Case Study from the Electronics Manufacturing Industry

Christoph Karrer ()
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Christoph Karrer: McKinsey & Company, Inc.

Chapter Chapter 6 in Engineering Production Control Strategies, 2011, pp 103-115 from Springer

Abstract: Abstract A previously executed Lean transformation has already led to a significant operational performance increase, mainly by limiting WIP between processes, defining the OPP, and establishing, as it is typically recommended in Lean thinking, a pure MTS replenishment system in front of the OPP. All three aspects are also covered by the presented PCS engineering framework. However, through disengagement from pure Lean thinking and its pure MTS approach, the transition to a hybrid MTF/MTS control approach can lead to a further significant performance increase, which translates into a further reduction potential of WIP in the SMT supermarket by 33%. Interpolated to the whole plant, this would be a WIP reduction of almost 7 million DKK, only considering the book value of the stock and no follow-on benefits of reduced inventories. For the examined case, due to increasing volumes in the plant, the potential increase in space productivity by reducing the stocks is one of the most important follow-on benefits.

Keywords: Forecast Error; Delivery Performance; Surface Mount Technology; Demand Variability; Planning Segment (search for similar items in EconPapers)
Date: 2011
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Persistent link: https://EconPapers.repec.org/RePEc:spr:mgmchp:978-3-642-24142-0_6

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DOI: 10.1007/978-3-642-24142-0_6

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