Turnaround – Food Manufacturer

The customer is a well-known player that manufactures food products for the Nordic market. The food industry places great demands on quality and hygiene, which means that production must have a short lead time while handling of the raw material inventory is crucial for the end product. The food industry has demanding customers who expect products to be constantly updated and renewed.

The company was introduced and exposed to many changes in a short time. In 2018, these changes resulted in substantial losses every week and ended the budget year with a large deficit. The customer moved the factory to new premises, bought several smaller suppliers to be part of the production, and there were many changes in the management. Customers expected new products that the company undertook to deliver. All this meant that the factory faced major challenges.

Step 1 – Visualization

The first thing C2U supported the leaders with was to get an overview. Important indicators were developed and a new reporting structure was created for the new management. An overview of products, brands and customers was made to make the operations comparable with similar companies. Together, we organized updating of the product calculations with the right costs and components. Based on these facts, management was able to create a ”Sense of Urgency” in the company and prioritize improvement measures.

Step 2 – Stabilization and Delimitation

Early on, C2U engaged department heads in workshops to define and clarify the interfaces and deliveries internally at the factory. The work resulted in documented SIPOC (supplier, input, process, output, customer) for all departments. We conducted similar exercises with sales, quality, product development and production also conducted similar exercises and defined processes and mandates for product launch. To involve employees and increase the degree of improvement, C2U coached the management in daily operational meetings with information about the business and the challenges they worked with. The management set up regular weekly management meetings and daily meetings to follow up measures and challenges.

Step 3 – Improvement

Employee engagement was created through working groups that produced standards. Work routines and 5S were made to ensure correct deliveries internally at the factory, and these were implemented and followed up by line managers with coaching and support from C2U. The line managers were thus also more involved in the production and regularly reported production status during the day.

Throughout the company, clear communication channels and decision-making mandates were established for quality, sales, product development and production. In this way, the company created an awareness of production processes that added value and the need for synchronized support functions.
After six months, the company managed to drastically reduce its financial losses. Productivity increased to pre-product levels and production became much more visible. The company can now focus on sales and product development to secure revenue, this time in line with the factory’s wishes and opportunities.