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Inefficiency in engineering change management in kimberly clark vietnam co , ltd

UNIVERSITY OF ECONOMICS HO CHI MINH CITY
International School of Business
------------------------------

NGUYEN VAN THONG

INEFFICIENCY IN ENGINEERING
CHANGE MANAGEMENT IN
KIMBERLY CLARK VIETNAM CO.,
LTD
MASTER OF BUSINESS ADMINISTRATION

SUPERVISOR: DR. TRAN PHUONG THAO

Ho Chi Minh City – Year 2018


INEFFICIENCY IN ENGINEERING CHANGE MANAGEMENT IN KCV
Table of Contents

List of Acronym............................................................................................................................... 3

List of Figure .................................................................................................................................. 4
List of Chart .................................................................................................................................... 4
List of Table .................................................................................................................................... 4
EXECUTIVE SUMMARY ........................................................................................................... 5
CHAPTER 1: PROBLEM IDENTIFICATION ......................................................................... 6
1.1

Company overview ......................................................................................................... 6

1.1.1

Company introduction.................................................................................................... 6

1.1.2

Plant introduction .......................................................................................................... 7

1.1.3

Manufacturing processing in KC’s plant ................................................................... 10

1.2

Problem mess ................................................................................................................ 11

1.2.1

Symptoms ....................................................................................................................... 11

1.2.2

Insight analysis production line BD03 ........................................................................ 13

1.2.3

Initial Cause-effect map ............................................................................................... 14

1.3

Problem identification .................................................................................................. 15



1.3.1

High turnover rate ....................................................................................................... 17

1.3.2

Lack of training and refresh training ........................................................................ 18

1.3.3

Inefficiency in product flexibility ............................................................................... 19

1.3.4

Inefficiency in engineering change management ...................................................... 20

1.4 Main problem definition and consequences ..................................................................... 21
1.4.1

Definition ....................................................................................................................... 21

1.4.2

Consequence of the problem ........................................................................................ 23

CHAPTER 2. SOLUTION SUGGESTION .............................................................................. 25
2.1

Cause validation ................................................................................................................. 25

2.2 Alternative solutions ........................................................................................................... 27
2.2.1

Effective document control for engineering drawing during implementing
engineering change ....................................................................................................... 28

2.2.1.1 Overview on document control for engineering drawing ......................................... 28
2.2.1.2 Document control for engineering drawing in Kimberly Clark’s context .............. 29
2.2.1.3 Implimentation .............................................................................................................. 30
2.2.1.4 Budget planning ............................................................................................................ 32
2.2.2

Develop a design for reliability model to eliminate the operation risk .................... 32
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INEFFICIENCY IN ENGINEERING CHANGE MANAGEMENT IN KCV

2.2.2.1 Overview on design for reliability ............................................................................... 32
2.2.2.2 Design for reliability in Kimberly Clark’s context .................................................... 33
2.2.2.3 Implementation ............................................................................................................. 33
2.2.2.4 Budget planning ............................................................................................................ 35
2.2.3

Develop a engineering change process in new product development ...................... 36

2.2.3.1 Overview on engineering change process in new product development .................. 36
2.2.3.2 Engineering change process in Kimberly Clark’s context ........................................ 37
2.2.3.3 Implementation ............................................................................................................. 37
2.2.3.4 Budget planning ............................................................................................................ 39
2.2.4
2.3

Solution selection .......................................................................................................... 40
Action plan in organization ............................................................................................... 41

2.3.1

Details action plan for solution engineering change process in new produce
development .................................................................................................................. 41

2.3.2

Detail action plan for solution develop a design for reliability model to eliminate
the operation risk .......................................................................................................... 44

2.3.3

Conclusion ..................................................................................................................... 47

CHAPTER 3: SUPPORT INFORMATION ............................................................................. 49
3.1

Methodology........................................................................................................................ 49

3.2

Trancript ............................................................................................................................. 49

3.2.1

Overview interview on the symtoms ........................................................................... 49

3.2.2

Overview interview on the comfirmation ................................................................... 64

Appendices .................................................................................................................................... 69
Engineering Change Management Aseesment _ Questionnaire ............................................. 69
Procedure to executing a product development at Kimberly Clark ....................................... 71

