14: Improving operational performance for the electronics business of a global electrical engineering group
Global electrical engineering group
The “Industry” sector provides solutions for production, transport and building technology and includes, among others, the Industry Solutions and Mobility divisions. The “Mobility” division is the internationally leading solution provider for transport & logistics.
Head of Operations “Electronic Design & Manufacturing Service”
Industry Solutions Division, Business Unit Electronic Design & Manufacturing Service (EDM), Germany. The EDM business unit supplies external customers and in-house divisions with electronics solutions for industrial electronics/automation, the automotive and rail industries, as well as traffic engineering, energy technology and medical technology.
- Operational business responsibility for the “EDM” business unit (EMS/ODM business) of the “Industry Solutions” division with 4 production plants for “built-to-print” PCB and device assembly, with revenue of €170 million.
- In-house and external customers in the automotive, traffic engineering, rail technology/plant engineering (power electronics), automation technology/plant engineering (power electronics), medical technology and energy technology sectors.
- Management of production and assembly, procurement, order processing, logistics and quality management.
- Reporting line to the CEO (Spokesperson of the Executive Board), leadership of approx. 650 employees.
Initial situation & tasks:
- The business unit’s operational performance did not meet the Executive Board’s targets (division management).
Activities / Measures:
- Introduction of lean methods and consistent shopfloor management.
- Optimisation of manufacturing processes and material flow using “Value Stream Analysis” (VSA) and “Value Stream Design” (VSD).
- Cashflow improvement programme by reducing working capital (inventories, WIP, receivables, payables).
Key successes/results:
- Increase in EBIT by ~3% p.a. within 1 year and in free cash flow by ~10%
- Reduction of capital employed (current assets/working capital) by ~20%
- Improvement in manufacturing performance (significant reduction in manufacturing costs, lead times, delivery performance and quality costs/NCC).
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