CASE STUDY Easy Sew Peasy is a medium-sized, Cape Town based, family business that produces a various winter jackets and tracksuits. To improve the efficiency of their operation they purchase cotton, nylon, polyester, leather, pleather, rubber and elastic bands, wool, silk, zippers and buttons from various suppliers. Their waterproof tracksuits are particularly popular during the winter rainy season. This demand is seasonal, which means their factory is much busier in winter. In an attempt to improve customer relations and storage utilisation, the general manager, Dave Pea, as considered purchasing an MRP-system program. To accommodate the increased demand during winter, the business forecasts the demand and tries to manufacture as many jackets as possible during low demand periods, such as summer.

 

The South African textile manufacturing industry has become increasingly competitive since Easy Sew Peasy was first founded in 1990. Not only does the business have to compete with local clothing producers, it also has to compete with cheaper articles of clothing imported form Chinese manufacturers. To differentiate Easy Sew Peasy's brand, quality has always been the foundation of their strategic decision making.

 

Despite the success that Mr. Pea has enjoyed in recent years, there are still some operational issues that perturb him. For instance, business hours are supposed to start at 08h00, but on most days the local staff bus driver arrives at 08h15 which eats away at production time and causes some of the rest of the personnel to aimlessly wait around. The previous general manager had a free modification and customisation policy applicable to certain customers. Mr. Pea believe that this practice does not add value to the vast majority of customers, but he is forced to keep it since the previous general manager was his father. The layout of the factory causes unnecessary handling of WIP-goods during peak production cycles. During these high production times, the business also receives a disproportionate amount of customer complaints and returns due to orders not being compliant with the specifications given on the invoice. Some employees have started complaining about the repetitive nature of their work. Additionally, Mr. Pea as noticed that these employees often alleviate their boredom by unduly moving manufacturing goods and materials between work centres. Danica Pea, the procurement manager and Mr. Pea's daughter has also announced that he would like to peruse a career more aligned with her BA in Historical Arts degree.

 

QUESTION 1

                                 

Despite the success that Easy Sew Peasy has enjoyed in recent years, there are still some operational issues that can be improved upon in an attempt to eventually achieve lean status.

 

a) The methodology of lean production has identified eight common wastes that are present in every process. Discuss one (1) the types of common wastes present in the business above.                                                                                                                                              

 

b) Discuss the costs incurred as a result of the wastes discussed in Question a

 

QUESTION 2

 

With the business' recent grout spout, it has become apparent that there is a need for the implementations of a quality management system. Mr. Pea is unsure whether the business should implement an ISO 9000 system or opt for SHEQ management.

 

a) Convince him to choose SHEQ management by highlighting the advantages of this system.

 

b) Suggest and explain the implementation of an applicable quality improvement technique for the Easy Sew Peasy operation.

 

QUESTION 1

a) A core principle in lean methodology is the removal of waste within an operation. And in any business, one of the heaviest drains on profitability is waste. Lean waste can come in the form of time, material, and labor. But it may also be related to the utilization of skill-sets as well as poor planning. he Lean Manufacturing model recognizes 8 types of waste within an operation

1 Defects

2 Excess Processing

3 Overproduction

4 Waiting

5 Inventory

6 Transportation

7 Motion

8 Non-Utilized Talent

 

the types of common wastes present in the business above is INVENTORY.

Inventory is considered a form of waste because of the related holding costs. This is true of raw materials, WIP and finished goods. Over purchasing or poor forecasting and planning can lead to inventory waste. It may also signal a broken or poorly designed process link between manufacturing and purchasing/scheduling. Lean Manufacturing does not just focus on the factory but also requires process optimization and communication between support functions.

Purchasing, scheduling and forecasting can have a version of standardized work in the form of defined minimums and maximums and order points that are mapped to the process flow and takt time.  Purchasing raw materials only when needed and reducing WIP and eliminating or narrowing the definition of "safety stock" will reduce this type of waste.

Common causes of Inventory Waste include:

• Overproduction of goods
• Delays in production or 'waste of waiting'
• Inventory defects
• Excessive transportation

b)      costs related to excessive inventory are

1. The Item Cost

If your inventory isn't being updated in real time, you are just guessing how much inventory you have in stock. You may then end up buying new items at a higher cost than usual because you think that you need to replenish your stock.

2. Transportation Cost

Transportation costs tend to run high, especially during certain times of the year when fuel prices traditionally increase. You could end up paying a lot of money to transport new inventory items to your warehouse even though you actually don't need those items to round out your inventory. Some shipping companies will charge a surcharge if your load of goods doesn't meet certain requirements and that cost just gets added to the cost of transportation. Shipping costs that are higher than usual will cut into your profit when those items are sold.

3. Labor Cost

Once the items that you've purchased arrive, you will need to pay workers to unload them and get them safely into the warehouse. Those labor costs can add up quickly, especially if you have a large order of items or if the items are very heavy. The workers unloading the items will also have to spend time reorganizing the goods already inside the warehouse to make room for the new inventory items.