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INEFFICIENCY IN ENGINEERING CHANGE MANAGEMENT IN KCV
List of Acronym
BD03: Production line 3- BD is abbreviated of Binh Duong province, where plant located
BD04: Production line 4- BD is abbreviated of Binh Duong province, where plant located
BD05: Production line 5- BD is abbreviated of Binh Duong province, where plant located
BD06: Production line 6- BD is abbreviated of Binh Duong province, where plant located
BD07: Production line 7- BD is abbreviated of Binh Duong province, where plant located
BD08: Production line 8- BD is abbreviated of Binh Duong province, where plant located
BD09: Production line 9- BD is abbreviated of Binh Duong province, where plant located
BD10: Production line 10- BD is abbreviated of Binh Duong province, where plant located
BD21: Production line 21- BD is abbreviated of Binh Duong province, where plant located
BD22: Production line 22- BD is abbreviated of Binh Duong province, where plant located
BD23: Production line 23- BD is abbreviated of Binh Duong province, where plant located
BD24: Production line 24- BD is abbreviated of Binh Duong province, where plant located
FDI: Foreign Direct Investment
VSIP: Vietnam Singapore industrial park
FMCG: Fast moving consumer goods
EMEA: Europe, the Middle East, and Africa
LAO: Latin American Operations
APAC: Asia Pacific
OEE: Overal Equipment Effectiveness
CMM: Capability Maturity Model
BOM: Bill of Material
ISO: International Organization for Standardization
DRCS: Design Release Control System
NPD: New Product Development
DfR: Design for Reliability
TCO: Total cost ownership
ECR: Engineering change request
EC: Engineering Change
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INEFFICIENCY IN ENGINEERING CHANGE MANAGEMENT IN KCV
PCR: Process change request
List of Figure

Figure 1: Kimberly Clark Plant vision ................................................................................. 8
Figure 2: Kimberly Clark plant organization chart ............................................................. 9
Figure 3: Production line process ...................................................................................... 10
Figure 4: Initial Cause and effect map............................................................................... 15
Figure 5: Update Cause and effect map............................................................................. 16
Figure 6: Update cause-effect map .................................................................................... 24
Figure 7: Final cause and effect map................................................................................. 26
Figure 8: Equipment life cycle ........................................................................................... 33
Figure 9: Engineering change process .............................................................................. 37
Figure 10: Engineering change request ............................................................................. 39
Figure 11: Interview summary Lead operator ................................................................... 51
Figure 12: Interview Summary Process Specialist ............................................................ 53
Figure 13: Interview summary Process Engineer .............................................................. 56
Figure 14: Interview summary Asset Leader ..................................................................... 59
Figure 15: Interview summary Continuous Improvement Engineer .................................. 62

List of Chart

Chart 1: Mid- Year Performance –OEE ............................................................................ 11
Chart 2: Mid- Year Performance – Waste ......................................................................... 12
Chart 3: Engineering change management assessment ..................................................... 25

List of Table

Table 1: The production performance of another line from 2016 to Jun 2018 ................. 12
Table 2: The production line 3 performance from 2016 to Jun 2018. ............................... 13
Table 3: The delay information on Production Line 3 ....................................................... 14
Table 4: Turnover ratio ...................................................................................................... 17
Table 5: Newcomer training subject .................................................................................. 19
Table 6: Changeover summary .......................................................................................... 19
Table 7: Financial evaluation on Production line 3 performance ..................................... 24
Table 8: Criteria evaluate the solution .............................................................................. 40

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INEFFICIENCY IN ENGINEERING CHANGE MANAGEMENT IN KCV

EXECUTIVE SUMMARY
In manufacturing, the key business responsibility is to produce a product that can supply
the demand of customer and the performance is made the competitive elasticity with a
rival. So that the purpose of the thesis is to explore the causes of low performance on
overall equipment efficiency of manufacturing and find out that production line BD03 is
the lowest performance from early of 2017 to mid-year 2018 in Kimberly Clark Viet
Nam. The thesis using theory-informed to group possible problem based on interviews
and theory-confirmed combined with depth-interview to figure out the main problem. The
finding of thesis revealed that the inefficiency engineering change management is the
main reason that leads to inefficiency in change management during project
implementation for new product development on production line BD03 and strongly
impacts to manufacturing performance.
The inefficiency engineering change management is a serious problem, it leads to internal
and external customer dissatisfaction and cost for redesign, human resource constraint for
rework, the author has reviewed the literature and the collected data from Kimberly Clark
plant during deep interviews with managers, mini-survey on staffs and reports from
Kimberly Clark plant of head department, and employees to figure out the main problem
and the causes of this problem. The solution for inefficiency in engineering change
management is developing a design for reliability model to eliminate the operational risk
and develop an engineering change process in new product development. Both solutions
need budget investment approx. $27,000 USD for human resource and consultant, this
solution will build a strong foundation verification a design change and analysis the
impact to machine performance before application on production.

