Our journey to world class manufacturing
Posted on 13.06.12 by
Since the global financial crisis took hold in late 2008, the pressure has been on all companies worldwide, from small firms to multinational, to make savings while raising productivity. It is easy to perform well in a boom, but the most competitive companies are those that manage to look good in a downturn. In Warren Buffet’s words, “It’s only when the tide goes out that you can see who’s swimming naked.”
These economic pressures have instilled a sense of urgency in our goal of making savings while raising productivity. This in turn has put World Class Manufacturing – a management system as well as an industrial technique used to measure and improve a company’s performance by identifying and eliminating losses – at the top of ArcelorMittal’s list of business priorities.
ArcelorMittal sites have been put under the microscope as part of the company’s drive to be more competitive. Leaders were asked to make their plants more efficient and to pursue the goal of having zero defects for their products. At the same time, the company needed to improve its customer service and proximity, as well as just-in-time management. All of this needed to be done without compromising working conditions, safety, or the environment – a Herculean task which could only be achieved using the right methodology. World class manufacturing presented itself as a useful tool.
The origins of WCM
World class manufacturing, or WCM, originated as an idea in Japan under the name of TPM, which stands for total productive maintenance). WCM has since evolved into a process that is applied not only by car manufacturers but across a wide range of industries – including the steel industry.
For ArcelorMittal, World Class Manufacturing is a management system focusing on reducing or eliminating losses. The model is based on ten pillars; which are ten methodologies specifically structured to target the different kinds of losses found in organisations such as ours. One of the basic premises underlying WCM is that “you improve your business by improving your people”. Training, communication and cross functional interaction are built into all of the pillars. And this is why these methodologies are deployed at the shop floor level of an organisation. The ten pillars are:
1. Health and safety (H&S): our number one priority, with our goal of zero accidents
2. Cost deployment (CD): identifying where your major losses (cost gap compared to benchmark) are and where actions need to be taken to reduce them
3. Focused improvement (FI): applies problem-solving methods to manufacturing problems
4. Autonomous maintenance (AM): requires machine operators, and not only the maintenance team, to focus on detection and prevention. This engages shop floor people, develops a sense of ownership and improves equipment reliability
5. Professional maintenance (PM): requires maintenance technicians to focus on the reliability of equipment and on elimination the root causes of failures
6. People development (PD): making sure that employees have the skills that are needed to perform their jobs today and allow them to maximise their potential for tomorrow
7. Early equipment management (EEM): planning and preparing equipment investments, guaranteeing an efficient start-up, a safe and reliable operation and a machine that is easy to run and to maintain
8. Product quality (PQ): stabilising and improving our processes so that they consistently produce the requested level of product quality for our customers
9. Customer service (CS): becoming the supplier of choice by delivering first class service to our customer
10. Environment and corporate social responsibility (ECSR): producing steel in a safe and sustainable way, which can only be done by respecting the environment and the communities around us
These ten pillars apply to all aspects of ArcelorMittal: our steel business, our mining activities, and beyond.
The practical reality
On a day-to-day basis, WCM is about setting tailored goals that are clear to everyone, and breaking the different projects down into several clear steps, into achievable parts. This greatly contributes to employee motivation and engagement, which are indispensable to any company’s success. Through our WCM approach, we are committed to international best practice principles, concepts, policies and techniques throughout all facets of the organisation.
The success of WCM comes from efforts made by each and every employee in the company, at all levels of the organisation. The process is supported by the chief technology office through its operational excellence team, providing training and coaching sessions to sites all over the world. In collaboration with the ArcelorMittal University, centralised training sessions are also being organised.
ArcelorMittal Saldanha in South Africa is the most recent success story for WCM at ArcelorMittal. 58 WCM teams were deployed on the most critical machines and areas and the combined efforts of these teams helped achieve savings of more than US$15 per tonne of hot rolled coil (HRC) after just nine months, in line with expectations. Within 15 months after the kick-off, the site had already been recognised with an ArcelorMittal WCM award, reaching bronze level.
This is just one out of several WCM success stories we have been celebrating within the group over the past few years, and we are confident there are more to come. As more and more plants and segments have realised the value of the approach, we will continue to guide and support them on their way to World Class Manufacturing.
By Luc Bonte, vice-president operational excellence