Case Study: Lean Implementation at Siemens’ Kalwa Plant Essay

1.0 EXECUTIVE SUMMARY & COMPANY contextBriefly, in this case we glimpse on Kalwa Planet- s appearh in India which modify itself from a traditional organization to fly the coop anxiety structure. The jump second invent snoop started on May 1st, 1955 in a sm solely(a)-scale roam on Mumbai with 10 employees and with very simple equipments. Their chief(prenominal) business is fastness damaged switch boards and an new(prenominal)(prenominal) fabrication jobs which most of their components were imported and sm both number of them produced inside workinghop. In 2009 Siemens connection in India unify its placerather than before this factory equipped with the most advanced machinery and testing facilities and 40 percent of the India Siemens worked in Kalwa factory, not just they miscellanea their role during these years from a simple assembly come in to the medium voltage switchboards (M1) producer ,medium voltage indoor and give awaydoor nothingness circuit breakers (MC) producer , gas insulated switcher (M2-GIS)producer in backup man of the main comp any(prenominal) , but alike they improved their position in the market , now the troupe has 5 factories in Mumbai , Nasik , Calcutta ,Aurangabad and Goa , 4000 employees and 11 gross revenue powerfulnesss, 300 dealers . Further more than their company is second Siemens factories outside of Germany by and by Brazil branch. Siemens improve its products in 4 sections 1-industry 2-energy 3-healthc atomic number 18 4-consumer products in India and all of the world and our case company counterbalanced low variety and juicy variety products which belong to power distribution segment, energy division. Siemens society in India competed with ABB, Areva, Schneider electrics on the other hand Kalwa products exported to Bangladesh, Sri Lanka, Nepal, Bhutan, Maldives, Oman, Qatar and etc.In 2009, 60 to 65 percent of The Switchboard Factory (WSWB) bea allocated to manufacturing panels (M1) and IVCBs (MC ) and remain distance remains for manufacturing OVCB (MC) and M2 products. This company had 400 push back-out (blue and white collar) and employees worked in 2 working shifts and one additional shift (if aimed). Manufacture cycle array planning and logisticInitially , SOE ( gross sales request engineering) was the commencement segment in M1 which had nearly duties the like design manufacturing , growth planning ,testing and quality package and collide with commercial , incoming inspection and stores. Local customers ordered to the regional sales team and market team foc utilize on export orders. all(prenominal) order that transferred to the SOE marked and entered to the factory. All the orders must(prenominal)iness passed 2 pegs 1- formula and engineering stage , 2-order planning and execution stage. After an order trustworthy by marketing section, indeed SEO prep bed an engineering drawing with cooperation with sales colleagues and customer (to ski binding cus tomer selects), these drawing prepaid in 2 stage A and B , in stage A they have all entropy except wiring diagram which completed in section B .after passing these two take aims they displace their drawing to the customer to approve and thence send it to the manufacturing. During these wreakes SEO consulted them to avoid any non criterion customer requirement if all the level passed correctly the documents were passed to the manufacturing de sort outment.Technical Order Processing department (TOP) received orders and recorded it in to the work planning database according to their periods then tryy committee tried to estimated the delivery date to the customer. Every order need two type of raw corporals (equipments) 1-electrical , 2- mechanical ,the top leave wrote the necessary equipments in a list that called (BOM) bill of materials list . The BOM sent by enterprise resource planning software (ERP) to the material planning department, mechanical equipments were existe d inside of the company and electrical postulate to order to the supplier. indeed procurement cycle started following(a) equipments release to the shop according to the requirement. The exits manufacturing corpse had many error, glom and inefficiencies in shop floor and logistic (they boney long time and valuable raw materials and roughlytimes the manufactured panels counterbalanced because of weak layout design) , on the other hand on 2006 customer pauperizations increase around 75 percent and managers need to enhance their manufacturing performance efficiency to reduce their personifys and respond sooner to the customer demand .in October 2006 Siemens AG sent a letter regarding the performance of flowerpott worry in Kalwa company and mentioned they eagerness to improve Kalwa factory like the other branches during the world . They expected this utensilation testament enhance companys capacity to triple during tail fin or six years. carry watchfulness follow upat ion measuring sticksThe break away instruction team vi graded Siemens site in Turkey which managed in bunk oversight methods then advisor added to the team fragments , one of the most cardinal duties for managers and team member is to finish off how much this death penalty is vital for the company to hold its market donation and all the personnel had a critical role to achieve this final stage , thus managers started the Lean management process with brain storming among all the company sections , they asked which points make waste during productionprocess ? They wanted to cut and wrap up any waste of time and raw material during production demarcation. However, changing the working methods which many person work with it for many years has around resentment among different roots.the inclining team refractory to divide their changes to 1-layout 2-support corpse 3-vendor management 4-cultural changes , which these changes caused to improve the Kalwa company effic iency. Lean team had confrontation with personnel of sections that had more errors after pass instruction execution, team members tried to find out enigmas and seek to solve the snub.2.0 headway 1Has Siemens Kalwa botany been potent in achieving campaign carry throughation? In our opinion, Siemens Kalwa Plant has been affectional in achieving lean implementation. The main alter factors for an effective lean implementation for Siemens Kalwa Plant are as follows 1. Top Management provide a very good support and clear direction a. excrete by Global Head, Mr Gewaldb. Siemens Kalwa Plant General Manager, Mr Khandekarc. Mr Khandekar, demonstrating walk the lambaste by showing his commitment by closely twisting in the implementation activeness to hold back the proletarians understood the objectives2. Proper planning in run intoing the as is process and to be process d. 6 months of invasion assessment and feasibility study on Vacuum Circuit ledgeman (VCB) existing produ ct limit processes3. Lean objectives and target was snuff itd clearly to the upstanding team in Kalwa embed e. Introduction of Gewald to the shop floor workers and office employees to clearly communicate the initiatory and the lean implementation objectives f. Clearly communicate that lean implementation to be introduced to nevertheless manufacture of panels and VCB. g. Provide clear reason on why the two (manufacture of panels and VCB) waschosen4. Formation of execution of instrument team to operationalize and monitor h. Siemens Kalwa Plant General Manager, Mr Khandekar as the interrogation for both the panels and VCB implementation team i. Supported by Mr Vedak for VCBj. Working group from cross give wayal team managers and executives5. Site visit to learn from a real life lean implementation k. 2-3 team members and Mr Vedak visited lean plant Maruti l. Kandekar and Vedak visited Siemens Switchboard in Turkey6. Appointment of consultant to cooperate on the lean implement ation m. The consultant provide tangible potentiality benefitsi. Increased productivity of restrictionsii. Reduction in Inventory Leveliii. remedy space utilizationn. Knowledge sharing and best practice base on real life lean implementation from other industries7. musical arrangement are highly committed and motivated in implementing lean o. company leaders support the workers maintaining the pace of the situation p. Khandekar and his management team get out at unravel the dashboard meeting to resolve issues q. By the bodily engages of 7.a and 7.b, the employee realizes the importance of the initiative and start to commit themselves in making it a success r. With fit procreation, the employee feels engage and motivated to check into the initiatives is a success The 7 contributing factors above enable Siemens Kalwa plant to effectively implement the changes needful below 1. Layout changesa. Assembly line introducedb. Work station found on orderc. Fixed takt time2. S upport System changesd. Introducing Dashboard for issue escalatione. A fix time to discuss the escalated issue. The and mandatory for the f. Training to watch the employee has the right skill-sets 3. seller Managementg. Able to adopted Just In Time (JIT) supplies delivery h. Able to embrace Pull Philosophy4. pagan changesi. Team belongingnessj. Uniform dress-codeAfter 12 months of implementing lean, Siemens Kalwa Plant achieved its 3 main objectives for implementing Lean processes bases on the followings business outcome 1. Panel throughput time on the shop floor had reduced by approximately by 30 per cent 2. First Pass Yield (FPY) had increase by approximately by 40 per cent 3. Worker productivity had increased approximately by 30 per cent Siemens Kalwa plant should get ahead refine and improve the improved processes/functions or to include other processes/functions which not part of the original scope to be part of the lean implementation. Siemens Kalwa plant should look into implementing lean to the remaining processes/functions as shown below 1. Design department processes/functions2. Engineering department processes/functions3. Vendor and supplier manufacturing processes/functionsThe approach above combine with the adherence to lean principles and lean steps should ensure lean implementation is sustainable.3.0QUESTION 2How was the organizations change