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INEFFICIENCY IN ENGINEERING CHANGE MANAGEMENT IN KCV

CHAPTER 1: PROBLEM IDENTIFICATION
1.1 Company overview
1.1.1 Company introduction
Kimberly Clark Corporation was established in 1872 in the USA and is now a leading
global marketer of a wide range of Family Care, Baby and Child Care, Adult and
Feminine Care, Personal Care, and Professional products for use in the home, business,
and industry. This company focus on providing branded, single-use products in four
business areas:
• Personal Care
• Consumer Tissue
• Professional business
• Healthcare
Kimberly Clark’s remains committed to building sustainability into every aspect of its
business. This approach maintains the company as well-established sustainability efforts
and integrates these existing programs with a number of new initiatives:
• Introduced new sustainable products that combine high performance and
exceptional quality with significant environmental benefits
• Strengthened environmental protection through our enhanced fiber
procurement policy
• Continued to measure and make progress in reducing our company’s
environmental impact through the ambitious goals outlined in our
environmental program
• Focused on developing more productive working relationships with our global
stakeholders
Today Kimberly Clark and its well-known global brands are an indispensable part of life
for people in more than 175 countries. Every day, nearly a quarter of the world's
population trust Company brands to enhance their health, hygiene, and wellbeing. This
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INEFFICIENCY IN ENGINEERING CHANGE MANAGEMENT IN KCV

trust has led to Company brands holding the No. 1 or No. 2 share position in more than 80
countries.
The values of authentic, accountable, innovative and caring describe how company A
work with and are judged by our consumers, business partners, investors and each other.


Authentic: Our heritage is one of honesty, integrity and courageously doing the
right thing.



Accountable: We take ownership of our business and our future.



Innovative: Our commitment is to new ideas that add value.



Caring: We respect each other and care for the communities where we live and
work.

In Vietnam, as one of the leaders in the categories they play in – over the years, they have
ensured millions of babies are kept comfortable and thrive through Huggies brand and
similarly millions of women are ensured of superior comfortable protection for feminine
intimate care needs through the key famous brand.
Kimberly Clark Vietnam’s story starts in 1991, we introduced the first product to the
Vietnamese consumer and it quickly becomes the #1 brand in Vietnam market.
Production lines were located both in Hanoi and HoChiMinh City.
Between 1992 and 2000, we also launched the second brand and third brand with lots of
success. In 2000, we became a 100% FDI Company: Kimberly Clark Vietnam Ltd,
wholly owned by Kimberly Clark World Wide Inc.
In 2003, construction started at Binh Duong province at the Vietnam-Singapore Industrial
Park (VSIP) and all manufacturing was quickly consolidated at one location.
1.1.2 Plant introduction
-

The scope of study: Plant of Kimberly Clark Vietnam Ltd

-

Size of plant: Plant was built in 2003 with the area is 3,000 sqr, it included
production, Warehouse for material, Office, Facility. The total employee is 500
people.

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-

Segmentation of product: Plant of Kimberly Clark Vietnam produce a product
that belongs to FMCG industry, the product is feminine care, adult care, and diaper
care.

-

Main competitor: Diana Unicharm

-

Plant address:
No. 32 Huu Nghi Avenue, VSIP, Thuan An Town, Binh Duong Province, Vietnam
Tel: (+84) 274 374 3911
Fax: (+84) 274 376 7068

-

Plant vision:

Figure 1: Kimberly Clark Plant vision

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-

Plant capacity:

In overall, the Kimberly Clark plant does not only produce a product for the local market
but also supply product for the internal customers (Kimberly Clark International) such as
EMEA, LAO, and APAC regions. To momentum support supply chain, there is totally 12
production line at Kimberly Clark plant, in that total amount 4 production line is going to
produce Baby care product, 2 production line are going to supply Adult product, the rest
is for feminine care product.
-

Organization chart

The organization structure of Kimberly Clark based on the manufacturing standard, at the
top there is Plant manager and sub-manager for each critical department, there are
Production department, Engineering department, Quality department, Logistic
department, Continous Improvement department, and Safety department. In overall, there
are around 500 employees, it included 100 office employees, the remaining employee is
following the shift to support the production schedule.
Mill Manager

Operations
Manager AFC

Asset Leader
BD3, BD4, BD9)

