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Maintenance Cost Reduction Project

Solving Problems with Labor and Maintenance Costs

Prepared by:

JWS
August 4, 2008

Executive Summary
ABC and its primary customer DCE have observed a “lack luster at best” industry wide business climate and pressure has been placed to reduce costs due to rising fuel expenses coupled with the soft economy. DCE’s business volume in the (LTL) less-than-truckload division is down approximately 20% year over year in comparison sales and is seeking aggressive reductions in the amount they spend on equipment maintenance expenses as a percentage of their revenue. The focus of the project will be to reduce parts and labor expenses on tractor assets per mile driven. DCE currently runs approximately 2,500,000 miles per week on a tractor fleet of 1,525 tractor units. DCE has an average (non-tire) cost per mile driven on its tractor fleet of $0.102. The goal of this project will be to reduce this metric 20% to $0.080 per mile. Non-tire expenses include all parts and outside vendor repairs applied to tractor assets exclusive of any tire related expenses. Shop scheduling and productivity will be analyzed as well. Shop labor payroll is currently trending at $196,000 per week and we will be seeking a 20% reduction in this expense as well. Based on the analyst’s forecast for 2008 and therefore preparing for a slow freight cycle through the next two quarters it was imperative we examined and reacted to our findings rapidly. We understood to gain an immediate impact we would first start to analyze labor costs and then engage the more complex problems driving our tractor fleet’s part consumption. Following the Six Sigma strategy, we determined inconsistency in our shop scheduling and established staffing ratios amongst the twenty-three shop locations. Having limited productivity metrics in place we knew we had some low hanging fruit, so we began the process of setting up specifications for hours worked per asset type to gauge staffing needs by shop size. Data was measured across the overall shop network using descriptive statistics. The between and within shop variation exposed several opportunities to adjust staffing levels, and/or hours per week reductions. From this information we brainstormed for standards for each asset type i.e. tractor, trailer, and forklift. Once the specifications were set we considered the following alternatives to address under performing shops: 1. Training and development of the shop personnel. This included communication of the newly established specification with measured accountability to standards, and identified internal specialists to assist with a performance improvement strategy. These solutions required limited resources and we could implement quickly. 2. Extensive specialized technical training to enhance knowledge to increase efficiency. This solution would be expensive and protract the measurable impact to gauge affect. 3. Reducing a non-working manager to a working lead-mechanic. This solution could be implemented quickly and at no expense. Administrative support and macro level management was required from the regional and corporate level. 4. Upgrade personnel or make the required cutbacks immediately. This solution required some shift rescheduling and reporting established to ensure quality was not compromised, but could be implemented with limited cost.

