How to Survive and Thrive in Today's and Tomorrow's Manufacturing Environment

3rd China International Logistics
Development Conference
Suining City Nov 2016
Liam Cassidy FCILT
Managing Director LCL Consult Ltd.
Connectivity Win - Win & Sharing

 About LCL
Lean Practices
Case History: The Transformation of FESTO
China Manufacturing & Supply Chain
 Summary

LCL (Leading Change through Lean)
was established in 2009 to provide rapid
turnaround solutions to businesses &
factories that are concerned about
survival.
With offices in Dublin, Ireland it
provides solutions on a global basis.
Liam Cassidy has amassed over 30 years of experience successfully managing
operations for General Motors, Gillette and Procter & Gamble. He was their
most successful Lean General Manager, transforming traditional factories,
Supply Chains and Distribution Centers into Lean Benchmark operations in
both high and low cost countries in Europe, USA and Asia, including China.
His work has been acknowledged by major international institutes and
journals. He is a regular speaker at conferences worldwide
About:

 2 years ago I was fortunate to be invited
to speak at your inaugural conference in
Beijing
My presentation talked about the value
of using the Lean Philosophy &
Practices to run organisations,
regardless of what type that is.
I said then that “ I know of no better
way to transform and manage a
successful operation than the Lean
way”.
I will repeat that today...there is no
better way!

What is Lean?
Maximise Customer Value by minimising Waste
Simply, Lean means creating more value for customers with fewer
resources
The Lean Toolbox
The Lean ToolboxThe Lean Toolbox

100% Customer Focused Org
Delivering Exceptional Customer
Service On-Time-In-Full
Putting People First – Inclusion
& Building Engagement
The Power Of ‘Everyone’
• Valuing & Involving Everyone
• Education & Personal
Development Plans For Everyone

 However, Lean has a large
failure rate and it has been
getting a bad name.
When Lean fails it is usually a
failure of Leadership to
understand how they need to
change and what they need to do
to ensure lasting success.
However, there is also another
major factor: this is the failure of
Lean Providers to insist on what
is necessary to make it successful

Far too many will not risk losing the project
and will compromise rather than tell
Leadership what they may not want to hear
So there are many Lean Providers offering
minimal programs, which may provide some
early good results, but which have no chance of
being sustained.

In reality, it is a waste of time and money.
It takes a sustained program of between 18-24
months to get an organisation to what I call “Phase 1”
At this level great results are being achieved. The
workforce at all levels are energised and enthusiastic
and the organisation has the skills necessary to
continue to drive forward with ever improving results.

However, it is not easy and demands full and
determined support from Leadership at every
level. The CEO or equivalent must also be
prepared to deal with any managers &
employees who are not fully supportive of it,
or lacks the necessary skills to support it.

Phase 1 Approx 1.5 – 2 years to complete
Step 2
5 – 6 S
Step 3
OEE
Level 1 -3
Imp process
Step 1
Education
Vision
Goals & Objectives
Communications
Role of Leadership
Step 4
Visual
Management
Lean Signage
Step 5
Value Stream Map
Process Map
Kaizen Events
Step 6
Supply Chain
•Kan Bans
•Suppliers/SLA’s
•Planning
•Visual Schedule
Step 7
AM
Step 8
SMED
• Pace of implementation depends on local situation
• Usually 2 years to embed but most activities in
place after 12-15 months
• Benefits flow almost immediately
• Will not work without foundation steps
• No fast track
• Requires determined & relentless leadership
• Coaching & Mentoring is provided over entire
program
• Our consultants usually on site 1 week per monthConnectivity Win - Win & Sharing

One of the Case Histories I referred to
in 2014 was a project in Jinan
We were well through the early phase
of the project at that stage, and were
already showing outstanding results
Today I want to finish that story and to
show you how incredibly successful
this project was, and how by doing the
right things with Leadership the
practices we put in place are being
sustained

Case History China
费斯托济南案例历史

Founded in 1925 FESTO is a privately owned
German industrial control and automation
company based in Esslingen am Neckar, Germany.
It is an engineering-driven company that sells
pneumatic and electric transducers primarily to the
automation industry. It is among the world leaders
in its field

Located in Jinan, in the province of Shandong, the
state owned factory has been in operation since
1956 producing a range of low to mid range
pneumatic components.
 Acquired by FESTO AG in 2007 and has since
been transferring its production to its mainstream
higher value products, while discontinuing most of
its original product offerings.
Very significant investment by FESTO which
included a new factory completed in 2012

The factory was
experiencing
-Poor Customer Service
- Poor Employee Motivation
- Quality problems
It was the worst performing factory
& Supply Chain in its global
operations

Before
济南工厂的过去

In 2014 I showed the conference these
results.
Productivity up 53%
Inventories down by 60%
Customer Service was improving

Today, almost 6 years years after the project started
and 3 years since we finished supporting the site the
results show continued and impressive improvement.
This is the true test of a
successful project ...
continued use of the Lean
Tools and impressive year
on year improvements after
the consultants have gone

Productivity Improvement since 2012
(Actual FESTO Slide)
34
35
32
201
100
201420132012 2015
- Productivity= ∑(Standard Routine*Output)/∑Working hours from attendance
- For direct only
Base