Operations
Manager BCC

Asset Leader
BD6,BD8, BD21

Logistics
Manager

Project Engineer

Planning Team
Leader

Mechanical Team
Leader

WH Team Leader

PTM

Electrical Team
Leader

Export Project
Leader

Packing
Coordinator

Maintenance
Team Leader

Imp-Exp
Coordinator

Process Engineer
Electrical
Engineer

Maintenance
Engineer

Asset Leader
BD5, BD7, BD10

Asset Leader
BD22, BD23,
BD24

Process Engineer,
Electrical
Engineer

3rd Party
Coordinator

Engineering
Manager

QA&PD Manager

Project Leader
(Local Project)

Process Excellent
Manager

Country EHS
Leader

Office Admin Sup

LEAN
Coordinator

QA Engineer
(QMS)
QA Engineer Exp.
Project

QA Engineer
(Material)
QA Engineer
(QA/QC)
Packaging
Engineer

Facility Engineer;
Maint Planner
Maintenance
Store
Coordinator

Figure 2: Kimberly Clark plant organization chart

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INEFFICIENCY IN ENGINEERING CHANGE MANAGEMENT IN KCV

1.1.3 Manufacturing processing in KC’s plant
There are 4 key steps that happen continuously during the chain of production
Step1: Make the core absorbency of the product
The core absorbency of the product has formed by cellulose made from wood pulp mixing
with SAP supper absorbent polymers material together with the compressed with the
pattern to build the shape of the core product.
Step 2: Combine with critical material to cover the core absorbency
After the core product was formed, it will be transferred conveyor and combine with other
material likes the poly film, cotton, fragrance, and antibacterial, etc.
Step 3: Form the shape of the whole product
To build the shape of the product, manufacturing processing uses the knife module that
included the shape requirement and cut on the line of the product right after combining
whole components together.
Step 4: Package product
This is a final step in the manufacturing process that will pack the product base on the
amount of piece of product requirement.

Figure 3: Production line process

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1.2 Problem mess
1.2.1 Symptoms
From the mid-year business performance review at the end of June 2018 between Plant
Manager, Sub Managers and all heads of department, there were some issues about
operation and management which were raised.
Firstly, the person in charge of production department has updated the overall objectives
of production division and there are two key criteria OEE and Waste did not meet
performance from Jan-2018 to June-2018, the year to date for OEE is 88.4% versus target
is 90.3%. Moreover, the Waste year to date is 1.2% versus target 0.71%. so that there is a
risk that the whole mill will not meet performance at the end of the year and directly
impact to benefit of whole employees.
Secondly, the Logistic manager has raised the potential risk on the shortage supply chain
in term of machine capacity can not a delivery product on time due to low performance. It
will strongly impact prestige and transportation.
Mid-Year Performance - OEE
92.00%
91.00% 90.52%
90.30%
89.77%
90.00%
89.3%
89.2%
88.4%
88.4%
89.00%
88.0%
88.0%
88.00%
87.3%
87.00%
86.00%

Chart 1: Mid- Year Performance –OEE
(source: Kimberly Clark plant mid-year business review 2018)

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Mid-Year Performance - Waste
2.00%
1.26%

1.50%

1.00%

1.43% 1.41% 1.35% 1.39%
1.2%

0.72% 0.73% 0.71% 0.64%

0.50%
0.00%

Chart 2: Mid- Year Performance – Waste
(source: Kimberly Clark plant mid-year business review 2018)

Obviously, a clear and deeper understanding of the issues which were reported during the
June meeting is essential for Kimberly Clark to success in its vision in 2020. Based on the
importance of the issue, the author decided to conduct research within the company to
collect more information and clarify the real problem.
At the first steps, the writer approaches to machine performance from beginning of the
year 2016 to mid-year 2018 to figure out how the health of the machine, the data came
from the production performance record an official update to the management team.
2016
2017
Jan to Jun 2018
Production
line
OEE
Waste
OEE
Waste
OEE
Waste
BD 3
86.06% 0.94% 70.83% 5.46% 76.34% 5.01%
BD 4
88.44% 1.12% 90.07% 0.82% 87.10% 0.85%
BD 5
92.22% 0.63% 92.88% 0.51% 89.50% 2.18%
BD 6
95.17% 0.47% 95.31% 0.42% 94.60% 0.46%
BD 7
93.31% 0.71% 90.48% 0.54% 87.54% 3.10%
BD 8
87.99% 0.76% 90.05% 0.65% 86.32% 1.06%
BD 9
89.90% 0.55% 91.98% 0.49% 87.97% 1.58%
BD10
83.88% 1.20% 81.01% 0.93% 82.73% 1.57%
BD21
91.56% 0.78% 83.39% 0.68% 87.73%
1.4%
BD22
93.61% 0.71% 94.64% 0.66% 93.29% 0.84%
BD23
92.76% 0.69% 97.27% 0.61% 89.81% 1.23%
BD24
93.63% 0.64% 91.68% 0.69% 93.67%
0.6%
Table 1: The production performance of another line from 2016 to Jun 2018
(Source: Production performance 2016,2017, and 2018)

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Overall Equipment Effectiveness definition: OEE represents the ratio of good units
produced over the number of total units that could have been produced over a
period of time if the equipment had experienced no losses such as breakdowns, setups, bad quality or machine speed losses.



