among the departments improved significantly.