During an ISO 9001 implementation engagement, I began creating process maps for my client’s key processes in order to help them understand the interrelationship of their processes. These exercises uncovered a significant duplication of effort that resulted in wasted labor, increased inventory and vital space not being available for assembly operations. It became apparent that both the material control and purchasing functions assessed the inventory levels upon receipt of a sales order. The purchasing department placed a purchase order for the required raw materials. The material control department also issued a duplicate purchase requisition resulting in double orders being placed for a very expensive raw material with a limited shelf life.
Upon reporting this, my client then asked me to put the ISO 9001 implementation on hold and initiate a Real Rapid Results project. A project team, with me as the facilitator, was subsequently launched. A short time later various process improvements were implemented, which resulted in the following:
- Inventory of this expensive raw material was reduced
- Unused warehouse space was converted to assembly use
- Two unnecessary subcontractors were dropped
- Sales orders were processed faster consuming less labor
- The purchasing manager no longer needed to perform inventory assessments, thus allowing her more time to perform other critical tasks (ie. supplier development and cost reduction, etc.).
The annual savings due to the above was $4 million! This engagement began as an ISO 9001 implementation, but when a powerful Real Rapid Results tool was employed for another purpose a significant opportunity to affect the bottom line became apparent (almost by mistake!). Just think what can happen when a directed and planned Real Rapid Results project is launched!