Pull flow model in assembly industries

In today’s global industrial landscape, marked by demand volatility and growing operational complexity, the ability to respond quickly, reliably, and efficiently has become a critical competitive differentiator. This case study describes the transformation journey of a century-old global company that faced significant challenges in planning, supply, and the organization of its production operations.

With high inventory levels, failures in production plan execution, and an internal defect rate exceeding expectations, implementing a more agile approach became imperative. Through the introduction of KAIZEN™ methodologies and a pull model, the company was able to reduce waste, improve efficiency, and achieve significant operational and financial gains.

The company and its path of innovation and global expansion

Founded in the 19th century, this company began operations with a strong emphasis on innovation and social responsibility. Over the decades, it has distinguished itself through its ability to expand internationally, establishing a presence on all five continents since the early 20th century.

Over the past three decades, the company has undergone a profound transformation, expanding its portfolio beyond traditional industrial products to focus on software, digitalization, data protection, and emerging technologies. The company is committed to integrating solutions such as autonomous driving, smart homes, and machine-to-machine communication, demonstrating a clear focus on the future.

The challenge: Increasing efficiency and reducing operational failures

Despite its global presence and established reputation, the company faced several operational constraints that compromised efficiency and production plan adherence:

Misalignment between planning and execution

The planning process did not accurately reflect the company’s operational reality, reflected in:

• Finished goods inventory for 15 days, but a service level of only 93% (misaligned inventory).
• A 30-day supply of raw materials and components.
• Work-in-progress (WIP) inventory of 1 to 5 days across production and assembly lines.
• Low line efficiency, with a 50% production plan non-attainment rate due to parts shortages.

Logistical and operational inefficiencies

In addition to planning issues, the operation presented several structural inefficiencies:

• Finished goods planning based solely on order forecasts (push model), with forecast errors ranging from -18% to +16%.

Figure 1 – Example of a push model

• Use of forklifts for line supply, with criteria defined by supervisors.
• Operators isolated from each other, oversized containers being supplied, Standard Work not optimized, and inefficient line balancing.
• Functional layout with pre-assembly lines separated from final assembly lines.

Figure 2 – Example of a functional layout

The coexistence of planning failures, line imbalances, and logistical inefficiencies was limiting operational performance. It became clear that only a structural transformation grounded in robust, demand-driven methods would overcome these challenges.

The operational transformation approach

In response to the identified challenges, a comprehensive transformation was implemented based on lean methodologies and the pull model:

Pull planning based on replenishment

A daily pull-planning algorithm was implemented based on actual consumption and replenishment levels, generating adjusted production orders aligned with deviations.

Figure 3 – Example of a pull model

Kanban and production leveling

Orders began to be managed through kanban cards, integrated into a daily planning system driven by a logistics box. This process includes freezing one day of production in accordance with leveling rules.

Line redesign and balancing

One of the assembly lines was transformed into two simpler lines, each with fewer assigned product references. This change made it possible to eliminate setup times, improve operational balancing among operators, and implement small containers at the line border.

Figure 4 – Example of flow production cells

Introduction of mizusumashi

Three mizusumashi lines were created to supply components, sub-assemblies, and finished products.

These tools were fundamental in enabling the transition from a traditional push model to a pull system — more efficient and aligned with actual demand — directly contributing to the results achieved.

Results achieved through operational improvement

The logistics reorganization generated a significant impact on the company’s key performance indicators:

• Annual savings of €3 million
• Reduction of 52% in the internal defect rate (PPM)
• Increase of 36% in productivity (parts/operator)
• Reduction of 40% in total inventory (days of coverage)
• Payback period of only 5 months

Figure 4 – Key results achieved

The operational transformation carried out at this company clearly demonstrates the impact of adopting lean and KAIZEN™ principles. The shift from a push to a pull model enabled the organization to achieve significant results in just five months. The combination of visual planning, logistics reorganization, and efficient line design made it possible to create a more flexible, balanced environment aligned with market needs.

This case study reinforces that, with the right methodologies, it is possible to transform operational challenges into growth opportunities.

We are committed to respecting our clients’ confidentiality. While we have altered or omitted their names, the results are genuine.