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Consulting Services for Equipment Manufacturing Companies

An equipment manufacturing or custom manufacturing company’s ability to grow its sales and profits consistently is limited by constraints in the following areas like Operations, Sales, Spares and Services and New Product Development:

Operations

Our Offer

More than
95%

increase in on-time delivery

Upto
50%

Reduction in
lead time

Upto
40%

Increase in
plant output

Upto
20%

Reduction
in inventory

Reduction in expediting
Costs

like overtime and emergency freights

Improved
cash-to-cash cycle

Being part of a cyclical industry, means that typically, most equipment manufacturing companies go through periods of ‘flood’ and ‘famine’. During a flood (when the market is booming and backlog of orders goes up significantly), companies experience the ‘constraint’ in operations. Expediting orders to ensure timely delivery and the perennial struggle for matching components on the shop floor lead to significant wastage of capacity and month end skew in equipment production. These prevent a company from exploiting its operational assets to its full potential.

Vector offers consulting services to help equipment manufacturing companies reduce lead time of delivery, improve delivery reliability and increase plant output. Find out how

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operations

Sales Bandwidth

Our Offer

More than
50%

release in rales
team capacity

Increase in
rate of acquisition
of new customers

Maximising sale rate
from existing customer base

Increase in
overall enquiry base

During periods of underload on equipment manufacturing plants, the pressure on operations teams dips while the pressure on the sales teams (to procure orders) increases. Sales teams are often unable to respond fittingly to the challenge as they lack the bandwidth to expand their efforts in the market. The sales teams’ energies, which ideally should be used to develop customers are mostly consumed by transactional activities associated with existing customer orders.

With the help of Vector’s consulting services, equipment manufacturing, or custom manufacturing companies can increase bandwidth and improve effectiveness of their sales teams.

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Spares and Services

Our Offer

Enhance to near
100%

Availability of Spares at Point of Sale

By Around
25%

Reduced Inventory in Supply Chain

Upto
50%

Turn Around Time at Service Centres

More than
90%

Increase on time
Service Performance

More than
20%

Increase in spares sales

One of the ways equipment manufacturing companies can expand market share in many equipment categories is by improving availability of spares for equipment under breakdown and rapid resolution of service issues. This is because equipment uptime is critical for customers. However, ensuring availability of equipment spares for service is a major challenge for companies considering the enormous variety of parts involved. To complicate things further, some of the equipment parts are in frequent demand while others, often called “stranger” parts, are needed infrequently. Consequently, when companies try to improve sales and service, they suffer the downside of cash being tied up in slow-moving inventory.

Vector offers consulting services to equipment manufacturing companies to help them manage spare parts availability without increasing inventory

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New Product Development

Our Offer

Upto
50%

Reduced Project
Lead Time

Upto
50%

Increased Output from
Existing Resource Base

Reduced Rework

Improved
Quality of Output

Rapid
Mass Production
Stabilisation

Reduced Stress
on People and Resources

Creating new equipment and new variants of equipment is challenging for the new product development departments of equipment manufacturing companies. In addition to the fact that R&D is inherently uncertain, enormous workload and heavy dependence on external suppliers make the task more difficult. Added to this is the complexity of being forced to multitask across the initial stages of projects and the emergent residual work on equipment variants for which customer orders have been secured. Consequently, equipment manufacturing companies have to routinely contend with rework, delays in product stabilization, delays in launch of new equipment and post launch quality complaints.

Vector offers equipment companies or other custom manufacturing companies consulting and implementation services which can stabilize operations in R&D units and increase the companies’ output and reliability.

Know more about how Vector’s consulting services can enable equipment manufacturing companies to tackle the problems of chronic delays and poor output in new product development.

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new-product-development

Case Studies

Discover how Vector’s consulting services enabled organizations like Kirloskar Oil Engine, Godrej & Boyce and many others to transform their operations using “pull” systems of Theory of Constraints and secure for themselves a competitive advantage in their markets.

