Lean Production Benchmarking Survey Sample Results

1
Lean Production Benchmarking Survey - Sample
Results

• Report to Manufacturers Division
• MHI Annual Meeting, September 2005

2
Benchmarking survey

• 141 plants participated
• HUD-code and modular
• Collected production-related data
• First step in applying lean production to factory
  homebuilders
• Results provided back to plants

3
Collected a variety of data

• Basic plant metrics
• Productivity measures
• Quality measures
• Value measures
• Problems

4
Productivity(total labor cost as a percent of
sales-all plants)
Plants on the upper end of the scale should
eliminate non-value added activities, and/or
increase capacity with the same workforce by
eliminating bottlenecks and smoothing flow.
Average 15
5
Customer satisfaction(all plants)
This chart summarizes how well participating
plants satisfy their customers, both in terms of
product and service. It is based on
manufacturer-administered customer satisfaction
surveys. A low value indicates customer
dissatisfaction.
Average 89
6
Ratio of indirect to direct labor cost(all
plants)
This trend line suggests a typical ratio of
indirect to direct labor costs of 17. Plants
located on the graph above the trend line have a
higher than average ratio of indirect to direct
labor costs.
7
Top production bottlenecks (all plants)
Drywall finishing operations were reported by the
greatest number of plants as one of the top two
production bottlenecks/problem areas. Drywall was
followed by roof build, wall build and factory
building constraints, which includes any problems
related to the layout of, or space available in
the factory.
8
Productivity vs. accidents per worker(by market
segment)
This trend line suggests that labor productivity
and accident rates are inversely correlated.
9
Labor turnover vs. quality(by market segment)
This trend line suggests that service costs
increase decrease as labor turnover rises.
R2 0.2906
10
Total labor cost per floor produced(by market
segment)
This is a key measure of labor productivity.
Plants on the upper end of the scale should
eliminate non-value added activities and/or
eliminate bottlenecks and smooth production flow.
11
Service cost per home (by market segment)
Per-home cost of resources (labor and materials)
wasted resolving discrepancies identified after
the home is delivered to the customer. This is a
key measure of in-plant quality. Plants on the
upper end of the scale should seek to reduce
service costs by identifying critical quality
problems, pinpointing their root causes, and
developing and implementing solutions.
12
Phase two lean activities

• Implement lean techniques in 8-10 plants
• Criteria for plant selection
• Commitment by senior plant management
• Lean advocate to undergo 1-week intensive
  off-site training
• Lean advocate to collect performance data, lead
  improvement activities
• Plant workforce to participate in rapid process
  improvement events