Yagna overview dec 2019
- 2. Is it possible for one initiative to increase Throughput(Sales), improve Delivery Performance and reduce Inventory & wastages in a short period of time without any increase in Investment and Operating Expenses? Question!
- 5. ▪ Current capacity is not enough to fulfil the demand ▪ Profits and Profitability are not growing ▪ Cash Flow is poor ▪ Customer deliveries are delayed ▪ Long lead time taken for customer orders ▪ Material shortages affecting capacity utilisation ▪ High Inventory ▪ Frequent change in production priorities Do you face any of these problems?
- 6. Your Current Reality / Vicious Cycle ?
- 7. Cash Flow Pressure Supplier Payments are delayed ‘Relevant’ Material is not available Shortage and Surplus Inventory Money is stuck in Inventory and Receivables Cause and Effect forming a Vicious Cycle
- 8. SME Entrepreneur’s Dilemma A: Do well now as well as in future C: Build for Future B: Protect the current status D’: Focus on new initiatives D: Focus on day to day fire-fighting In order to have A, we must have B In order to have B, we must have D In order to have C, we must have D’In order to have A, we must have C Objective Need Need Want Want
- 9. Evaluate the YAGNA Way WHY? Any company can significantly improve in short period of time HOW? Focus on leverage point / Constraint WHAT? Convert untapped capacity into cash flow
- 10. An ideal solution would be A: Do well now as well as in future C: Build for Future B: Protect the current status In order to have A, we must have B In order to have A, we must have C Objective Need Need • The current investment and employees deliver far more than earlier • The cost of the new initiatives is derived from additional income • The solutions implemented are stable. • A Decisive Competitive Edge is created which ensures future revenues
- 11. Theory of Constraints (TOC) based Approach to covert untapped Capacity into Cash Flow
- 12. Leveraging the TOC Body of Knowledge 1975 1985 1990 1995 2000 2005 2010 Production, Throughput Accounting – OPT, The Goal, The Race, The Haystack Syndrome The Thinking Processes – Jonah Program TOCEvolutionoverlast35years Distribution, Marketing, Sales, Management Skills – It’s Not Luck Project Management – Critical Chain The TOC Holistic Approach – 8 Video Sessions TOC & Technology – Necessary but not Sufficient TOC & Business Strategy - Viable Vision / S&T Trees TOC in Retail - Isn’t it Obvious
- 13. Over 7 Million Copies Sold - The Goal by Dr. Goldratt! • Discover why your efficiency improvements are causing those late deliveries • Learn how to dramatically improve production capacity without increasing operating expenses. • Discover a powerful 5 step process for continuous improvement THE GOAL
- 14. YAGNA – Client Engagement Model Awareness Assessment Adoption
- 15. Our Clients and Partners RAMDEVS MOTORS
- 16. Few Clients consulted by YAGNA Team in past
- 17. Case Study
- 18. Meet Mr. X A 3rd Generation Entrepreneur 45-year-old SME Capital Equipment OEM Serving clients in India and Globally Mr. X is the owner of an SME*
- 19. 1 2 3 4 5 6 Delayed Deliveries Start New order early Cash Flow Pressure Delayed Vendor Payment Difficult to synchronize full kit Higher WIP Life Once Upon A Time
- 20. CAUSE Current belief & practices – early start will lead to early completion EFFECT Lack of visibility of the relevant information YAGNA’s Findings
- 21. Identify Assembly Bays Decide How To Exploit Zero Wait On Assembly Bays Subordinate Eliminate bad multitasking Single priority Across The Company Full-Kit Before Start of Work Limited Work In Process TOC @ work
- 23. In 90 Days Assembly Cycle Time In 1 Year Flow Through System Working Capital Delays In Delivery START By 40% By 60% By 60% By 20% 4 Months By 40% By 30% From 6 To 3 months SUCCESS CHAOS TO SUCCESS
- 24. Internal External Standardization Vendors Performance Measurement Incentive Link To Customers Rationalized Machine Variety Fast Delivery For Standard Machine Well Defined Sops For All Function On-time In Full Throughput Education And Alignment For Timely Material Delivery Performance Scorecard Faster Payments Faster Resolution To Customer Request Customer Communication Formats Collateral Advantage
- 25. Spares Function Marketing: Unrefusable /Mafia offers Stores Hired and trained the Lead Designed and implemented the Planning system along With SOP Constitutes 5% of the company's revenue within an year Designed mafia offers to create monopoly Rolled out the mafia offer based on delivery commitment Helped to organize the store New inventory module Buffer system Picture Abhi Baki Hai...
- 26. “Yagna guys aren’t like those fancy consultants who make fancy presentations but they actually get onto the shop floor to get their strategy executed. They deliver more than what they commit! They are my business partners.” - Mr. X, Chairman and MD Happy Mr. X Speaks
- 27. YAGNA Results
- 28. YAGNA DELIVERS RESULTS FORBES Precision Tools Manufacturer Before • Availability of Make- to-Stock SKUs 60- 70% • High Inventory • Struggle to delivery product variety • Delivery Performance 50% After • Availability of Make- to-Stock SKUs >85% • Inventory reduced by 30% • Deliver 25% more variety in a given period • Delivery Performance increased over 80%
- 29. YAGNA DELIVERS RESULTS MIRANDA TOOLS Precision Tools Manufacturer Before • Availability of Make-to-Stock SKUs 70% • High Inventory • High Production Lead Time After • Availability of Make-to-Stock SKUs >90% • Overall Inventory reduced by 43% • Production Lead Time Crashed by 30%
- 30. YAGNA DELIVERS RESULTS KOHLI INDUSTRIES Printing Machines Manufacturer Before • No Capacity to take more Orders • 5-6Cr investment for expansion • Assembly Lead Time 150 Days • Sales Stagnant • Zero Spares Sale After • More than 100% Capacity released • No investment • Assembly Lead Time 50 Days • Sales 2X • Spares Sales contribution 5%
- 31. YAGNA DELIVERS RESULTS BULLOWS PAINT EQUIPMENTS Paint Booths Before • Sales stagnant • Throughput stagnant • High Project Lead Time • Many Projects open at a time – High Working Capital After • Sales 1.6X • Throughput 1.7X • Significantly Shorter Lead Time • Priority system driving the project sequence
- 32. YAGNA DELIVERS RESULTS RAMDEVS MOTORS Motors and Pumps Manufacturer Before • No Capacity to take orders • Inventory Turns < 7 • Firefighting on the shop-floor • Skewed production and billing (>50% in last 10 days) After • 100% more Capacity exposed • Inventory Turns 8 • No firefighting • Uniform weekly production and billing
- 33. YAGNA DELIVERS RESULTS LOSMA Air & Liquid Filtration system for machine tools Before • Assembly Lead Time 1 week • Due Date Performance 50% • Sales Stagnant After • Assembly Lead Time 1 Day • Due Date Performance 95% • Sales 2X
- 34. YAGNA DELIVERS RESULTS GODREJ LOCKS Leading Locks Manufacturer Before • Channel Partner Inventory Turns 4- 6 • Availability of Make-to-Stock SKUs 60-70% • Lead time for Made-to-Order SKUs 45-60 Days After • Channel Partner Inventory Turns 12-18 • Availability of Make-to-Stock SKUs >95% • Lead Time reduced by 50%