Maintenance Cost Reduction Project JWS August 4, 2008

2

In essence. and year built. and cost per mile driven. Stratify tractor units by fleet type and determine our highest cost units. fleet type. miles accumulated and maintenance costs. The challenge was to reduce costs without outlaying capital to cycle underperforming tractors out and replace with newer models. could be implemented fast. DCE’s business volume in the (LTL) less-than-truckload division is down approximately 20% year over year in comparison sales and is seeking aggressive reductions in the amount they spend on equipment maintenance expenses as a percentage of their revenue. and further decompose spending by part component code.737 miles. maintenance cost per unit. we needed to make the best out of what we had currently. Shop to shop comparisons were also used to target potential process issues. We encouraged all those with worthwhile suggestions to participate in a brainstorming exercise to discuss parts spending each week and ways to control consumption. as a percentage of total hours by 11% and mechanic headcount was reduced 21%. Total labor payroll was reduced 24%.371 miles and reduced the cost per mile $0. The fleet is comprised primarily of 14 different tractor types. overall tractor unit cost per mile was reduced 9.8%. model.827. We began to decompose our tractor fleet by make.0 Introduction ABC and its primary customer DCE have observed a “lack luster at best” industry wide business climate and pressure has been placed to reduce costs due to rising fuel expenses coupled with the soft economy. The purpose of this report is to Maintenance Cost Reduction Project JWS August 4. Analyze our miles data by unit seeking a relationship between tractor fleet type. 2. DCE is seeking a 20% reduction in equipment maintenance expenses and labor payroll. From this we focused our efforts in these main areas: 1. The data was grouped by preventative cost in nature (proactive) or a reaction to a breakdown (after the fact). This lowered the miles per unit per week 3. and was cost effective would be considered. 2008 3 . This approach assisted in a 15% reduction in road breakdown expenses over the period analyzed. A 16% decrease was achieved in our focus four highest cost tractor units. Tractor utilization. Labor payroll reductions gave us the shot in the arm we needed and provided us some time to dive deep into the more complex equipment problems that would yield an impact but over a longer period of time. Once we established our higher cost lower performing tractor units from the lower cost higher performing units we began to educate the operations and equipment control departments to park and not use the tractor at all or place the tractor in a “best functionality” to mitigate maintenance costs and potential breakdown situations. It was essential to understand where our money was going before we could advance a plan to control for it.15 on our higher cost tractor units. Executing a data driven philosophy over a 14-week period and 36. 1. From this a positive relationship was determined to exist between age of the unit. Something expected however using Pareto principles we were able to separate the vital few units from the many and focused on four main fleet types. and 4 in varying degrees. Since this change we reduced overtime. Any idea that was determined to be practical.Beginning in May 2008 we began deploying solutions 1. 3. This helped lead to a reduction in weekly tractor unit spending of 6%. 3.

process mapping.0 Improvement Opportunity: Define Labor Group 1-shop locations. control charts. data stratification. are smaller shops located at smaller hubs and/or satellite locations to the hub based on a geographic region. Each tractor can be used in two main functions: Local pick up and delivery and longer haul runs from satellite locations to hub locations. Engineering a model for each shop based on required hours per week per asset type we made adjustments that led to a 24% reduction in weekly mechanic payroll. We further stratified and analyzed the data by shop location. Group 2-shop locations. 2. Satellite locations operate with slight variation but typically run two shifts over a 5:00am to 20:00 window. We concluded that we had inconsistency in our shop scheduling and established staffing ratios amongst the twenty-three shop locations. and Pareto charts. 5 days per week. tractor fleet types. The following analysis tools will be utilized: Brainstorming. Monday through Friday. are shops located at main larger hub locations.present the results of our problem-solving and cost reduction process and explain the solutions we embraced. and part component cost. Assets Tractor assets will be targeted because of their 73% contribution to total asset expenses. cause and effect diagrams. A hub is a large flow-though distribution center that typically operates on a twenty-four hour schedule five in half days per week. Labor We began stratifying each shop into two groups based on size and hours of operation. process capability. Having limited productivity expectations or metrics in place we knew we had some low hanging fruit. grouped by fleet type. To understand our tractors we analyzed the type of usage and miles driven by unit. The same unit is ideally utilized during the day in pick up and delivery functions and at night in the longer haul runs. Each group separately was then further stratified by shop labor hours allocated to each asset type per week. 2008 4 . The following table represents the actual performance versus the established new specification: Maintenance Cost Reduction Project JWS August 4. so we began the process of setting up specifications for hours worked per asset type to gauge staffing needs by shop size.

For this example. The methods utilized in this project will provide a very good model for how we analyze the other asset types down the road. 2. this will be a future project. We targeted tractor assets due to its large proportion of the total expenses. tractors. equipment maintenance i. a reduction of 3 people. Our reason for using this view of the data was due to the number of fleet types in the system and the variance in the fleet type size and miles driven as a percentage of the total tractor maintenance spending. 2008 5 . The company’s total maintenance part consumption includes trailers and forklifts. This was done in two methods: 1.HRS/WK= hours per week per asset type Specification hours per week divided by 45 hours (standard work week) this equaled the mechanic headcount propose at the Detroit Shop.e. In order to decompose the tractor maintenance spending. Assets When you slice up the total expense pie for an asset based transportation company. The goal of the project was to reduce equipment maintenance costs overall by 20%. it was important to stratify by fleet type. 12 mechanics would be staffed versus 15. Maintenance Cost Reduction Project JWS August 4. however. Maintenance cost per tractor (CPT) Maintenance cost per mile driven (CPM). trailers and forklifts make up the third largest piece behind labor and fuel.

