Assessing the contribution of quality and efficiency initiatives to reduce productions costs at Distell's Green Park

Smit, Wiehahn (2008-12)

Thesis (MBA (Business Management))--Stellenbosch University, 2008.

Thesis

ENGLISH ABSTRACT: Manufacturers can gain a competitive advantage through lower production cost, better quality, better efficiencies and being more flexible and dependable than its competitors. Lower production cost can be a result of first-time-right quality products and efficient production processes in terms of throughput. Low production cost is not a destination but a journey where the goalpost will always move as competitors will continuously come up with ideas to lower prices and margins have to be cut in order to stay competitive. This is where manufacturers must come up with initiatives to continuously drive its operational metrics to remain competitive. This research report will explain how Distell's biggest bottling plant, Green Park, successfully introduced Process Control to increase its quality operational metric and a Six Sigma project to reduce downtime to increase its efficiency operational metric to drive its operational costs down. Process Control was introduced as a TOM initiative with a subsequent reduction in rework due to poor quality (thousands) from R1 585 to R484. This contributed to 'first-time-right' production, better efficiencies and not tying up valuable production time with reworks. The Six Sigma principles were used on a production line to introduce initiatives to reduce changeovers and unplanned downtime to improve its GEE. This initiative has a projected benefit of R687 (thousands). The report also indicated that a 1% increase in Green Park's overall GEE will result in 1% saving of production hours resulting in a 1% saving of variable cost. This will result in an OEE of 63% that will save 226 hours and R410(thousands).

AFRIKAANSE OPSOMMING: Vervaardigers kan 'n kompeterende voorsprong verkry deur laer produksiekoste, beter gehalte en groter doeltreffendheid te bewerkstellig en deur meer buigbaar en betroubaar as hul teestanders te wees. Goeie gehalte produkte wat die eerste keer reg is en doeltreffende produksieprosesse vir verwerkingskapasiteit kan laer produksiekoste tot gevolg het. Lae produksiekoste is nie 'n bestemming nie, maar 'n reis waartydens die doelpale sal skuif met teestanders wat deurgaans met idees om pryse te verjaag, vorendag sal kom. Winsgrense sal moet verklein word om kompeterend te bly. Hier moet vervaardigers inisiatief aan die dag lê om hul operasionele meetbares te dryf om kompeterend te bly. Hierdie navorsingsverslag sal verduidelik hoe Distell se grootste botterings aanleg, Green Park, prosesbeheer (Process Control) suksesvol in werking gestel het om sy meetbares wat operasionele gehalte betref, te verhoog, en 'n Six Sigma-projek ingestel het om staantyd te verminder sodat sy meetbares wat operasionele doeltreffendheid betref, kan verhoog en sy operasionele koste sodoende besnoei word. Prosesbeheer is as algehele gehaltebestuursinisiatief ingestel met 'n gevolglike vermindering van herverwerking weens swak gehalte (duisende) van R1 585 na R484. Dit het bygedra tot groter doeltreffendheid met produksie wat uit die staanspoor reg is, en verhoed dat kosbare produksietyd op herverwerking gespandeer word. Die Six Sigma-beginsels is in 'n produksielyn gebruik om inisiatiewe in werking te stel om oorskakelings en onbeplande staantyd ter verbetering van die algehele toerustingsdoeltreffendheid (OEE), te verminder. Hierdie inisiatief hou 'n geprojekteerde voordeel van R687 (duisende) in. Die verslag dui verder aan dat 'n 1%-verhoging in Green Park se algehele OEE sal lei tot 'n 1% besparing in produksie-ure, wat 'n 1% besparing op veranderlike koste tot gevolg het. Dit sal tot 'n OEE van 63% lei, wat 226 uur en R410 (duisende) sal spaar.

Please refer to this item in SUNScholar by using the following persistent URL: http://hdl.handle.net/10019.1/5042
This item appears in the following collections: