Digitization of order processes to increase performance
Focal points: Performance enhancement
Company:
- Globally active family-run group of companies, headquarters in Germany
- Measurement and control technology, sensors and fittings, €1 billion turnover, 10,000 employees worldwide
Responsibility:
- Head of work preparation for a product area. With 15 employees, responsible for the daily conversion of 1,000 customer order items into production orders.
- 100,000 different products per year, of which only 30,000 are recurring.
- A wide range of mechanical and mechatronic measuring devices – “configured and produced” or “engineered to order”.
Initial situation:
The product area was the Group’s pilot for the introduction of lean principles. Great successes were quickly achieved in production and the physical production lead time was reduced from 4-6 weeks to just a few days. In practice, however, this did not result in shorter delivery times for the customer, as there were major problems in managing the administrative processes. Attempts by IT to provide support with tools in the ERP system met with resistance from the specialist department.
There was a backlog of several weeks in the conversion of customer orders into production orders. Accordingly, there was no order scheduling, no component procurement and no order confirmation to customers for a long time. Eventually, the head of department was demoted and I was appointed project manager and new head of department.
Measures:
- Systematic analysis of the processes and IT tools (these had fundamental logical errors) and thus “resolution” of the conflict situation between IT and the specialist department
- Introduction of KPIs, daily monitoring of the backlog situation and allocation of resources
- Creative measures, such as the introduction of “home office” (in 2003) to create additional capacity
- Redesign of the order and material planning process – implementation in the ERP system with IT department (in-house programming of configurator with automatic delivery time determination)
Result:
- Reduction in delivery time for customized products from 4-6 weeks to a guaranteed five working days
- Increase in productivity in administrative order processing by 40%
- Automatic determination of price and delivery time immediately upon order creation
- Rolling out the developed processes and tools to the entire group of companies worldwide
