Implementing a frozen schedule and firm plan in the paint industry

Customer

The customer is one of the leading paint manufacturers. The project focuses on the production of paint for the refinish car industry in Europe in one of their main plants. The majority of the products are MTS related.

Challenges

The central supply chain planning team and the local operations teams struggle to commit to- and deliver the plan. There is a need for a more structured approach on different levels.

• The plans are not stable creating a need for rework and lack of adherence to the plan
• The plans are not optimal. There is room to either :
  • Reduce cost by improving the way the plant is used (e.g. changeovers, overtime, underutilization),
  • Reduce the inventories
  • Improve the planned service levels
• The roles and responsibilities are not clarified. People assume other people will execute certain tasks but this is not in line with the leader’s expectations and the actual processes
• There is no or little insight in the upcoming horizon. Despite the creation of an S&OP plan, there is no connection between the S&OP plan and the item-level plan and no upfront understanding of deviations versus S&OP or bottlenecks
• The meeting structure is heavy and does not lead to the needed understanding. Despite long daily calls where a lot of details are discussed, there is still no common understanding on whether the plant is running at, behind, ahead of plan. There is also no understanding of operations on the plan of the upcoming weeks.

There is an intent to do a digital transformation. In order to prepare for this digitalization, Allics was asked to assess the situation and enable improvements on different areas.

Solutions

Allics assessed the current planning processes, and proposed to work on the following key aspects:

• The creation of a frozen week schedule
• The creation of a firm plan on item level that is in line with S&OP
• The alignment of a meeting structure
• The execution of a process that drives continuous improvement

The frozen week schedule was created for the different departments and visualized up to the production floor, enabling the team leaders to understand whether they were running on, ahead or behind the agreed schedule. It was also serving as a basis to understand why deviations were happening. Different root causes were found in the entire flow (related to the time of releasing a batch, over the checks that were done for releasing the batch, over the synchronization of the internal logistics) and were tackled one by one.

A firm plan was made within the planning time fence. This creates insights into the resource utilization, the planned inventories and service levels. It also ensures an alignment with the S&OP plan.
A meeting structure was setup on weekly and daily level, ensuring discussions are held in an efficient and structured manner.

Results

The results are:

• Clarity of the roles and responsibilities of the different teams (operations, planning, schedulers, raw material planners)
• KPI’s that are followed up in a disciplined way as the basis for continuous improvement across the different departments (operations, internal logistics, raw material planning, data, planning)
• An efficient meeting structure, creating the right level of visibility to the different stakeholders
• A visual and stable production schedule, highly valued by the teamleaders
• Increased supply reliability (from 40% to around 75% of the batches made on the scheduled day)
• Reduced lead times
• Reduced intermediate inventories
• Increased visibility into the firm plan