00 $4.000.000.00 $6.000.000.00 $2.000.00 $5.00 $0.000.00 $8.000.TRACTOR MAINTENANCE COST/UNIT $10.00 $3.000.The following two Pareto Charts depict our focus four fleet types for the project: • • • • 1998 International Conversion Daycab Tandem 1998 Volvo Conversion Daycab Tandem 1999 International Conversion Double Bunk Sleeper 2005 International Conversion Ext Cab Tandem Sleeper PARETO CHART.000.00 Maintenance Cost Reduction Project JWS August 4. 2008 Bu nk te Sl ab rn ee at Ta pe io nd na r em lC 19 on Sl 98 ee v D Vo pe ay lv r ca 19 o 20 b C 96 05 on Ta -F v nd In R D EI tC em ay G on ca H TL v b D Ta IN ou ER nd bl em e -C Bu O 20 N nk V01 Sl D ee AY In tC pe C AB r on v -T 19 D AN ou 97 D bl Vo EM e Bu lv o nk C on Sl 20 v ee D 02 pe ay r In ca 20 tC b 04 Ta on v nd St D er em ay lin ca g 20 b C 06 Ta on v St nd D er em ay lin ca g b C on Ta 20 v nd D 03 em ay In ca tC b on 19 Ta v 95 nd D em Fo ay ca rd 20 b C 07 Ta on v St nd D er em ay lin ca g b C on Ta v nd D em ay ca b Ta nd em Ex tC C 19 99 In t 20 05 In te rn a on v tio na lC D 19 98 -In on v ou bl e 6 .00 $9.000.00 $7.00 $1.

400 0.600 0.300 0. Maintenance Cost Reduction Project JWS August 4.000 te In 899 1 lC na tio a rn v on ab yc Da tC In em nd Ta e bl ou nk Bu r pe ee Sl v on D b ca ay v on em nd Ta ab em nd Ta tC In r pe ee Sl e bl ou nk Bu r pe ee Sl v on D b ca ay tC In em nd Ta e bl ou nk Bu r pe ee Sl v on D b ca ay tC In em nd Ta e bl ou nk Bu r pe ee Sl v on D b ca ay em nd Ta v on D 99 19 98 19 o lv Vo C t Ex C v on D 05 20 lC na io at rn te In 00 20 04 20 li er St ng C v on D 01 20 06 20 li er St ng C v on D 05 20 07 20 li er St ng C Although the focus four fleet types only comprise of 12% of the total fleet they contribute 23% to the fleet’s maintenance costs. 2008 7 .000 0.900 0.700 0.TRACTOR COST PER MILE DRIVEN 1.PARETO CHART.100 0.200 0.800 0.500 0.

3.25 P P M Total 558147. O v erall P erformance P P M < LS L * P P M > U S L 558147.920 1.25 Process Capability of CPM-98INTL-1 0.6 3.2 4.919637 S ample N 41 S hape 0.02 P pk -0.868216 O bserv ed P erformance P P M < LS L * P P M > U S L 414634.4 Maintenance Cost Reduction Project JWS August 4.15 P P M Total 414634.0 Performance: Measure Current process capability on each fleet’s CPM is as follows: Descriptive Statistics: CPM-1998 INT’L-1 Variable Mean StDev Minimum Median Maximum 0.0 1.362 Calculations Based on Weibull Distribution Model USL P rocess D ata LS L * Target * USL 0.910044 S cale 0.48 S ample M ean 0.8 6.15 O v erall C apability Pp * PPL * PPU -0.140 CPM-98INTL-1 0.02 E xp.131 0. 2008 8 .412 6.

