Leading Global Automotive Parts Manufacturer Goes Lean with Glovia

Keihin Aircon furthers lean initiatives by streamlining operations, synchronizing cycle times

Keihin Aircon furthers lean initiatives by streamlining operations, synchronizing cycle times

El Segundo, CA — March 11, 2004 — Keihin Aircon, North America Inc. (KAC), a leading global manufacturer of heating, ventilating and air conditioning components for the automotive industry, said it has furthered its lean initiatives through the use of Glovia's extended enterprise resource planning (ERP) solution, glovia.com.

Glovia said the lean concept of manufacturing focuses on revolving a company's operations around the needs and operations of their customer.

According to KAC, in order to further its lean initiatives the company knew the first step was to optimize cycle times on the production line to match those of its customer, so that their finished goods came out at the same rate, thus eliminating excesses and shortages of finished goods.

With Glovia's Factory Planning module, KAC said it is able to assimilate customer information and run simulations of their inventory, production schedules, finished goods and inventory. The manufacturer also has visibility into line loading and timelines for jobs, making it easy to see the status of their operations and identify problem areas.

In addition, a synchronized production line requires tight integration between KAC and their suppliers so the right inventory, in the desired amount, arrives at the correct time. KAC uses Glovia's Supplier and Customer Releasing modules to manage customer requirements and their subsequent distribution to their suppliers.

KAC said the Customer Releasing module allows it to assess the customer requirements in order to know what needs to be accomplished. The requirements are then converted into the Supplier Releasing module and made available via the Internet.

Inventory control also plays a crucial part in this streamlined flow process. KAC employs what its calls a "roaming warehouse," meaning the manufacturer doesn't use the typical vertical racking found in most manufacturing plants. Instead, KAC uses floor storage, which is easier and faster to access but holds less quantity, thus increasing the need for tighter inventory management. The company's suppliers pack their trucks in such a way that when a truck arrives the parts are unloaded and used on the line immediately, rather than being unloaded and stored until use. By adopting this methodology KAC is able to eliminate a great portion of time and space spent storing parts.

Since the trucks serve as KAC's warehouse, the tightest of inventory control is imperative for this method to work effectively. The manufacturer said it is crucial to know exactly where the inventory is at any given moment; Glovia's Inventory control provides KAC with visibility of all material movement through an enterprise-wide system with integrated, interactive management of all inventories, including physical stock room and in-transit.

"We operate in an intensely competitive industry. We have to have information quickly and it must be accurate. Our customer schedules are very fluid and they become more so by the week, month and year as the car makers try to respond to consumer demands," said Mike Mitsch, vice president of operations at Keihin Aircon, North America. " Glovia has enabled us to run a tighter ship and a more efficient business. We're now confident our inventories are correct, we have accurate sales figures and a full breakdown of materials costs."