Alcoa 1999 Annual Report Download - page 25

23NEWS99 23
Linking Up with Boeing
Alcoa Mill Products linked APS to Boeing’s Manufacturing
System during three one-week long joint meetings of key execu-
tives and manufacturing staffs. Result: the entire material supply
chain for the new generation Boeing 737 is connected – from
casting, rolling, skin sheet polishing, structural bond, and final
assembly for the fuselage skin sheet. Benefits: faster flow times,
shortened cycle times, and lower costs for both enterprises.
APS and Customer Service
Alcoa Forged Products created a new subsidiary designed to
increase service capabilities to large truck and trailer customers
who outsource their tire mounting and logistics operations. Called
Alcoa Sub-Assembly and Logistics (ASL), this unit has leveraged
Alcoa’s technology and APS to make major improvements in both
noise reduction and ergonomics and to accelerate the order fulfill-
ment and tire mounting process to less than two hours. For cus-
tomers, this means significant savings in floor space requirements
and inventory costs. The transformation will continue through
2000, as ASL opens four to six additional facilities.
APS: Progress Report
The Alcoa Production System – manufacturing arm of the Alcoa
Business System – continues to roll out across the company’s world-
wide network of operations, improving production efficiencies,
job satisfaction, and responsiveness to customer needs. Following
are a few recent examples of the results:
Cressona, Pa. Extrusion plant metal inventory trimmed by 32%,
compared with 1998 levels. Efficiency improved by elimination
of waste from all processes in the value stream. In 1999, pounds pro-
duced per work hour registered their largest-ever annual gain. All
told, a safer and cleaner as well as more productive work environment.
Sorocaba, Brazil. Alcoa University training sessions in 1999
(including one for customers) focused on reliability and related
issues. Delivery performance rose to 97.9% while order lead time
fell from seven days to three days. Extrusion costs were trimmed
by 17% in 1999 following a 19.7% reduction in 1998.
Hernando, Miss. Alcoans at an extrusion plant which had been
experiencing difficulties achieved a dramatic turnaround in 1999
through relentless pursuit of APS methods. Year over year, delivery
performance improved by 11%, recovery rates by 3%, inventory
turns by 38% – and there were zero lost workday injuries. The
plant became solidly profitable.
Drunen, Netherlands. APS teams in Drunen’s Flat-Rolled
Products plant reduced inventory, simplified logistics, and acceler-
ated flow time by 30%. Drunen Extrusions developed a “visual
factory” concept so crane operators can see exactly when and
where to transport goods. Process improvements raised output by
100 kg per hour on each press.
Sidney, Ohio. Alcoa Building Products sharply reduced in-process
inventory and cut conversion costs by 3.7%. The plant recorded
only one lost workday injury in the entire year.
Székesfehérvár, Hungary. APS programs cut throughput time
by 70% and inventory by 56%. Output per employee increased by
17%, and safety performance improved by 50%.
Lafayette, Ind. By late 1999, the ingot plant of Lafayette
Operations had reached 100% performance on delivery of cut billet
to Lafayette’s extrusion plants. The tube mill raised delivery per-
formance by 29% and, in the case of driveshaft shipments, reached
99%. Inventory decreased by 38%. Shipments grew by 12%.
Productivity measured in pounds shipped per work hour rose 23%.
Portland and Point Henry, Australia.
> Portland potrooms converted to a “pull” system – producing
molten metal to meet real-time demand from the ingot mill –
reducing the need for vacuum crucibles from 24 to 14 and saving
A$400,000 in capital outlay. Ongoing savings will be around
A$100,000 per year.
> At Point Henry, reduction in coke inventory made it possible to
take one coke tank out of service and reduce inventories of petro-
leum coke, for a one-time saving of some A$1.5 million. Additional
one-time savings of A$560,000 flowed from eliminating 700 of
10,000 anode rods.
’96 ’00*’97 ’98 ’99
141 100 104 109 129
Output per
employee
Base 1996 = 100
*Estimate
Productivity
Improvement
Extrusions
Székesfehérvár,
Hungary
13.5
88% 63%
12.0
Shipments
and Delivery
Tube Mill
Lafayette, Indiana
’98 ’99
Shipments
millions of lbs.
Delivery
Performance
percent
Order
Lead Time
Flat-Rolled
Products
Itapissuma,
Brazil
’97 ’99 ’99
Sheet
Foil
Evaporator
35
0
Days