SUBARU’S LEAN TRANSFORMATION
Presented By:
Darryl Bol & Michael Meier
Subaru’s Lean TransformationTransformation – Why make a change?
Increased Volume
Bridge Production
Mixed Production
Manage Warehouse
Efficiency
Production Flexibility
Effective & Efficient
Part Separation
Adapt to Schedule Changes
Subaru’s Lean TransformationFactors to Move to Lean Supply Chain
WHSE Space
•Converted for Production Capacity increase
•Reduce Space, Increased Volume, and Additional Complexity
Inventory Policy
•Reduce from 1.2 days -> 4.5 hrs. Standard Inventory
•Less Storage -> High Throughput / Repeatable Delivery Model
Parts Ordering
•Larger Low Freq. delivery-> Small, High Freq. delivery
•Separate Part numbers by A/B Production Line Requirements
•Supplier instructions that are Clear, Concise, and Detailed
•Tie together Part Orders to Transportation Plan, Date, and Time
Capacity Expansion
Efficient Use of Existing
Plant Space
Streamline Processes
Subaru’s Lean TransformationWhat we did and why we partnered with Venture Global Solutions
OCT2015
FEB 2016
JUL 2016
OCT 2016
JAN 2017
APR 2017
BASELINE
•Routing with maps and spreadsheets
•850 DPV•VGS
OPTIMIZATION
• Lean processes/separation ctrs• Technological solutions
•1,000 DPV•VGS EXPANSION
•B Line added•Deliveries specified by Dock and Prod. Line
•1,350 DPV•VGS
NEW PRODUCT
•New Model “Impreza” •50 new suppliers•1,600 DPV•VGS
RE-DESIGN
•New route design for optimum efficiency•1,600 DPV•VGS
INNOVATION
•New cutting edge YMS
•1,600 DPV•VGS
Transformation Timeline
DPV: Daily Production Volume
Subaru’s Lean TransformationDaily Production Timeline
0
200
400
600
800
1000
1200
1400
1600
1800
2015 FEB 2016 JUL 2016 OCT 2016 JAN 2017 2018
AA A A A A
BB B B
Veh
icle
s P
rod
uce
d p
er
Day
2015 - BASELINE• Routing with maps and
spreadsheets• 850 DPV
FEB 2016 - OPTIMIZATION• Lean processes• Technological solutions• 1,000 DPV
JUL 2016 - EXPANSION• B Line added• Dock and Line specific
deliveries• 1,350 DPV
OCT 2016 - NEW PRODUCT• New Impreza • 50 new suppliers• 1,600 DPV
JAN 2017 - RE-DESIGN• New route design for optimum
efficiency• 1,600 DPV
APR 2017 - INNOVATION• New cutting edge YMS• 1,600 DPV
Subaru’s Lean TransformationTotal Alignment: Materials/Logistics - Improved our Supplier Requirements
Managed Transportation
Network
(3PL)
Logistics Optimization
System
Material Management
SIA + 3PL + SupplierStronger Data
Integration
Route Optimization
Carrier/Supplier/Plant Users
Procurement
Finance
WMSWMS
Route Planning & Execution
Supporting Info
ERP/ Purchasing
EDI Info
830862856
21
4
3
5
6
7
81. Plant and supplier location2. Part order quantity3. Baseline route data4. Route optimization results &
updates5. Carrier/Supplier/Plant Interfaces6. Contracted lane information7. Self billed invoices for payment8. Sub/Shuttle/Main Route Schedule
Subaru’s Lean Transformation2015 – Automotive Lean Logistics Optimization Software Implemented
Route planning pre and post network optimization
Daily Production
Value
850
Daily Production
Value
1000
Where we started After optimization
Minimum Flexibility
Direct Routes
Increased Flexibility
Specificdock / line delivery
Subaru’s Lean TransformationFebruary 2016 – New Route DesignRoute planning pre and post network optimization
Network Optimization Lean Logistics Centers Dock Specific DeliveriesAutomotive TMS
Daily Production Value increased from850 to 1,000
N –
10
Wee
ks
Data Collection
N –
9 W
eeks
Data Validation
N –
8 W
eeks
What-if Scenarios
N –
6 W
eeks
N –
2 W
eeks
N –
1 W
eek
N –
0 D
ays
Reporting & Scheduling
Finalize & Execute
Go Live!Transition into New PlanTH
E P
RO
CES
STH
E TO
OLS
New Network Optimization Route PlanningTechnology and process integration: Route design
• New Network Optimization
Tool Launched
• Inbound Optimization Tool
utilized
• System allowed 32 “What-if”
scenarios to be run over a one
week period
• Tool to design high frequency
low inventory lean logistics
network
• Originated from OEM inbound
solution (Global Solution)
• Automotive lean logistics
strategies applied to container
loop
Subaru’s Lean Transformation
New Automotive TMS SystemTechnology and process integration: Route design
• New Automotive TMS system launched (December 2016 -
ALMS/TMW Integration)
• Implemented the Venture Collaboration Suite to receive EDI
214’s including check-calls and 15 minute in-transit check-
calls to show location and time of truck.