Jinan – Now
济南工厂的现在

Operator Work Station 操作工作站

242424Connectivity Win - Win & Sharing

• Agenda:
- Introduction LCL
- Lean Experiences
- Experience working in different Countries
- Managing Plant in China
- Experiences with Ceska Lipa/Jinan
- “Outside” view of Festo

Kanban Control
Board
看板控制管理
GPC - JinanGPC - Jinan
工作要有紧迫感
没有等待
团队精神.紧密合作 GPC - Jinan团队精神.紧密合作 GPC - JinanGPC - Jinan GPC - Jinan
GPC - Jinan
GPC - Jinan
保障客户满意
快速换产
当天交货
100%完成定单
团队精神.紧密合作 GPC - Jinan团队精神.紧密合作 GPC - JinanGPC - Jinan GPC - Jinan
GPC - Jinan
GPC - Jinan
成为世界级一流工厂
没有停机
没有断料
建设自信自立的团队
团队精神.紧密合作 GPC - Jinan团队精神.紧密合作 GPC - JinanGPC - Jinan
6S
GPC - Jinan
GPC - Jinan
6S6S
GPC - Jinan
有效的工作区域管理-6S
物有其位
物归其位
团队精神.紧密合作 GPC - Jinan团队精神.紧密合作 GPC - JinanGPC - Jinan
Festo Jinan Lean
Boards
费斯托济南精益
管理板

2828
GPC - Jinan
工作要有紧迫感
Working With Urgency - Nobody Waits
没有等待
团队精神.紧密合作 GPC - Jinan

2929
GPC - Jinan
GPC - Jinan
保障客户满意
Customer Satisfaction – 1-day Lead Time + …
快速换产
当天交货
100%完成定单

3030
GPC - Jinan
GPC - Jinan
World-Class Manufacturing –
machines working all of the time + …
成为世界级一流工厂
没有停机
没有断料
建设自信自立的团队

3131
6S
GPC - Jinan
GPC - Jinan
Workplace Organisation – 6S
– A Place For Everything & …..
有效的工作区域管理-6S
物有其位
物归其位

3232
SMED Process Maps – Mazak
Current Process
• Changeover Time 207mins
New Process
• Changeover Time 61mins
• Reduction 146mins (70%)

After completing our project in
the factory we then went to work
on their China Supply Chain
Lead Times from Order Placement
to Delivery was averaging over 20
days.
This was far in excess of their
major competitor who had Lead
Times of approximately 7 days
Urgent action was necessary

There were multiple offices
throughout China, leading
to duplication & confusion
Processes were outdated
People blaming each other
Unhappy customers

What did we do?
Established Cross Functional Teams
Process Mapped all of the key
processes
Rationalised number of locations
Identified problems & bottlenecks and
put solutions in place
It was hard work and took just over a
year, but results have been
tremendous!

China Supply Chain
Improvement in Lead
Times
from
Order
Receipt
to
Delivery
0
5
10
15
20
BEFORE
AFTER

Summary
So the entire FESTO operations in China have been
transformed from being the worst within their
organisation, to being the best!
This has been achieved by a combination of well applied
Lean Practices and the right kind of Leadership
It takes both to ensure lasting success
One without the other simply will not work

Are you concerned about your
business?
Are your costs rising?
Is performance not what you
would like it to be?
There is a solution!
Lean Practices…

Summary
• Well implemented Lean Programs will transform
organisations and make them the envy of the
competition
• They can be applied in any industry , Supply Chain or
Offices
• They will dramatically reduce costs and help secure
future investments
After 3 months - improvements visible
6 months – remarkable
1 year – dramatic

Contact:
LCL Consult Ltd
39 Fitzwilliam St. Upper,
Dublin 2,
Ireland
M: +353 86 7919759 M: + 86 13681 962 687
Email: liam@lclconsult.com or: enquiries@lclconsult.com
Web: www.lclconsult.com

Lean Projects with LCL
Christian Leonhard
Senior Vice President
Head of global
Production at Festo
LCL worked for Festo in Factories in Czech Republic, Hungary , in Jinan, China &
currently USA
Liam and his team are true lean experts, the best I ever met in my long career as
head of factories. They excel not with power point slides but with solid lean work
on the shop floor. Results have been fantastic in all projects they conducted for us.
In Jinan, within less than 9 months they introduced lean thinking and a sense of
urgency, which largely exceed our expectations. Our local workforce has been
powered up by the coaching and training of LCL. Most importantly, productivity
continued to rise by 10-15% per year after the project with LCL ended. Our own
people became so engaged into lean thinking, that productivity improvements
became self propelling. Our site in Jinan now is among the most productive in the
entire global Festo supply network.

Lean Projects with LCL
Hong Chen
GM
Festo Production Ltd.
LCL worked for Festo in GPC- Jinan, China.
Liam and his team have brought the lean methodology to GPC-Jinan, with their
professional on-site consultation and passion to drive change, lean management
spread among factory. By analyzing existing problem and using Lean tools to
optimize the manufacturing process, we changed the production from “push” to
“pull”. Productivity has been doubled with significantly reduced lead time. OEE and
SMED help us improved the utilization of equipments so that we could reduce
production cost continuously and make production more predictable due to high
process reliability.
More important, the Lean thinking is deeply embedded in the mindsets of staff here
in GPC-JN.

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