The Problem
A company that tests equipment for various industries including Aerospace & Defense, Spaceflight, and Telecom was losing market share due to underpricing by smaller niche competitors. The GM wanted to see how we could get more test hours on their assets by finding and minimizing non-value added activities. This would then enable price adjustments to be more competitive. They called Advanced Process Optimization.
Our Approach
We used Simulation Modeling along with fundamental Lean and Industrial Engineering techniques to find hidden capacity on the value added assets of the company. We then worked with them to devise a new go-to-market pricing model that leverages a Lean approach to testing and economies of scale by throughput maximization.
The Results
We re-engineered the testing process to minimize non-value added activities such as setups, and developed standard methods to eliminate any delays in the testing process. The result is an additional $500k of testing capacity opportunity of which $250K will be realized with the first phase of our solution