by William Toh, Global Quality Director, Jabil Circuit
In today’s technology landscape, consumers expect products to be faster, smarter, more durable, of highest quality and less expensive. To meet these expectations, companies turn to innovative quality systems and continuous improvement programmes to gain a competitive advantage. By embracing quality as a strategic asset, they are able to be more adaptable and meet customer demands.
According to a new “Global State of Quality 2 Research” study and compared to a similar study in 2013 which examined quality improvement in organisations worldwide, fewer organisations in 2016 view quality as simply a compliance activity or a check-the-box opportunity. Both the 2016 and 2013 studies were conducted by ASQ, a global network of quality improvement professionals and APQC, an industry leader in quality and continuous improvement benchmarking research, with 1,655 respondents in 20 countries.
The latest data shows that more organisations now see quality as an opportunity to gain a competitive edge, and as a strategic asset. In fact, the research shows 36 per cent of all respondents say their company views quality as such, up from 22 per cent from 2013. Jabil, an electronic product solutions company operating over 100 facilities in 28 countries, is an example of a manufacturing company leveraging their global Lean and Quality systems to improve manufacturing processes and exceed customer expectations. Jabil’s Manufacturing Process Optimization Program at Jabil Shanghai showcases how a company can streamline their processes, cut costs and save time.
The project improved the supply chain velocity of the order response time with a customised “e-pull” system for higher customer satisfaction. Selected by Jabil’s Lean Six Sigma council to reduce internal order response time, reduce work in process (WIP) and improve attrition rate, the project contributed to the improvement of the company’s performance and was shared as a best practice internally at Jabil as well as externally through ASQ.
Implementing the “e-Pull” system
To address the challenge in delivering products with flexible lead times, the team identified the root causes as a push planning system, a manual pull system and materials attrition. In order to improve the process, a pull system was implemented to automatically send a signal from shipping to the previous stations. The new “e-pull” system helped Jabil respond to customers rapidly by simplifying and streamlining the manufacturing order process and improving cross-functional communication.
The new “e-pull” system is the centric system of this project. Its functions embrace material transaction processes from planning, warehouse, and manufacturing to shipping. In the past, the production planning’s push-system required the planner to release a work order to production. The plan was manually released, station by station, from warehouse to shipping. This resulted in high WIP, long response times, high attrition rates, more material handlers and other defects. With the new “e-pull” system, the planning department issued a plan order to the shipping station. From here, the information from the plan order was automatically sent to each station in the process, starting with the backend station and moving up the chain to the front end station. This process change helped achieve the goal of reducing WIP and order response time.
Achievements & benefits
Post implementation, the project accomplished its goals by reducing order response time by 200 per cent. WIP decreased by more than 74 per cent, and the attrition rate was reduced by 100 per cent. All of the results met or exceeded the targets, which show the feasibility and effectiveness of this project. This allowed Jabil Shanghai to improve order response time increasing their Customer Satisfaction Index score by more than 14 per cent.
While the customer was the key drivers for this project, Jabil Shanghai realised many additional benefits from the project including many back office process improvements, such as improved material kitting space, material handling, paper usage, internal customer satisfaction, data integrity and on-time delivery.
Result validation through
Six Sigma methodology & quality tools Six Sigma methodology tools and statistical tools were implemented throughout this project and the DMAIC (define, measure, analyse, improve, control) approach was used for project execution. Team alignment and expectations were established by determining deadlines and deliverables for each phase in a Gantt chart before the project started. The SIPOC (suppliers, inputs, process, outputs, and customers) tool allowed the team to define the boundary of project scope and identify the opportunity for improvement in a macro view. In addition to using problem-solving tools for finding possible improvement opportunities, the following tools were also incorporated:
• Process flow chart to help with the understanding of process sequence;
• Value stream mapping (VSM) to identify the current stage of material flow as well as the cycle time of each stage. This tool greatly helped the team to measure baseline performance and provided insights into waste reduction opportunities.
• Failure Mode and Effects Analysis (FMEA) and statistical tools based on the characteristic of each set of data, were used for validation purpose before implementing the possible solutions.
The solutions were validated through the pilot run and were deployed across the Jabil Shanghai site, and consequently provided a significant annual cost saving for the site.
Project results, sustainability, culture transformation, replication & recognition The stakeholders’ group is continuously monitoring the sustainability of the project results. The organisation has moved from the traditional push system to a pull, and the results have showed an accelerated responsiveness and flexibility that came with this new system. The “e-pull” system has been widely used in all production lines in the Shanghai plant and this project has also been successfully replicated in other Jabil sites.
About the Author
William Toh is Jabil’s Global Quality Director specialising in New Product Introductions that supported the Jabil Shanghai team in preparations for the 2016 ASQ Competition, which led to the team winning the prestigious Silver Award. The Shanghai team includes Morning Cao, Planning Manager; Melvin Wong, Assistant Quality Assurance Manager; Johnson Jia, Senior Lean Coach; and Hanson Zhang, Subject Matter Expert. The ASQ Global State of Quality 2 Research: Discoveries 2016 and three Spotlight Reports can be accessed for download at ASQ Global State of Quality.