Lean is about to test things.

Lean is about to test things.

Not enough storage space at an FMCG company – A case study of Lean Optimization in four acts.

Act I

‘Why didn’t the BlackTlen 300 gel go to the customer?’ The plant manager was very upset at the morning meeting the next day.

‘Because the production line didn’t make it,’ said the planning manager.

‘Nonsense! How could we even make it, if the warehouse has stopped collecting finished parts from the production lines and we don’t have space to store them anyway? I had to stop production because of that, so the BlackTlen 300 gel only entered the line after a delay,’ the production manager retorted.

‘And where could I have put it, exactly? On my own head? Our warehouse is too small. I’ve told you many times before – we need to invest in a new, bigger warehouse or at least a high-rack storage system.’ The warehouse manager refused to take the blame for the gel’s delay.

‘Alright, alright,’ said the plant manager. ‘I’ll make a note that we need a bigger warehouse so that customers can get our products on time. At the moment, there’s nothing we can do about it since further investment this year has been suspended. Anyway, I already reported the problem to head office a few months ago.’ He shrugged.

Everyone went back to their duties feeling that it wasn’t their fault. If the customer liked the gel, then the customer would wait for it.

But this time the customer didn’t want to wait. Fed up with the continuous delays, they demanded a significant price reduction or they would break the contract and stop buying.

So it was decided that the time had come for action! E-mails were sent, teleconferences were held, and head office promptly assigned the money for construction of another warehouse.  Everyone rejoiced. Finally, the problem was solved!

Act II

‘Hey boss, why does the 300 gel have to sit here with us so long before we can load it?’ asked one of the loading bay workers.

‘Eh, it needs to stand for 48 hours after production, because it’s a gel.If it doesn’t have time to settle, it splashes around inside the packaging during transport and the customer gets a shake instead of a pretty gel.’

‘Seriously? That’s funny, because when I started down here a few years ago, it didn’t need to stand so long.’

‘Just get on with it!It’s already twelve and we’re getting well behind with our work…’

 Act III

‘Magda, what’s up with these gels?’ he asked her. ‘Do they really have to hang around for 48 hours before they can be loaded up and sent out? Half of our warehouse space is full of new gel settling in its packaging. ’ – the manager started conversation with a laboratory technician.

‘Well, yeah, they do. Otherwise they would shift in transport and get messed up. There’s a SOP98732 procedure about it. ’

‘Yeah, I noticed you’d signed an updated version of it  two weeks ago. So, how do you know whether it’s actually still necessary?’

‘What do you mean? It was valid six months ago, it’s valid now. No need to check anything.’

‘Fair enough,’ he said. ‘So on what basis was it first introduced?’

‘Oy! Maciek, give me a break already. Do you know how many SOPs I have to do? If you’re going to bug me about every one that comes down the line, I’ll never get anything done!’ She took her coffee and stood up.

‘Sorry, sorry. I didn’t mean to bother you. It’s just – couldn’t we just verify whether it’s actually still necessary? You know, for me, every square inch of space out there is worth more time, and on the production side, time is money. You know.’

‘Only Marek, our boss, can do that. He’d have to email Chris at head office, who would need permission from Frank to take it further. They’d probably have to meet and talk about it or something. Perhaps they could send some gel to our R&D people in Milan, for testing. I don’t know. Asksk Marek about it.’

‘OK. So, how long do you think it’ll take?’

‘No idea. Last time we questioned an SOP, it took six months.’

Act IV

Wiesiek! Can you come in with Andrzej for a 12 hour shifts this weekend?’ – the manager asked a loading bay worker at the turn of shifts.

‘Uh, yeah, sure boss. Are there extra orders to ship?’

‘No, we’re going to have some fun.’

‘Fun?’

‘Yep, you and Andrzej are going to be throwing boxes around.’

‘Brilliant! Can we throw some at you?’ Wiesiek asked, grinning.

‘You wish! We’re going to do an experiment. You guys will take a pallet of fresh stuff from the gel production line and put it aside. Then, every hour, you take one box and drop it, from shoulder height, onto the ground, top-side down. Then you open the box and take a picture of the mess inside. And you do that every hour for the next 48 hours.  Tell the boys at the other shifts.’

‘Well, that’s something new. Count me in!’

Epilogue
The experiment with the boxes showed that after 23 hours of resting, the gel had not significantly solidified. This means that it doesn’t matter whether it rests for 24, 29, 35 or 48 hours, it will still move in transport. Subsequently, the procedure was changed. There are now no unnecessary pauses , and all the gel customers get their deliveries on time. As for the new warehouse… well, it was built. Now it stands empty. They’re thinking of turning it into an indoor football pitch for company sports days.

Conclusions
The above story was in fact an actual case, and it shows that:

a) Lean is gemba: the place where the physical product is created – a production hall, warehouse, etc. Optimization of processes is best considered in those places, not at a meeting, not in a manager’s or quality department’s office.
b) There is a waste of Lean in “excessive” production processes, meaning we process the product too much (in the example above, it sits doing nothing for longer than it has to).
c) Before we make a decision about an investment, we need to make sure there is nothing more we can do to improve our processes (and this almost never happens).
d) Lean means experimenting – instead of long meetings and never-ending e-mail exchanges, it is better to simply carry out experiments at the production site. Literally, to throw boxes on the floor. Even if this doesn’t confirm our hypothesis, at least we’ll have the answer immediately, not after six months.
e) Lean means undermining the status quo – doing something the same way for years doesn’t mean we’re doing it right.

 

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