Question

Read below case study and give the answer below formate

Please write in your own words minimum 1-2 pages

Process Management Approach Reduces Scrap, Saves Alcoa Millions

As Alcoa Power and Propulsion sought to minimize manufacturing process waste, inefficiency, and related expenses, two key findings caught the attention of the business unit’s executive leadership team. Customer satisfaction surveys revealed 60 percent of respondents held an unfavorable or neutral opinion of the unit, while at the same time, internal quality measures revealed the business unit recorded the highest levels of scrap in the organization for the year. The findings represented a significant opportunity, but improvement would require rapid deployment in a methodical, deliberate, and sustainable manner.

About Alcoa Power and Propulsion

Alcoa Power and Propulsion (APP), a unit of New York City-based Alcoa Inc., is divided into three segments: structural castings and special products, industrial gas turbine airfoils, and aerospace airfoils. This business unit serves the defense, energy, aerospace, and industrial markets, where its products are used in military and commercial aircraft engines as well as power-generation turbines. Additional products and services include molds, hot isostatic pressings, specialty coatings and tools, as well as machinery. APP operates 25 production facilities around the world, employing more than 9,000 people.

Working to Improve Processes

The APP leadership team discovered scrap and rework issues were resulting in high customer claims and delivery issues, therefore they sought solutions for significant reductions to scrap levels to improve delivery, rework, and customer satisfaction. In the past, substantial scrap level decreases were thought to be unattainable because casting is a particularly complex process (see the sidebar, The Investment Casting Process, for more details) with many sources of variation. In late 2011, APP’s quality focus shifted toward sustainable and continuous process improvement,

particularly at nine of the unit’s super alloy foundries (five in the United States, three in Western

Europe, and one in Japan). While these foundries were the starting point for the initiative because

they recorded the highest levels of scrap, the ultimate goal for APP was to create a sustainable solution for deployment at the plant level by mid-2012. The right solution would need to capture and communicate tribal knowledge as well as monitor capable processes. Creating a new approach could directly impact financial performance by reducing scrap, rework, and returns.

Identifying Stakeholders and Building the Team

One of the first steps in forming a project improvement team was to identify stakeholder groups from which team members would be selected. The following stakeholders were included:

• Internal groups: engineering process owners, business unit and site managers, Operations personnel, and members of the quality staff.

• External groups: Alcoa and the business unit’s customers.

Once these groups were determined and the required knowledge and skills for each group identified, skill and knowledge gaps were identified. For example, the engineering process owners needed training on the DMAIC method, while the quality group required additional training on the audit process. Corporate quality staff provided introductory training on the organization’s process management methodology, and APP created a Six Sigma training class for its engineers.

It made sense to build upon already-existing team structures and working relationships at APP where there are business unit process owners and corresponding plant process owners. The improvement project’s deployment team included members from these process owner groups. The project goal was to develop a sustainable methodology to reduce the APP scrap rate by 10 percent year over year by June 2012, as depicted in Figure 1. The team was to develop manufacturing process models for key areas, validate the methodology at pilot locations, and then prepare a full implementation plan.

Analyzing the Opportunity

When analyzing the improvement opportunity at hand, the team quickly realized the part-focused scrap reduction methodology, which had been used for years, reached the point of diminishing returns. To achieve the additional scrap reductions required to meet the stated goal, process stability became the new focus. Since the investment casting process includes several complex steps, the team created process maps to identify, understand, and analyze each step for its savings potential. Pareto charts helped illustrate the contribution of each step to the overall scrap rate. Brainstorming, scrap rates, and defect data were used to identify potential improvement opportunities within the process. In addition, the team utilized scrap rates at each APP location to search for potential savings.

Scrap by point-of-cause data was analyzed within each process area to determine which processes held the greatest savings potential. In addition to pinpointing specific processes for improvement, quality tools such as Pareto analysis were also useful in determining which plants to target for early implementation.

