Applying knowledge management tools/ concepts to solve a company problem in Schaffner.

1. Applying knowledge management tools/ concepts to solve a company problem in Schaffner. AB Goh 9 January 2011.

2. Presentation title Fig. 1.0 - Choke Components Plastic Housing Toroid Copper Wire Steel Wire Separator Resin

3. Presentation title Applying knowledge management tools to solve a company problem in Schaffner. • Figure 1.0 shows the Choke products which are the traditional strong hold products of Schaffner. • At the peak, a few years ago Schaffner produces between 1 million to 1.5 millions a year. • The Choke products is also one of Schaffners’ revenue generators. • In the year 2008 Schaffner sold slightly above half a million pieces and 2009 , Schaffner sold much less than half a million pieces.

4. Presentation title Applying knowledge management tools to solve a company problem in Schaffner. • The main problem is ; • Schaffner is losing market share and is being threatened that the entire Choke business will be wiped out within two to three years.

5. Presentation title Problem; Schaffner is losing market share and is being threatened that the entire Choke business will be wiped out within two to three years. Schaffner’s prices are above the competitors No priority for salesmen to sell Not designing to customers’ requirements 3% >40% >5% Losing market share on Choke products >44% >5% Schaffners’ Chokes have lesser performance features than competitors Unhappy customers >3% Customers shifting to new technology platform Fig. 2.0

6. Presentation title Problem; Schaffner is losing market share and is being threatened that the entire Choke business will be wiped out within two to three years Too much walking around 1 Methods Man 7 40% Throughput time too long High content of manual operations 2 8 Cycle time too long as compared to standard Schaffner’s prices are above the competitors 1 Workers are not ergonomically positioned 1 1 Work sequences not optimised. 3 9 Cost reduction by 25% Related machines are in different floors/ locations causing too much transportation No cost reduction targets with suppliers 4 10 use over specified materials resulting buying expensive materials 5 Machines are not fully automated Still buy materials from Europe ( costly) 6 11 Machine Materials Fig. 2.1

7. Presentation title Problem; Schaffner is losing market share and is being threatened that the entire Choke business will be wiped out within two to three years Qualityissues 1 Poor solder joints 3 2 scratches Potting materials not fully hardened 44% Unhappy customers Too long to pick materials at warehouse to fill a work order 4 7 Long set – up times required before Production can start 5 Suppliers not delivering materials on-time Inflexibility of production lines 6 Poor on- time deliveries Fig. 2.2

8. Presentation title Reorganise the work flow from traditional production conveyor lines to lean cell concepts. • By applying Lean cell concepts , the following causes/ actions will be taken care of; • Fig.2.1 • Cause #1 • Cause #3 • Cause #7 • Cause #8 • Cause #9 • Cause #10. • Fig.2.2 • Cause #4. • Cause #5 • Cause #6.

9. Presentation title Application of LEAN CELL CONCEPTS • First , the entire process is mapped out as shown in fig.2.3. • All the processes are studied by removing the 7 wastes in manufacturing. • Figures 3.0 A to 3.0D show the application of lean cell concepts. • Fig. E is the final lean cell layout. • The lean cell concepts will reorganise all the process stations close together with the objective of a smooth and ergonomic flow. • One piece flow is applied. • Materials are at the point of use. • It is a two bin system .

10. Presentation title Winding Pin Insertion Cutting & Wave Dipping Assembly Soldering Fig. 2.3 Choke Process Flow Moulding Baking Hi-Volt test Test Printing Packing

11. Presentation title 7 Wastes In Manufacturing Over Production Unnecessary motion Over Processing Rejects and Defects Seven Wastes Inefficient Transportation Waiting Times Unnecessary Stock Fig.3.0 A

12. Presentation title High inventory hides the problem High water level conceals the rocks UNSTABLE DEMAND LONG SET UPS 100 meters GENERATING DEFECTIVE PRODUCTS REWORK DELAY IN DELIVERIES POOR HOUSEKEEPING HIGH MANPOWER REQUIREMENTS MACHINE BREAKDOWNS MIXED MATERIALS Fig.3.0B

13. Presentation title Low inventory exposes the problem Low water level reveals the rocks UNSTABLE DEMAND LONG SET UPS GENERATING DEFECTIVE PRODUCTS 50 meters REWORK DELAY IN DELIVERIES POOR HOUSEKEEPING HIGH MANPOWER REQUIREMENTS MACHINE BREAKDOWNS MIXED MATERIALS Fig.3.0C

14. Operation 3 Operation 4 Operation 2 Operation 1 Operation 5 Customer Raw Material Presentation title Value Adding Processes Smooth cellular flow by connecting the relevant processes together: Fig.3.0D One Piece Flow Production in a Cellular Layout: Significantly reduces transportation, inventory, and waiting time while improving quality, delivery, and costs.

15. Presentation title Fig. E Choke Lean Cell

16. Presentation title Problem; Schaffner is losing market share and is being threatened that the entire Choke business will be wiped out within two to three years • By automating the process operations the following causes / actions will be solved. • Fig 2.2 • Cause # 2 • Cause #11 • Fig. 2.2 • Cause # 2. • Use Nonaka model for automating the following process operations; • Winding process. • Cutting and wave dipping process. • Pin- insertion process. • Assembly process. • Moulding process. • This will cut cycle time by at least 35% but most important is the quality improvements ( yield and less scrap).

