Case study May 18th, 2021
Kontio’s journey: 5 steps to a lean production
Kontio, the world’s largest log home manufacturer, was struggling with a high seasonal fluctuation of demand. The inability to simulate and control inventory levels led to excessive emergency stocks, high amounts of capital tied to inventories, strong variations and delays in lead times.
Kontio begun to find that its growth is limited by its ability to plan and deliver. It was clear they needed to have a new approach.
Challenge
Throughout its 50-year history, Kontio has delivered more than 50,000 log buildings while doing production planning entirely on Excel spreadsheets. Spreadsheet-planned production was the epitome of waste. Furthermore, because the existing system offered no true overall picture of production capability, it resulted in disconnected material flow throughout the factory.
Solution
We created a standardized analysis model for businesses aiming to create lean production, covering the entire cycle from pre-implementation analysis and early proof of concept to full implementation.
Step 1
Production analysis
Our first step was to determine how the production is carried out and break it down into individual processes to understand their characteristics and restrictions.
Result
Just-In-Time (JIT) production
Step 2
Planning analysis
By mapping out planning restrictions, prioritization order, planning tools and data, frequency of scheduling and failures and production feedback, we got an
overall view of what needs to be reformed.
Result
Perceptive planning process from sales to production
Step 3
Business analysis
The third step of the analysis aimed to understand how to optimize the end-to-end production by defining business targets, main KPIs, supply strategy and the related stakeholders.
Result
360-degree view of the full value chain
Step 4
Early proof of concept and implementation
Early proof of concept allowed for validating the solution for covering the business and production requirements found in the analysis. The solution was up and running in 3 months, providing tangible benefits from day one.
Result
Rule-based optimization approach by Asprova. A holistic planning process and visual management of the entire production
50%
Shorter lead time
30%
Reduced raw material inventory
50%
Reduced work-in-process inventory
Impact
The impact on Kontio’s production planning has been dramatic. We combined the right knowledge with the right tools to impact Kontio’s bottom line: from no late deliveries, eliminated finished goods inventory to increased factory production capacity and double stock keeping unit enabled by Asprova.
Learn more how to streamline production via real-time overview
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