At the outset, the project scope was quite broad—global business unit scrap reduction—a hefty challenge. After reviewing the data and securing buy-in from leadership, the improvement team narrowed the scope to focus on the greatest opportunities—the wax, shell, and cast manufacturing operations of nine selected locations. Although the scope was now more narrowly focused, the challenge was still immense, requiring the engagement of the entire operation. At this point, team membership grew to include additional process owners, engineers, quality staff, operations, and leadership personnel from plants involved in the project.

Developing Solutions

Because the nine APP locations for this improvement initiative were located around the world, it was imperative to create a cohesive language that could tie all the foundry processes together. This common language was necessary for not only deploying the methods and tools, but also identifying the key operations and sub-processes at various plants for comparative and benchmarking purposes. Process-mapping exercises, shop-floor interviews, brainstorming sessions, and benchmarking studies generated data to help develop potential solutions. The data was first used for comparing Alcoa plants with similar processes and improvement requirements. The company saved $20 million at seven Alcoa plants that had implemented process management initiatives. These results inspired the improvement team to pursue a similar approach within APP.

The left portion of Figure 2 depicts a typical plant-based approach to process improvement where efforts are confined. In contrast, the right side of Figure 2 shows how an integrated approach involving plants throughout the BU enables the sharing of approaches with common templates and coordinated plant projects. The new approach would leverage one plant’s independent ideas by sharing its solutions across the entire business unit to spur global improvement. This business-unit approach also enabled process owners to transfer technical details through a common language that was lacking in the past, and to build a collaborative culture.

The team developed a three-stage plan to implement its process management approach. The first stage involved pilot plants; the second fast-follower plants; before finally, implementation to a broad business-unit approach. This three-stage rollout provided data that team members used to validate the efficiency and speed of the shared and integrated approaches.

The key to incorporating solutions throughout the business unit was a structured, common process model, which incorporates the tools recognized as the best-suited means to get processes in control, and to identify key operations and sub-processes at multiple plant locations. Utilizing this process management approach, as illustrated in Figure 3, would increase sustainability through management review, quality audits, rigorous control plans, and a focus on the correct variables.

The process management solution was validated through the pilot and fast-follower stages. For example, one of the pilot-stage plants deployed a new casting/mold wrap process and demonstrated a 30 percent reduction in related scrap in just three months. Then a fast-follower plant used the same new process as the pilot plant and achieved similar scrap reduction results, but this time within just 30 days. This demonstrated that lessons learned at one plant advance the process management efforts at other locations when similar process improvements are implemented.

Overcoming Resistance

During the team’s initial analysis members discovered a few areas of resistance, including:

• Concerns regarding the availability of resources, particularly the ability for employees to handle the new initiative while still meeting production goals.

• Stakeholders at various levels lacked a sense of urgency and showed some hesitancy about making changes.

• Because the process management approach was a nontraditional method for reducing scrap, a change in culture would be essential to inspire employees to embrace the new process-focused method.

The team understood providing information and education was vital to achieve positive change, so the process management model includes routine communication such as holding team-building meetings and sharing monthly process audit databases. Resistance was also mitigated by engaging the entire workforce in the new process management approach. Examples included employees who helped by defining improvement opportunities, planning and prioritization activities, participating in kaizen events, as well as establishing and executing control plans.

Exceeding Goals and Realizing Additional Benefits

Once the pilot and fast-follower stages were completed, APP implemented the process management model throughout the business unit. While the initial project goal was to reduce scrap by 10 percent year over year, those expectations were exceeded by more than $20 million in improvements from the three key areas: wax, shell, and cast. Tyrus Hansen, APP team lead, said reductions in scrap and other costs of poor quality continue year over year, as highlighted in APP’s

Quality Index, shown in Figure 4.

Specific examples of dramatic cost savings include:

• A 77 percent improvement in wax expenses in one department at one plant, which resulted in a $38,000 annual savings.

• A sub-process involving shell weight control to reduce material costs at one production facility resulted in a 21 percent improvement and an annual savings of $400,000.

• A sub-process of the cast/wrap step reduced scrap and rework expenses by more than 30 percent, approximately $750,000, at one location.

