Access savings potentials in the indirect areas in a sustainable manner …
Access savings potentials in the indirect areas in a sustainable manner
To reduce the costs in the indirect areas and maintain the competitiveness of the internal structures, Nolte Möbel [Nolte Furniture] together with Staufen AG implemented a large-scale lean administration project. The result: efficiency increased by up to 50 %, processing times decreased by up to 70 % and quality increased by up to 65 %.
When Dr. Stefan Schwarzfischer became Managing Director for Technology and Administration at Nolte Möbel GmbH & Co. KG in 2007, he faced a difficult profit situation. Shortly thereafter, the Global Financial Crisis became imminent. In consequence, the decision was made to cut costs across the entire business. During this process, the focus was to be on sustainability. "We didn't have the objective to cut costs by a certain percentage as classic management theories stipulate", Mr Schwarzfischer explains. "Primarily this was about generating long-term effects through process and structure optimizations." In a first step, Nolte Möbel initiated targeted lean production measures in manufacturing. The second lever the company wanted to use was the overhead costs, comprising all indirect areas including the indirect components of manufacturing and assembly, maintenance and internal logistics, which are also categorised as overheads at Nolte Möbel. "This was where Staufen AG entered the playing field. Together with them, we developed a comprehensive lean administration project".
As in manufacturing, lean administration is based on the idea of focusing on creating value and avoiding waste. Waste is defined as anything not directly or indirectly serving the customer. During the process, internal areas are also considered "clients" if they depend on the work results of upstream processes to carry out their own work. Staufen AG's fundamental lean administration approach was also used in the Nolte Möbel project: analyze, differentiate, optimize.
Analyzing and differentiating
For two months, Staufen consultants rigorously analyzed Nolte Möbel's overheads. "In agreement with the shop council, we initially analyzed the cost structures", explains Andreas Mohren, Senior Manager and Partner at Staufen AG and manager for the project "Nolte Möbel". "Based on these findings, we analyzed each workplace, functional areas and process in great detail where appropriate". In consequence, for the first time it was possible to define who in the company spends how much time on what. The analytical tools used ranged from job analyses of individual workplaces to function and value stream assessments to interviews with executives. The consultants presented their findings in a comprehensive final report. While differentiating between processes that create value (indirectly) and waste, they also came up with measures to improve the analyzed processes in close collaboration with managers and employees. Furthermore, they highlighted savings potentials and developed schedules for the implementation. "In some departments, we had potentials of up to 50 %", Mr Mohren says. However, due to capacity and budget constraints, not all suggested measures and approaches could immediately be implemented. During a workshop with senior management and Staufen consultants in late 2009, all measures were checked and ranked according to their potential as well the required investments, capacities and time: All items falling below a certain threshold were postponed. Moreover, the workshop team linked the measure to the context of projects already underway in other areas at Nolte Möbel - the "Power" program came to life.
Implementation and internal resistance
In early 2010, the Power program and the lean administration measures were supposed to commence. However, the program only ran sluggishly to begin with. "Everything we had considered a great kick-off with senior management seemed to have been almost forgotten over the Christmas time", Mr Schwarzfischer surmises. "