Paper & Packaging

Digital-age consumers are consuming less paper. Commercial paper manufacturers are faced with the need to become more competitive and more profitable by reducing lead times and increasing product variety without investing in new machinery. Packaging suppliers are constantly faced with demand to develop new packaging solutions. Rising raw material and energy costs and supply chain pressures have introduced new challenges and urgency to all manufacturers. Survivors will be those able to satisfy demand in the shortest time with the least amount of inventory. They’ll win by having the most efficient operations and the capability to consistently meet changing customer expectations.

A well respected manufacturer was faced with these issues in a market segment where the decline in demand is greater than most others. We worked with the leadership team to develop and implement several key initiatives that allowed this company to grow profitability and gain market share in a very challenging business environment. Its results are outlined below:

• Improved yield 25 to 30 percent by focusing on equipment repeatability, standardization of work tasks, product handling, shut down / start up losses, and minimizing splices
• Improved Overall Equipment Effectiveness (OEE) from 84 to 94 percent by identifying and acting on opportunities relevant to machine performance, availability, and process yield.
• Reduced waste from start-up, splicing and changeovers by 50 percent
• Reduced energy cost 18 percent for the entire facility
• Increased plant SKU flexibility by changing the planning and scheduling system. At the same time, we helped them to reduce inventory and outside warehousing space by more than 40 percent.
• Reduced variation in multiple key product characteristics such as brightness and weight by 40 to 50 percent
• Developed and implemented lean certification and training for all the key continuous improvement professionals enabling them to independently drive improvement in their operations.

Implementing LeanSigma allowed kaizen teams throughout the organization to maximize machine effectiveness, create new visual controls for better quality, and engage the work force. “We sought ideas from every operator and every engineer. Along the way, something surprising started to happen,” said an operations manager who asked not to be named.

One multi-million dollar packaging manufacturer and distributor sought to be the one-stop source for packaging products in a highly-competitive, cost-critical market. Doing so required the alignment of 39 manufacturing and eight distribution facilities across the US, Mexico and Canada. Through analysis of demand patterns, the manufacturer accelerated adoption of a demand-based replenishment system. Today, its statistical forecasts now incorporate promotions and point-of-sale data for a real-world perspective. They were able to rationalize some slower-moving and highly volatile products. The results were as follows:

• The creation of a pull system that reduced inventory system that reduced inventory levels by $1 million for a single product line while simultaneously improved case fill-rates from 97.7 percent to 98.5 percent.
• Shipping orders direct from the factor reduced inventory as well as related carrying and transportation costs.
• Standardized process improvements improved forecast accuracy from 55 percent to upwards of 75 percent.

“All of a sudden, lean was the sexy new thing and our customers were asking to come in and see what we were doing -- even customers that had drifted over to a competitor,” the manager said. “Now, bringing our customers in on kaizen events has drawn us closer to them. They see our changes as proving a commitment to the long term.”