Trima trims costs with IBS softwareCustomer Story A factory that was once threatened with layoffs received a new boss and a new IT system. The result: increased productivity, shorter lead times and more sales. Trima is a leading manufacturer and distributor of advanced frontloaders and accessories for tractors. Based in Sweden, the company has been making agricultural machinery for over 100 years. Innovative thinking, deep-rooted traditions, a highly skilled workforce and modern technology have placed Trima among the world’s leading manufacturers.
Trima produces over 6,000 frontloaders per year - the majority of which are for export. The company’s products are targeted to the agricultural sector, construction companies, industrial applications and local authorities. In fact, Trima’s frontloaders fit 95 percent of all tractors worldwide.
Trima employs 115 people and has in excess of sales of EUR 33 million.
Overtime and long lead-times
A few years ago, Trima was in a crisis. Profitability was on a downward spiral and the factory was on the verge of closing down. The company had numerous supervisors who were always stressed, working seven days a week and feeling that they were achieving very little.
Trima needed to change focus and to start concentrating on the right things, such as producing what customers ordered, getting it to them on time and shortening lead-times. A new approach was urgently needed to reach these goals - along with a fresh production planning and management approach, and production control system.
The idea was to have a stream of information that would reach everyone in the plant. The company also wanted to reduce planning to a minimum. Trima manufactures 30 different types of standard loaders. With all the different specifications that are possible - parallel drive, quick release, shock absorption, etc. - this comes to 900 article items or part numbers for frontloaders. Some 8,000 different parts are required for manufacturing. The company felt that a computer system would be more cost-effective and better at matching these parts to actual customer orders than a person.
Customer orders took between seven and ten weeks to ship and were a critical problem area. Delays still occurred in spite of the tremendous lead-times. Factory production was based on sales forecasts and warehouse levels. Trima realised that it needed to switch to a demand-driven manufacturing style.
Empowering the staff
Trima had been using IBS software since 1997, but not optimally. When new management took over the factory, they soon realised the unexploited potential of the system. An upgrade would make it possible for Trima to achieve its goals.
Previous use of the IBS solution at Trima was limited to office personnel. To reduce lead-times, the company realised that the IT system needed to be accessible to people on the factory floor. This would empower the manufacturing staff to direct, follow up and check their own work. A fear of computers was behind much of the opposition to change. After the software upgrade, some of the strongest critics became the best system users.
Operators can use a production technology function to combine orders that undergo similar processing. IBS software has an efficient priority facility, which allows operators to raise the status of any individual order.
Just-in-time production reduces lead-times
Orders that are taken at the sales office are sent to the IBS solution and jobs are planned during the night. The only manual intervention that occurs is a quick check by the person responsible for material procurement.
Short lead-times speed up the subsequent production and materials procurement but must be maintained through quick action by suppliers. After some lengthy negotiations, Trima now has a ten-day horizon for its suppliers, who are also furnished with forward schedules of expected orders.
IBS software reacts directly to changes in order volume by adjusting procurement routines. If fewer orders are received, orders are planned with shorter delivery times. When there is a surge in order volume, deliveries and material procurement lead-times are extended.
To overcome the order size problem, all items ordered fewer than twelve times per year are produced on a per-order basis, with a safety buffer allowance for all other products.
Accurate planning
With help from IBS’ planning capabilities, Trima has been able to reduce the staff time needed from supervisors and planners. In addition, the work has been reorganised from top to bottom. The people who carry out the actual production on the factory floor also run the planning and production system. With 25 IBS-powered computers on the shop floor, lead-times, which were once seven to ten weeks, have been trimmed down to just two weeks.
By acting quickly to changes in incoming orders, Trima has made significant cost reductions. With the same number of employees, production has increased by an astonishing 30 percent. Trima’s delivery precision has increased by 50 percent and bound capital has decreased by 20 percent.
Increased staff satisfaction and profit
Employees are much happier and there is a great sense of team spirit. Overtime - once a necessity - has been eliminated altogether. Fewer man-hours are required for planning and preparation, thanks to a more rational workflow and the eradication of manual planning.
Shorter lead-times have produced not only a reduction in fixed capital, but also tighter control, better process overview and streamlined production - not to mention increased profitability and ROI. The rise in profits proves just what can be achieved with bold management, empowered and motivated staff and enhanced functionality with an existing business system.
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