Sachin W Joshi Redesign of S Series (30-62.5 kVA) G ... - Cummins

Sachin W Joshi
Redesign of
S Series (30-62.5 kVA)
G Drive Skids for
Improved Logistics

DFSS Project Overview
Project Name:
Sponsor:
DFSS MBB:
Redesign of S Series (30-62.5 kVA) G Drive
Skids for “improved logistics”.
Ashwath Ram
Abhijit Phadke
Project Duration: 183 Days
Benefits: (i) Annualized Profit Improvement $139,000
(ii) Annualized savings
(PBIT + Avoidance) $231,000
(iii) Spin off Project (Identified) $ 228,000
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Background
6000
5000
4000
3000
2000
1000
0
2008 2009 2010 2011
S Series G drive AOP achieved
46%
12% reduction in
Domestic
volumes in 09
Domestic
Export
62% reduction
in Export volumes
in 09
Out Bound
Metal Skid Spend
is $ 167 K
54%
Break up of Metal skid purchases
in 2008 ($ 364 K) (Sept 07 – Aug 08)
The writing was on the wall early
Quarter 4 2008 that 2009 would be
a difficult year due to the recession.
CPGI business in India will be
affected so would CPG globally.
Maintaining our profitability was
therefore the top most priority as
was evident from the messages
from the CPG Leadership.
Skid procurement in CPGI and its
logistics is an "expense” in the
books and has a direct impact on
the profitability of the CPGI entity
and this project is an attempt to
minimize this.
S Series was picked as a Pilot case
to be further deployed horizontally
to other Models as 60% of the
outbound skid purchases in 2008
was on S series.
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Relevance to Business
S Series (30-62.5 kVA) G Drives shipment to GOEMs
and Skid return to PGBU
From
To
GOEMs
Cost per
skid=$ 206
Cost per
skid = $ 60
CPGI
Daman
Variety of
Skids
Universal
Skid
Bangalore,
Silvasa
Skid
return
(10 per
Vehicle)
Skid
return
(60 per
vehicle)
Pirangut
Plant India
Daman
0% Customer
(GOEM)
owned Skids
50%
customer
(GOEM)
owned Skids
Temporary storage at GOEM Plants.
Returned when a G drive is assembled.
4

Current Status
2008 (Actual)
2009 (Actual)
S Series AOP Shipment
5352 (Achieved)
4729 (Achieved)
12%
No of Types of Skids
2
1
50%
Cost/ Skid
206
60
70%
Skid Expense Value
USD 94K
USD 19K
80%
GOEM Ownership
0
50%
50%
Logistics Cost
10/ Vehicle (MCV)
10K
Gross Margin
(S Series Domestic)
34%
5

Savings: Reduction in Expense
1 USD = 47 INR Planned Old Actual Old New Planned Old Actual Old
6
S series Gross Margin 34%
1. Reduction of $ 102 K in Skid procurement.
This includes skids purchased by GOEMs.
2. Reduction of Expense on Logistics cost by $ 10K.

Project Objective / CFR / Y=f(x):
Skid Design = f (Total load, Skid Life, skid handling)
7

DFSS Work Flow
Planned
In Process
Results Available
8

Concept Phase
KJ
Customer Requirements
P Diagram
Stackable design
(Strong and durable design)
Universal Design
Reduced Size, No Transit Damages
(Strong and durable design)
9
GOEM Requirement
CPGI Requirement
Reduced Cost to introduce Customer owned skids.
Manufacture in-houseif necessary.
More Numbers of empty skids per
truck (Less volume). Less no. of Trips
to CPGI. On time delivery.

Design Approach
Cummins Designed creative Innovation tool used to
clarify Contradictions in Customer Requirements –
1. A strong skid that has ease of manufacturability
2. A strong skid occupying less volume.
3. A durable skid that causes no transit damages
to the fragile G Drive components.
10

11
Design Phase

CPM Score Card
Meets all the
load cases
CGI = 85%
The design allows the Skid Material to be Loaded
within its tensile limit under all Load cases.
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Universal Design for G Drive
and Vehicle Verified
30-62.5 kVA
RIGHT FIRST TIME
The vehicle is not a
controlled factor any more.
One skid for all engines
from 30-62.5 kVA G Drives
30 KVA
62.5 KVA
The design of the skid is
COMMON for all 6 Engine
Models. And also COMMON
for LCV and a MCV truck.
13

Reduction in Return Trips to CPGI with
Improved Safety Levels in Transit and Handling
Old: Unsafe & Unstable
New: Safe & Stable
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Partnering with Customers
Proportion of Skid share
11.5%
Category
CIL
Powerica
Sudhir
Jakson
11.5%
48.1%
28.8%
Customers ( GOEMs) partner with CPGI to
purchase skids from Vendor directly. Progress
reviewed in every GOEM Council.
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Long Term Sustenance – Tracker
Skid recirculation tracker reports
– daily skid returns
– stocks at GOEMs on a monthly basis
200
150
100
50
0
Old
New
'Nov 09 'Dec 09
100% phase over in Jan 2010
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The Extra Mile…
The new design made the old
skids redundant. How do we
utilize the redundant skids?
– Made presentations to the
Genset OEMs in the monthly
review councils on storage
ability of the old design. One of
the OEM purchased 100 skids.
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Summary
2009 S series Sales 12% i
2009 S series Gross Margin 34% i
(Domestic)
Skid cost reduced by 85%
Logistics cost reduced by $ 10K
Introduced Customer (GOEMs) owned skids
Customer (GOEMs) buy old stock for internal storage.
Spin off project identified for Horizontal deployment
Spin off project to prevent annual use of $228 K
outbound wooden skids in B Series Identified.
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