A medium-sized company had outsourced part of its production to a foreign country in Eastern Europe. The company is part of an international group. It manufactures components for measuring, displaying and controlling process parameters for various industries.
Some plant managers had managed the company with very little success. When the error costs had reached a maximum and delivery performance had fallen below 60 percent, the current interim manager was entrusted with the project. He was given the task - still in a permanent position at the time - of making the company competitive again in the shortest possible time.
Management structures changed and management team formed
During the initial discussions, it became clear that some strong managers dominated the entire team and sometimes obstructed important decisions. Competent other managers remained in the background because they believed that the next level of management only listened to these strong personalities. In addition, very few people had access to important company information.
In order to eliminate this management weakness, the interim manager formed a management team as a first important step, which was structured by formal appointments and agendas. All managers were given the task of measuring and explaining the results of their area and discussing next steps together. The interim manager took on the role of moderator. In particular, he strengthened the managers who had previously been in the background. He also provided support in defining the tasks and the necessary working groups.
Measurable criteria create more transparency at all management levels
In this way, it was possible to challenge the strong people in their areas in an objective manner using clearly measurable criteria. On the same basis, other managers were promoted in their areas of responsibility and equipped with expertise. The transparency at this management level also had an impact on the responsible department heads, who were now better informed about data important to the company and recognized where their part in improving the company's performance lay.
Introduction of planning software for production and supply chain management
One of the biggest challenges in this project was planning in production and the associated supply chain. Previously, order data was entered manually into separate planning software, and production and procurement plans were created from this, which in turn were repeatedly changed by manual intervention. As a result, confirmed delivery dates were frequently changed, material stocks reserved for specific productions were used for other purposes and delivery dates had to be continually postponed. Prioritization was based on the definition of "important" and "less important" customers.
The interim manager therefore initially had to influence the formation of opinion. There is now a consensus within the company that all customers are important customers and that a company is judged by whether it keeps its promises. At the same time, the interim manager ensured that the positions of quality manager, customer service and logistics manager were strengthened and that the entire team was able to develop an understanding of the overarching supply chain.
Delivery performance increased to well over 90 percent in a very short time
Building on this, the consistent implementation of a modern, IT-supported planning system could be tackled. Orders were entered into the central ERP system and transferred from there to the planning system via IT. The data determined here was fed back to Customer Service and the actual delivery date was transmitted to the customer. These steps alone increased delivery performance to well over 90 percent in a very short space of time, thereby enhancing the company's image.
