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Mueller stoves reduces the assembly line stops after Preactor deployment
June 2015
There is no single formula for the success of a business group. The Mueller Group in Timbó - SC - Brazil is a spectacular example of management independence and culture, which guaranteed success in each of its business units, despite the plurality of production management methods adopted.

Mueller Stoves, one of the new business units of Muller Group, was established in 2001 and to produce different items ranging from stoves, domestic ovens and cook-tops stoves. They originally used the concept of mini factories pulled by Kanban from the assembly line. Today the unit has grown to about 518 employees in 94 000 m2 of built area, producing about 118, with a capacity of about 70,000 units per month. Revenue in 2014 was R$ 244 million. For 2015 the target is R$ 266 million, an estimated growth of 10%, increasing production capacity without increasing assets. This is true productivity supported behind the scenes  by Preactor + Lean.

Challenge
From the beginning Mueller Stoves created an audacious concept of mini factories, each of which was scheduled empirically by their supervisor, who obeyed a kanban board, pulling the production by subsequent mini factory.



Despite all competent efforts of the Lean Manufacturing team, Kanban was not bringing the expected results, primarily because the assembly lines are extremely dynamic in terms of:
  • High variability of items per day on each assembly line;
  • High volatility of quantities and reschedules caused by unforeseen events.
While each mini factory was producing its own scheduling, other valuable information was not considered, such as the availability of material (supplied by other area or outsourced). Consequently the assembly lines did not produce as planned because the mini factories could not respond in time to changes arising.

The plant sought to supply the necessary components for the items scheduled on the assembly lines through daily inventories lists and urgent production requests of missing part, which invariably occurred; forgetting a component made it impossible to produce.

In short, Mueller Stoves had the following problems to be overcome:
  • Kanban not working properly
  • Many of the assembly line stop, due to lack of parts from supplying mini factory
In addition to the line stops due to lack of parts, the plant experienced:
  • Difficulties to balance load across  several resources
  • Difficulties to evaluate properly production bottlenecks
  • No visibility of the consequences of unforeseen events
  • No possibility of harmonizing a preventive maintenance plan without sacrificing productivity
  • Lack of capacity analysis to give adequate responses to the demand.


Solution

At the end of 2012, given the above difficulties with the implemented pull system and compounded by the fact that raw materials suppliers were not adequately developed for the JIT environment they were trying to deploy; the Planning and the Production departments independently began to seek other solutions.

In different situations both these departments found Preactor and APS3 (Siemens partner for Simatic IT Preactor products) and immediately realized that a fine scheduling tool based on finite capacity, taking into account materials and resources, represented a convincing answer to solve the challenges they faced.

After undertaking a DWS (Design Workshop) showing the feasibility and viability of the solution, Mueller Stoves started a deployment project with the Preactor 500 APS software utilizing the expertise of APS3. The initial scope proposed for the first step was to generate fine scheduling only on the Stamping area in order to load level (using a Heijunka methodology) the assembly lines, thereby preventing  the internal parts supply shortage that were causing lines to stop.

The project began in April 2013. However, as the Project Team took notice of Preactor's impact, they began questioning of why not schedule the entire plant rather than just the stamping area. The scope crept ‘during the flight’ and created an important lesson for all.

At the end of 2013, the attempt to schedule the entire plant actually resulted in frustration because of cultural reasons due to the required passing of know-how, details of scheduling, and control to a central planning from each mini factory.

The project team did not give up and decided to return to the original scope. The Preactor configuration was created, within the initial scope, load leveling the assembling lines by scheduling the Stamping area with Preactor.  This new solution went Live April 2014.

Results
The results were striking and have highlighted that there is also an opportunity to schedule the painting area with the same principle adopted for stamping. At the time this case study is being written the painting sequencing project has already begun.

The most immediate results can be so relayed:
  • Improved visibility reducing production uncertainty:
    • Scheduling horizon of 5 days + 1
    • Firm scheduling of 1 day + 2
  • Increased reliability of the supplier to the JIT process because of their perception on the improving factory scheduling.
  • Reduction of stamping stocks from 3 days to 1.5 days of parts needed for future assemblies.
  • Significant reduction of semi-finished stocks
The table below summarizes the achievement of project goals and the results obtained; showing unequivocally that it was worth the effort expended by the entire project team: