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Record-breaking line efficiencies for ABI

line efficiencies

Executive Summary
To improve the efficiency of the production process, Amalgamated Beverage Industries (ABI) implemented TRACC Operations Best Practices at five sites. As a result, the record-breaking improvements to the line efficiencies at all five sites equaled world class standards in the beverage industry. One site saw a 45%-65% improvement within a ten-month period. A preliminary assessment, using the Profit Improvement Program (PIP) process, identified potential materials management performance improvements. As a result, a 20% reduction in active stock inventory, 49% reduction in active nonstock and a 100% improvement in inventory turnover were achieved. ABI’s improved efficiencies at these sites put them on the road toward becoming the best bottler in the industry.

line efficiencies

 

Situation and Action
ABI identified a need to optimize production management and process efficiencies at its five South African plants. This was decided due to the below-par reliability and availability of equipment which was resulting in reduced throughput and high costs per HL. Issues of duplicate stockholding also had to be addressed.

The main aim of the TPM journey at ABI’s Devland site was to improve line efficiencies, reduce maintenance costs and develop a multiskilled workforce. CCI-GrowthCon facilitated this process, as well as the subsequent rollout into the remaining glass line factories in Pretoria, two sites in Phoenix and the PET line in Midrand.

As part of a three-year manufacturing strategy, the TRACC integrative improvement system was introduced to increase internal capability, progress toward a more effective, efficient organization and provide central assessment capability across the group. During the two-year facilitation period, ABI achieved significant results with some 17 efficiency improvement projects, mainly by identifying focused improvement areas and initiating profit improvement projects.

The main aim of the TPM journey at ABI’s Devland site was to improve line efficiencies, reduce maintenance costs and develop a multiskilled workforce.

These were expanded as client-driven projects and the mechanism for breakthrough improvements. The focus was to optimize production management and process efficiencies at all facilities, which included training, process analysis and development to ensure optimum product quality.
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Results
Not only were significant costs savings realized, but for the first time in ABI’s history it achieved record-breaking line efficiencies, equaling world class standards in the beverage industry. Line efficiencies were up by 75% at all five ABI sites, including an improvement of 45% to 65% on one site within a 10-month period.

The Profit Improvement Program (PIP) is used to drive all initiatives. Each PIP is aimed at a high-leverage area until results are achieved (usually 60-90 days) before moving onto the next focus area. In essence, the skills shared during training are applied in a phased approach.

By using PIP, potential materials management performance improvements were identified during the preliminary assessment. As a result, active stock inventory was reduced by 20% and active nonstock inventory by 49%. Inventory turnover saw a 100% improvement from 0.4% to well over 0.8%. Improvement in controls, stock analysis and business processes were instrumental in reducing active stock inventory to a maintainable level, without impacting service levels to the maintenance and operational teams. Coding and naming convention also played an important role in identifying and eliminating duplicate stockholding.

Not only were significant costs savings realized, but for the first time in ABI’s history it achieved record-breaking line efficiencies, equaling world class standards in the beverage industry.

Improved efficiencies at the five South African sites have put ABI firmly on the road toward becoming a world class company and most importantly, the best bottler in the industry.

Company Background
Established in 1976, Amalgamated Beverage Industries (ABI), the soft drinks division of SAB Ltd., is one of the leading soft drink businesses in the international SABMiller plc group of companies, and one of the largest producers and distributors of The Coca-Cola Company brands in the southern hemisphere. ABI bottles and distributes 27 soft drink, bottled water and ice tea brands, including Coke, Fanta, Valpre and Fuze Tea.

Disclaimer
This resource has been prepared for general guidance on matters of interest only, and does not constitute professional advice. You should not act upon the information contained herein without obtaining specific professional advice. Competitive Capabilities International (CCi) does not accept or assume any liability, responsibility or duty of care for any consequences of you or anyone else acting, or refraining to act, in reliance on the information contained in this resource or for any decision based on it.

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