In 2013, Leadership team at Kirloskar Brothers Limited (KBL) chose Avenir Management Consulting as a knowledge and implementation partner to facilitate holistic transformation of KBLs oldest manufacturing division, Small and Medium Pumps Division (SMPD) at Kirloskarvadi, Maharasktra. SMPD provides fluid handling solutions to leading companies in domestic and export market.
In the two years of Avenirs engagement with KBL, we have seen holistic transformation in thinking, actions and results accross SMPD.
The ONE transformation change in our thinking has been that organizations net worth can grow only by significant and consistent increase in Throughput. Most of the cost reduction exercises at minimum take away lot of top teams time and effort with little impact on the bottom line and worse in many cases, inadvertently, creates obstacles for increase in Throughput.
In order to increase Throughput we are now focussed on improving FLOW and are constantly on the lookout for improvement opportuinities which appear as obstacles to smooth flow.
The mechanisms which have been implemented for FLOW improvement are:
- Constant focus on Bottleneck and taking actions to improve output from Bottleneck.
- Successful allignment accross the value chain using modifications in SAP, ehich helped us in moving away from monthly planning to perpetual on-line planning using real-time data. Everyone in the value chain – Vendors, Purchasers, Production planners, Shop-Floor Supervisors, Stores, Quality, Despatch, Logistics etc. speak one language and have common priority system based on traffic lights – Black, Red, Yellow, Green and White.
- Moving to weekly reviews based on common-sense scorecard which has Lag and Lead measures which gives actionable information to people at all levels.
- Supplier allignment to synchronize their deliveries based on priorities of our production communicated to them using SAP portal.
- Changes in KRAs of people to allign with Throughput and T/OE. (T/OE is Throughput divided by Operating Expenses).
Tangible results achieved:
- In the face of market slow down, we succeeded in holding on to our resource productivity, T/OE with some Throughput growth. We are now perfectly poised for a significant growth in Throughput.
- We have seen good improvement in Lead Time and On Time In Full (OTIF). The voice of the customer in domestic and export market bears testmony to this. Average Lead time has reduced by 50%.
- Constant focus on Bottleneck has resulted in output increasing by 50%. (in ACS Foundry).
- Old pending pumps under rework have reduced by 80%.
Most importantly, teamwork at plant has improved. Plant people have become more confident and are ready to take up new challenges and new targets.
We appreciate the efforts of Team Avenir in this journey. Avenirs collaborative approach and close working with operations team made a big difference. It took Avenir Consultants gentle yet firm persistence to convince us to let go off some of our legacy practices which no longer made business sense in current context.
At KBL this journey has just begun and we believe even sky is only the lower limit.