process managed? very this company had different sections which needed to change during lean management possibleness for example shop floor , design and engineering departments, vendor and suppliers all of these sections work in traditional methods .on the other these company use two different kinds of resources 1- mechanical , 2-electical which mechanical components exist in the company warehouse. alone electrical components needs to order and buy from suppliers, this company manufacture in mass customization method. As a matter of fact changes had started with cooperation among Mr.Kulkarni with corporal strategy department to find out feasible switchboard part for implementation lean management in process , on the other hand management replacement occurred Mr. Kulkarni was promoted to director of Medium voltage function and Mr. Khandekar raised to general manager for WSWB factory . Following, Mr. Gewald worldwide person in charge of lean project in the Siemens Switch Boards arrived at the Kalwa factory , and manager introduced him to the shop floor workers and office employees and they decided to implement lean management in the VCB company too .In the prototypal step Vedak and some members of the team had a trip to the lean plant of Maruti and they could understood benefits of lean management at the same time some American consultants arrived to the Kalwa factory to cooperate with them in lean management process implementation. Initially consultants had a meeting with manager and explained for him benefits of lean management like increase productivity, reduction in schedule levels and improve space utilization. In 2008 khandekar and Vedak visited Siemens site in Turkey and surprised of implement lean management results in company efficiency. Managers needed to restructure layout and process to implement lean management .obviously errors, inefficiencies and wastes were not clear before implementation, during this process managers asked each department idea to achieve expeditious ways and reduce next pertain between personnel. Kalwa Company needs this process because total demands enhance for their panels. Company must changed exist traditional layout in operating sections that needed unity among workers and supervisors.They decided to cultivate workers with rewards if they leave alone catch the enough production monthly. They decided to prepare six work stations along their five assembly lines and they made this process flexible to use leader worker team to help the other assembly line (if necessary). As a Mather of fact, its necessary to c hange support establishment for new layout, managers used a board at the beginning of both assembly line which describe who are person in charges? Production features and their standard? And necessary raw materials this board called dashboard and help to the company to find out the faulting or weakness points during the process. Seriously, suppliers were one of the most vital part for their JIT and lean management. Lean companies need the correct part in a correct time because they do not have pedigree any more. In the beginning  on that point were many inconsistency between companys operational section and suppliers which cause to direct meeting between lean team members with them and team members describe that it is possible this methods make supererogatory cost for you but in long time this method will improve company production quantity and improve your selling. Mr. khandekar decided to self-possessed every line member (engineers , workers , etc ) as a team to improv e their organization culture , for feeling team belonging he decided to take 30 min for their pray and sport activity day-by-day.3.0 QUESTION 3What resistance did Khandekar face in implementing the change and why?Lean is consider one of the most important success factor in an organization strategy as one of its main focus is to disparage impediments to the production line in order to ensure smooth process advert by eliminating waste. As noted in the article, time waste was evident throughout the department in the value chain and this requires major(ip) changes to the process point. Since this would request adjustment to the process flow and directly impact the way employees had been performing their task for years, it has created resentment from various groups of employees. Eventually, most of the departments involved are becoming defensive of their own approach and the way they do their work.At the beginning of every line there were dashboards installed throughout the shop fl oor, SOE and right to the dispatch section. The shop engineers and workers will post all issues that occurred on the line including the names of the pack involved. The errors uncovered from various departments thru lean remains which are overlooked previously has create strong resentment among the workers peculiarly for those who werent at ease in admitting their mistakes. This has leads to workers blaming each other which finish out with heated arguments among the departments. Furthermore, the structure change within the team, high human race intervention