3094 0.4 0.6 0. O v erall P erformance P P M < LS L * P P M > U S L 492192.14 O v erall C apability Pp * PPL * PPU 0.2424 1.0827 Process Capability of CPM-98VOLVO-1 Calculations Based on Weibull Distribution Model USL P rocess D ata LS L * Target * USL 0.3270 CPM-98VOLVO-1 0.0 0.49 P P M Total 492192.409861 O bserv ed P erformance P P M < LS L * P P M > U S L 392857.39016 S cale 0.Descriptive Statistics: CPM-1998 VOLVO-1 Variable Mean StDev Minimum Median Maximum 0.36975 S ample N 28 S hape 1.0 1.32 S ample M ean 0.8 1. 2008 9 .4 Maintenance Cost Reduction Project JWS August 4.49 0.2 0.3698 0.00 P pk 0.2 1.14 P P M Total 392857.00 E xp.

0 1.445 0.5 2.824285 S cale 0.444911 S ample N 16 S hape 0. O v erall P erformance P P M < LS L * P P M > U S L 530852.0 3.00 P P M Total 375000.0 0.00 O v erall C apability Pp * PPL * PPU -0.Descriptive Statistics: CPM-1999 DOUBLE-SLEEPER-1 Variable Mean StDev Minimum Median Maximum 0.5 1.0 2.01 E xp.5 Maintenance Cost Reduction Project JWS August 4.98 P P M Total 530852.01 P pk -0.5 3.22 S ample M ean 0.188 3. 2008 10 .586 CPM-99DBL-SLP1 0.382939 O bserv ed P erformance P P M < LS L * P P M > U S L 375000.863 Process Capability of CPM-99DBL-SLP1 Calculations Based on Weibull Distribution Model USL P rocess Data LS L * Target * USL 0.064 0.98 0.

6 1.44 O v erall C apability Pp * PPL * PPU -0.0 0.Descriptive Statistics: CPM-2005 INT’L SLEEPER-1 Variable Mean StDev Minimum Median Maximum 0.17 S ample M ean 0.5626 0.317042 O bserv ed P erformance P P M < LS L * P P M > U S L 435897.320 1999 International Conversion Double Bunk Sleeper was targeted at $0.8 2.44 P P M Total 435897.3371 0.0227 Process Capability of CPM-05INTLSLP-1 Calculations Based on Weibull Distribution Model USL P rocess D ata LS L * Target * USL 0.2 1.1568 2.02 P pk -0.170 Maintenance Cost Reduction Project JWS August 4.91 P P M Total 567016.6907 CPM-05INTLSLP-1 0.02 E xp.91 0.480 1998 Volvo Conversion Daycab Tandem was targeted at $0.4 Target performance improvements were set for each of the focus four fleet types accordingly: • • • • 1998 International Conversion Daycab Tandem was targeted at $0.220 2005 International Conversion Ext Cab Tandem Sleeper $0. O v erall P erformance P P M < LS L * P P M > U S L 567016.337112 S ample N 39 S hape 0. 2008 11 .909369 S cale 0.

2008 12 .333 per week or 4. OEM parts Cooling Systems Tractor Utilization (best functionality) Material Machine It was determined that the 1998 International’s primary cause for maintenance cost and repair stemmed from transmission and power plant (engine) failures. The average odometer reading on this model was 625. Maintenance Cost Reduction Project JWS August 4. An action plan was deployed to mitigate utilization and/or “park” some units that have run their useful life. With this approach.0 Data Analysis and Interpretation with Recommendations: Analyze and Improve The following cause and effect diagram depicts identified potential causes to our focus four fleet’s high CPM yield: Focus Four Highest Cost Per Mile Tractor Units Man Training and Development Method Tractor Unit Locations Breakdown Maintenance Advanced Technical Knowlege Preventative Maintenance Limited Specialists Indentified Part / Unit Knowledge Issues High Cost Per Mile (CPM) PM Codes Exhaust Systems Transmissions Engine. we reduced weekly miles for the fleet type by 1. Placing applicable units in a “park” status to not be used entirely or placing the unit in its proper functionality accomplished this.421 miles.79%. We performed an observational study to isolate where we had them and educated our operations personnel on the best functionality of the unit while minimizing disruption to the company’s service product.4.Power Plant Useful Life Analysis Remanufactured vs.

