Yuchai builds most competitive engine enterprise through lean manufacturing

Recently, at the second monthly presentation of Yuchai Group on lean manufacturing, the pilot entities such as CSR Yuchai Sichuan Engine Co., Ltd. (CSR Yuchai) and Yuchai Power Machinery Co., Ltd. (YPM) made presentations on the progress and effects of respective projects. The presentations showed remarkable achievements in Yuchai's lean manufacturing projects.

Despite the continuous slump of the engine market in 2012, Yuchai achieved intensive growth, with its share in the engine market rising by 3 percent. A major reason that Yuchai grew more healthily than similar enterprises in 2012 is that its lean manufacturing projects functioned, said Wu Qiwei, general manager of Yuchai Machinery Co., Ltd.

In October 2011, the lean manufacturing project of Yuchai Machinery was launched, with the aim of building Yuchai into ��the world��s most competitive professional engine supplier��, namely a professional engine enterprise with tremendous comprehensive strength in such aspects as product, market, marketing, service and cost.

In October 2012, Yuchai Group has also launched lean manufacturing projects, selecting three subsidiaries--CSR Yuchai, YPM and Yuchai Huayuan as the pilot entities for lean manufacturing in the hope of gradually extending lean manufacturing to other business fields, subsidiaries and links of the industry chain on the basis of the successful pilot practice of the entities, thus creating a group lean manufacturing platform and building a lean operation system characteristic of Yuchai.

Lean manufacturing yields benefit

In April 2012, Yuchai Machinery held Phase 1 summary conference & Phase 2 launch conference on lean projects. At the conference, eight Phase 1 projects were rewarded: the heavy engine assembling efficiency improvement project of Engine Plant 1 won the special prize, the smelting/core making/modeling project of the Foundry won the first prize, the logistics efficiency improvement project of Engine Plant 2 and the 6M body efficiency improvement project of the Vehicle Engine Assembly Department of the Machining Plant won the second prize, and four others including the TPM equipment project of the Production Department won the third prize, with a bonus of ranging from 50,000 yuan to 100,000 yuan.

By late 2012, all the 16 projects had been completed, met fixed targets and achieved remarkable achievements: Yuchai Machinery's lean management system had taken shape, with the quality of the sample line up by over 28 percent, efficiency up by over 27 percent, cost down by over 30 percent and average equipment failure rate down by 29 percent.

On February 2013, the second monthly presentation of Yuchai Group on lean manufacturing was held at YPM. Three pilot entities--CSR Yuchai, YPM and Yuchai Huayuan reported on respective projects.

Tan Jiang, head of YPM's assembly efficiency increase project, said, "Since launching the assembly efficiency increase project on November 27, 2012, YPM has set a target of increasing man-hour output and production capacity by 20 percent. Through rectification, adding equipment, improving tools, optimizing layout, straightening out logistics, dismantlement and rearrangement, and line balance re-measurement, by January 31, the project's man-hour output and production capacity had increased by 14.92 percent and 16.9 percent respectively. We must fulfill the target before the project acceptance on March 30."

Among CSR Yuchai's lean manufacturing projects, through earlier efforts, the time consumed in the bottleneck process of the project of standard operation of medium-speed engines has reduced from 326 minutes to 276 minutes, and the assembly efficiency of cylinder cover is expected to increase by 18.2 percent; by adjusting processing technology, the speed regulator efficiency increase project has increased the efficiency of cylindrical fine turning by 310 percent.

Meng Jianmei, a member of Yuchai Huayuan's efficiency increase project team, said she and her teammates compressed the site work-in-process inventory by optimizing the process layout during the lean project. In January 2013, Yuchai Huayuan's work-in-process inventory dropped by 13.92 percent.

Typical cases shows prominent effects

During practicing lean manufacturing, Yuchai has not only gained strength for its future development, but also yielded benefit to provide guarantee for its continuous and healthy operations, which are concretely reflected in many typical cases.

Case 1: Efficient team collaboration

To better the situation of lack of collaboration among teams of all entities, on the basis of remarkable results of the 11 pilot teams, Yuchai Machinery increased the number of lean project teams to 104 with 1,700 members, thus gradually establishing a project management mechanism conducive to coordinating all teams efficiently.