in team activities and lack of synchronization between departments has contributed to high come of errors. One of the main reasons that contributed to this resistance isbecause the workers view the lean remains as just another initiative from the management.Furthermore, the workers bonuses were solely dependent on the lines productivity. In the event where throughput of the line is hampered due to issues, workers productiv ity as well as their salary will be touch on as they need to wait until the issue is resolve and might need to extend their working mins. on that pointfore, the disruption was unacceptable and was compounded by the labour union.Vendor management is considered one of the toughest issues and it posed major challenges for Kalwa plant. All this while, vendors were so used to supplementing in batches the take materials and goods for a large numbers of orders by a certain date. Thus majority of the vendors could maximize the cost advantages due to supplying materials in bulk. However, with lean implementation, the material is only requisite once the individual panel came on the production line since there is no longer needs for materials to be delivered by batch or by customers order. The change had a vast impact to suppliers where vendors were required to be constantly reminded of the new arrangement and to deliver the goods the following day which barricade their profits since th ey could no longer exploit the economies of scale.Additionally, the new set up has as well leave an impact to the material planning group as they need to arrange order for individual panels constantly instead of fiat in bulk and require to be in constant rival with the suppliers to ensure the material is delivered on time.5.0QUESTION 4How did Khandekar handle the resistant to change?The company faces some(prenominal) challenges despite the benefits of successful implementation were attractive. The challenges among others include restructuring the organization, acquire the staff to accept the lean implementation and handling the resistance from intrinsic and external stakeholders. One of the way Khandekar handle the resistance to change is byorganizing meeting to explain to the employees the importance of adopting lean to cater the growing demand for panels. This lean was use at the shop floor which in like manner requires the support department to adopt the lean implementati on which includes layout changes, changes in the support dust, changes in vendor management and cultural challenges. As for the layout change, the group leader plays a role to support the workers in maintaining the pace of the line. The workers will press an and on informal which would then light up another add on lamp in the manufacturing departments office in the event there is an issue with regards to the material or drawings. The TOP material planning or the equipment group would meet the worker to discuss the issue and subsequently the light would be switch off upon the issue is settled. Khandekar also attend meeting with a a couple of(prenominal) other head of departments to discuss on the issues involve as well as those individual staff names which is listed on the dashboard.The meeting which is conducted every afternoon 2 pm for an half an hour provides the basis for managers to identify number of panels manufactured for the day, how the line is progressing and identify t he issues that hampered the lines progress. During the meeting, the issues are gradually addressed the individual staffs involved were required to solve the issue by performing 6hkooa root cause analysis. Khandekar also face challenges to implement the lean as the vendors face problem to supply materials as and when required when the respective panel come on line as previously the materials were supplied in batches as per the agreed timeline. Hence, to overcome this issue, the lean team visits the vendors and presents the benefit of lean program. For miserable term, it was decided that vendors will manufacture the material in bulk but delivery of the materials as required by the line. Khandekar also introduce joint prayer and manage academic session at each assembly line at the beginning of every shift. This creation was also introduced to the personnel in office. All the members involved in the lean project were given a T-shirt with lean logo which represents the team effort w hich was later introduced to the workers besides to the office staff and management. Khandekar also introduce key performance indicators and the workers performance bonuses are determine based on the agreed panel produced, i.e. six panels per day per line. The abovementioned solutions were identified and implemented by Khandekar to handle the resistance to change tosuccessfully implement the lean at Siemens Kalwa Plant.6.0QUESTION 5How was the lean implementation institutionalized in the new set-up? When Siemens AG (headquarters) decided to implement lean manufacturing in the Kalwa factory, few initial steps were taken to ensure a seemly fundament in foothold of association and understanding of lean manufacturing is first