Waste (Defect product rate) is the ratio of defect units produced over the number
of total units that have been produced.

1.2.2 Insight analysis production line BD03
The production line BD03 in this thesis produces feminine product and support for
approx. 25%, the local market is 75% so that this machine is very important for both
markets. From the data, the researcher found out that the BD03 performance decreased
definitely from begin of 2017 and it slightly improves a little during 2018. The writer
approaches the person in charge of production team line 3 and management to collect the
data and information from operations base on the real situation and verify the machine
performance for each period.
Criteria
2016
2017
Jan to Jun 2018
OEE (Overal Equipment
86.06%
70.83%
76.34%
Effectiveness)
Waste (Defect product rate)
0.94%
5.46%
5.01%
Table 2: The production line 3 performance from 2016 to Jun 2018.

Target
83%
2.5%

(Source: Production performance 2016,2017, and 2018)

Next, from the first symptoms, the writer discusses with operations team to figure out the
potential cause of the problem as below table:
Category
Breakdowns (over
15mins)
Change product
Minor stop machine
(under 15mins)
Loss speeds of machine
Quality adjustment

Description

Rate

Moving machine parts and various machine subsystem fail

18%

The time required to set up the machine for a different part
Events that interrupt production flow without machine
failure
The machine runs slower than designed to operate
Products or services failing to meet established production
specifications or customer requirements

24%
32%
2%
25%

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Table 3: The delay information on Production Line 3
(Source: Production Line BD03 performance record 2018)

From the proportion of data above, the Minor stop machine is the highest ratio, the second
and the third is a Quality adjustment and Change product. Based on the abnormal signal
on production line BD03 performance, the writer has used the qualitative and in a deep
interview to understand the insight happened on the machine. The interviewee will be
production team and stakeholder, it includes Lead Operator, Process Specialist, Process
Engineer, Asset Leader, Continuous Improvement Engineer, and Engineering Manager.
(refer to chapter 3-3.2 Transcript at page 48 for details information)
1.2.3 Initial Cause-effect map
The writer has filtered from each in a deep interview to summary the item that same
content to connect all collaboration findings together as an initial cause-effect map. There
are three main branches that lead to low performance on production Line 3, first of all, the
ineffective project implements on production 3 has impacted the machine capable of
running stable, and as interview asset leader that it came from the lacking engineering
change control during project planning, evaluation design, and risk control so that
machine could not control the setting and did not perform a mitigation plan for risk
reduction. Moreover, it did not only impact on a new product, but the current product also
needs evaluation capacity as well.
The second branch, during production time, machine have high proportion delay rate, so
the might lead to production line 3 low performance. As summary feedback from the
production team, there are many operator signatures, and the recruitment for replacement
also happen right after that, however, they were lacking experience on machine
processing and lacking technical training from Continous Improvement Team. Lastly,
production line 3 has a complexity product and many category products that have run on
this machine, so that this machine needs to perform product change many times during a
week and month. However, the production time for each product is short so that machine
can not approach the loss time for a product change, the key feedback from production
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INEFFICIENCY IN ENGINEERING CHANGE MANAGEMENT IN KCV

line 3 team is that the current setting for product change was not performing well and it
impacts to machine performance.
Lack of engineering
change management

Ineffective project
implementation on
BD03

Machine stop by
operator mistake

Machine delay is high

Low performance on
Production Line 3

Changeover not
effective

Poor mid-year
performance

High turnover rate

Lack of training and
Refresh training
Many product and data
setting is not good

Total time changeover is
high

Small volume per each
changeover

Figure 4: Initial Cause and effect map

1.3 Problem identification
As the resulted from the interview, the researcher has approached another thesis for
references the theories that can support to update the initial cause-effect map. First of all,
as (1), changeover means a change from one system or situation to another. At Kimberly
Clark Vietnam, the changeover is a process of converting one product to another.
Moreover, it is used to describe the change equipment, setting, material from one product
to another product with different characters, shapes, dimension, the capability of output
product. It means that per each machine will flexibility to produce some segment of
product categories. It will support business adapt to the change in the volume from market
flexibility when upgrading new product innovation. However, follow (2) the process
change to support flexibility on the product will impact the manufacturing efficiency, in
term of good performance effective flexibility management system, it will enhance the
competitor of the company, increasing output and reduce manufacturing cost (3).
Therefore, there is an update inefficiency in product flexibility for changeover branch.
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INEFFICIENCY IN ENGINEERING CHANGE MANAGEMENT IN KCV

