Component Kanbans Used At GTC PhilipsDunlee Greg Taylor

Component Kanbans Used At GTC Philips/Dunlee Greg Taylor and Julie Fenza Aurora Health Care Division MAY 20, 2009

Purchased Component Kanban Strategy • Major Portion of Inventory Plan and Lean Initiative • Standardize on Few Processes • Balance Conflicting Business Goals – Minimal Inventory Investment – High Level of Schedule Flexibility – High Level of Product Availability Confidential Aurora Medical Divison, MAY 20, 2009

Project Goals • • • Limit Methods Used Keep Inventory $ Investment To a Minimum Improve Employee Efficiency Improve Data Accuracy and Speed To Supply Base Improve Material Availability To Manufacturing Confidential Aurora Medical Divison, MAY 20, 2009

Three Processes Selected • Floor Fax Release • VMI • Nocturne Confidential Aurora Medical Divison, MAY 20, 2009

Floor Fax Release • Philips Uses – Packaging – Hardware – Pay off invoice – Reload Kits – Bearings - $ Value Too High For Vendor To Hold Inventory • Works Well When – Vendor Will Take Inventory Position – Blanket Purchase Order Only Demand Data Given – Short Lead Times – Parts Qualified For Dock To Point Of Use – Responsible Floor Employee Confidential Aurora Medical Divison, MAY 20, 2009

Floor Fax Release Example - Wood Crates Confidential Aurora Medical Divison, MAY 20, 2009

Floor Fax Release • Packaging Reorder Form Confidential Aurora Medical Divison, MAY 20, 2009

Vendor Managed Inventory • Philips Uses – Cable Assemblies – First Aid Kit and Safety Supplies – Pay Off Invoice – Machine Shop Tools – Pay Off Invoice – Product Technical Data – Pay Off Invoice • Works Well When – You Can Trust Vendor Not To Overstock – Parts Qualified Dock To Point Of Use – Vendor Has Own Material Delivery Capability Confidential Aurora Medical Divison, MAY 20, 2009

VMI Example Cable Area Confidential Aurora Medical Divison, MAY 20, 2009

VMI Example • Copy of worksheet Confidential Aurora Medical Divison, MAY 20, 2009

Nocturne System • Most Complex Process • Prerequisites – Accurate Inventory Record Data – Clean Demand Data • • Don’t have invalid past due open allocations Update schedules regularly • Commitment From IS • Commitment From Supplier Confidential Aurora Medical Divison, MAY 20, 2009

Confidential Aurora Medical Divison, MAY 20, 2009

Daily Report • Shows All Part Information Between Dunlee and Supplier • Shows Daily Stock Status • Shows Daily In Transit Information • Helps Supplier Determine Ship Dates • Displays Daily Receipts • Initial Setup Considerations – Quality Issues, Transportation Costs, Additional Processing Post Receipt, and Safety Stock • Other User Specific Fields Can Be Added Confidential Aurora Medical Divison, MAY 20, 2009

In-Transit History Report • Shows Entries Related To A Particular Part • Shipments, Receipts, Adjustments and Shipment Information • No Need To Call Supplier On Shipments Confidential Aurora Medical Divison, MAY 20, 2009

Weekly Demand Forecast Report • Displays Data Up to 52 Weeks • Weekly Update Confidential Aurora Medical Divison, MAY 20, 2009

Daily Forecast Report • Shows Demand In Daily Buckets • Shows Part Information - Ending Balance, Limits, In. Transit balance Confidential Aurora Medical Divison, MAY 20, 2009

• Displays Stock History, USL, LSL, Receipts, Net Usages Confidential Aurora Medical Divison, MAY 20, 2009

Results • • • Limit Methods Used – Ten To Three Keep Inventory $ Investment To A Minimum – 23% Reduction Improve Employee Efficiency - Achieved Improve Data Accuracy - Speed To Supply Base – Plansee Improve Material Availability To Manufacturing – Floor Processes Virtually 100% - Nocturne Parts Consistent to Improving Confidential Aurora Medical Divison, MAY 20, 2009

Thank You Confidential Aurora Medical Divison, MAY 20, 2009 19