000.17 $7.The following Pareto Chart details the components generating the highest cost for this model: PARETO CHART .00 $0.15 $20.920. Current process was to PM a tractor every 90 days or 30.000.12 $1.000 miles.000.00 $8.396.00 Fu el Sy st em Sh ee tM et al er P -M ai n.000.179.000.83 $1.00 $3. M Su sp en Po w Pm S ab Tr an sm is si on The analysis of the 1998 Volvo model led to a system-wide analysis of the (PM Code) preventative maintenance process.190 miles due to the system’s indicator for a PM Code being triggered on days first then miles second.00 $20.368.00 per work order performed.51 $5. The analysis yielded that PM Codes were being performed on average at every 18.085.28 $2.877.000 miles or no longer than 120 days between cycles.73 $8.00 $10. The following Pareto Chart details the highest component costs for this model: Maintenance Cost Reduction Project JWS August 4. We implemented a process change to PM Code tractors at 30.485.833.1998 INTERNATIONAL TRACTOR PARTS $25.40 $5.00 $15.818. The average cost for a PM Code ran at $225. 2008 C C Li gh tin g ra nk in g & Sy st em la nt si on Br ak es C ys te m an ua l od es 13 .

00 $4.920.74%.000.554.004.00 $6.343.000.00 $0.218.000.000. The following Pareto Chart details the highest component cost for this model: Maintenance Cost Reduction Project JWS August 4.00 $1. ge au .51 $6.00 $5.75 Pm s de Co es ak Br ch ut Cl ing ol Co em st Sy ion ns pe us S b Ca & al et M et e Sh t us ha Ex m ste Sy C s.793.704.56 $2. At the unit’s next service.000. The likelihood of a breakdown occurred as models approached 1. Although miles per week driven increased 1.1998 VOLVO TRACTOR PARTS $7.000.83 $2.00 $2.91 $2.00 $4. Corrective action was put in place to flag units in the system as they approached 750. 2008 14 .16 $4.267 a proper utilization strategy was deployed analogous to the 1998 International process.529.28 due to placing the units in a best functionality position to perform at higher levels.33 $4.000 miles.720.00 $3. they will have the radiators switched out to prevent road breakdowns.000.000 miles.602 miles or 4.000.g ts en m ru st In g in nk ra em st Sy r wa g nin es vic de A study was performed on cooling system failures on the 1999 Int’l Double Bunk Sleepers. Again for this model due to high costs for power plant and transmission failures and an average odometer of 851.80 $4.75 $2.PARETO CHART . CPM was reduced $0.

19 $3.55 $4.909.000.408.64 $4.000. M oo lin g Po w Pm D riv e C Tr an sm is si on The analysis of the 2005 International Ext Cab Tandem Sleeper model revealed an exhaust manifold bracketing issue.35 $1.00 la nt Sh ee tM et al Sy st em Fu el Sy st em Sh af ts od es er P Su sp en Br ak es an ua l C -M ai n.71 $1.23 $1.604.685.338 or 4. Therefore.000.00 $0.054.98 $3.00 $4.071.292.00 $1.74 $1. The following Pareto Chart details the highest component cost for this model: Maintenance Cost Reduction Project JWS August 4.03 $616.00 $4.37 $5.000.00 $5.000.PARETO CHART. a solution was implemented to properly secure and mitigate the issue. an action plan to mitigate utilization was deployed reducing miles per week driven by 4.066.64%.00 $2.061.1999 INT'L DOUBLE BUNK SLEEPER TRACTOR PARTS $6. The piping system was not supported adequately. For this model as well.000. 2008 C ab & C lu tc h si on 15 .

