Despite the advances in information technology and systems, most plants manage the process of prioritizing and managing the production of customer orders as if it were an art, approaching the task as a craftsman would, rather than treating order fulfillment systemically, using a robust process to manage and control production.
Rarely is the order fulfillment process treated as a process unto itself, with sequential steps and appropriate controls. Instead, order fulfillment is treated as an independent group of production steps, delegated to the resource owners (the plant) who do the work. Typically, they have little incentive to deliver on time, but rather, their incentive is to be “efficient”. As a result, the important task of improving on time delivery is an afterthought in process improvement efforts. In the end, orders are thrown over the “wall” from sales function to the production function, like hand grenades that might explode into a product that satisfies the customer. The result is chaotic efforts, late deliveries and unhappy customers.
The Maximum Flow System
The next few blog posts introduce the Maximum Flow System, which results in every order delivered on time, in less time, with minimal management intervention.
The Maximum Flow System is a set of tools and processes to schedule and manage your order fulfillment efforts that involve planning, management, and ongoing improvement. It results in:
• 20% increase in throughput
• 25% shorter lead times
• 15% more sales
• 20% more cash flow every month
• Improved labor productivity of 15% or more
The Maximum Flow System causes people to synchronize their day to day efforts towards the delivery requirements of the customer, which results in on time deliver of the customer’s order, with less effort and management intervention.
The system has six parts:
• Synchronized Execution
• Order Promising
• Buffer Diagnostics
• Sales & Operations Planning
Read a testimony below from Bob who used the system to transform his process.
“The beauty of the changes we have made has been that it was accomplished with a low tech common sense approach that yielded nearly immediate results of a magnitude I would not have thought possible. Two year increases in billings of 28% and 40%, with increases in our bottom line of five fold, and three fold. In short, the process has totally changed the look and feel of our business, and made it a better place to work.”
Bob Page, President, Graphics Systems
My next blog posts will focus on each of the 6 parts of the system. Do you want to read ahead? Check out the full white paper titled “How to Build a Reliable Delivery Process” here.