In the other hand, from the theory of change management, the explanation of change
management is absolutely broad range compare with Kimberly Clark plant
manufacturing, according to (4), the examples of change enablers including: a stated
vision and goals for the change direction, defined roles of employees involved in change,
leadership guidance or commitment in involvement, training employees and having
strong human resources to measure and evaluate performance. Additionally, (5) has
claimed that the reason for this lacking of success in implementation can be subdivided
into four barriers. The management barrier reflects the problem that the focus of
management activities is dealing with daily business, not discussing new strategies. The
vision barriers arise when visions and strategic objectives are not broken down by means
of target definitions on the employees as a whole usually fails. If the risk of failure is
indeed at its highest in the implementation phase, then it is exactly here that the greatest
potential for success in a change of company strategy lies. Therefore, the inefficiency
change management has been inputted in the middle of ineffective project implementation
on BD03 and inefficiency engineering change management.
High Turnover rate
Machine stop by operator
mistake

Machine delay is high

Lack of Training and
Refresh training
Many product and data
setting is not good

Inefficiency in Product
flexibility

Total time changeover is
high

Changeover not
effective

Low performance on
Production Line 3

Small volume per each
changeover

Inefficiency Engineering
change management

Inefficiency Change
management

Ineffective project
implementation on
BD03

Poor mid-year
performance

Figure 5: Update Cause and effect map

At the update cause and effect map and based on the deep interview, there is some
possible problem that leads to low performance on production line BD03, the researcher
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INEFFICIENCY IN ENGINEERING CHANGE MANAGEMENT IN KCV

will performance interview higher level and look back benchmark data between each
production line to study deeply the possible problem.
1.3.1 High turnover rate
Refer to the research of (6), change a status of ownership of an individual is a turnover,
(7) defined the definition of turnover that can cover the whole organization that is a
degree of individual movement across the membership boundary of a social system. More
specific is the rate that relates to employee resignation and human resource needs to
recruit new people to fulfill the empty position and it is associated with the reduce the
productivity performance of manufacturing (8), (9) have provided the evidence from
research that the outcome of manufacturing decrease apparent when employee departure.
Based on the theory, it has presented that the impacts of turnover to productivity and
business, however, to deeply understand the production line 3 situation with overall
Kimberly Clark plant, Researcher has reached to turn over data from human resource
during 2016 to mid-year of 2018 for the whole production line. This data will support to
figure out the proportion per each machine to benchmark together whether the production
line is a higher rate.
2016
Machine
BD03
BD04
BD05
BD06
BD07
BD08
BD09
BD10
BD21
BD22
BD23
BD24

People
Resignation
1
5
3
1
0
0
3
1
2
4
1
6

2017
People
%
Resignation
5.00%
9
45.00%
25.00%
1
5.00%
15.00%
1
5.00%
5.00%
3
15.00%
0.00%
1
5.00%
0.00%
1
5.00%
15.00%
1
5.00%
5.00%
2
10.00%
10.00%
5
25.00%
20.00%
1
5.00%
5.00%
3
15.00%
30.00%
2
10.00%
Table 4: Turnover ratio
%

2018
People
Resignation
5
4
3
3
4
6
2
2
6
5
4
4

%
25.00%
20.00%
15.00%
15.00%
20.00%
30.00%
10.00%
10.00%
30.00%
25.00%
20.00%
20.00%

(Source: Human resource report 2016,2017, and 2018)

