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Analysis
Thermo Fisher Scientific is a world leader in serving the science industry. Within their Carlsbad location, the
manual package assembly process has an issue with high cycle times and work order (WO) variability within their
stock keeping units (SKUs). There is also a lack of a standardized training process that optimizes the assembly of
large kit SKUs. There is the potential to increase throughput efficiency with the installation of formal assembly
guidelines and a review process that promotes continuous improvement. Thermo Fisher has an incoming
automated machine to assemble kits with less than 5 components. Because of this, our focus was SKUs with 5-30
items per kit. At the inception of our project, Thermo Fisher had just developed a software tool to document all
work orders, their details, as well as efficiencies. Using this newly developed labor hours tool, we were able to
break down the data and narrow our scope to a smaller set of SKUs that we classified as the main causes of
overall variability. Along with identification of these SKUs, we suggested a process for the continuous review and
improvement of cycle time. Along with this method, we created a set of Assembly Guidelines to help standardize
the training process and encourage ergonomic practices and align procedure with the company objective of
constant improvement.
After finding the Delta for all SKUs, we multiplied this value by the number of times the SKU was ordered.
This gave us a new metric, which we used to select the set of SKUs to analyze. The resulting figures gave us
a set of 51 SKUs we deemed worth examining due to the combination of their high degree of variability, as
well as the frequency of which they are ordered. The positive values correspond with actual hours worked
being much higher than the standard, while negative values imply that the actual time worked is below the
standard, and therefore either highly efficient, or need an adjustment in standard hours.
Thermo Fisher Scientific has a wide range of services they provide, as well as
customers they serve. Each product has a specific SKU, which is a specific set
of numbers, attached to it in order to enable electronic tracking. A particular
SKU may be assembled many times, but it receives a unique work order every
time it is built. Each WO has its own set of data, which is now tracked in the
labor hours software database. The process we followed, as illustrated in the
graphic below, incorporates the scope we included in our project.
WO Received
Assemble
Materials
Ready Work
Station
Assemble Kits
QC Inspection
Record Time
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May 8, 2015
Assembly Guidelines
In an effort to standardize the training process, we created a set of
assembly guidelines. The idea behind this was to expose all
employees to the same materials which stress practices to improve
the flow of WO builds and ultimately increase packaging efficiency.
We view this document as vital to the training process because of
the high turnover rate and use of temporary workers in the
assembly department, which can contribute to possible
inefficiencies.
Guidelines Preview:
1. Before: Emphasize ergonomic practices, including practical
component placement and minimizing trips to stock room
2. During: Maintain open line of communication between team
members, and avoid workers leaving the process if possible
3. After: Accurately input build results, compare to standard
hours, & complete WO update form including causes of
positive/negative results
WO Review Process
Potential Improvements
Complete
Documentation
Transfer to
Distribution
As we can see from the visualization of the data, there are a handful of SKUs on either end of the spectrum
that are main contributors to the high degree of discrepancy between actual hours worked and standard
hours. The boxplots below depict SKUs on opposite ends of the field. We compared actual throughput
(Quantity Completed/Hours Worked) to the standard throughput (Quantity Ordered/Standard Hours).
MC2001, which is a MaxiCard/Reagent Tray kit, was consistently below the standard throughput of 50.
However, since there are several data points above the standard, it is clear that achieving a higher efficiency
can be more frequent. On the other hand, 4484083AB, an Ion Cartridge kit, is an example of a kit constantly
outperforming the standard hours. In this case, we suggest a review of the standard hours by management.
SKU: NC2010
STD WO Throughput: 25
Avg WO Throughput: 17.58
# hours worked over STD: 307
Potential savings if process
brought up to STD: $36,024
Next Steps
Recommendations for Thermo Fisher:
Utilize updated training materials (Assembly Guidelines) to encourage ergonomic and lean practices to help
improve flow of assembly
Use WO review method to continuously monitor process and enable more precise capacity forecasting through
establishment of accurate standard hours
Discover reasons for poor performance and address root causes to align with corporate goal of practical
process improvement
Increasing and maintaining assembly efficiency can lead to substantial savings
Potential to implement approach of historical data breakdown
Acknowledgements
We would like to take the opportunity to thank the following for their support of this project:
Dr. Bradley Chase, Executive Champion and Professor & USD ISyE Faculty
Charles John, Thermo Fisher Liaison
Thermo Fisher Management & Team Members