Operational Excellence & The 4 Pillars of Success Aerospace - - PDF document

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Operational Excellence & The 4 Pillars of Success Aerospace - - PDF document

Operational Excellence & The 4 Pillars of Success Aerospace & Defense Forum, & f Orange County Chapter March 1, 2012 Michael Dill, Group Vice President CIRCOR International, Inc. Headquartered - Burlington, Massachusetts MAJOR


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Operational Excellence & The 4 Pillars of Success

& f Aerospace & Defense Forum, Orange County Chapter March 1, 2012 Michael Dill, Group Vice President

Headquartered - Burlington, Massachusetts

CIRCOR International, Inc.

MAJOR LOCATIONS

US ITALY GERMANY CHINA

MAJOR LOCATIONS

US FRANCE MOROCCO CHINA

MAJOR LOCATIONS

US UK GERMANY INDIA

KEY MARKETS

NATURAL GAS, OIL

KEY MARKETS

INDUSTRIAL/HVAC/CHEMICAL

KEY MARKETS

AIR TRANS/BIZAV/DEFENSE

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Group Structure

North America and Europe (900 + Employees Worldwide)

CIRCOR Aerospace Products Group Landing Gear / Actuation Fluid Control Systems

Electromechanical

Control Group Headquarters 6 Mfg., Sales and Service Sites

Corona, California Dayton, Ohio Hauppauge , New York Paris, FRANCE Pau, FRANCE Chemille, FRANCE Tangiers, MOROCCO Sylmar, California Suzhou, CHINA

2 Low Cost Mfg Sites Engineering + HCL partnership 3 HCL partnership

“One CIRCOR Aerospace” “One CIRCOR Aerospace” ‐ ‐ Building the Brand with an Building the Brand with an Integrated, Global Footprint Integrated, Global Footprint

2011 Sales Estimate

NA 50% EMEA 42%

7% Misc. Global Sales By Segment Sales By Region

Military OEM 37% Commercial Commercial Aftermarket 6% Business Aviation 6% Medical 3% Other 3% LA 1% Landing Gear Systems 31% Fluid Control Systems 53% Electromechanical Control 16% Military Spares 8% Commercial Air Transport OEM 37%

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31%

Sales By Product Line

Overall Business Balance Improving with Sylmar Acquisition Overall Business Balance Improving with Sylmar Acquisition and Key 2011 Wins and Key 2011 Wins

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Harnessing The Power of Proven Industry Innovators

Bringing together proven innovative capabilities

  • f industry leading brands…

to develop and deploy the precision solutions …to develop and deploy the precision solutions… …necessary for our customers to succeed – and continue to partner with us

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Bringing together proven industry innovators into one brand, one image, one aerospace company

Major Programs – Commercial Aircraft, Defense Aircraft/Rotorcraft/UAV, Regional Air Transport, Business Jets Airbus A350 XWB , A330/340 Boeing Next Generation: 737, 747, 767 and 777 Mitsubishi Regional Jet / Bombardier Regional Jet Gulfstream 650/Learjet 85/Hawker Beechcraft/Dassault 7X, 2000/ Cessna Citation / BBJ / Hondajet / Embraer Phenom/Bombardier Global Express T‐38 / T‐45 / F‐15 / F‐16 / F‐18 / F‐22 /F‐35 UAVs: Predator / Global Hawk / Fire Scout CH‐47 / Augusta Westland 129 BCH Helicopter / AH‐64D / Eurocopter EC‐175 (Z‐15) Sikorsky UH‐60 Black Hawk

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Product Portfolio

Air Transport Regional Actuation Landing Gear Fluidic Control Electro-Mechanical Control Sub-Systems Components Military Rotorcraft Business Aviation Military Fix Wing Unmanned Aircraft

Growth = Creating Customer/Shareholder Value Strategy

Expand commercial and aftermarket business Invest in engineering and proprietary products Develop sub‐system integration capability D i t S Partner with Tier 1 system providers Win major, long‐term growth platforms with customer performance Acquire complementary technologies for critical controls and landing gear solutions Design to Spec Build to Print

Value

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Machining

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5 Low Cost Sourcing Strategy

China – Suzhou

Machining / Final Assy / Test Local supply chain

Morocco - Tangier Assy & Test

Machining Windings

India - Coimbatore Engineering + HCL partnership

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CIRCOR Ownership of Low Cost Facilities is a Key Value CIRCOR Ownership of Low Cost Facilities is a Key Value Proposition for our Customers Proposition for our Customers

Sourcing components Future potential: Assy, machining

IMPROVED STAKEHOLDER VALUE TALENT ACQUISITON & DEVELOPMENT

  • Leadership

E d

CULTURE

  • Values

PROFITIBILITY & ASSET VELOCITY

  • Cash

Generation

SUSTAINED COMPETITIVE ADVANTAGE

  • Talent

Gro th

OPERATIONAL EXCELLENCE

  • Continuous

Improvement

EXPLOIT NEW OPPORTUNITIES

  • Acquisitions

N M k t

OUR VISION . . . THE CIRCOR BUSINESS SYSTEM (CBS) Global Business & Supply Chain Development Customer Relationship Development

  • Engaged

Employees

  • Employment

Branding

  • Careers
  • Behaviors
  • Brand

Identity

  • Customer

Focus

  • ROIC
  • Growth
  • Customer

Loyalty p

  • Speed &

Flexibility

  • Repeatable &

Reliable Lean Processes

  • New Markets
  • New Products

Product Innovation Lean Enterprise, Six Sigma & Continuous Improvement Talent Acquisition, Development & Retention Acquisition Integration & Repositioning pp y p

2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2005

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6 CIRCOR’s Operational Excellence Model

  • Applying Lean “an inch wide and a mile deep”

– focus efforts, gain success, and increase impact to the corporation. – Must be Measurable!!!

  • Ten Steps to a Model Line

– Modeled after proven methodologies – 12-18 month process – Multi-Tiered (Continuous Improvement) – Internally Developed Training/Tools – Cross Corporation Sharing – Model Cells

  • Operational Excellence Leadership Team

– Roadmap/Vision Roadmap/Vision – Standards – Educational Tools

  • CIRCOR Problem Solving

– Basic Problem Solving Education – Structured Certification Process – Advanced Course

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MODEL LINE Approach

CIRCOR Business System Value Stream Performance levels

Gold World Class Performance

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Bronze Completion of CBS-Ten Steps to make a Value Stream Lean (Inside the 4 walls) Silver Value Stream Linked From Customer through Factory to Supply Chain

Lean Enterprise

2 3

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Stability – Lean Fundamentals

No “hockey stick”, lean thinking “critical mass”, robust kaizen activity, basic lean training accomplished

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7 10 Step Process Communication

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We were still missing something…….

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Business Results

Marrying Culture and Op-Ex

4 Pillars

  • f

Excellence THE Culture O ti l

Gaps to Excellence

THE CIRCOR BUSINESS SYSTEM (CBS) Operational Excellence

The Base

4 Pillars of Future Excellence

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9 Pillar 1: Customer Satisfaction

Relentless Pursuit of Customer Satisfaction We must make it a part of our DNA We must make it a part of our DNA Should permeate through all levels Messaging, measurement, process, tools Goes well beyond Delivery and Quality Performance

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Performance

Pillar 2: New Product Introduction

Best in Class New Product Introduction Process/skillset/people/discipline Process/skillset/people/discipline “We are an engineering company that manufactures, not a manufacturing company with engineering capabilities” Migraton; Mfg – BTP to Increased BTS Critical to Strategy – Tier 1 Design Partner

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It is a Whole Business Process

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10 Pillar 3: Great Place to Work

CIRCOR a great place to work at all levels Attraction Retention the best people Attraction - Retention - the best people…. Our people as a competitive weapon Leadership must create the environment: Empowerment leads to… Engagement … Ownership… Passion

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Passion… Performance TURN IT LOOSE!!!

Pillar 4: Leadership

Leadership Team with few equals First Class Tone at the top Value driven, we do things right g g Brave and Decisive yet data driven Performance Orientation Pure: open/honest/no fear of expression of opinion Drivers of continuous improvement across enterprise

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Passionate about new leader development Continuing Education is way of life Leaders of the Culture Change

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11 CIRCOR Aerospace Success

  • CH47 Landing Gear Line Achieved Bronze Certification

– Lead-time Reduction from 18 months to 1 Month – Floor Space Reduction of 80% Single Point of Schedule and Single Piece Flow through two facilities – Single Point of Schedule and Single Piece Flow through two facilities – 21% cost Reduction – All flow on Pull of Customer – 3 Years without a missed delivery

  • Benchmarked by Multiple Leading Customers
  • Won Sikorsky Blackhawk Landing Gear

– And all major programs targeted +$200 million in 2011

  • 4 Additional Model Lines Launched in 2011/2012

– Fluid Control, Corona – A350, France – Landing Gear Sylmar – JSF Pneumatic Launch Modules

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Corona F-16, CH-47 Cells & A350 Test Lab

Before

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After

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12 Corona Machine Shop

Progress toward future state

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Market Cell – holding stock at various of WIP & Finished Goods

CIRCOR Industria – A350 Cell “before”

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13 CIRCOR Industria – A350 Cell progress

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CIRCOR Industria – A350 Cell “after”

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14 Long Island Facility Move & Upgrade

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Sylmar Pre-work for overhaul “Future State”

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Lean Benchmarking

“I will say on behalf of the Messier‐Bugatti staff that we were very impressed with your facility and operations. It truly demonstrated what is possible with the correct lean perspective. You should be proud of what you are doing and it is evident that you are Thank you very much evident that you are. Thank you very much for the opportunity to be a witness to your success.” – Mike Michele, Operations and Supply Chain Manager ‐ Wheels and Brakes, Messier‐Bugatti USA

Moving OpX Excellence Beyond MFG

  • 12 Global NPI Kaizens in 2011
  • +30% of Kaizens scheduled in 2012 are Transactional
  • Engagement of Front Office/Back Office
  • Expanded CIRCOR Problem Solving to include Advanced training

January 11- Planning/Scheduling Kaizen Team

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Corona Facility – Transactional Kaizen - Planning

Current State VSM Summary; 16.43 Days, Lead Time Order Entry thru Purchasing

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g 136 Steps 98 Process blocks 38 Decisions 17 Functions 7 VA Steps 43 Non value added 86 Necessary non value added

Corona Facility – Transactional Kaizen - Planning

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Presented By: 33

Michael Dill

Group Vice President, CIRCOR Aerospace

Line vs Cell

Model Line

Financial Impact

Model Cell

Site Impact

– CIRCOR – Move the needle for CIRCOR

OPEX Approval, Oversight and Audit

– Transformational – Financial ~ Site Level

Site Leadership Guidance People – CI Leadership People – CI Leadership Process Stability 10 Steps – Value Stream Process Stability 10 Steps – Value Stream

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