Transform your business: Create a Culture for Continuous Improvement - Armin Schwab, Bosch Thermotechnology GmbH

HOW A GERMAN PLANT
WITH MAINLY MANUAL PRODUCTION
REACHED COST COMPETIVENESS OF
LOW (SALARY) COST COUNTRIES
The power of the „WHY“
The impact of operational excellence

© Robert Bosch GmbH 2016. Alle Rechte vorbehalten, auch bzgl. jeder Verfügung, Verwertung, Reproduktion, Bearbeitung, Weitergabe sowie für den Fall von Schutzrechtsanmeldungen.
2 Intern | WeP/PM | 15-Feb-2017

Intern | WeP/PM | 15-Feb-2017
5

6

7
Our products and assembly lines

8
Todays journey . . .
The
initial
condition

9
Factory “output”
174
119
2007
2011
PPC-Volume
[inMioEUR]
Staff | Salary earners
140
130
2007
2011
Associates
[inPK]
Staff | Directs
432
311
2007
2011
Associates
[inPK]
Illness rate | Directs
8,5 9,5
2007
2011
Illnessrate
[in%]
Fix costs
13,8 14,6
2007
2011
PPC-Volume
[in%ofAPC]
Productivity
Productivity
[in%vsPY]
Why we started our journey in 2012

10
The
initial
condition

11
Normally . . .
you would now see the slides
of our strategy, activities
and at the end (hopefully) . . .
some results . . .

12
In order to make this more efficient,
I will first show first the results
and then . . .
you can decide whether it’s
interesting enough to stay or not . . .

1) Reference 2012
The fruits of our work . . . so far . . .
Illness rate | Directs
Illnessrate
[in%]
1)
1) compared to 2012

14
or

15
The
initial
condition

16 In many areas no refurbishment done since the 80ths . . . .
Initial conditions in 2012

17
- 13 nationalities
- Ø age: 49 years
- 15,5 % handicapped associates in blue collar area

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and with . . . .
- great experience in assembly
- enormous willingness to perform
- deep wish to bring back pride to “their” plant . . .
. . . especially the associates on the shop floor!!!

19
If problems seem to be almost
everywhere, when performance
is low over years and most
associates don’t “see” a real problem
What is the conclusion . . ?

20
Apparently we face (another?)
plant with leadership deficiencies
and missing entrepreneurial mindset.
So, we have to start from the top . .

21
Develop problem solving competence | Elements
"1-week
projects"
~20 x year
(1 week)
- Associates from:
- logistics and production
- Support department
- Indirect areas
- Implementation orientated projects
(no budget, as money ruins creativity . . .)
- Involve associates especially on "working level"
to further increase motivation and make it "their company"
"4-week
projects"
3 x year
(4 weeks)
- Department managers
- Group leaders
- MDP-Candidates
- Plant & GB-Externals
Built-up problem solving competence of leadership team
(focus: department managers and group leaders)
"Break trough
projects"
3 x year
(1 - 3 months)
- Group leaders
- MDP-Candidates
- Specialists
- Considerable changes within production & logistics, e.g.:
- movement of production lines, racks in warehouse, . . .
- indirect processes (e.g. QMM. TEF, CTG)
- Big KPI improvement steps in short time
System CIP
Workshops
4 x year
(á 2 days)
- Group leaders
- Workers council
- "plant external" moderator
- Review business requirements (inline with strategy)
- Set priorities for next 3 months
- Lessons learned out of last 3 months
- Develop entrepeneurial mindset of management team!
Topic Frequency Participants Target
"1-week
projects"
~20 x year
(1 week)
- Associates from:
- Indirect areas
"4-week
projects"
3 x year
(4 weeks)
- Group leaders
- MDP-Candidates
"Break trough
projects"
3 x year
(1 - 3 months)
- Group leaders
- MDP-Candidates
- Specialists
System CIP
Workshops
4 x year
(á 2 days)
- Group leaders
- Workers council
"1-week
projects"
~20 x year
(1 week)
- Associates from:
- Indirect areas
"4-week
projects"
3 x year
(4 weeks)
- Group leaders
- MDP-Candidates
"Break trough
projects"
3 x year
(1 - 3 months)
- Group leaders
- MDP-Candidates
- Specialists
System CIP
Workshops
4 x year
(á 2 days)
- Group leaders
- Workers council
"1-week
projects"
~20 x year
(1 week)
- Associates from:
- Indirect areas
"4-week
projects"
3 x year
(4 weeks)
- Group leaders
- MDP-Candidates
"Break trough
projects"
3 x year
(1 - 3 months)
- Group leaders
- MDP-Candidates
- Specialists
System CIP
Workshops
4 x year
(á 2 days)
- Group leaders
- Workers council
"1-week
projects"
~20 x year
(1 week)
- Associates from:
- Indirect areas
"4-week
projects"
3 x year
(4 weeks)
- Group leaders
- MDP-Candidates
"Break trough
projects"
3 x year
(1 - 3 months)
- Group leaders
- MDP-Candidates
- Specialists
System CIP
Workshops
4 x year
(á 2 days)
- Group leaders
- Workers council