Enabling assured one-week delivery at Kirloskar Oil Engines Ltd

After having made the shift from the forecast-based model to consumption-based operations, KOEL can now offer guaranteed deliveries in ONE WEEK (industry standard is four-six weeks). In addition to improved efficiency, the company also enjoys several financial and operational benefits, all thanks to this shift in approach.

  • Indicators
  • Remark
  • Order to Dispatch
  • Reduced from 35-45 days to 7 days
  • Daily Availability of Engines
  • Increased to 99%
  • Credit Policy
  • Reduced by 95%
  • Debtors
  • Reduced by 96%
  • Raw Material Inventories
  • Reduced by 18%
  • Net Cash
  • Improved from cash- negative to cash-rich

Aligning delivery with dynamic site conditions - Godrej Material Handling Equipment

With the help of Vector Consulting Group, GODREJ-Material Handling Equipment, India's largest lift truck manufacturer, significantly improved several parameters including output and on-time performance.

  • Indicators
  • Remark
  • On-Time Performance
  • Improved to 85%
  • WIP (days)
  • Reduced by 33%
  • Output (Export Line)
  • Increased by 54%
  • Output (Domestic Line)
  • Increased by 24%
  • FG (count)
  • Reduced by 75%
  • RM Availability
  • Improved to 97%
  • RM Inventory (in Days)
  • Reduced 44%

Increasing output of New Product Development - Kirloskar Oil Engines Ltd

KOEL focused on facilitating flow of projects in the new product development funnel using the principles of Theory of Constraints. This enabled the company to shorten project lead time by more than 50%!

  • Indicators
  • Remark
  • NPD contribution to sales
  • Near 20% (up from 4%)
  • Short-Term projects
  • 63% faster
  • Long-Term projects
  • 56% faster
  • New parts developed
  • Increased 75%
  • CRE Engine drawings
  • Increased 68%
  • AE Industrial drawings
  • Increased 88%

Clients

We have partnered with major names in the equipment manufacturing industry to create and implement radical solutions which have redefined industry benchmarks. These names include:

larsen-toubro
godrej-material-handling
lmw
godrej
hercules-health
l-&-t
ace

Client Speaks

dara-byramjee
Dara Byramjee
Executive Vice President & Business-Head, Godrej Security Solutions

With three times more output from the same capacity and reduced working capital requirement, we were able to improve our ROCE by three times.

Q. What actions did you take to improve plant output?

A: We provide physical security solutions (safes, lockers, strong room doors) to banks and to other institutions that need them. Each product requires over 50 components; a few of these are made in-house, the rest are sourced from suppliers. In the past, we battled severe desynchronization of components which meant significant loss of capacity. When we solved the problem of desynchronization, we also saw improvement in output.

In 2010, we started implementation of Theory of Constraints processes by partnering with Vector Consulting Group. After deploying the flow concepts of TOC, synchronization of components at assembly improved dramatically. Our manufacturing units began achieving record output almost every day of the month.

Moreover, firefighting reduced significantly. This released the bandwidth of management for use on improving manufacturing line set-ups and for working on capacity release projects. These efforts further increased output

Q. What were the major paradigm shifts for you and your managers?

A: We had always assumed that higher WIP leads to higher output. We realized that this was not correct. One of the biggest paradigm changes we implemented is the system of pull - inventory is pulled into the system based on the daily gap in a pre-defined WIP level(which is now half of what it used to be before implementation). Lower WIP meant focus on fewer orders, and therefore, better flow.

Q. What challenges did you face during implementation? How did you align the various stakeholders to the new change?

A: The biggest challenge was changing the mindset of managers. They had to be convinced of the merits of the new way of working (daily planning instead of monthly planning; letting go of local efficiency targets and aligning manufacturing to fulfil priority orders). When our people saw dramatic improvements in inventory and output in a very short time, their initial skepticism made way for infectious enthusiasm.

Q. What cultural change was required to implement the new paradigms?

A: Cultural change was an effect of the implementation. For example, desynchronization of components required for assembly and massive month-end skew were sources of stress and frequent conflicts between departments. When flow became uniform, and output increased, teamwork improved significantly.

"With three times more output from the same capacity and reduced working capital requirement, we were able to improve our ROCE by three times."

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