DBJvRensburg_16 TOCPA_April 2015_South Africa

16th International Conference of the TOC Practitioners Alliance - TOCPA

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April 23, 2015 Johannesburg, South Africa

16th International Conference of the

TOC Practitioners Alliance - TOCPAwww.tocpractice.com

Driving SMME Behaviour

through a TOC Priority System

Case Study of the Footwear

Manufacturing Supply Chain at

Watson Shoes

Dawid B Janse van Rensburg, CargoSolutions, South Africa23rd April, 2015


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Dawid Janse van

Rensburg

MD of CargoSolutions, a supply chain optimizationbusiness unit of the Cargo Carriers Group.

Focus on TOC supply chain solutionimplementations, and is an Implementation Partnerfor Inherent Simplicitys Symphony software in SA.

Worked in many industries in SA, including FMCG,building supplies, extrusion, footwear, clothing andprinting, distribution, etc.

TOCICO certified in Supply Chain and Logistics.

Contact info:[email protected] 485 8700083 3034183


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Watson Shoes & History (SMMEs)Industry challengesResponse to ChallengesTOC ImplementationThe New Supply Chain & Buffers (uppers)SMME roles factory lines & prioritiesThe good, the bad and the ugly!Relaying the priorities visibilityLessons learned

Discussion Points


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Watson Shoes

1859 Charles Searle, a British immigrant and

resident tollkeeper of Great Brak River, began

manufacturing traditional leather veldschoens

for the pioneering travelers along the

Southern Cape coast

Today approximately 1 million pairs pa (850k

own manufacturing)

Employs roughly 900 people in Southern Cape


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Earlier Challenges facing the

Footwear Industry

Massive growth in imports from China (driven

by retailers)

Industrial action

A make-to-order industry characterised by

long lead times 8-16 weeks plus

Resultant impact on retailers

BEE - factor on larger contracts


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Footwear Imports


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Initial Response to Challenges

2008 to 2013

SMME drive

Started to embrace MTS, but with sales order

bundle approach

Ongoing issues with MTO styles efficiencies!

Compliment range with imports (25%)

Intricate production planning systems


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Supply Chain Before

SuppliersRM

WH

Non Complete

SMMEs

In-house

Clicking

Complete SMMEs

FG

WH

In-house

Making

SMMEs work

with due date

SMMEs work

on a day-plan

with due date

Based on day-

done for RM

Based on day-

plan, MRP is

done for RM

Sales Orders

complete

Sales Orders

stacked, and

shipped when

complete

Non Complete

SMMEs

Uppers

Soles

5 16 weeks


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Challenges in 2013

Planning process

Efficiencies

Availability of fast runners not good

Due Date Performance of MTO styles not good

Long lead times

Excessive inventories

Raw material challenges (shortages & surpluses)

SMME alignment

Many, and Varied

Service levels difficult to enforce


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TOC Project

Started in early 2014

Combined Consumer Goods and

Manufacturing MTO Strategy and Tactics

templates from Goldratt Consulting

Initial focus on high availability of fast runners

MTA to enable inventory turns selling

Secondary focus on MTO lead time reduction

and high Due Date Performance

Ultimate objective is to increase sales across

the range


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Five Focusing Steps

16

1. IDENTIFY the systems constraint(s)

2. Decide how to EXPLOIT (make the most out of) the

constraint(s)

3. SUBORDINATE everything to the above decisions

4. ELEVATE - Find/invest in additional capacity or alternatives

5. If at any time in a previous step a constraint has been broken

go back to Step 1.

Do not allow INERTIA to become the constraint!

