Wausau Equipment Company: a Lean Journey

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Lean has had some success at Wausau. What should the management’s next steps be in: a) Making further Lean improvements
Wausau is facing a shortage both in experienced labor and reliable equipment. They rarely hire new employees, and older employees are close to retirement. Furthermore, Wausau generally has a culture suspicious of change, and employees and managers are resistant to Lean progress. Employees are not motivated to accept lean or previous management methodologies because of the feeling of insecurity, and employee morale is low. Wausau is facing other challenges as well. Along with the labor issues, equipment downtime is increasing, and OEE is decreasing. Also, inventory is high, and the company even lost some customers because of slow response time and poor delivery service. The high volume of inventory takes resources in cash flow, maintenance labor, space and operations management. To reduce WIP materials, the Kanban system could be introduced for inventory management. The Kanban system is easy to install and understand. It responds to MSD’s demand without taking much extra resource or labor. Wausau is also experiencing issues with the manufacturing process. Figure 1 shows major areas of total loss. Figure 1

Figure 1
According to Figure 1, setup time, idle time engineering or qualification losses and rework or scrap contribute 73.53% to total losses. According to Appendix 1, SU loss has been reduced by 0.5 out of 1.8 hours per shift, Idle time has been reduced by 0.2 out of 0.56 hours per shift, respectively. OEE at present is 60%. There is space for further improvement. The consulting company, Lean Dynamics, deployed lean process in short terms so that employees can be convinced of its power. However, further improvement requires the lean improvement cycle to be implemented over time. Because Lean has been proved to be effective in MSD, Wausau’s next step should be expanding lean thinking to other divisions. Part rework is reduced by...
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