Customer Gains 6-12% Cost Reduction from Acme’s Lean Manufacturing Benefits
Many of Acme’s customers encounter cost pressures as they strive to stay competitive in their markets. Since most OEM’s products have more than 50% of their costs generated by the material, parts, and assemblies they purchase, they are very dependent on their supply chain to not only control their costs, but also find cost reductions that can be shared. With many of the costs driven by the OEM’s product design, the OEM needs their supply chain to find process improvements and material source changes that can produce savings without affecting the design specifications of their products.
Beyond Precision Solution
Acme used Lean Manufacturing techniques and found that its customers could benefit by segmenting Acme’s business into four different value streams and focusing on the specific needs of each. For one of these four value streams, Acme has been able to modify its processes and totally eliminate setups for the parts that flow through it. That has produced savings not only with setups but also with scheduling and lead time as Acme moved to a pull system for the parts in that value stream. Acme was also able to locate better casting sources for several part families that improved the quality, delivery and cost of raw material that Acme machines for its customers.
Acme Industries’ Value
With the Beyond Precision solution described, Acme was able to proactively offer savings of 6-12% for several parts for a customer that was challenged with finding ways of being more competitive with an important product in their market.