Supply Chain Blog

“Lean” FMCG/Drinks factory operations mean excess manpower

Posted by Dave Jordan on Mon, Feb 04, 2013

Back in the days when the only reality TV was live sport, a tablet got rid of your headache and a mobile was a normal phone with a longer cable, I used to run a large FMCG factory. Long before TPM was implemented the factory cost base was huge and unsustainable. There were people everywhere and everyone seemed to have their own assistant or “mate” to do any tasks that were difficult or labour intensive.

The factory did not really need conveyors on the filing lines as the high operator numbers could pass the filled bottles or stamped tablets to one another towards the packing station. Even the packing stations were only semi-automatic and required a human helper. There were so many operators that 50% of them could have all gone to the toilet at the same time – space permitting – and production efficiency and output would not even blink.

In D&E countries the labour cost is usually so low that capital proposals for automation investment don’t really get too far. People can do the jobs far cheaper although excess manual handling can lead to unacceptable quality variation.

Production SupplyChainAfter some time listening to the raft of reasons why staff numbers could not possibly be reduced I started to observe a little more closely and at unexpected times of the day. I noted that most production lines were actually running reasonably well with little or “no touch” from humans. Line operators were slouched against walls or leaning on machinery and that is when I realised that this type of “lean manufacturing” was not helping and had to stop. The only place where more people were being paid to do nothing was in the EU parliament.

With a liberal helping of Non Violent Direct Action (NVDA) aided by non-unionised labour:

  1. Slowly but surely remove people from overstaffed operations. If after making a reduction you are not sure if more can be removed, remove 1 more and see what happens….. and repeat.
  2. Residual staff will now have to actually work. Ease the pain by sharing some of the saved salaries across the new team in return for KPI efficiency improvements.
  3. Train the staff in multi-disciplinary skills to facilitate seamless sickness and leave substitution as well as job rotation.
  4. Avoid having a separate maintenance or repair department. The people who run a machine need to be the ones to fix any problem right now, immediately and not at the whim of another group.
  5. Get people motivated to implement one of the continuous improvement programmes, e.g. TPM, 6-Sigma. High profile leadership is required for success.

This is just for starters. Once you get some momentum and operator involvement in decision making you will start to see significant cost, efficiency and reliability benefits and no leaning!

 

Tagss: Brewing & Beverages, FMCG, Dave Jordan, Performance Improvement, Manufacturing Footprint, Supply Chain, Cost Reduction