Executive SummaryExecutive SummaryCompany Description: Schindler is one of the leading global manufacturers of elevators, escalators and moving walks.
Problem Statement: A bottleneck in theEngineering Change Order process is resulting in increase in lead time for approval of designs.
Recommendations: XXXXXXXXXXXXXXXXXXXX
Company
Company ProfileCompany Profile
Founded: Switzerland, 1874Employees: 44,000 worldwideProducts:1.Passenger elevators for high, mid and low-rise residential and office buildings2.Freight elevators3.Escalators for all applications – malls, airports, theaters, etc.4.Moving walks5.Product modernization and innovation6.Complete maintenance and service – 24/7
Schindler Transports 900 Million People Every Day
2009 Global Sales (all products)2009 Global Sales (all products)
Brazil accounts for 15% of total Latin American Market
*60% of total revenue comes from sales of service oriented products
Atlas Schindler - BrazilAtlas Schindler - Brazil
In 1999 Schindler purchased Atlas, a Brazilian company
Atlas Schindler now controls 40% of the global market share and 50% of Brazil’s total market share
Sao Paulo construction market expected to gro wXXXX
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Two Plants
150 Service Points
*67% from maintenance and modernization*33% from new products and installation
Brazil OperationsBrazil Operations
Demand in Brazil is growing in ALL segments
3-5 year estimated growth rate is 10% for elevators, 5% for other products
Residential segment growing fastest due to low interest rates
Expected GDP growth rate of 5% - a paralleled growth
SWOT AnalysisSWOT AnalysisStrengthsStrengths WeaknessesWeaknesses
OpportunityOpportunity ThreatsThreats
Consolidated leadershipDiversified portfolio of productsName brand recognition (Atlas)70% certified suppliersTop quality global producer
Growth in relation to 2014/2016 gamesDemand for new constructionUS transition to electric elevators
Decentralized Management teamDisruptions in communication flowLack of adequate human resources
Strong currency fluctuationsChange in regulation of interest ratesChange in regulatory codes
to this ECO in advance.
The ECO ProcessThe ECO ProcessEEngineering ngineering CChange hange OOrderrder
R&D Swiss Engineering Team
Planning
Remaining 6 ECO Steps
TimelineTimeline
ECO Process Orders
Submitted
ECO Orders Approved
ElevatorInstallation
Order Received
135 days 84 days 56 days
Manufacturing
1. Increase in incoming ECOs needing approval
2. Seven separate approvals needed for each - all running simultaneously.
3. Documents from Switzerland don't identify modifications and needtime-intensive interpretation and validation. 4. Lead time for tooling is 90 days. - not in all causes, but we canconsider this in the great majority - OK5. Product charecteristics and mechanical features are different for eachreceived KA (ECO). - OK6. Revision from original version to revised version stops the flowof approval process. - OK7. Problem finding qualified SAP experts & drawing interpreters - It is notcorrect. We have qualified SAP experts and drawing interprets, but they areinvolved in others process.8. Inconsistent deadlines instead of a clearly defined timeframe. - OK
ECO process Challenges
Make
Financial InformationFinancial InformationIn million CHF 2009 2008 2007 2006 2005
Orders received 12 865 14 479 14 116 11 720 9 445
Operating revenue 12 691 14 027 13 835 11 106 8 870
Profit before taxes 904 878 486 711 572
Net profit 653 634 278 511 401
Atlas Schindler’s Share (Brazil) 131 129 57 142 114
Projected Loss (30 days) 10.9 10.7 4.7 11.8 9.5
Projected Profit (30 days) 10.9 10.7 4.7 11.8 9.5
Automate follow up email via SAP to Lotus Notes, follow-up notifications
Automate identification of the type of workflow in each stages of the approval process
Configuration in SAP to include delivery date fieldCreation of queries in SAP to minimize manual work for Planning
Short-TermShort-Term
Weekly production meetings by all the process approvers for ECO status updates and prioritizing.
Create a checklist for each of all the steps, bypass some of the approvers
Create Business Process Procedure (BPP) - set instructions in writing, (for back-up) in case other approvers are not available
Reject ECO's with incomplete informationFollow written procedure even if it's a quick reference guide of creating an ECO
Mid-TermMid-Term
Hire additional staff due to the growing business
BW Reporting tool
Create a team of ECO Approvers
Long-TermLong-Term
QuestionsQuestions
How do the differences in the Brazilian and Swiss cultures affect Atlas Schindler’s productivity?
2009 Quarter Number Approved
Total days Average days/ ECO
1 22 1085 76
2 74 362 121
3 72 503 62
4 56 625 70
2009 224 2575 91
20101 Qtr.
50 428 135
Desirable - - 93
Over 100% projected increase in orders in 2010
33% Increase in cycle time per ECO approval
Growth trend to continue for next 5 years
Executive Summary -problem statement/recommendationsCompany background-introduction of AS team-product lines-locartions/distreibution centers, service points-market share and forecasted market share SWOTProblem Statement--Company goal-ECO target number-Quantity of ECOs in process/pending-Define ECO issueDetailed info about ECO process-Define the 7 stages of approval-2 are going well, 5 could improve-Simultaneous view of approval-Deadlines-New products vs. modifications-detail of cycle time-reasons/assumptions of the changes in the last 2 years-causes of bottleneckPnL – Forecast-Incoming ordersAlternatives-Form an interdepartmental team-Hire additional staff-Weekly status update meetings-Change the 7 stages-Additional options?Recommendation-short, mid, long-termQ&A-Queue up the questions for the audience
Who did what?Who are our resources?
• Cost of the expat might be the salary times the 1.5 (for relocating, plus relo costs (housing etc.)
• Investment cost• Income statement
• PandL – example save 3 months on cycle time, what $$ will you save – more time then for other products. e: if you c
• Increase productivity• Average elevator sells for XX amount, sell x per year
• What is the demand? Number of buildings coming up?• In Sao Paulo alone and then make assumptions for
• Sao Paulo 50% of market for buildings in Brazil
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