build in the Kalwa factory. Mr.Gewald, global head for spearheading lean project was brought in to the Kalwa factory to educate the top management level on what lean manufacturing is all about and how it can improve and benefit the factory. One of first few ac tions that Mr.Gewald took was to form a lean implementation team with Mr. Khandekar as the project leader and Mr.Vedak as the lean manager. Mr.Gewald with the help of consultants from United States held few meetings with the management to explain the potential benefits of the implementation. Through brainstorming and awareness sessions, the consultant team also gave presentation on the successful lean implementation in other companies especially at Toyota. isolated from that, Mr. Khandekar and Mr.Vedak also had a series of factory visits to companies which have completed the implementation of lean manufacturing. The main purpose of all this meetings, presentation and visits were to create the managements arrogance and prove how the implementation will be beneficial. Creating the belief and confidence of the management is essential in ensuring the success of the implementation. at a time the lean team has been organise and the essence of lean manufacturing has been incorporated in them, the team starts the implementation process. put down 1 show the implementation process.Observations & Analysis of Current process flow Identify Waste Area Identify Changes and Implementation supervise Performancessamara Activities* Process Mapping to understand how the current process works* Current process flow chart is derived from the process mapping activity.Key Activities* From the derived process flow chart, waste or non value added works are identified.* Through brain storming, the ways and means to make this process efficient are discussed. Key Activities* From the analysis, changes are identified and the implementation process begins. The changes will cover- a) Layout changesb) Changes in support systemc) Changers in vendor managementd) Cultural changes.Key Activities* The monitoring KPIs were defined.* A monitoring team was formed to document, analyses and report on these KPIs.Figure 1 Implementation process of lean manufacturing.As mentioned in question one, l ean manufacturing by principle is the emptying of waste or non-value added works. As such, Mr.Khandekar and the lean team realized that they need to restructure both the layout and the process itself to eliminate non-value added works. Rather than blindly doing the implementation process, the team first did process mapping for the existing process to understand how it works. In the process mapping stage, the lean team held discussion with the finished department in the value chain regarding their process flow. The outcome of this activity was process flow chart. Next, the lean team conk outd the process flow chart to identify all non-value added in the flow. A brainstorming session was through with all the related personal to decide the changes that need to be made to make the process more efficient. At this stage the lean team also held meetings with all the employees to explain what lean manufacturing is all about and why it is important for them to adopt lean in their work place. This was an important action by the lean team as there were signs of resentment and mental rejection among the employees. From the first two stages of the implementation process, changes that are required to eliminate waste were identified. The changes are as below-Layout ChangesThe lean team realized that physical structure of the layout needed to be changed, as there were wastage in terms of workers movement and the flow of the product or material. For the layout changes, the assembly line invention was adopted. Assembly lines with workstations were formed. The time per workstation was fixed and their work content was adjusted. An efficient flow of the products and worker movement were also considered in the new layout. Apart from that a communication system between worker level and the executive level was also created to improve response time. Changes in support systemApart from layout changes, lean team also made changes in support system for the production line. The m ain idea here is to introduce ownership concept to the production line whereby the owner has to be answerable to all problem that arise under his ownership. Dashboards were introduced at the beginning of each assembly line. each issues in the production line will be highlight in the board with name of the related personal. Meetings will be held on cursory bases to oversee all the issues. The dashboard also will display daily out of each assembly line to show progress in each line. Apart from that skill assessment of the employees and top management were also done continuously to identify skill gaps and appropriate training are arranged. Change in Vendor Management.Implementing lean manufacturing in the Kalwa factory alone would not be sufficient to eliminate waste. With vendors continuously supplying material or part in bulk orders, wastage of storage or inventory space occurs in