1. Lean Implementation and Supply Chain Development at Oak Hills 1
Lean Implementation and Supply Chain Development at Oak Hills
By
Christina Cecil
An assignment submitted in partial fulfillment of the requirement for MGT 608
School of Business Management
National University
Gary Solomon
12/12/15

2. Lean Implementation and Supply Chain Development at Oak Hills 2
Background
This article focuses the Oak Hills facility and their need to implement a more lean supply
chain. “The Oak Hills facility is a unit of The Oil and Gas Services Company (TOGS)” (Visich,
2013, p. 79). With oil prices and demand low in the industry and a “wave of mergers…within the
oil and gas industry” TOGS was able to acquire a “competitor, Triangle Corp.” (Visich, 2013, p.
79). Soon after The Oil and Gas Services Company was purchased by Pasadena Services. This
purchase by Pasadena Services leads the company to planning “to reduce operating expenses by
consolidating redundant operations” (Visich, 2013, p. 79).
What are the specific quality problems Oak Hills is facing, and how will they influence the
company’s ability to convert to a lean system?
The Oak Hills manufacturing facility has problems in no knowing what testing
instruments Pasadena Services will need once they are done reducing operating expenses. Other
problems are the “inventory holding costs” being high and inventory turnover only being five
times annually, “increased delivery costs and overtime pay were other costs associated with
expediting orders” (Visich, 2013, p. 80). This has caused issues since their customer are used to
this expedient shipping on orders and as a result has led to unhappy employees and a drop in
customer service. A major issue Oak Hills faces in that “a different lid is required for each type
of box” that they produce and this leads to lids not being able to be inventoried (Visich, 2013, p.
82). Other problems are in the lid manufacturing process since “employees were not trained in
process control techniques” and their supplier’s poor delivery record has causes issues with
orders being rushed (Visich, 2013, p. 86).

3. Lean Implementation and Supply Chain Development at Oak Hills 3
What changes in the manufacturing environment need to be undertaken in order to convert
the current systemto a lean system? Think about this from both short-term and a long-
term perspective.
The changes that need to be made are a lot for this company. By reducing the number of
lids by implementing a more streamline box set that can use fewer models of lids. Employees
need to trained on process control and with the Rhythm Wheel certain employees should be
delegated the tasks of testing and moving the lids to different departments. Another solution
would be to reorganize the production facility so the movement of products and employees
between departments would not only save on time but be more efficient for the production
process overall. By eventually considering going with a different supplier for their sensor boards
this could reduce the costs of delivery time and overtime pay since the parts will then be making
it to the manufacturing plant in the time frame that it is needed.
How will the implementation of lean systemimpact employees and what can be done to
smooth the transition?
Initially employees might be worried about losing their jobs but once the new plan is laid
out for employees things will go smoother. To smooth the transition managers need to make sure
that the employees are trained in the new system and are aware of the changes and the time-line
in which the changes will be taking place in the work environment.
At what stage in the development of a supply chain is Oak hills, and what can be done to
improve the supply chain?
I think the supply chain needs improvement not only in their issues with their sensor
board supplier, but in the whole manufacturing process in the plant. The plant set up for

4. Lean Implementation and Supply Chain Development at Oak Hills 4
production needs to be changed to make the process more streamline for the employees and the
employees need to be trained on quality control. Other issues lie in the employees moving form
station to station which slows down the process. In order to improve the supply chain
implementation of the “Rhythm Wheels makes it possible to match production capacity with
stocks more efficiently” (Packowski & Francas, 2013, p. 135). This allows for the company to
“bring production and replenishment planning together when dealing with volatile environments,
the alignment of production planning parameters and inventory targets” (Packowski & Francas,
2013, p. 135). In the issue of the lids ending up up damaged to the customers by using RIFD the
company would be able to determine why the lids are being damaged, also implementing quality
standards for the lids and a standard set of measurements for thickness and weight of each lid
would reduce the waste from rejected lids.
For Oak Hills, what is the connection between demand management and the supply chain?
Demand management does not seem to be doing a very good job in predicting the
demand for the year’s sales this causes issues in the supply chain in that it causes the employees
to rush to fill orders for the delivery truck to get the products to the customers for next day
delivery.
What should Oak Hills do? What problems might occur in implementing your
recommendations, and how can these problems be avoided or neutralized?
By implementing both a Rhythm Wheel and Time Compression Principle the company
should be able to fix some of the issues in the supply chain. Time Compression Principle
“suggests that every activity in the supply chain should be undertaken in the least possible time
needed to achieve the task. It also suggests on-time delivery of what is actually required” (Panda

5. Lean Implementation and Supply Chain Development at Oak Hills 5
& Mohanty, 2011, p. 25). This would require the company to look for a new supplier that would
not be late in their delivery of the products needed.

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References
Packowski, J., & Francasa, D. (2013). Lean SCM: A Paradigm Shift in Supply Chain
Management. Journal of Business Chemistry, (10)3. P. 131-137. Retrieved from
http://web.a.ebscohost.com.ezproxy.nu.edu/bsi/pdfviewer/pdfviewer?sid=54e02b8c-
c0e3-44a4-96fb-7f35691a6d5e%40sessionmgr4003&vid=1&hid=4107
Panda, T.K., & Mohanty, P.K. (2011). Supply Chain Management and Bull Whip Effect: A
Conceptual Framework for Efficiency Improvement in Supply Chain. The IUP Journal of
Supply Chain Management, 7(4). P. 20-29. Retrieved from
http://web.b.ebscohost.com.ezproxy.nu.edu/bsi/pdfviewer/pdfviewer?sid=b59eb8de-
2805-45a0-85e8-720a35706720%40sessionmgr111&vid=1&hid=101
Visich, J.K., & Wicks, A.M. (2013). Lean Implementation and Supply Chain Development at
Oak Hills. Bryant University. P. 79-86. Retrieved from
https://nu.blackboard.com/bbcswebdav/pid-1264980-dt-content-rid
4687838_1/courses/MGT608-65511
1512/Lean%20Implementation%20and%20SCM%20at%20OH%20wisner_case_pt03_13
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