Case Study - LCD Sub Assembly Program for Leading Computer System OEM
SerCom - experts is just-in-time delivery...
The Challenge
Our customer is one of the world's leading computer system companies, and a premier provider of products and services required for building information technology and Internet infrastructures. They manufacture and customise products to customer requirements, and offer an extensive selection of software and peripherals. Their EMEA (Europe, Middle East, Africa) manufacturing headquarters are located in Ireland.
Our customer sought to outsource the assembly of Notebook LCDs (Liquid Crystal Displays) in order to increase the throughput of Notebook (laptop) assembly within their manufacturing facility. The challenge for SerCom was:
- LCD components were to be sourced, bought, assembled and supplied directly into ourselves and subsequently delivered onto our customer's facility on a JIT basis
- The solution would need to reduce average notebook assembly time in our customer's facility by 30% as well as dramatically reducing the unit cost of a delivered LCD.
- Many of these components are high value, requiring excellent security, traceability and process controls
- These services would need to be fully IT supported and integrated with our customers systems as well as being operated from a near site outsourcing hub.
- The solution would need to be capable of supporting peak capacity requirements which are a multiple of the average daily run rate.
SerCom's Solution
SerCom developed a solution whereby a 30-day forecast for LCDs is downloaded onto our fully integrated ERP system. The appropriate components are then ordered and expedited with suppliers, with metrics for these suppliers managed by SerCom in all cases. These components are delivered to SerCom Solutions' near-site facility, where they are stored on a consigned stock basis in our bonded warehouse.
We position key personnel at our client's location to monitor consumption across the 30-40 sub-assembly varieties supported by SerCom. Our employees within the customer's facility manage the kanban area, replenishing several times throughout a 24-hour period. Actual hourly run-rate information combined with the 30-day forecast provides a starting point for LCD production planning within our own facility.
This solution requires highly detailed capacity and resource planning. SerCom's mySAP system supports the requirement to re-plan production as frequently as every two hours based on actual consumption of material at our customer's facility. Raw materials on our own production lines are replenished based on hourly component usage. This replenishment activity is managed automatically by systematic report generation based on usage through our mySAP system.
Our state of the art production lines are engineered to ensure highest quality output - features include Pick-to-Monitor during the kitting process, confirmation of activities via a process scan and automatic back-flush of components at the end of the production line.
Our facility is staffed 7 days a week with daily output varying significantly based on our customer's daily demand. There is a great deal of flexibility required within the process to flex up and down to meet capacity requirements at short notice, therefore the efficient management of resources, proper process controls, well maintained equipment and a highly motivated team are essential to the continued success of our business.
The Results
- Our customer reduced inventories, showing a 2,300 sq ft (700 sq m) saving to our customer
- Increased line efficiencies were attained by the client as a result of receiving a reliable flow of sub-assemblies monitored by SerCom's on-site personnel
- SerCom enabled multi-million euro cost savings on components for our client
- SerCom has continued to add capacity and improve output from our production lines thereby supporting significant growth in their business since our partnership commenced