the factory. With the availability of extra material or parts, manufacturing mistake will go unnoticed . As such, vendor management was also needed to be changed. The main idea here is to have the right quantity of parts available at the right time with the right quality. Vendor will have to supply each order quantity then rather that supplying in batch. Because of some difficult faced with the vendors, succinct term and long term plans were made. Long term plans are to implement lean principle at the vendors end. As for short term plans are the implementation of pull philosophy of the lean system whereby vendors will manufacture material in bulk but deliver it to factory as needed by the line. This is to reduce storage and inventory space in the factory. Occurs of manufacturing mistake or defects will come to the knowledge of the line managers or supervisors.Cultural ChangesActivities such as joint prayers and exercise session were introduced to instil a sense of team belongingness among employees. Apart for that unvaried dress code are also introduced for the lean implementa tion member to send the message of team effort to all workers and management staff.Once all the changes have been implemented according to the plan, the next important step that was taken is to monitor the effectiveness of the changes. With the help of Mr.Gewald, the monitoring KPIs were defined to analyze the effectiveness of lean system on the overall performance of the factory. A monitoring team was formed to continuously document, analyze and report on these KPIs to the Siemens AG (headquarters) on monthly bases. To summary, we can say several key actions have been taken to institutionalize the lean implementation in the new set-up of the Kalwa Factory. i) Before implementation process was started, a proper foundation was built in the company by educating the top management on the lean principles. ii) A sound implementation plan was made by the lean team by first, analyzing the existing process to identify inefficiencies. and so determine ways and means to improve them. iii) Th e lean team proceed to educate all employees from staff level to worker level to ensure all of them understood the lean principles. iv) Proper monitoring was done to know the effectiveness of all the changes made. v) Mr.Khandekar and his team also continuously come up with creative solutions for problem such as resentment and worker issues.What more does Khandekar need to do so that the changes are not cabbaged? There are several actions that Mr.Khandekar can take to make sure that the changes are not reversed.i) regular training on lean principles.People tend to fear things they dont understand and in the case of Kalwa plant, it is proved to be true. When lean implementation was first announced to all Kalwas employees, there were signs of resentment and scepticism among the employees. This happened because employees didnt understand what is lean, why the management wanted to implemented it and what benefit do they and the company get. Proper training must be provided to all the employees to ensure their understanding of lean principles. The implemented changes can only last if the employees willing to work according to the changes and this can only be achieved through understanding. The lean principles must also be integrated in to the companys training programs for new employees. uninterrupted assessment must also be done to measure the level of understanding of the employees especially workers as it is always difficult to reach them because of their teaching background. An establishment of lean culture among all the employees in the company is important to ensure the sustainability of all the implemented changes.ii) Proper documentation.Proper documentation must be made regarding all the implemented changes. This is important because there is a possibility that a future improvement can unintentionally reverse the change made now. Believe me this tends to happen more often than not in the manufacturing line. As such proper documentation can function as reference to future employees especially engineers when they are making some improvement. Changes made in the method of working must also be documented as work standard as it can function as training tool for workers.iii) Regular Auditing.Regular auditing is important to ensure that all the changes in terms of process flow and work standard are followed accordingly. Regular audit must also be done to all related supplier and vendors to ensure their compliancewith the lean principles.iv) Continuous Monitoring & Improvement.Lean manufacturing is designed in such a way that it will not leave any room for problems and mistakes to hatch if it is implemented correctly. As such implementation of lean manufacturing will force all wastage, problem and mistakes to surface. The monitoring team must be mete out to continuously monitor for such case and appropriate action must be taken to solve or improve. Continuous sustainability can only be achieved if improvements are carried out conti nuously by capable people truly understand the way of lean.