17. Presentation title Fig. D-1 Choke Process Flow

18. Presentation title Fig. D-3 Choke Process Flow

19. Presentation title Fig. D-2 Choke Process Flow

20. Presentation title Fig. 1.0 – four modes of knowledge conversion

21. Presentation title Yr 1, tacit to tacit = socialization Target is to automate winding fully tacit to explicit externalization socialization tacit 3 2 1 0 from internalization combination explicit Figure 2.0 – 3 years of spiraling knowledge

22. Presentation title Knowledge management – Nonaka model • Yr 1 = tacit to tacit • SOCIALIZATION( Fig. 2.0) • Grand theme; maximachine/minihuman • Automate winding • Socialization; • How- To • Get the experts and most experienced winders for a brain storming session. • Informal gatherings. • Off- site meetings for 3 days. • Building samples, experimenting and sharing etc. • First 4 months – no formal reviews , just discussion.

23. Presentation title Knowledge management – Nonaka model Yr 2- tacit to explicit – Externalization -automate cutting and dipping tacit to explicit externalization socialization tacit 3 2 1 0 from internalization combination explicit Figure 3.0 – 3 years of spiraling knowledge

24. Presentation title Knowledge management – Nonaka model • Yr 2 = tacit to explicit • EXTERNALISATION (Fig. 3.0) • Grand theme; maximachine/minihuman • Automate cutting and wave dipping • How – To • Document useful discussion, observations and experiments. • Mid – theme ; The cookie concept • Aims to produce chokes like cookies. • Understand how cookies are fully automated and produced. • Consistency of the cookies produced. • Low cost production. • Easy packing

25. Presentation title Yr 3- explicit to explicit - Combination -Automate the assembly Knowledge management – Nonaka model tacit to explicit externalization socialization tacit 3 2 1 0 from internalization combination explicit Figure 4.0 – 3 years of spiraling knowledge

26. Presentation title Knowledge management – Nonaka model • Yr 3- explicit to explicit • COMBINATION (Fig. 4.0) • Automate the assembly • Grand theme; maximachine/ minihuman • Final theme; Everyone loves cookie. • How- To. • Exchange ideas and experiences. • Combine , sort and prioritize concepts of value. • Formal and informal communications. • Exchange visits with European colleagues.

27. Presentation title >Yr 4 explicit to tacit- Internalization- - Continue automation of other operations Knowledge management – Nonaka model tacit to explicit externalization socialization tacit 3 2 1 0 6 4 from internalization combination explicit Figure 5.0 – 3 years of spiraling knowledge

28. Presentation title Knowledge management – Nonaka model • Beyond 3 Yrs- explicit to tacit • Continue automations of other operations INTERNALIZATION (FIG. 5.0) Grand theme; maximachine/ minihuman How- To; • Verbalize ,constant interactions and informal groups gatherings. • Continue to document success stories and new learnings. • Alignment use ROFO MODEL • Encourage learning by doing • Mindset change and modification of behavior towards learning.

29. Presentation title Fig. 2.2 Quality issues – solve by implementing Total Quality management TQM • Fig. 2.2 Qualty issues • Cause # 1 • Cause # 2. • This is solved by implementing SPC and multivari – charts as shown in Figures 6.0 A and 6.0 B. • A X- bar , R chart is used to track the dimensions of the housing . • A multi vari chart is used to track the solder defects and the scratches. • Cpk – process capability index of 2.0 is set as target. Fig. 6.0 C • A TQM approach is also applied throughout the company by incorporating training and development plan

30. Presentation title Fig. 6.0 A -1 X- bar chart Upper control limit 4 3 henry 2 Lower control limit 1 2 3 4 1 Time hrs

31. Presentation title Fig. 6.0 A – 2 R- chart Upper control limit 4 3 henry 2 Lower control limit 1 2 3 4 1 Time hrs

32. Presentation title RENAULT – SCHAFFNER’S MODEL OF RENAULT QUALITY SYSTEMS The Multi- Vari chart fig. 6.0B I II III IV 5 defects 4 3 2 1 Time ( hrs or shifts)

33. Cpk = 1 Three Sigma (3) process 2700 ppm 31 31 61 Cpk = 2 Six Sigma (6) process 3 ppm 32 32 62 Presentation title Process Capability Study Lower Specification Limit, LSL Specification mean Upper Specification Limit, USL We need suppliers to have the same mindset and practice of Consistency Fig . 6.0C

34. Presentation title SUPPLIER MANAGEMENT PLAN( SMP) • SMP • By localisation of European parts. • Manage suppliers by developing merit points ; • Quality------------ 50 points. • Cost……………..20 points. • Delivery…………30 points. • On- time delivery targets are jointly set with suppliers. • Develop local suppliers that have materials that are less expensive than European materials. This can be achieved by changing the specification of materials with R&D. • The above actions will reduce materials costs by 18%.

35. Presentation title The final picture. • Figures 7.0 A and 7.0 B show how the target is achieved.

36. Presentation title Solve by automation solve by developing a supplier management plan Solve by lean cell Too much walking around 1 Methods Man 7 Throughput time too long High content of manual operations 40% 2 8 Cycle time too long as compared to standard Schaffner’s prices are above the competitors 1 Workers are not ergonomically positioned 1 1 3 Work sequences not optimised. 9 Cost reduction by 25% Related machines are in different floors/ locations causing too much transportation No cost reduction targets with suppliers 4 10 use over specified materials resulting buying expensive materials 5 Machines are not fully automated Still buy materials from Europe ( costly) 6 11 Machine Materials Fig. 7.0 A

37. Presentation title Problem; Schaffner is losing market share and is being threatened that the entire Choke business will be wiped out within two to three years Solve by TQM Qualityissues 1 Poor solder joints Solve by automation 3 2 scratches Potting materials not fully hardened Solve by supplier Management plan 44% Solve by lean cell Unhappy customers Too long to pick materials at warehouse to fill a work order 4 7 Long set – up times required before Production can start 5 Suppliers not delivering materials on-time 6 Poor on- time deliveries Inflexibility of production lines Fig. 7.0 B

38. Presentation title Thank you very much for your attention. Any questions?