Not only did the new approach lower scrap rates, but it also reduced rework activities and customer returns, leading to more on-time delivery and higher levels of customer satisfaction. At the outset of this project, all nine plants involved in the pilot were rated in the poor performance category, but since that time, all of the manufacturing locations have fully integrated the process management approach. An unexpected benefit of the work was an improved workforce development. Many team members completed training and then gained valuable experience with basic problem-solving tools—new skills that enabled employees to operate in a more proactive, process-focused manner. Members of the improvement team learned valuable lessons throughout the project, but Hansen said the biggest lesson centered on discipline as team members realized, “If we maintain the discipline, quality will improve,” he said. “The proactive work minimizes the time spent managing problems and fighting fires.”

Sustaining the Momentum

The APP process management models for the wax, shell, and cast operations were revised to reflect the new approach. These models were deployed through the process owner group at each APP location. Results are measured and reported at the process and sub-process levels with metrics directly linked to each location’s business case. Reports and feedback soon became more proactive and process-focused rather than reactive and problem-focused as was the case before this improvement initiative.

To ensure the new process management approach remains sustainable and continues to perform to expectations, APP implemented a number of controls, including:

• The business case must drive all activities associated with this approach and the activities are measured for impact.

• A reporting structure was created to communicate specific details on a regular basis.

• All efforts are recorded and included in the business unit manuals and audit tools.

As APP continued to implement the process management approach, the business unit realized further benefits, such as:

• By emphasizing control of the entire process, additional operators and supervisors are engaged in more proactive roles.

• The workforce is more satisfied and engaged due to greater stability, education, and structure.

• With fewer daily “firefighting” activities, time to focus on key process metrics for employees increases, triggering reactions before issues become scrap problems.

Sharing the Team’s Story

The team has devoted a great deal of time in sharing its success story with others. Within Alcoa, the model used in this project now serves as the corporate standard and is being applied at various locations and business units around the globe with similar results. The team’s effort was also highlighted at the 2014 Alcoa Corporate Process Management Network Conference and was a candidate in the 2013 Alcoa Corporate Impact Award Competition.

At the prompting of Alcoa’s corporate quality department, the team entered its project into the ASQ 2015 International Team Excellence Award (ITEA) competition. The project was named a finalist, and this recognition enabled members of the team to share APP’s proven process management approach during the World Conference on Quality and Improvement.

Now please write in your own words as below format:

1. Write a Problem

2. Solution ( given, needed, assumption, analysis, rewrite)

3. Summary and conclusion.

Any help I really appreciate.

Thank you.

Answer 1

1. The problem was focussed on reduction of scrap at APP which was affecting the operations, customer complaints and quality issues. The company initiated a scrap reduction program as there were processes and technologies available for reduction of waste and more efficient operations. Considering the scale of operations, it was challenging to introduce the new processes across organizations.

2. The given solution for the problem included an analysis of different processes along with internal and external stakeholders which can influence the process and benefit from the outcomes. The changes were started on pilot project basis and later implemented on large scale. It led to achieving the goals of scrap reduction, rework and customer satisfaction.

The needed solution was overhauling the operations of the company for more efficiency and performance for increase in customer satisfaction. The process was done systematically and the was recorded through reports, process flows and charts for implementation and understanding. It was done by taking into account the communication and coordination challenges and upgrading the team with necessary training and skills.

Assumption was that it was possible to improve the process and reduce the scrap, change the traditional process, reduce the rework and increased customer satisfaction. It was done with help of internal and external teams, analytical and technological tools which led to cost reduction and improved performance, setting global standards.

The change process was well planned and managed at micro and macro level. The gaps like communication, skills and knowledge, process effects, defects and quality standards were carefully monitored and implementation was executed successfully leading to cost saving and better quality standards.

3. APP recognized the challenge of reduced scrap and rework for global operations. It mobilzed the internal and external stakeholders for the project to be done on large scale. The resources were arranged, analysis was done and required tests were done on pilot basis and implemented on large scale by reducing communication gaps and training the staff. APP was able to achieve the goals and exceed its plan by proactive action and planning. It was considered a hallmark in business and gained recognition for its applicability, efficiency, planning and achivement. APP had the benefit of upgrading its workers, operations and customer satisfaction.