Production

Stock, Time &

Capacity Buffers

Priority system in

procurement

and production


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Type 2: MTS - Stock Buffers

Stock & Time Buffers

If order not yet

completed, its

status turns Yellow

Type 1: MTO - Time Buffers

If order not yet

completed,

its status turns

Black

Order

Date

Scheduled

Release

Date

Due

Date

Buffer time

If order not yet

completed, its

status turns Red

Blue

Status

Implies

Too Early

If stock consumed is 1/3 its

status turns Yellow


status turns Red


status turns Black

If stock is greater than the

buffer, the Status is Blue3/3


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Supply Chain After

SuppliersRM

WH

Non Complete

SMMEs

In-house

Clicking

Complete SMMEs (MTA & MTO)

WH

Upp

ers

WH

FG

WH

In-house

Making

Soles SMMESoles

WH

3-8 weeks

1 week

2-4 weeks


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Post Implementation Status

Production planning improvement, but.

Improvement in MTA availability, but

Improvement in lead times and DDP, but

Overstocking reduction, but

Soles availability, but

Raw material availability, but.

Etc


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Finished Goods WH


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Kraal WH (Uppers)


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Dormadeals Misc SB


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Shipping Buffer - All


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Experience Spoiler (Bulk)


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Experience Bass


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Arse end. Shoeroom!


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Five Focusing Steps

27

1. IDENTIFY the systems constraint(s)

2. Decide how to EXPLOIT (make the most out of) the

constraint(s)

3. SUBORDINATE everything to the above decisions

4. ELEVATE - Find/invest in additional capacity or alternatives

5. If at any time in a previous step a constraint has been broken

go back to Step 1.

Do not allow INERTIA to become the constraint!

YES

YES

NO!


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Subordinate!

Production Planning

Making Uppers

Making - Soles

Raw Materials procurement

(and Elevate on MTOs)


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RM Upper Leathers


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RM Bottom Grindery


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Crepe Soles


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Innovative Cutting GH Mocc Bulk


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Experience Spoiler


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Experience Misc


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Dorma (Kraal)


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MTO Lead Times

Average 48 days to 28 days!


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Overstocking (FG)!


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Prime Measurements

Sales (Throughput)

Stock-Outs Percentage

Due Date Performance (MTOs)


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Web Interface


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Mobile Interface


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Violations Report

Previous Load Closed Tickets

Non-Complete SMME's Non-Complete SMME's

Factory Line FL No Black Red Yellow Green Blue Factory Line FL No Black Red Yellow Green Blue

JR Cutting Mocc (Bulk) KRL 93 5 50 2895 3005 2510 JR Cutting Mocc (Bulk) KRL 93 0 0 0 0 100

JR Cutting Stitch-down 92 1700 884 428 442 93 JR Cutting Stitch-down 92 12 0 0 0 0

JR Mocc (Bulk) KRL 90 0 200 330 180 6070 JR Mocc (Bulk) KRL 90 0 50 70 0 50

JR Stitchdown 91 406 329 177 38 0 JR Stitchdown 91 17 0 0 0 0

Just Upper Kiddies (Bulk) 11 0 0 0 0 0 Just Upper Kiddies (Bulk) 11 0 0 0 0 0

Inhouse & Complete SMME's Inhouse & Complete SMME's

Factory Line FL No Black Red Yellow Green Blue Factory Line FL No Black Red Yellow Green Blue

JR Cutting Mocc (Bulk) KRL 93 0 0 0 0 0 JR Cutting Mocc (Bulk) KRL 93 0 0 0 0 0

JR Cutting Stitch-down 92 0 0 0 0 0 JR Cutting Stitch-down 92 0 0 0 0 0

JR Mocc (Bulk) KRL 90 0 0 0 0 0 JR Mocc (Bulk) KRL 90 0 0 0 0 0

JR Stitchdown 91 0 0 0 0 0 JR Stitchdown 91 0 0 0 0 0

Just Upper Kiddies (Bulk) 11 960 330 790 830 330 Just Upper Kiddies (Bulk) 11 30 30 20 0 0


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Conclusion

The Five Focussing Steps Work, BUT

SUBORDINATE (after Exploitation)!

Also implies VISIBILITY!

And never compromise!

DBJvRensburg_16 TOCPA_April 2015_South Africa

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