22
Problemsolving
competenceof
associates
problemsolving
competenceof
management
Increasingteamagility
System CIP Workshop
Projects in production and logistics
“1-week-project”
Mindsetof
management
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 …..
2012 2013 2014 2015
System CIP Workshop
System CIP Workshop
Projects in all areas
System CIP Workshop
3 x
per year
9
projects
21
projects
4 x
per year
>30
projects
4 x
per year
Develop problem solving competence | Time line

23
The
initial
condition

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Same bonus level for all
managers, defined one
year in advance . . .
1st step . . . the bonus system for all managers

25
2nd step | Target deployment based on A3

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Background
Strategic action fields
Projects & timelines
Competitive costs
Productivity
Value stream 1
e.g.:
Re-Design packaging line
A3 used 4 business plan, quarterly targets & projects

27
A3 used for communication to the whole plant teams
Annual A3 of 2012 – 2016 & all project A3
displayed in Kaizen area @ Gemba
Standardized boards for all
projects with link to “Years-A3”

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. . . our weekly project review with the plant team

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We want to become better leaders
We want to further develop our culture
We want to be daily reminded about
our values and what we stand for
Our understanding as leaders

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Our understanding of leadership
Your associates and colleagues
will value your strengths . . .
. . . but they admire you, when you
recognize your weaknesses

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Two people that I learned from about leadership . . .
and learning continuous . . .

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The
initial
condition

33
Deriving target and strategy from market requirements
Who are our competitors and
what is our position within the competition?

34
$
Understanding our position within the competition
Within Germany:
- Southern part of Germany
has highest wage level with
lowest weekly working hours
Within Europe:
- Wage level Turkey is 20% of Germany
- Highly motivated associates
- Very good qualification (esp. engineers)
Main markets in Europe:
- Germany
- UK

35
We can never
compensate that . . .
The figures must
be wrong . . .
There are other
things which are
important . . .
Conclusion?

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Conclusion?

37
The
initial
condition

38
Project 1 | Change from 2 to 1-shift production

39
Our reasons for 1-Shift-Operation

PRODUCTION BUILDING
“ENTRANCE” FOR INTERNAL
LOGISTICS
(MILKRUNS, FORK LIFTS . . .)

44
Project 2 | Production Levelling
- Customer demand fluctuation covered
via stock of low runner and exotics
- Customer demand fluctuation
covered via stock of runner parts

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Project 2 | Production Levelling | Result
-51%
-46%
WIP:
3 – 5 hours
[Mio EUR] [days]

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Project
start

48
After
6 weeks
Packing are moved, adapted
and integrated into assembly line
in other building

49
After
7 weeks
Floor space reduction via ship-to-line
Instead of double handling + “free space”
 Elimination of external warehouse (95k/a)

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The
initial
condition

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Our Improvement work

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Presentations done @ Gemba by the associates
Their projects, their responsibility, their story, their merits . . .

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Our approach:

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Our Setting of the project teams

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Our Setting for the improvement projects

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Change of working condition

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Change of working condition s

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The
initial
condition

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Lessons learned

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Thank you very much
for your time and attention
Questions / Comments?

63
Armin Schwab
Vice President
Bosch Thermotechnology

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Attachment

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Systematic of our ”implementation workshops”
Define stabilization criteria
Dauer der Einhaltung
des Stabilisierungskriterium
Stabilisierungskriterium
Dauer eines
Umsetzungsworkshops
performanceindicator
(e.g.outputinpcs)
time

Transform your business: Create a Culture for Continuous Improvement - Armin Schwab, Bosch Thermotechnology GmbH

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