4. Storage Cost

If you add new items to the inventory that you didn't actually need you will end up paying costs to carry those items in your warehouse. Increased costs for keeping the items in good condition and safely stored are not good for any business. If your business is still small, the extra storage cost on top of all the other costs associated with having too much inventory could really cause a financial problem.

5. Lost Profit Cost

When you have too much inventory you need to sell more. For most businesses that means running a sale to unload the excess items from the warehouse and eliminate all of those extra carrying costs. However, if you are forced to drop the price of the items in order to get them out the door fast, you'll end up making less of a profit on each item. You may even need to sell at a loss to get the items out of your warehouse.

 

QUESTION 2

a) advantages of SHEQ management system   

Reduced administrative costs

• The potential for reduced insurance and liability costs

• Positive employee impacts and protection of worker health

• Enhanced image within your company for employees, the communist, clients and customers, and stakeholders

• Improve regulatory compliance

• Improved employee performance

• Reduced costs from injuries and illnesses

• Improved relations with OSHA and other associated agencies

• Better employee relations within the company. Everyone is on the same page with regard to safety.

• Other businesses similar to yours may learn how they can do better, too

• Improving Safety is usually a competitive advantage, because of reduced costs                                                         

 

b) QUALITY IMPROVEMENT TECHNIQUE FOR SEW PEW

9 Brilliantly Simple Continuous Quality Improvement Techniques

Posted by Maggie Millard Find me on: LinkedIn Twitter

Feb 8, 2018 11:09:33 AM

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I often find myself falling into the common trap of believing that if something is worthwhile, it is necessarily difficult. I think we all expect that valuable things are hard. The truth is, however, that sometimes the most effective and impactful things we can do are really quite simple.

 

When it comes to continuous quality improvement, this is absolutely the case.

 

Here are 9 examples of quality improvement tools, techniques, and technology that are uncomplicated yet extremely valuable.

Standard Work

Standard work is simply the documentation of the current best practice for any given task or process. That's it. It should be detailed and include any necessary supporting assets like diagrams or images. It needs to be accessible to everyone performing the work and is ideally designed by those involved. There's nothing tricky about it, but it is the key to continuous quality improvement. You just can't improve something that has no baseline from which to improve.

 

Catchball

The idea of Catchball comes from the Lean business management methodology. The idea is that no matter who starts a project, that person (often, but not always a manager) states the purpose, objectives and other ideas and concerns and then 'throws' them to others for feedback, ideas, support, and action. This creates a bi-directional loop, which clear ownership and accountability. Everyone knows who has the "ball" so to speak.

The 5 Whys

The 5 Whys is a process for getting to the root cause of any problem. When something goes wrong, you ask "why." That answer leads to another "why" and so forth. It turns out that the underlying cause of most process breakdowns can be uncovered by asking why about 5 times.

 

Digital Huddle Boards

Huddle boards (also called Kaizen boards) are used to create a visual representation of improvement work. This helps people easily understand the health of continuous quality improvement within the organization and immediately detect when progress on any given project is stalled. In modern practice, they are electronic so they can be accessed from anywhere by any member of the team.

 

5S

5S is a workplace organization method that uses a list of five Japanese words: seiri (sort), seiton (set), seiso (shine), seiketsu (standardize), and shitsuke (sustain). An organized workplace is the key to efficiency and safety. It can also be enormously important when attempting to reduce waste, especially the wastes of motion and transportation.

 

Gemba Walks

During a Gemba Walk, a supervisor or other leader goes to the place where the work is done to observe and ask questions of the people doing the work. The goal is not to evaluate people's performance, but rather to seek opportunities for improvement and get a clear understanding of how the standard work is being executed in the real world. After the walk, the supervisor may use Catchball or another technique to begin the process of improvement.

 

Value Stream Mapping

Value Stream Mapping is a way of documenting and assessing everything that happens to bring value to the customer. It is an end-to-end analysis of how a service or product goes from the initial requires into the hands of the customer. Processes that add value are improved, while those that don't add value are eliminated. It is an excellent method for uncovering the current state and a jumping off point for quality improvement and waste reduction.

 

PDSA

PDSA stands for Plan, Do, Study, Act. It is a basic improvement cycle that helps teams act on opportunities for improvement. The planning phase involves understanding the current state of affairs and describing the desired state. During the "Do" step, potential improvements are introduced. This is followed by a period in which the results are studied. Finally, if the changes are positive, the standard work is updated, and the new process is enacted.

 

Mind Mapping

A mind map is a diagram used to visually organize information. It is a technique for visualizing connections between many related ideas or pieces of information. It can be extremely useful in brainstorming, problem-solving, project planning, and note-taking. Mind maps are like a tree, starting with a core thought (the trunk) and connecting it to related ideas, big (branches), and small (twigs). The visual structure makes gaps in knowledge readily apparent and relationships between ideas clear. It is useful anytime fresh thinking is needed and is effective for process development, product improvement, quality control, or any other opportunity for improvement.