The company and growth in the food sector

The company operates in the food production industry, focusing on the manufacturing and processing of chocolate and cocoa. With an annual sales volume of approximately £220 million and over 2,000 employees, its main markets include the United Kingdom, the United States, and Japan. Founded in the 1990s with sales exclusively through the online channel, the company expanded into physical retail in 2004 by opening its first store. Since then, this company has grown significantly and now boasts a network of stores, cafés, restaurants, boutiques, and even a resort. The brand is known for selling high-quality chocolates and continuously innovating, launching new product ranges yearly, such as coffee, kitchen utensils, beauty products, and more.

From challenges to operational excellence

The rapid growth and expansion into new markets placed pressure on operational processes, leading to a direct negative impact on efficiency, operating costs and service levels.

It became clear that operations needed to be redesigned to support business growth and meet the demands of different markets. The goal was to achieve excellence in production and logistics, reducing costs while ensuring the highest level of customer service. The company then followed a structured approach, starting with identifying opportunities in existing processes, understanding the medium-term operational needs of the business, and designing robust processes that could support future growth.

Below are some of the challenges encountered:

Inefficiencies in the production process

Throughout the production process, several operational inefficiencies were identified. For example, raw material waste was evident, primarily due to the manual introduction of ingredients into the production lines. The inconsistency in the weight of the finished product highlighted this waste, which increased product costs and added further expenses for manual final verification. Similarly, waste in packaging materials and labor was uncovered, particularly during periods of high demand, resulting in significant costs of £20k per year. The packaging process was suboptimal, requiring seven operators to meet the production capacity. Finally, the process of transferring liquid flavors also led to significant waste, which had a direct impact on costs.

Gaps in improvement routines

The operational teams, burdened with existing inefficiencies, found it challenging to dedicate time to improving their operations. Additionally, there were gaps in their knowledge of improvement tools. A culture of continuous improvement had not yet been fully developed, with teams heavily focused on immediate problem-solving, lacking visibility on eliminating root causes and mitigating future issues.

Lack of alignment between management and operations

A significant gap existed between the management and operations teams regarding identifying problems and implementing improvements. Inadequate communication between these two levels of the organization made it difficult to solve problems effectively and prevented opportunities for improvement from being adequately explored.

The approach to transforming processes and reducing costs

The approach to addressing the identified challenges was centered on the principles of continuous improvement and operational excellence, aiming to optimize processes, reduce costs, and empower teams to contribute independently to productivity improvements. During this period, 310 employees participated in improvement projects, workshops, and training sessions. These initiatives fostered the development of improvements and involved employees directly in the solutions being designed, resulting in 78 projects that led to savings of over £800,000 in just 12 months.

The project involved redesigning processes and training operational teams to become autonomous in identifying opportunities and implementing improvements.

The teams were trained and equipped with the following improvement tools:

• A3 (problem-solving): A structured approach to tackling challenges and designing solutions, encouraging teams to identify root causes and implement effective, high-impact solutions collaboratively. The A3s were essential for ensuring each challenge was approached clearly with well-defined objectives, allowing for a structured and standardized resolution process.
• Fishbone analysis (Ishikawa Diagram): Used to identify and map the main causes of deviations, such as waste and inefficiency in production. This analysis helped teams visualize the multiple causes of a problem, including human factors, machines, and processes, enabling more effective problem-solving.
• Data-driven analysis: Teams were trained to find relevant data for each opportunity, extract insights, and make informed decisions. This allowed the most impactful opportunities to be tackled first, while enabling clear measurement of the results from the improvements implemented.

It is important to note that these training sessions gave the teams the necessary skills to autonomously identify problems, analyze causes, and implement continuous solutions. Below are some of the actions and tools the teams implemented after receiving their respective training.

Removal of the printer for pre-printing the film

After training in A3 and Fishbone Analysis, the team identified the opportunity to eliminate the pre-printing of the film to reduce labor and material costs while also avoiding the waste generated by having to process the same roll of film during batch changes.

Reducing waste in chocolate production

Root cause analysis training enabled the team to identify the main causes of waste, concluding that many products were underweight due to the manual method of adding ingredients. The solution involved adjustments to the manual scale and improvements to the processes, which allowed for reduced waste and increased accuracy in the addition of chocolate.

Reducing labor costs in production lines

The Fishbone Analysis helped the team understand the causes of waiting times and the need for task redistribution, while A3 training ensured the implementation of a clear and efficient action plan. By analyzing the line capacity and waiting times, a line balancing solution was implemented that aligned with the strategy of reducing labor costs without compromising quality or productivity. The reorganization of the line layout and elimination of redundant steps reduced the number of operators to just four, maintaining productivity without increasing operational costs.

Increase in production yield

Through a bottleneck analysis, the team focused on optimizing the performance of one of the production lines. After identifying that the pressing machine was the main bottleneck, the team worked with the engineering team to redirect the production circuit, increasing yield and reducing costs. The teams adjusted the settings of the dispensing machine, and constant weight monitoring improved dosing accuracy, effectively eliminating waste.

Reducing waste and improving the accuracy of measuring ingredients

During the observation of the production line, it was identified that the accuracy of ingredient measurement was compromised, leading to inconsistencies in the final product weight. A stricter weight control system was implemented to ensure the minimum weight was reached without excesses, reducing chocolate waste and optimizing the process.

Reducing liquid material waste

As part of the process of analyzing the transfer of liquid flavors using the A3 method, a waste issue was identified due to material spillages. The engineering team was brought in to develop a simple yet effective solution: a reusable funnel made from materials already available in the factory workshop. This measure significantly reduced waste and improved precision in the dosing process.

These projects exemplify how applying Lean Manufacturing principles—such as eliminating waste (Muda), process optimization, and continuous improvement—can lead to significant financial results while enhancing operational efficiency and employee engagement. It is worth noting that this success was made possible by introducing the methodologies above, in which the teams were trained. In addition to implementing these tools, the team’s skills development, as well as everyone’s commitment, led to the resolution of the operational challenges addressed.

Furthermore, the structured approach to continuous improvement has provided a solid basis for sustainable improvements. It has enabled the company to overcome current challenges and be prepared for sustainable growth in the future.

Results achieved by implementing continuous improvement

The results of the continuous improvement program were highly positive, reflecting the effectiveness of the adopted approach and its significant impact on production operations. Over 12 months, the program generated total savings of approximately £800,000, with contributions from several key areas of the operation:

• Materials: Savings of around £29,000 were achieved through process optimization and waste reduction, particularly in managing materials and ingredients.
• Hygiene materials: Approximately £11,000 in savings were realized by implementing more efficient processes and reducing waste in hygiene materials.
• Engineering resources: Savings exceeding £100,000 were achieved by improving the efficiency of engineering resources, with a focus on process improvements and resource optimization.
• Labor: The largest portion of the savings, about £700,000, came from increased production speed and improved line capacity, resulting in greater operational efficiency and the release of additional capacity.

In addition to the financial outcomes, the program significantly impacted the company culture. The commitment and empowerment of the teams were central to the project’s success, and employees became more engaged and proactive in identifying improvement opportunities. The ongoing application of Kaizen Principles helped establish a solid foundation for these improvements to become part of the daily work routine.

“Winning the Kaizen Award truly demonstrates a solid understanding of continuous improvement and reflects the internal capability we’ve built, led by our management team. However, the true players are really the operators on the shop floor (…). By following the true principles of Kaizen, we’re just getting started, and every day, we strive to be better than the day before. This year, we focused on implementing and developing our culture of improvement, which we started last year and continue to support with our teams.”
– Production Director

The emphasis on the practice of “Zero Loss” became the key driver of improvements during this period, with the team focused on eliminating losses and further increasing operational efficiency, ensuring that operational excellence was achieved and maintained.

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