Udugu Journey

Case Study 5

Growth Management Coaching

Background

A family-owned fencing business experienced significant growth, leading to challenges in managing stock and controlling wastages. As the business expanded, the lack of consistent processes for managing inventory and handling leftover materials from projects resulted in increased wastage, inefficiencies, and ultimately, financial losses. The business was struggling to find a systematic approach to track timber and other materials effectively.

The Challenge

The primary challenge was to create a consistent and efficient process for managing stock and reducing wastage. The lack of inventory control systems made it difficult to understand how much material was being used, how much was left over, and how to minimize wastage. Without proper processes, leftover timber and materials from completed projects were either unused or discarded, leading to significant losses over time.

Udugu Journey's Approach

Udugu Journey was brought in to help the fencing business streamline its processes and reduce waste. We took the following approach:

  1. Process Mapping and Documentation: We began by working closely with the business owners and employees to map out and document their existing processes. We observed how stock was ordered, stored, and used across different projects, identifying inconsistencies and gaps in the current process.
  2. Gap Analysis: Once the current processes were documented, we conducted a gap analysis to compare them with an ideal process for efficient stock management. This helped us identify areas where the existing processes were falling short, particularly in tracking material usage and preventing wastage.
  3. Identifying Areas of Improvement: Through our analysis, we identified several areas for improvement:
    • Lack of a standardized system for ordering and tracking stock.
    • Inconsistent methods for measuring and utilizing leftover materials.
    • Limited communication between project teams and inventory management.
  4. Waste Reduction Plan: We developed a plan to reduce waste by implementing best practices for material usage. This included educating the team on efficient cutting techniques and reusing leftover materials in future projects.
  5. New Process Implementation: We helped the business implement a new process for managing and tracking stock. This included introducing a centralized inventory tracking system to monitor materials from procurement to project completion, providing visibility into stock levels and usage.
  6. Just-in-Time Stock Management: To further improve efficiency, we implemented a Just-in-Time (JIT) stock management system. This ensured that materials were ordered only when needed, reducing excess stock and minimizing the risk of material wastage.
Results

The implementation of these new processes had a significant impact on the business:

  • Reduced Wastage: The business saw a 30% reduction in material wastage within the first six months of implementing the new processes.
  • Improved Inventory Control: The centralized inventory tracking system provided better visibility, allowing the business to manage stock levels effectively and reduce excess ordering.
  • Cost Savings: By reducing wastage and implementing JIT stock management, the business achieved substantial cost savings, ultimately improving profitability.
Key Takeaways
  • Process Mapping is Crucial: Understanding the current state of processes through mapping and documentation is key to identifying areas for improvement.
  • Gap Analysis Helps Drive Change: Conducting a gap analysis allowed us to pinpoint specific weaknesses and develop targeted solutions.
  • Just-in-Time Stock Management: Implementing JIT principles helped reduce excess stock and wastage, leading to cost savings and increased efficiency.