What VDL Asked
VDL Groep, headquartered in Eindhoven, the Netherlands, is an international industrial family business with 104 operating companies, spread throughout 20 countries, with 16,854 employees. The VDL companies break down into four divisions: Subcontracting, Car Assembly, Buses and Coaches, and Finished products.
Today, VDL Groep is a major player in the subcontracting and semi-finished products sectors, produces its own finished products such as suspension systems, is active in automotive factory automation, builds heat exchangers and container handling systems, and the family business owns VDL Nedcar in Born, the Netherlands’ only large passenger car assembly factory, which carries out assembly line production of cars for third parties. The combined annual turnover in 2018 was 5.991 billion euros.
2014, VDL VDS TI, a VDL operating company located in Hapert, the Netherlands, was under a lot of pressure from one of their major automotive customers as a result of poor delivery and quality performance. Additionally, audit results also indicated the company risked losing business if the situation would not be turned around.
It was quickly agreed that the shipping and to some extent also the final assembly process required immediate attention. The fact that VDLs client was a major automotive brand made JIT a logical choice as the starting point for the approach to be followed.
What We Did
After creating a kaizen team, all 180 items supplied to VOLVO-RENAULT were analyzed to understand their demand patterns, to identify those items causing the problems, and to check their routings.
First priority was to secure the customer, and for all fast-movers, a finished goods supermarket was immediately put in place.
Next up was to develop and implement a robust picking, staging, labeling and shipping process. As part of this, the team went through a detailed value stream mapping exercise.
Furthermore, a highly visual shipping management board was developed and quickly put in place, even if only in a cardboard fashion. This board allowed the teams to manage missing items and shipping progress.
To increase the dependability, the team also developed standardized work for the whole shipping process. This was used to train the teams and it functioned as a reference on the shop floor.
Subsequently, the team also started integrating the assembly cell into the JIT approach, using production kanban to trigger replenishment of the items in the FG supermarket.
What Was Delivered
Through the work that was done by the teams, the client regained confidence with VDL. Using concepts that are mainstream in the automotive industry certainly helped to convince the client that VDL was on the right track to improvement this time.
In the shipping department, the transformation was most comprehensive. Visually managed truck preparation areas were created as well as supermarket locations for all fast-moving items.
The whole picking and shipping process also went through a complete transformation. The process was now standardized and managed using the visual shipping management board. This gave the client confidence that VDL was on top of its game, and that abnormalities would be detected immediately.
In assembly, the first group of fast-movers coming from one of the assembly cells was integrated into the pull from the shipping department. Batch sizes were determined considering changeover times in the cell, kanban loops were determined and the just-in-time replenishment of the supermarket for these items commenced.
Overall, delivery performance as measured by the client (dispatch precision) started to improve rapidly after the changes were implemented. But as only shipping and final assembly were under JIT control, there still was significant work ahead of the team to further extend JIT into the upstream manufacturing areas and towards suppliers.