TXM Lean Case Study – DMG Mori China

Client DMG Mori - Tool Manufacturer

Location Shanghai, China

The Challenge

DMG Mori is one of the largest machine tools builders in the world. Like many manufacturers in China, DMG Mori was facing rapid rising costs. This was making it difficult for the Shanghai factory to compete with other DMG Mori plants, particularly those in Eastern Europe. This led to a fall in export sales. A key challenge for DMG Mori in Shanghai was to reverse this sliding competitiveness.

Management in the plant recognised that there was significant scope to improve shop floor productivity. A simple observation of the plant showed that despite the advanced shop floor management systems there were a high level of non-value added time and shop floor organization including housekeeping could all be improved. The challenge therefore was to achieve this productivity gain while maintaining a flow production system.

The TXM Solutions

TXM Front Line Lean Leadership program at DMG Mori focused on providing training and coaching aimed at improving culture and work practices on the factory floor. To achieve this, TXM designed 4 elements to support DMG Mori’s Lean Leadership transformation program.

Building Foundations for Sustained Improvement – the Lean Daily Leadership Process®

TXM trained DMG Mori Leaders to develop and apply more effective leadership structures, systems and practices on the factory floor. TXM implement proven “Lean Daily Leadership Process®” (LDLP®). LDLP® is a highly customisable operations management system focused on building the Lean foundations of 5S, Visual Management, Problem Solving and Daily Routine Tasks for shop floor leaders. These tools developed front line leaders and their teams to take more responsibility for managing performance and solving problems in their area.

Improving Housekeeping and Organisation and Providing a Platform for Improvement – Practical 5S™

A key step in changing shop floor culture and building more effective work practices was to improve how the workplace was organised and to develop the discipline to keep it in its desired state. At DMG Mori, P5S™ had particular focus on what needs to be held in the working areas, where it needs to be held, the design layout of bench areas, the flow of jobs and of materials and the safety of employees working in the work areas including traffic flows. P5S™ established a culture of standardisation in the workplace that also supported improved quality and consistency of output.

Engaging Front Line Teams in Improving Every Day Performance – Visual Management and Daily Routine Tasks

Introducing visual management, where the day-to-day performance of production is displayed clearly on the factory floor for the benefit of managers and operators further expanded LDLP®. TXM coached DMG Mori to establish communication centres in the workplace to track daily project progress, problems and quality, safety and production metrics. Teams conducted a 15 minutes daily “stand up” meeting at the communication centres to discuss the issues of the day, review operational performance and to solve problems.

Providing the Tools to Solve Every Day Problems – Solving Problems Every Day®

TXM coached the DMG Mori team in the application of tried and tested problem solving techniques using the TXM “Solving Problems Every Day” (SPED™) methodology. This encouraged quick, on-the-spot action to find and address the root causes of problems. It also established discipline amongst team leaders and first line supervisors to fix problems rather than constantly referring problems to management to solve. Using the TXM SPED® approach, problems were used as opportunities to improve by analysing the root causes implementing fixes and tracking the improved performance.

Kamishibai board with green red Tee cards to help front line leaders to organiser daily activities

The Results

After one year of front-line Lean leadership program, the management culture at DMG Mori Shanghai plant has been changed. Achievements made included:

• Addressing daily problems much more quickly and effectively;
• Improving line efficiency from 71% to 96%;
• Improving OTD (On Time Delivery) by 28%;
• Reducing average rework points by 44.7% per project