Lean Inventory Levels Resulting in Improved Customer Satisfaction

Northern Elastomeric, Inc. Lean Inventory Levels Resulting in
Improved Customer Satisfaction
Northern Elastomeric, Inc. (NEI), headquartered in Brentwood, N.H., is one of the nation'sleading suppliers of SBS-modified asphalt, self-adhesive, roofing and moisture barrierproducts, serving the North American construction industry. Among its products that aremost in demand are roll-roofing underlayment, foundation waterproofing, and innovativeflooring-crack isolation membranes. All NEI products are manufactured for private labeldistributors.
THE SITUATIONA fast-growing supplier, NEI's delivery performance was declining, creating a significantproblem with past-due shipments, even though the company had an excess of finishedgoods. Since customers were unable to trust NEI's delivery promises, they would submit"place-holder" orders as backup. The movement and cancellation of these largely extrane-ÅìëíçãÉê=ëìÅÅÉëë=ëíçêóous orders generated considerable distress within NEI.
In trying to remedy its delivery problems, NEI would increase production of finished"Besides the unique goods, but typically it built the wrong inventory, and shipment dates consistently weremissed. Unneeded materials sat in finished goods for six to eight weeks. The resultinghigh finished-goods inventory meant the company tied up more cash and required addi-pull-system software, tional warehouse facilities.
Infor had the experts With its current processes, NEI had no easy, formal system for managing priorities andwork flow. Although priorities were developed in weekly production meetings, they wouldwe needed to change change ten minutes after the meeting concluded.
NEI understood it needed a system that enabled it to deliver more rapidly and on time toour operation. They take advantage of its potential for 20 percent annual sales growth.
understood our busi- THE SOLUTIONOnce NEI determined it needed to move to a leaner operation, one that was much moreness and recommend- responsive to customers and required lower inventories, it found that Infor was the onlycompany offering the lean expert consulting and the protected pull Infor VISUAL Easyed a rapid improve- Lean software that they required to improve operations. Infor's Throughput ImprovementGroup PSO experts conducted an assessment of NEI operations and workflow training, andment plan in just a projected its future-state operations. After receiving the assessment, NEI managementchose to adopt the Infor Fast Track process to implement Infor's VISUAL Easy Lean meth-ods and software.couple days." NEI's vice president of manufacturing, Sam Pollard explained, "Besides the unique pull-Sam Pollard system software, Infor had the experts we needed to change our operation. They under-Vice President of Manufacturing stood our business and recommended a rapid improvement plan in just a couple days.During the Fast Track process, Infor's real-world experience helped us implement provenmethods and disciplines that we needed to get great results."NEI
Å~ëÉ=ëíìÇó"We increased our REAL RESULTSInfor's capabilities rapidly resolved NEI's problems and heightened its performance inextraordinary fashion. Even though sales leapt 20 percent, delivery performance improvedbusiness 20 percent from very poor to virtually 100 percent on time. Pollard noted, "Now our customers trustus and the 'place holders' have all but disappeared. Finally, our chronic past-due problemlast year and are on is gone."
Quoted lead times shrank from the previous four-to-six weeks to less than two weeks withtrack to increase it nearly perfect on-time performance. "Before Infor VISUAL Easy Lean," quipped produc-tion manager Bill Atwell, "the only thing we measured on time was our work force. Now,another 20 percent everything is on time."
this year... Infor The persistently high finished goods inventory tumbled by 50 percent within just threemonths, while the number of SKUs the company produced continued to grow. VISUAL Easy Lean Overall, the management of the operation became much more productive and predictable."We increased our business 20 percent last year and are on track to increase it anothermakes it completely 20 percent this year," Pollard said. "We are doing this without adding any indirect labor tomanage the additional work load. Infor VISUAL Easy Lean makes it completely manage-manageable." able."
Sam Pollard Scheduling, meanwhile, became routine instead of exasperati... [download for more]