The Company

The company is a global leader in industrial inspection technology and Non-Destructive Testing (NDT), with over 125 years of industry experience. With a solid international presence, it works with several well-known names across various sectors, including automotive, aerospace, and electronics, as well as the battery and additive manufacturing industries, which rely on its solutions to ensure quality, safety, and productivity.

The company offers a comprehensive portfolio of industrial radiography and computed tomography (CT) technologies, as well as visual inspection and ultrasound solutions. Its mission is to support clients’ digital transformation by leveraging data and analytics to optimize equipment and processes.

The Challenge

The project began with the company’s top management, who participated in an introductory session on Kaizen methodologies. Subsequently, a dedicated project team was assembled, with participants drawn from various departments across the organization, including leadership, department heads, and staff from engineering, commercial, and operational areas.

The team organized a kickoff event where Kaizen concepts, tools, and improvement techniques were introduced. In addition to challenging existing paradigms, they developed a future vision for the value stream, identifying the 3Ms (Muda, Mura, and Muri) by creating spaghetti diagrams. This information was essential for drawing up an 18-month transformation roadmap.

The project aimed to improve service levels, productivity, and cost management while promoting a cultural change within the company. To achieve these objectives, the project team identified several key steps.

The main target areas for improvement included:

• Reducing the employee absenteeism rate from 18% to 3%;
• Improving on-time delivery (OTD) from 25% to 95%;
• Reducing lead time from 18 weeks to 12 weeks;
• Increasing production capacity from 65 units/year to 99 units/year;
• Reducing inventory by €4.3 million and work-in-progress (WIP) inventory by €1.3 million;
• Achieving a cost reduction of €3.3 million.

While these were the immediate results the team aimed to achieve, the broader long-term goal was to radically change the company’s culture by transforming behaviors from top management down to the shop floor, thereby maximizing workforce performance.

The Approach

The company’s approach was structured in cycles, starting with a detailed analysis of critical areas and culminating in the implementation of specific initiatives for operational improvement. Focusing on continuous improvement and operational efficiency was vital to addressing the identified challenges and effectively responding to the organization’s needs. The main actions included:

Implementation of Daily Kaizen

The first step was the implementation of Daily Kaizen, a strategy aimed at creating a safe and motivating work environment that encourages active employee involvement. This direct engagement is essential for strengthening team spirit and fostering a culture of collaboration, encouraging continuous participation in improvement initiatives.

Introduction of new Work Standards

Afterward, new work standards were introduced, and adjustments were made to logistics processes, such as internal logistics and sequencing (Cycle 2), to guarantee greater efficiency in operations.

Redesign of the Factory Layout

Reorganizing the factory layout was central to optimizing production flow and eliminating waste. This approach helped identify inefficiencies and implement improvements that made the production process more agile, reducing waiting times between stages.

Production Capacity Planning

The company also prioritized production capacity planning, enabling more effective resource utilization and better alignment of operations with production needs.

Inventory Optimization

Optimizing inventory levels and implementing continuous improvement practices have become vital to minimizing fixed capital and significantly reducing costs.

Implementation of Kaizen Initiatives and Project Management

Finally, rigorous monitoring of continuous improvement initiatives was implemented to ensure that changes were tracked and adjusted to maximize efficiency and promote a sustainable improvement culture, contributing to more effective financial management. Through these continuous improvement cycles and a strong emphasis on employee participation, the company efficiently responded to the identified challenges, laying the foundation for achieving results.

Results

The project has surpassed expectations, successfully addressing the initial challenges and validating the chosen approach.

On-Time Delivery

In response to the challenge of improving on-time delivery (OTD), there was a 40 percent improvement. On-time delivery for parts remains consistently at 97%, and 89% of systems were delivered on time in June. The factory layout redesign and the implementation of new work standards were crucial to this success.

Pull Strategy and Inventory Management

A pull strategy based on the Reorder Point (ROP) was implemented for all systems, allowing more effective inventory management. This focus on optimization directly responded to the need to reduce inventory and WIP, leading to 20% and 40% reductions, respectively.

Lead Time Reduction

Lead time has been reduced by 33% so far, directly addressing the challenge of streamlining processes. Applying Kaizen methodologies and continuous improvement in operations played a crucial role in achieving this milestone.

This company’s example applies to other organizations facing similar challenges, demonstrating that achieving breakthrough results with adequate investment in processes and training is possible. Through a meticulous approach that involved implementing continuous improvement practices, training teams, and streamlining processes, the company turned significant challenges into growth opportunities. Improvements in OTD, a reduction in the absenteeism rate, and an increase in production capacity have solidified its competitive position in the market, establishing a model of operational excellence that can inspire other organizations on the path of transformation and innovation.

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