DB&A was recently engaged to help a California-based pharmaceutical company. Their production would be flat for three weeks and suddenly spike the last week of every month. These spikes caused staffing issues along with expedited deliveries resulting in higher costs.
The Executive Vice President believed their labor costs were too high, noticing they had too many staff working during the slower periods. While the company had shop performance metrics, the leadership was not utilizing these reports to manage hourly labor costs and productivity.
DB&A came in to help level out product flow, reduce expediting expenses, and normalize staffing. As a result, manufacturing and packaging productivity both increased significantly. The time from “receipt to ship” was reduced by two weeks which helped free up inventory dollars. In addition, by working one-on-one with the front-line management, the time they spent actively managing and engaging with employees went up threefold.
Overall, DB&A provided the company with $3.1 million in annualized savings – a 2.9:1 return on their investment.
- Project cost: $1.05 million
- Guaranteed Savings: $2.10 million
- Actual Savings: $3.1 million
- Actual ROI: 2.9:1