OnLogAir - Value Stream Thinking
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This document discusses value stream thinking and an integrated partnership approach to logistics. It emphasizes understanding the customer's perspective of value for the entire product delivery process. Silos between processes disrupt value flow and create inefficiencies. The company focuses on lean logistics techniques like flexibility, reduced costs/time/inventory, and improved quality to maximize customer value. Case studies demonstrate identifying a process's current value state, creating a future improved state, and measuring key performance indicators to increase specified value.
OnLogAir - Value Stream Thinking
- 1. Value Stream Thinking through integration
- 2. Working exclusively in aerospace logistics has taught us a thing or two over the years. The one big thing that stands out is: The customer only cares about the “entire product”, as a whole entity…
- 3. …that’s not just the manufactured component, but the whole service that delivers the “entire product” to them
- 4. What this means… is that the value of any component is made up of the entire series of process steps, within the business and it’s supply chain… ….not just it’s own internal manufacturing processes!
- 5. When silos exist, or walls between those processes, it disrupts the flow of value and creates inefficiencies and waste …and unhappy customers
- 6. We are value stream thinkers. We work with our customers to ensure that the whole series of processes – your manufacturing and our logistics - work together to deliver value to your own customers.
- 7. This means…an integrated approach: A Partnership. We believe that collaboration and cross functional problem solving and continuous improvement - our team working with your team - is only possible in Partnership manufacturing logistics
- 8. This means…an integrated approach: A Partnership. …and that Partnership working is the key to success in today’s demanding and dynamic aerospace industry. manufacturing logistics
- 9. A Partnership requires a common language… lean
- 10. Lean logistics, just like lean manufacturing, means increasing flexibility, reducing cost, time and inventory, and improving value COST & TIME VALUE
- 11. reducing time & costs ...using lean techniques, we help our customers to eliminate those processes (from their logistics) that do not deliver value Our approach to lean… increasing flexibility …we help our customer to meet fluctuations in supply and demand & fast turnaround times in their supply chain by configuring our own resources flexibly to meet their requirements reducing inventory …our customers only use our service on an order by order basis
- 12. improving product value …by increasing flexibility, improving quality and reducing costs, we make sure that the customer doesn’t pay for organisation inefficiency and waste. Our approach to lean… improving quality ….we work in partnership with both our suppliers and customer to continuously review and improve product and service quality
- 13. So, how we do it? …we start by understanding how customer value is delivered…
- 14. Increasing flexibility Reducing inventory Reducing time & costs Improving quality = Improving product value Value Stream thinking 4. On-going measurement & improvement 3. Create future state in adding more value 2. Identify current state in delivering value 1. Understand value delivered to customer
- 15. …and is completed by agreeing clear improvement Key Performance Indicators, in order to deliver, and increase, the specified value
- 16. We work across the Aerospace Supply Chain Raw Materials Suppliers & OSP’s Sub-component Manufacturers Principal Component Manufacturers Engine Module Suppliers Engine Module Suppliers Aircraft OEMs Aerospace Engines OEMs Repairs & Maintenance OEM TIER 1: Systems Integrator TIER 2: Sub-assembly manufacturer TIER 3: Make to print components TIER 4: Materials & Processes
- 17. Distribution: • Express delivery of parcels, pallets across UK, Europe and the world, • Reverse flow of re-usable commodities (e.g. packaging flight cases) Our Integrated Services cover… Managed Logistics: On site supply chain services such as goods receiving, packing, dispatch and store management
