Tru-Test achieves world class operational excellence

operational excellence

Executive Summary
New Zealand-based Simple MFG (the contracting division of Tru-Test) took the decision to outsource some commodity products to Asia in order to maintain flexibility and protect intellectual property. The TRACC Integrative Improvement System was implemented with Lean transformation to improve customer service, reduce inventory levels and streamline the manufacturing process. Excellent results were achieved with greater flexibility, improved quality and yield, better product turnaround and improved service offering. Simple MFG’s changeover reached world class level, with customers benefiting from a broader range of product delivery and supply chain services. TRACC’s objective measurement process allowed the company to benchmark its performance within the organisation and across organisations internationally. TRACC also facilitated shop floor engagement, which has ensured sustained improvements.

 

At the end of the pilot trial period, which was set up in a machine- and labour-based department, the results were:

operational excellence

 

Situation
Faced with the same difficulties as other manufacturers and exporters, such as high exchange rates, stiff competition from Asia and higher regional input costs, action was required. Reviewing its core competencies and value-adding capability, the company decided to outsource a few commodity products to Asia while all technology-based manufacturing remained in New Zealand. This decision was influenced by the ability to maintain flexibility because of the large product range made in small to medium volumes, as well as the need to protect intellectual property in products and processes. An extended supply chain wasn’t commercially viable.

A major improvement has been reduced set-up times for key processes such as the SMT line, which showed a 75% upturn in changeover time.

After reviewing many global industries and improvement systems, the choice fell on the TRACC Integrative Improvement System, initially as a pilot project before being rolled out across other company areas.

Tru-Test commenced its Lean transformation to improve customer service, reduce inventory levels through improved skills and flexibility, and to integrate and streamline manufacturing processes.

operational excellence
Portable readers deliver information by reading electronic ear tags on animals on a weight platform – livestock.tru-test.com

Action
In its quest for operational excellence, Tru-Test uses the same process as some of the world’s best known manufacturers, including Unilever, Coca-Cola, Ansell and Fonterra. The benefits are particularly relevant to the Australasian CEM market and include:

operational excellenceTru-Test indicators record accurate weights quickly – livestock.tru-test.com

  • Greater flexibility: A major improvement has been reduced set-up times for key processes such as the SMT line, which showed a 75% upturn in changeover time. Single Minute Exchange of Dies (SMED) improves flexibility as it means run sizes are better and more cost-effectively matched to customer requirements.
  • Improved quality and yield: By using Visual Performance Measurement (VPM), each team member is involved in capturing and using quality and yield information. This closed loop system enables actions to be taken in real time on individual items during manufacture and supports the one piece flow manufacturing strategy.
  • Better product turnaround: Combined with the benefits achieved in SMED, value stream maps are prepared to track value-adding activities. This value stream activity has helped eliminate non-value processes and improve product velocity through the entire supply chain.
  • Improved service offering: Tru-Test continues to invest significantly in capability-enhancing capital equipment due to better utilisation of existing equipment. Job changeover was the largest downtime source.

Results
During implementation, changeover times dropped considerably. World class sub-10-minute
changeovers are now a way of life. This benefits customers since Tru-Test is able to offer an increasing and broader range of product delivery and supply chain services, as well as an ability to produce small runs efficiently and cheaply.

World class sub-10-minute changeovers are now a way of life.

The key deciding factor for selecting the TRACC methodology was its objective measurement process,
allowing the company to benchmark its performance in key areas within the organisation, as well as across organisations internationally. Another deciding factor was the system’s ability to facilitate shop floor engagement.

In addition, the Tru-Test Group has learnt a great deal by implementing the improvement methodology:

  • A structured process with a common language is essential in achieving and maintaining improvements in progressing towards world class performance
  • Shop floor engagement and process ownership sustain improvements
  • Success requires high-level organisational support
  • Successful implementation and achieving gains need substantial investment in people due to the required culture shift-targeted capital investment may also be needed to support the value stream and capability enhancement
  • Using an external consultant helps provide focus on implementing changes and processes—however, ownership must reside internally
  • The world class quest is a journey, not a race

 

Company Background
Headquartered in Auckland, New Zealand, Tru-Test designs, develops, manufactures and markets technology-based agricultural solutions for global markets. The company has emerged as one of New Zealand’s leading contract manufacturers, culminating in rebranding its contracting division, Simple MFG.
operational excellenceoperational excellence

Disclaimer
This resource has been prepared for general guidance on matters of interest only, and does not constitute professional advice. You should not act upon the information contained herein without obtaining specific professional advice. Competitive Capabilities International (CCI) does not accept or assume any liability, responsibility or duty of care for any consequences of you or anyone else acting, or refraining to act, in reliance on the information contained in this resource or for any decision based on it.

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