GOING BEYOND QUALITY BENCHMARKS

Situation

A leading chemicals manufacturer had successfully driven their operating cost to best-in-class levels within the stringent quality regulations of their product. Continuing cost pressure left plant leadership uncertain how their facility would further reduce cost beyond industry benchmark levels while maintaining quality. The team partnered with Stroud to find and deliver bottom-line improvements while improving overall product quality.

Finding More Opportunity

Plant leadership knew they were in a challenging position. Product composition was both paramount and heavily regulated, and their rework and “cost of quality” metrics were at industry-leading levels.  With cost a hot topic capital solutions were out of the question, leaving leadership feeling they needed a different approach to improving their assets. The plant team worked with Stroud to conduct a Zero Based Analysis designed to find all potential improvement opportunities in the plant. By approaching accepted “cost of quality” spend as recoverable opportunity, the team found that surprising levels of rework and batch adjustments could theoretically be eliminated. Leadership knew improving past their industry best “cost of quality” levels would be a challenge, but was necessary to remain competitive.

Unleashing Potential

The plant team set out to reduce batch adjustments due to quality variations, the biggest “cost of quality” driver in the plant. Many believed quality variation came from uncontrollable changes in the many incoming ingredients. Improving with many varying ingredients would be taxing and unsustainable. By combining the company’s process expertise and Stroud’s rigorous, first-principles problem solving approach the team systematically tested key process variables. After careful analysis the team found that only two key ingredients were actually driving quality variation. Changing measuring procedures and tolerances for these two key ingredients dramatically improved batch accuracy. Improving batch accuracy, which many thought couldn’t be done, helped shift the cultural perspective that right-first-time numbers were within the plant’s ability to control. 

Delivering Results

The team reduced plant-wide labor cost by 8% by eliminating 45% of the rework batch adjustments, and shortened the overall batch production time by 12%. More importantly, by demonstrating that the best-in-class process could still be improved the team catalyzed similar improvements throughout the rest of the facility and organization.

 

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