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INEFFICIENCY IN ENGINEERING CHANGE MANAGEMENT IN KCV

Finding on the data, it presented that the machine performance is not strong impact by
high turnover rate, according to the table, some machine have high turnover rate such as
BD21, BD08, BD22, however their machine performance also higher and better than
production line 3. As feedback from Engineer manager and Production manager, at the
time production line 3 had a high turnover rate, they have assigned operator from another
line to support production line 3 to prevent shortage resource and waiting for human
resource team recruitment and training until they can work well.
1.3.2 Lack of training and refresh training
The training is strong important for people capability development, and it has been
impacted to operating performance over the period time by the analysis individual
training data per hours and resulted in data from performance (10), (11). It is not only the
technical training impact on the operator but only the nontechnical also influence on
machine performance (12). Moreover, the author has reviewed the training plan of
Kimberly Clark plant and figure the courses and hours required for a newcomer, it
indicated that new operator has been trained the technical knowledge right after boarding
the Kimberly Clark plant.
In the other hand, Human Resource manager has provided a point of view of the training
program at Kimberly Clark Plant that it is going to train for newcomer according to the
subject which has been defined as a table as follows. Additionally, the training team also
develop the master plan for refresh training for old operation with advance knowledge to
build people capability. Hence, the lack of training and refresh training for the operator is
not the main problem that might lead to production line BD03 low performance.
Technical Training subject
Wed handling
Center Lining
Hot Melt
Die module
Belt bearing gearbox
Fluff forming

Duration (hours)
8
8
8
8
8
8
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INEFFICIENCY IN ENGINEERING CHANGE MANAGEMENT IN KCV

Electrical system
Stacker/Bagger
Camera/Checker
Air compressor system
Total hours

8
8
8
8
80

Table 5: Newcomer training subject
(Source: Human resource policy)

1.3.3 Inefficiency in product flexibility
From knowledge of theory, it indicated that changeover is very important for
manufacturing, the writer has approached the production data summary of Quarter 1 and
Quarter 2 to figure out how the changeover condition per all machine. As the table below,
there is two machines that had high changeover times, it is production line BD010 with 78
times, and production line BD03 with 79 times in changeover, as theory, the total time
loss will increase together with change over time. However, the database has not reflected
as theory, it presents that the highest time loss was on BD23, the second is BD04. From
the changeover performance result, “total time changeover is high” is not the main
problem that led to a low performance on production line BD03.
Machine
BD03
BD04
BD05
BD06
BD07
BD08
BD09
BD10
BD21
BD22
BD23
BD24

Total Changeover
Total time loss (mins)
79
937
35
1,074
29
805
14
335
42
985
33
572
11
960
78
887
20
501
11
35
17
1,410
21
828
Table 6: Changeover summary

(Source: Summary changeover on each machine from January to June 2018)

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INEFFICIENCY IN ENGINEERING CHANGE MANAGEMENT IN KCV

1.3.4 Inefficiency in engineering change management
In general, Engineering change is defined as an alteration made to parts, drawings, a
technical improvement that have already been released during the product design process
and product lifecycle. A change might modify the architecture of the product, function of
equipment as a whole or in part (13), the change will impact productivity performance
(14), moreover a lack of well-defined the change based on the process interactions and
analysis how it operates, truly there is threat to reflect on performance(15).
As check with asset leader of production line 3, “The Finish product specification
management is not good management, the add-on for each material is not reviewed
carefully and not benchmark with another plant. It impacted machine performance.
Otherwise, there does not have a system to control the change management and just
inform by email, the material and quality standard is not consistently and change much
time during production”
The process engineer perspective in change control of production line 3 and Kimberl
Clark plant system is that “The change in management is not good on material,
improvement and drawing control. And it comes from workload and system support.
There are a lot of change in the material by change sourcing, and its impacts on machine
performance, however, its impacts on the workload of the operator during machine
setting”
The researcher has done in a deep interview with Engineering manager who controls
technical and maintains manufacturing. He provided the engineering change management
in general as follows: “My perspectives, it is not only production line BD03 has impacted
by engineering change control, but another production is also too. However, the impact
on another machine is smaller than production line 3 so that the performance result did
not change much. The key problem is the lack of evaluation technical change on
production line 3 when implementing the project, and it has not benchmarked and
standardized technology with another machine, plants.

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INEFFICIENCY IN ENGINEERING CHANGE MANAGEMENT IN KCV

In summary, the authors based on the interview with a human resource for turnover rate
and training, the data of production flexibility in changeover and discussion with the
engineer manager for engineering change management. It has been presented that the
potential cause was come from the inefficiency in engineering change management
during new product development that changes the technology of machine and impacts to
machine performance, to perform change effectively will support production performance
better, the machine runs smoothly and handover well to the production line. To
implement the solution the engineering team is the main team to control the engineering
change management. As currently, it is a lack of engineering team and should act
immediately to control the engineering change and laminate the impact to production
performance and business as well.
1.4 Main problem definition and consequences
1.4.1 Definition
According to (16), the engineering change management is to achieve the greatest return
on investment, engineering change management needs to address all of the data impacted
changes, not just the change requests. This means that before the technology can be
applied to speed the process of requesting, approving, and incorporation must be brought
under control. To that end, it is important to understand exactly what information needs to
be managed. Broken down into key elements, the structure of information looks like this
o Engineering change management
o Product structure management
o Document and data vault
According to (17), The definition of engineering change is as the upgrade or innovation
on products, technical design in concept or update in documents. These changes can be
provided at the first stage of preliminary input of program that describing changes with
the previous developments, or what different during implement program, describing
changes with respect to the anticipated or actual design. The challenge for firms is to have
the capacity to implement both the small innovations that fit within an existing routine
21


