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David jacobs


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David jacobs

  1. 1. The Presidents’ Forum of Orange County Tuesday, March 11, 2008Building Value in Your Business Through Lean Business Management David Jacobs Anchor Audio Chairman
  2. 2. Portable Sound Systems
  3. 3. Lecterns
  4. 4. Wired & Wireless Intercoms
  5. 5. Assistive Listening Systems
  6. 6. Politicians
  7. 7. Military
  8. 8. Educators
  9. 9. Churches
  10. 10. Corporate
  11. 11. Emergency
  12. 12. Entertainment Rene Russo in “Hostage”
  13. 13. Question: How Does Anchor Audio Succeed in Competition With Foreign Manufacturers?Answer: Lean Business Management 1. Lean Manufacturing, 2. Lean Distribution, 3. Lean Vendor Management, 4. Lean Engineering, 5. Lean Finance.
  14. 14. 1. Lean ManufacturingAction Steps (Over a 3 Year Period):• Hired CMTC to Consult on Lean Manufacturing Techniques • Point-of-Use Storage (Minimized Movement of Inventory) • Cellular Manufacturing (Eliminated WIP Inventory) • Single Piece Flow (QC Each Unit to Assure High Yield)• Improved Receiving Inspection (No Bad Raw Materials)• Invested in Automation Equipment to Manufacture Circuit Boards• Re-engineered Products to Capitalize on Manufacturing Capabilities• Created Incentive Programs for Every EmployeeResults:• Reduced Direct Labor By 50% (7% of COGS)• Failures Reduced to 0 – 2 per Day• Reduced Inventory by 45% (No WIP)• On-Time Delivery is 100% (Promise 3 Day Shipping)
  15. 15. Liberty Manufacturing Cell
  16. 16. Automated Surface MountEquipment
  17. 17. 2. Lean DistributionAction Steps:• Improved the Management of Our 3,000 Dealers – Fired Independent Manufacturers Reps in the US – Expanded Our Sales Department to Provide Dealer Support, • Phone, E-mail, Web Support, Trade Shows & Field Visits • SPIFF Awards to Dealers’ Salespeople• Closed Barcelona Distribution Center – European Operating Costs Too High, – New Transportation & Communications ServicesResults:• Sales Increased After the Reps Were Fired,• Eliminated Rep Commissions (6% - 10% of Sales),• Improved Dealer Communication (Dealers Prefer Direct Contact)• Eliminated European Inventory, Staff & Overhead.
  18. 18. 3. Lean Vendor ManagementAction Steps:• Custom Parts (Plastics & Metal) – Designed Out Custom Components As Much As Possible – Studied & Improved Vendors’ Manufacturing Processes » Material Handling Procedures & Fixtures » QC Procedures to Align With Anchor QC Standards » Replaced Non-Performing Vendors• Commodities (Electronics) – Qualified Multiple Sources » Price, QC & Delivery Requirements• Accurate Forecasting to Drive the MRP and Purchasing.Results:• Gross Profit Increased By 10% (Parts are 87% of COGS),• Very Few Receiving QC Problems,• Almost No Raw Material Parts Shortages.
  19. 19. 4. Lean EngineeringAction Steps:• Efficient Project Planning & Control – Initiated Daily Project Management Meetings – Involved Marketing, Sales, Production & Finance – Improved BOM & BOO Documentation.Results:• Rapid Decision Making to Guide the Projects• Organization Operates as a Coordinated Network• Time-To-Market Dropped Dramatically• Accelerated New Product Development: – AnchorMAN Wireless Intercom – Patent Pending – Beacon Portable Line Array – Patent Issued 2/08 – Acclaim Portable Lectern – MiniVox Lite – Upgraded Electronics in Existing Products – Improved Enclosures for Human Interface
  20. 20. 5. Lean FinanceAction Steps (Eliminate the Outside Cost of Capital):• Bought Back All Outside Shareholder Stock• Paid Off All Bank Debt• Purchased a Building for the CompanyResult (Positioned to Pursue a New Growth Phase):• No Payments for Dividends, Interest or Rent,• Cash Flow Is Available to Fund Company Growth – New Product Development – New Market Development (Europe) – Acquisitions
  21. 21. Summary Recession Closed Europe Large Dealer BK Sales Incr by 14% Introduced New Products Improved Dealer Management Gross Profit Lean Manufacturing Incr by 39% Product RedesignsLean Mfg OverheadCut Reps Decrease by 19%Closed Europe Debt Income Increase by 617%FY01 FY02 FY03 FY04 FY05 FY06 FY07 FY08 FY09