Fleetguard Filters Pvt Ltd

After a company-wide implementation of TOC, the company enjoyed a CAGR of 25% in the last 10 years

solutions

Auto & Auto Components

Pull Manufacturing & Distribution

Established in 1987, Fleetguard Filters Pvt. Ltd is a leading Indian manufacturer of heavy duty air, fuel, lube and hydraulic filters, air intake systems coolants and chemical products for on and off highway application. Fleetguard is a Cummins group company with a turnover of Rs.5600 million. It is a supplier to renowned automobile companies and industrial engine and equipment manufacturers. The company implemented TOC company wide to achieve significant improvements in financial and operational performance. They also went on to win several national and international recognitions for their ability to sustain excellence.

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Video Case Study

Auto & Auto Components,

Fleetguard Filters: Ten Years Of TOC Implementation

Fleetguard Filters Ltd. implemented the principles of Theory Of Constraints company-wide to achieve phenomenal improvements in financial and operational performance. This video describes their ten-year journey of excellence which won them several national and international recognitions.

Client Speaks

Niranjan Kirloskar

Managing Director Fleetguard Filters Pvt. Ltd.

One of the few companies to implement Theory Of Constraints based pull system right from manufacturing to retail.

Q. The auto industry is reeling under a second slowdown in five years. How has your company been affected and what steps are you taking to withstand the impact?

A: Of course, in both the August 2008 slowdown and the current one, the sales to our OEM customers have gone down. However, our Aftermarket distribution business has been a significant bulwark for our company. We have increased our sales in the aftermarket segment over nine times in the past six years. Our market share has grown consistently because of our strength of the distribution business – even in times of slowdown. We are now market leaders in some of the key segments in Heavy Duty Filtration.

Q. You are one of the very few companies in India, which has implemented a pure pull system right from manufacturing to distribution and now unto the point of retail. Can you share your experience of making such a dramatic transition?

A: We have been on an exciting journey for about six years to make the transition from forecast-based push to a pull system. The paradigm changes were significant in production to move away from batch production to variety-based production, which was assumed to lead to inefficiencies but we have actually generated excess capacity by not producing what is not immediately required. The changes in sales were even more fundamental – we had to move away from a system where we used to push material to distributors at month end, to now a system where goods are invoiced daily as per consumption. This called for changes in the way we measured sales. Sales teams do not have a primary sales target – they have targets for generating real demand in the market and increasing range and reach of our products.

Q. What happened to all your trade schemes, which usually support a push approach?

A: We overhauled all our trade schemes, which were based on meeting short-term targets. Such schemes created an artificial wave of peaks and troughs because of demand advancement and did not help anyone in the chain. We have now stopped all such schemes and shifted the budget to long-term loyalty programs with our key customers and influencers – the mechanics in our case.