INEFFICIENCY IN ENGINEERING CHANGE MANAGEMENT IN KCV

and the more severe discontinuous innovations that require practices beyond the steady
state.
Measurement
There are many methods to measure the performance of engineering change and control
as linked with (18), the first focus is the procedure of new product innovation then leading
to three main sections that deploy the change; the first thing is to implement engineering
change management; the second is the engineering design and the third is the production
phase that is reviewed with the process necessary for the production of this product.
Moreover, the other author has claimed that Key performance indicator can be used to
evaluate the performance of engineering change, there are 4 simplified layers to measure
the performance of engineering change management (19).
- General performance: on this level, the change control will evaluate the change
performance based on the variable data of design change
- Focused performance: at this level, the engineering change will focus on within a
project implementation. It is quite important to get the effects during project
feasibility; the efforts will also be made to allow performance measurement.
- Specific performance: it will be measured through the subject of interest
- Detail performance: it will be measured by on how quick alternative solutions were
found or how many resources were needed for the approval process. This level can
be used to evaluate the risk, possible performance issue in the change process.
Additional, as (20) Capability maturity model (CMM) can be used to evaluate the process
implementation of engineering design execution and process performance, it will have 5
levels evaluation.
• Initial evaluation – the first viewpoint for applying the new process or repeat the
task.

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INEFFICIENCY IN ENGINEERING CHANGE MANAGEMENT IN KCV

• Task repeat - the process is at least documented sufficiently such that repeating the
same steps may be attempted.
• Defined - the process is defined/confirmed as a standard business process
• Capable - the process is quantitatively managed in accordance with agreed-upon
metrics.
• Efficient - process management includes deliberate process optimization or
improvement.
1.4.2 Consequence of the problem
As a theory, there are some authors has claimed that the inefficiency of engineering
management to evaluate the consequence if lack of change control. as (21) the outcome of
excellent change control will lead to the achievement of project objectives with within the
determined cost, timeline constraint, and human resources allocated. Additionally, the
technical performance can deliver the good result at the end of the project. The second, it
will satisfy the internal and external customer on the goods delivery on time, the output
performance. The other author has defined clearly the impacts of lack engineering change
management on the process of change implementation during project or improvement
happening(17) (22).
-

Resource unavailable due to delays in previous programs

-

Project work packages are already starting to change resulting in rework for other
projects

-

Many problems to be solved were also applicable to other products

-

A steady stream of changes during the development of prototypes

-

Extra work due to unexpected, extra technological challenges during integration

-

Limited time for manufacturing to learn from the prototypes which result in extra
work later on.

As summary feedback from Engineering manager, although change is good to maintain
the competitiveness of company with competitor, it is lack of control will impact the
quality system control and standardize equipment between each machine and spare parts
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INEFFICIENCY IN ENGINEERING CHANGE MANAGEMENT IN KCV

optimization, especially, the drawing control is a critical system that supports to manage
the asset and it is used to review and communicate when project implementation or
process improvement. Moreover, from the Financial analysis for loss on production line
BD03 performance that impacts on the operation cost. It was transformed from the
machine delay without produce product. In term of machine improve OEE 6.6% and
Waste 2.5%, it will cost saving approx. 2,2 billion VND.

Machine

Production
Line 3

A

Product
Output
increase
1% OEE
B

98,723

1,046

Volume
forecast
(SU) 2018

Cost /
SU

Raw
material
cost/SU

C

D

856,985

663,184

Machine
Improvement (%)
Machine
OEE
waste
E
F
6.6%

2.5%

Saving VND per year
OEE
G=A*B*E

Machine
waste
H=A*D*F

681,721,564 1,636,794,385

Table 7: Financial evaluation on Production line 3 performance
(Source: Finance Team analysis 2018)

From the theory and feedback from engineering manager to verify the engineering change
management definition, the potential cause that might lead to inefficiency in engineering
change control and implementation during improvement and project executive in
manufacturing in general and engineering department in particular. The following figure
has been build to explain the potential cause and effect of inefficiency in engineering
change management.

Figure 6: Update cause-effect map

24


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