• Increased SIA visibility through real time tracking of all
deliveries.
• Reduced standard inventory levels to 4 hours from 1 day
• ALMS Load Forecast allows for daily adjustments.
• 30 minute updates with route and part visibility
• Enhanced driver responsibilities-supplier pallet verification
Subaru’s Lean Transformation
New Lean Logistics Center
How Lean Logistics Centers reduced in plant material flow
Previous trailers would have mixed
docks and lines
Parts were stored and shuttled
multiple times (Muda/waste)
Now every load that hits the door is line and dock
specific
Key part of the supply network to
drive down wasted moves
and cost
New System utilized with QR
barcode scanning for early problem
detection.
Subaru’s Lean Transformation
35% Volume increase from 1,000 daily units to 1,350 daily units
Implementation of new Portland, TN Cross Dock
Addition of the B-Line doubled the quantity of Line/Dock Deliveries
Increased internal logistics delivery frequencies –Multiple orders per truck
July 2016Subaru’s Lean Transformation
October 2016 Impreza Launch
New vehicle line which included the addition of over 50 suppliers, 1,000 parts and an increase in planned
vehicle volume from 1,350 cars per day to 1,600
Increased Volume
Bridge Production
Mixed Production
Manage Warehouse
Efficiency
Production Flexibility
Effective & Efficient
Part Separation
Adapt to Schedule Changes
Subaru’s Lean Transformation
01
02
03
Increased consolidation at Cross Docks for improved trailer utilization
Transportation savings provided through reduction in overall miles driven
Transportation savings through improved driver and trailer utilization.
January 2017 Re-design for Production Volume ChangesSubaru’s Lean Transformation
April 2017 New Yard Management System
The Future of Yard Management: The digital yard is real-time, data-driven, automated, integrated, and connected
1300
1000
1750
850
1600
Uses software to eliminate islands of information
Utilizes automated technologies to locate &
track inventory
Leverages sensor technology to avoid wasting
time, fuel, labor, and product quality
Helps to gain a holistic view of your supply chain
Subaru’s Lean Transformation
New Yard Management System
300 trailers to 700+
New Yard
Management
System
Drones used to give RFID
reads
Manual system to
automation
Good KPI data to drive
continuous improvement for
Shunting
Subaru’s Lean Transformation
Yard Operation: Valet
Launched a valet process to streamline yard operations and reduce amount of time drivers spend in the yard before being dispatched on their next route or finishing their day. Improves accuracy of the yard.
Yard Operation: 5S
Dunnage trailers are parked in the same location each day. Improving yard accuracy, reducing the amount of time spent in the yard locating trailers, allowing for yard locations to be shared by several routes throughout the day.
Return Operation: Cross-dock
Successful pilot of dunnage being loaded as sub-routes at SIA. Eliminating the need to handle dunnage at the Cross-dock and reducing the time it takes to get dunnage back to suppliers
Studies: Trailer Yard
Study conducted by a third party organization to find opportunities for improvement in trailer yard operations
Studies: Empty Containers
Study conducted by a third party organization to find opportunities for improvement in empty container handling.
Completed Kaizen ActivitySubaru’s Lean Transformation
Information
✓ New in plant system for returnable container center management Q4 2017
✓ Turnaround time for reroute planning ✓ Order Process enhancements to support
production flexibility✓ In plant systematic material & packaging flow
01
Plant
02
Manage
03
Process
04
Material
Never Complete - Future Kaizen Activity Subaru’s Lean Transformation
Results
Reduced miles p/vehicle by 13%
Created a continuous and even delivery flow (pipeline)
Reduced internal floor space required by 35%
Inbound visibility at the route / part number level
3 Point Check for early part shortage detection
Elimination of waste through dock specific deliveries
Supply Chain visibility for continuous improvement opportunities
Subaru’s Lean Transformation
Thank YouDarryl Bol & Michael Meier