Consumer Goods Manufacturer Recognizes Increased Accuracy, Flexibility and Cost Savings Through a Service Level Agreement with MAU

MAU’s client, a leading consumer goods manufacturer, found themselves facing a common challenge as a result of increasing sales and upcoming product rollouts. With the arrival of state-of-the-art equipment imminent, they realized the need to allocate dedicated resources to operate it effectively. Consequently, internal restructuring was required, affecting core roles and resources within the organization.

Resource Scarcity and Rising Costs

For the client’s leadership teams, the primary goal was to stabilize spending and optimize profits amidst the escalating market demands. The shortage of resources throughout the Mill presented a particular obstacle, leading to the potential increase in costs associated with hiring new personnel.

To address this issue, a meticulous assessment was conducted to distinguish between critical non-core tasks and core tasks. Interestingly, it was discovered that valuable and experienced resources were being under-utilized in non-core tasks, ultimately hindering efficiency. It was imperative to ensure that these non-core tasks were maintained, given their critical nature and the potential for further growth in peak demand.

Another factor of consideration was the impact of raw material inventories on the client’s operational budget. Improving inventory accuracy was of paramount importance, as it directly affected the client’s ability to capitalize on new sales opportunities. The client sought a strategic partner with a deep understanding of their business, who could offer innovative ideas and services to stabilize spending and enhance inventory accuracy simultaneously.

A Strategic Move Towards Outsourcing Non-Core Departments

The client’s department leader joined forces with MAU, recognizing the benefits of outsourcing non-core critical departments. This decision provided the client with the necessary flexibility to redirect their resources towards safe operations of technical equipment, quality standards development, meeting product delivery expectations, and reducing new hire costs.

The collaboration between MAU and their client is a perfect example of synergy at work. Their partnership was more than just a business transaction; it was a strategic alliance designed to tackle the client’s specific needs head-on.

With the introduction of a Service Level Agreement opportunity, MAU implemented lean principles and strategies to eliminate waste within the outsourced department. Leveraging effective lean tools such as standard work, 5S, visual management, and leader standard work, MAU expanded their scope of work and services without incurring additional costs.

Collaborative kaizen events were organized to address key concerns surrounding inventory accuracy and associated processes, resulting in the establishment of written and visual standard procedures. Not only did this partnership stabilize spending, but it also resulted in improved inventory accuracy. This seamless integration and optimization of processes speak volumes about MAU’s competency and dedication to their clients.

The decision to outsource non-core critical departments was a strategic one. It allowed the client to focus on their core competencies, leaving the management of peripheral yet essential tasks to MAU. This enabled the client to streamline their operations, reduce waste, and improve efficiency – all hallmarks of lean principles.

The benefits of this collaboration were tangible. The client was able to overcome their challenges, optimize their operations, and witness an overall improvement in their performance metrics. This positive outcome not only reinforced their position as a market leader but also underscored the value of strategic outsourcing.

In essence, the partnership between MAU and their client showcases the power of collaborative problem-solving and the effectiveness of tailor-made solutions. It highlights how strategic outsourcing can lead to optimized operations, cost-saving, and improved performance, thereby setting a precedent for other businesses in the industry.