Improving Plant Productivity and Cycle Time to Meet Customer Demand for Shorter Lead Times

The Challenge:

The global air transportation business is a volatile one, filled with extreme peaks and valleys that force the companies
who supply it to be able to react quickly to changing demand. At project start, JBT AeroTech was experiencing
a period of growth,resulting in a backlog of sold equipment orders that challenged their existing capacity and
productivity levels.

Additionally, the nature of JBT AeroTech’s customer base was shifting. In recent history, airports, airlines, and
transportation companies would handle their own buying needs, making smaller buys and being accepting of leads
times suggested by JBT AeroTechbased on internal operational demands. The landscape was quickly shifting, with
larger, outsourced ground handling companies leading the buying process for multiple airports. The ground handling
companies purchased through bids and set lead time expectations that JBT AeroTech was required to achieve
regardless of internal operational demands.

Finally, commodity prices (steel, oil, gas) were escalating and the materials group was struggling to keep material costs
per unit in line with inflation in order to meet margin expectations. These environmental conditions created strain on
the internal operations, resulting in:

  • Pressure on planning and scheduling to improve integration/alignment between functional departments
  • Constraint areas in both engineering and manufacturing that held back overall output
  • Reduced productivity and high use of Overtime in order to keep up with schedule demands
  • Supply chain that was not able to meet reduced lead time requirements
  • Material costs coming in higher than planned and unable to pinpoint impact of sourcing initiatives intended to
    reduce spend

The Results:

The project met targeted savings expectations, realizing a 2.7:1 return on project fees. Over the length of the project,
manufacturing productivity was improved by 18% and direct materials costs initiatives were installed to reduce spend by
2%. Some of the implemented changes include:

Planning Improvements

  • Completed product offering analysis with specific tactics to change buying strategy on parts outside of delivery
    lead times window (through kanban, safety stock, alternate domestic and overseas suppliers)
  • Installed weekly stakeholder meeting to establish fulfillment strategies and mitigate constraints for all new orders
  • Created visibility to progress of all open orders throughout the facility and plans for off-schedule conditions discussed daily

Productivity Improvements

  • Labor shifted to constraint areas, based on build-up of sub-assembly crewing matrix
  • Enhanced Bill of Materials routing to deliver parts to specific sub-assembly stations
  • Reorganized warehouse and parts pulling methods to streamline cycle and keep skilled labor performing skilled labor work
  • Reduced rework by scheduling Engineering Change Request based on production need

Supply Chain and Sourcing Improvements

  • Coordinated with cost accounting to develop sourcing plan by part number that brought visibility to plans and
    was built into budget
  • Reviewed MRP buying parameters and developed quadrant strategy to group and purchase parts based on order
    frequency and lead time, reducing shortages and frequency of expedite
  • Implemented a lead time review program to improve accuracy within the system

The Client Experience

“We are all now pushing and pulling more succinctly towards our common goal of being our customer’s most valuable supplier.”

General Manager, JBT AeroTech

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