CASE STUDY – For the past year, Elementia Materiales, a producer of materials for the construction industry, has begun a lean journey that’s already brought impressive quality results.
Words: Jorge Andres Palacio L., Operations Director, Building Systems Division LatAm, Elementia Materiales.
January is typically a difficult month for our plants. Following the holiday shutdown, our machines always need maintenance. Normally, it takes us a few days to get back to “cruising speed”. This year, however, was different. January was one of the best months we have had lately. And that’s because of Lean Thinking.
At Elementia Materiales, we had been experiencing quality problems for years and tried to respond to them with a number of process improvement initiatives (all stemming from our very own performance system). Each of our 10 Latin American plants had improvement projects in place, but because they were a prerogative of local management they tended to fizzle out after a while. In the meantime, our quality problems were still there, and it was becoming increasingly clear that they were a barrier to the growth of our company.
Last year, with the support of Regional Directors from Mexico, Central America, and the Andean Region we decided to turn to Lean Thinking to start working on process control and tackle our quality issues. The aim was to give our 10 sites a common goal and a common methodology to reach that goal.
With the idea to build on our performance system – and with the support and encouragement of our Regional Director – we contacted Lean Institute Colombia. Seven of our process leaders joined the institute’s Lean Management Program, which we found to be the perfect complement to the improvement system we already had in place at Elementia Materiales. By the end of the first trimester of 2021, plant managers from across the region had received the certification from Lean Institute Colombia. Indeed, by the end of 2021, we had developed 30 engineers responsible for production, quality, and improvement across our 10 plants. The eight people that showed most promise as leaders were even selected to take part in the institute’s Lean Master course, which focuses more heavily on leadership and strategic frameworks, like hoshin kanri. (I must say, the institute was a great partner. They adjusted their course to match our needs and adapted the content to our already existing improvement framework.)
For the past few months, we have seen lean culture begin to permeate our sites. We are learning a different way of working, having introduced daily meetings on the shop floor and begun to track our KPIs hourly and daily so that problems can be identified and tackled right away. We no longer need to wait until the end of the month to see them, and we have a much clearer real-time understanding of our process.
Using the four types of problems framework by Art Smalley, we have also ensured that the right people take care of the right problems, meaning that problems end up in the hands of those who can actually solve them. We are learning to prioritize and are also developing an understanding of the most appropriate tools to use in the face of certain problems. Critically, this approach has also taught us to look for new problems every day, and to understand what the customer truly wants (so we can then focus on applying the tools to make value flow through the process as smoothly as possible).
Lean has really accelerated our rate of improvement, especially in terms of quality. Scrap was our main issue, which is why the moment we started to explore A3 Thinking we saw a lot of improvement ideas focusing on reducing the amount of defective material we produced. 2021 ended up being our best year in terms of quality: in the plants that were experiencing the most challenging figures, scrap went down by one percentage point – from 4% to 3%, which is the equivalent of saving $1.8 million. We have also seen a marked decrease in the tons of material claimed due to quality defects, which went from 0.4% of sales to 0.2% (This was a problem that popped up in meetings all the time, whereas now managers talk about business opportunities and strategy.)
These are very significant results, which gave us more motivation to continue to pursue our lean transformation. We now plan on progressing in our lean journey by tapping into the full potential of newly introduced practices, like gemba walks or daily management, and, of course, by continuing to develop people and bring lean to all levels of Operations. We just identified our second cohort to go through the Lean Institute Colombia course, and they are from maintenance, safety, and logistics – which means we will soon have all the key positions in Operations covered.
Over time, we will bring lean principles and techniques all the way down to the shop floor. People at the front line already have a basic understanding of what lean is – we had to explain it, of course, so that they could understand the new way of tracking KPIs, etc. – but our plan is to really make them all lean thinkers. So far, everyone has responded very well to the new way of working. Across Operations, lean is now a “language” people understand. Evidently, seeing leaders interacting with the work, with the indicators, and with the boards and A3s has encouraged people to take lean on.
As I look back at the last year, I realize that starting at the top and gradually cascading Lean Thinking to lower levels of leadership in the organization was very effective. It’s clear to me that without the support of senior management at the very beginning, lean can’t take off. This is by far the most important lesson I have learned this year. Now, as leaders, we try to talk about lean every chance we get. In our weekly meeting, we even take the time to openly discuss our progress with the lean work.
We have to become more mature, of course, but I think that lean has already changed our way of thinking. I love its “common sense” feel and the emphasis it puts on the gemba, on the actual work. The plan now is to continue to build on the work done so far and help Lean Thinking spread across Operations and management, so that we can then take it to areas that haven’t experienced it yet. This is how we will make a true lean enterprise of Elementia Materiales.
Jorge Andres Palacio L., Operations Director, Building Systems Division LatAm, Elementia Materiales.