The project group worked out a project map for lean teams, and fixed a series of measures and action criterion for fulfilling targets, to make team management of all entities maintain respective characteristics and meet the basic requirements of coordination. Through efficient collaboration, the project group fulfilled all targets as scheduled.

Over 3,000 problems were spotted in the reflection meeting and 2,180 were improved. In minor team activities, the failure rate of team equipment of Engine Plant 1 decreased from 4.02 percent to 0.29 percent, the improvement rate of operation time of Engine Plant 2 was up 12 percent. Bumper fruits have been yielded in ensuring safety, improving quality, reducing cost and increasing benefit.

Case 2: Accomplish one piece flow (OPF)

The Foundry's logistics improvement project for core making made improvement in logistics, field operation and visual Kanban management, thus increasing core quality and production efficiency, reducing cost and improving the entire production flow.

The project group mobilized all workers to search process waste, analyzed situation improvement and rewarded workers' valuable proposals. The group found field losses through quantization: due to large core inventory, workers wasted time in non-value-added operations such as search and handling; the circulation cycle of cores was up to 48 hours.

The project group determined three influencing factors: OPF was yet to be formed and reserves are needed between working procedures; workers differed in production efficiency; and core inventory was large.

Aiming at the three factors, the project group began to practice OPF involving core shooting, core finishing, drilling, core assembly, dip coating and baking; to practice the coordinated process of online core assembly to avoid redundant labor, simplify and standardize operations; to practice the visual management of core inventory to rationally arrange production. During improvement, the project group applied a lot of improvement tools, such as Spaghetti Chart, operation (element) analysis, fixed-point photography, value stream mapping, process flow diagram and standard operation procedure (SOP).

In late 2012, the core making section of the cylinder cover shop of the Foundry fulfilled the targets by reducing core inventory from 484 vehicles to 280 vehicles and core circulation cycle from 48 hours to 32 hours, with a fulfill rate of 136 percent and 166 percent respectively. In a production cycle, an inventory backlog worth 870,000 yuan was reduced, and a cost of 230,000 yuan was directly reduced for scrap reduction.

Case 3: Exhaust pipe "heats up water" to reduce cost by 270,000 yuan annually

YPM installed a two-way water tank on the exhaust pipe of the best bench for two-cylinder engines to "heat up water" for testing, thus making water inlet temperature meet testing requirements, shortening running-in time before diesel engine testing, increasing the testing efficiency of two-cylinder engines by 10 percent and reducing average fuel consumption by 0.8kg/unit.

To increase testing efficiency, YPM diagnosed the full process of testing and traced the reason for long running-in time before diesel engine testing. The process requires that water inlet temperature should range from 65 degrees to 85 degrees and the regulator should be used to maintain the temperature range.

The technical improvement substantially reduced the running-in time of diesel engines extended to make water temperature meet technical requirements, the time decreased from 3,600 seconds to 1,200 seconds for the first unit, and decreased by 600 seconds from the second unit. If 11 testing benches turn out 130 two-cylinder engines daily, 27 testing hours will be saved and 104 kilograms of diesel consumption will be reduced daily, and a cost of 270,000 yuan will be reduced annually.

Continuous improvement sharpens corporate competitiveness

With the smooth advancement of Phase 1 and Phase 2 lean manufacturing projects, the continuous progress made by Yuchai Machinery has been yielding substantial benefit for the enterprise and unconsciously affecting and changing the staff's thinking and codes of conduct.

Lean manufacturing has injected infinite power of "continuous improvement" in Yuchai and found a road of "intensive growth" by rebuilding competitiveness when external markets are weak for Yuchai.

At the second monthly presentation of Yuchai Group on lean manufacturing, Zhou Sunhai, vice president of Yuchai Group, said, as Yuchai's systematic project in the "twelfth five-year" period, lean manufacturing should focus on building Yuchai's lean industry platform and its advantage in industrial skills. The team members should overcome the fear of difficulties, make innovation, accelerate lean talent training and endeavor to bring Yuchai's lean manufacturing projects to a new level.

In 2013, Yuchai will proceed with lean manufacturing, optimize, reinforce and popularize lean achievements, and spare no efforts to build a lean system. The "collaborative improvement of suppliers" to be accentuated by Yuchai Machinery in 2013, from the perspective of whole value chain, examined and eliminated non-value-added operations to improve the "QCD" level of Yuchai and its suppliers simultaneously.