- 18. Commodity buyer of Packaging as a single source: • Procurement of consumable and reusable packaging from flight cases, card and wood. • Packaging refurbishment Our Integrated Services cover… Warehousing: • Storage of high value goods on a temporary or long term basis • Consolidation and delivery of batch sensitive parts fed from multiple vendor locations across the world
- 19. …and we flex our services to respond to our customer’s requirements of delivering value to their own customer, wherever they are in the supply chain…
- 20. Case Study 1: UTC, packaging supply, storage & re-supply Raw Materials Suppliers & OSP’s Sub-component Manufacturers Principal Component Manufacturers Engine Module Suppliers Engine Module Suppliers Aircraft OEMs Aerospace Engines OEMs Repairs & Maintenance OEM TIER 1: Systems Integrator TIER 2: Sub-assembly manufacturer TIER 3: Make to print components TIER 4: Materials & Processes Services: • Distribution • Warehousing • Commodity Buying
- 21. Tactic 1. Understanding value delivered to customer Tactic 2. Identified current state in delivering value Tactic 3. Create future state in adding value The difference we made… Results • We reduced stock holding value from 65K to 43k • We created over a 1,000 sq ft of space for use by the client • We took over the commercial role of ordering from the UTC supplier base of 8 with a clear objective to work closely with each supplier to improve quality and supply • We entered into a continuous improvement programme • Happy customer who was able to expand their operational footprint without need to build or outsource
- 22. Case Study 3: CDS, improvement to delivery driver communication and final proof of delivery Raw Materials Suppliers & OSP’s Sub-component Manufacturers Principal Component Manufacturers Engine Module Suppliers Engine Module Suppliers Aircraft OEMs Aerospace Engines OEMs Repairs & Maintenance OEM TIER 1: Systems Integrator TIER 2: Sub-assembly manufacturer TIER 3: Make to print components TIER 4: Materials & Processes Services: • Distribution
- 23. The difference we made… Results • The cycle time from Job entry to collection time improved on average by 45mins • Deliveries could be tracked by the customer without the need to contact despatch • Proof of delivery was instant leading to a time saving of 15 hours per month • Proof of delivery signatures could be e-mailed to our customer extending agile response time beyond our customer • Historical delivery data was used to create a fixed collection and delivery routes • A monthly saving of £2,800 due to better utilisation of the fleet Tactic 1. Understanding value delivered to customer Tactic 2. Identified current state in delivering value Tactic 3. Create future state in adding value
- 24. Our History… 2004 ON LOGISTICS FORMED BY NICK BENNETT FOUNDER AND CURRENT OWNER 2006 • NEW BUSINESS VALUE PROPOSITIONS INTRODUCED SPANNING DISTRIBUTION AND WAREHOUSING • OPENED OUR FIRST WAREHOUSE IN TAMWORTH 2005 FIRST AEROSPACE CONTRACT SIGNED
- 25. 2008 FURTHER EXPANSION OF PARCEL AND PALLET DISTRIBUTION BEYOND THE MIDLANDS 2007 SECOND AEROSPACE CONTRACT SIGNED ON LOGISTICS WON IT'S THIRD SITE AEROSPACE CONTRACT 2010 2012 SECOND WAREHOUSE OPENED TO MEET THE INCREASING DEMAND FOR FULFILMENT
- 26. 2013 • AN INVESTMENT OF £50,000 INTO A NEW WAREHOUSE MANAGEMENT SYSTEM • AN INVESTMENT OF £5,000 INTO PORTABLE VAN TECHNOLOGY 2014 • ALL AEROSPACE CONTRAC TS WERE RENEWED AND SIGNED • PLACED OUR FIRST ORDER OF PACKAGING FOR RE-SALE INTO AEROSPACE • JOINED THE MIDLAND AEROSPACE ALLIANCE AND ADS • ISO9001 JOURNEY STARTED • REFURBISHED OF WAREHOUSE TO MEET INCREASING DEMAND FOR AEROSPACE STORAGE • NEW WEB SITE LAUNCHED
- 27. T H E F U T U R E2015 • FURTHER CONTRACT EXTENSIONS WITH MAJOR AEROSPACE PROVIDERS • COMMENCED (DLF) OF RAW MATERIAL INTO AEROSPACE MANUFACTURING VALUE STREAMS • COMMENCED BS OHSAS18001 JOURNEY • WON FURTHER PROCUREMENT BUSINESS • CONSOLIDATED OUR POSITION AS A BEST IN CLASS AEROSPACE INTEGRATOR
- 29. A final thought… “There are so many men who can figure out costs, and so few who can measure value.” Shigeo Shingo (Japanese industrial engineer considered the world’s leading expert on manufacturing practices and the Toyota Production System)