SUCCESS Stories
Constraint management has produced documented successes in a wide variety of industries, both manufacturing and service. Some of these successes are summarized below.
SOURCES: Various books, periodicals, the Internet, and first-hand accounts. For a comprehensive listing of sources, try: Mabin, V.J. and S.J. Balderstone. The World of the Theory of Constraints. Boca Raton, FL: St. Lucie Press, 2000. (Available at www.amazon com)
Bal Seal Corporation (Southern California)
- Manufacturer of seals for high pressure containers
- Implemented a 30-day conversion plan
- Increased output from 65,000 to 100,000 units per week
- Cut manufacturing lead time from SIX WEEKS to EIGHT DAYS
- Went from make-to-stock to make-to-order
- On-time delivery rate increased from 85% to 97% and is still increasing
- Eliminated overtime (previously a 55-58 hr/week schedule)
- Net Profit DOUBLED
- Inventory reduced 50%
- Improved customer service
(Source: APICS Constraints Management Symposium Proceedings (1997).
ROCKLAND MANUFACTURING (Pennsylvania)
- $10 million job shop making attachments for heavy equipment
- Made more profit in the two years following application of constraint theory than in the preceding 10 years combined
- Throughput ($$$) increased 25% in two months
- Work-in-process inventory reduced 35%
- Had NO late shipments in 18 months
- Initiated a profit-sharing program with employees
OREGON GLASS
- Makes tempered glass for doors and windows
- $13 million per year in revenues
- BEFORE TOC: On-time delivery performance only 60%
- AFTER TOC: Consistently exceeded 99%
- Company went from losing money in 1995 to best-ever profits in 1996-97
- Company value doubled in 1.5 years
OREGON FREEZE DRY
- Food products and non-food perishables
- Late shipments reduced from 21% of all goods produced to 0.6%
- Finished goods inventory reduced by 60% initially
- Expect to exceed 80%
- Make-to-order lead time reduced 50%
- Sales increased 20%
LUCAS VARITY (Detroit, MI)
- Manufactures automobile parts
- On one manufacturing line, increased output 76%
- Manufacturing cycle time reduced by 24%
- First-run yield increased by 4%
- On-time delivery rates increased to 100%
- Scrap cost-per-unit reduced by 68%
- Delayed a $6 million investment in new capacity for ONE YEAR without negative customer service impact
Ford Electronics (Now Visteon) - Markham, Ontario (Canada)
- Manufactures radios, sensors, displays and other electronic components for Ford Motors automobile divisions
- Manufacturing cycle time reduced 93%
- From 12 days to TWO SHIFTS of ONE DAY
- "Liberated" 25% of floor space in the manufacturing facility
- Eliminated the need for one whole warehouse in inventory storage capacity
General Motors (Cadillac Division)
- Reduced time to deliver a CUSTOM-CONFIGURED Cadillac (From 85 days to LESS THAN 19 days)
- 24-48 hours, in most cases
(Source: SUCCESS Magazine, Jan-Feb 1995. Back issues available, $5.00 each.)
HARRIS SEMICONDUCTOR (Mountaintop, PA)
- Increased Throughput ($$$) 40%
- Industry average was 10-20%
- Went from making NO profit, to providing 80% of the DIVISION profit, to 20% of the entire company's profit
- Plan to introduce 200 new products in 18 months (Industry average: 20-40 a year)
(Source: Leading the Way to Competitive Excellence (ASQ Quality Press, 1998)
FMC Wellhead Equipment Division (Houston, TX)
- Produces high-performance drilling equipment for land and offshore oil drilling operations
- Expediting costs reduced 45%
- Eliminated 70% of work-in-process inventory ($4.0 million/year saving)
- Lowered outsourcing expenses by $400K per month
- $50 million in additional annual revenue from the same resources (no additional investment)
(Source: Integrated Design & Manufacturing, Nov/Dec 1997)
Zycon Corporation (Santa Clara, CA)
- OBJECTIVE: Reduce manufacturing cycle time by HALF within 18 months
- RESULTS:
- Cycle time decreased from 3 WEEKS to 3 DAYS
- Inventory decreased 50%
- Scrap loss decreased 50%
-Throughput DOUBLED
(Source: APICS CM-SIG Symposium Proceedings, 1995)
National Semiconductor
- Computer chip wafer fabircation
- 30% increase in Throughput in 6 months
- 20% increase in inventory turns
- 35% improvement in manufacturing cycle time
(Source: APICS CM-SIG Symposium Proceedings, 1995)
Meritor (Rockwell Automotive) Heavy Vehicle Systems
- Mjor global supplier of drivetrain components for trucks, buses, off-highway vehicles, etc.
- 42% increase in Throughput
- 55% reduction in work-in-process
- 61% decrease in cycle time
- 75% reduction in expediting expense
- 45% reduction in scrap & rework
- 41% reduction in late deliveries
(Source: APICS CM-SIG Symposium Proceedings, 1998)
EMC Technology, Inc.
- Manufactures RF and microwave components for commercial and military telecommunications
- 75% reduction in manufacturing lead time (12 weeks to 3 weeks)
- 67% reduction in backlog (from 700 orders to 225)
- 75% improvement in schedule "stability"
(Source: APICS CM-SIG Symposium Proceedings, 1998)