000.00 Po we rP lan Be ar ing s im W he els . 2008 Cr an k Ex ing 16 .00 $5.PARETO CHART.00 $10. Hu bs & te m ste m te m Br ak es Co de s ut ch t Sy s Sy ST E EY OR BE LT CO NV SY ys Cl M ha us t Fu el S Pm Maintenance Cost Reduction Project JWS August 4.000.000.R s.000.2005 INTERNATIONAL EXT CAB SLEEPER $25.000.00 $15.00 $20.00 $0.

338.154.459.152.35 $0.13 93.83 Maintenance Cost Reduction Project JWS August 4.52 22.5.25 ($0.15 $0.36 $0.13 ($0.92 $ 28.28) $0.11) $0.45 $0.10 23.602.17 $0.44 $0.69 -963.792.58 26.122.20 $0.23 $ 3.498.04) WK ANNUAL $WK DIFF $ 13.61 $ 1.16 ($0.461.451.84 COST PER MILE CURRENT FUTURE CPM DIFF $0.00 DESCRIPTION 1998-International Conv Daycab Tandem 1998 Volvo Conv Daycab Tandem 1999 Int Conv Double Bunk Sleeper 2005 International Conv Ext Cab Tandem Sleeper te rn at io na lC 19 on 95 v D Fo ay rd ca C b 19 on Ta 97 v nd D V em ol ay vo 19 ca 96 C b 19 on Ta -F 98 v R nd EI D V em ol ay G vo H ca TL C b on IN Ta E v nd R D em -C ay O ca N b V Ta -D 20 AY nd 02 em C A In 20 B19 tC 05 TA 99 on In N v In te D D tC rn EM ay at on ca io v na b D Ta lC ou nd on bl e em v B E un 20 xt k 04 C S ab le S te ep Ta rli er nd ng em C on S 20 le v ep D 03 ay er In ca 20 tC b 01 on Ta v In nd D tC em ay on ca 20 v b 06 D Ta ou S nd bl te e em rli B ng un 20 C k 05 on S le v In ep D tC ay er on ca 20 v b 07 D Ta ou S nd bl te e em rli B ng un C k on S le v ep D ay er ca b Ta nd em 19 98 -In MILES PER WEEK CURRENT FUTURE DIFF MPW 27.91 $0.26 $ 9.39 ($0.30 $0.40 $0.25 $0.05 $0.802.17 -4.333.838.512.515.52) $0.01 89.0 Improve: Future State Future state process capability: PARETO CHART.21 $ 2.699.48 -1.FUTURE STATE TRACTOR MAINTENANCE COST / MILE $0.10 $0.25 33.754. 2008 17 .38 1.83 32.817.

2892 1.6 0.8 1.16 E xp.0 Maintenance Cost Reduction Project JWS August 4.2354 0.20 P P M Total 268794.20 P P M Total 219512.0 0.0571 Calculations Based on Weibull Distribution Model USL P rocess Data LS L * Target * USL 0.2 0. O v erall P erformance P P M < LS L * P P M > U S L 268794.1304 CPM-98INTL-2 0.48 S ample M ean 0.407978 O bserv ed P erformance P P M < LS L * P P M > U S L 219512.Descriptive Statistics: CPM-1998 INT’L-2 Variable Mean StDev Minimum Median Maximum 0.20 Process Capability of CPM-98INTL-2 -0. 2008 18 .16 P pk 0.20 O v erall C apability Pp * PPL * PPU 0.4 0.3621 0.67883 S cale 0.362051 S ample N 41 S hape 1.

251823 S ample N 28 Location -1.2286 0.0878 Calculations Based on Lognormal Distribution Model USL P rocess D ata LS L * Target * USL 0.15 P pk 0. O v erall P erformance P P M < LS L * P P M > U S L 220831.32 S ample M ean 0.1 0. 2008 19 .4 0.74 P P M Total 220831.71 P P M Total 214285.46961 S cale 0.5613 CPM-98VOLVO-2 0.0 0.6 Maintenance Cost Reduction Project JWS August 4.74 Process Capability of CPM-98VOLVO-2 -0.Descriptive Statistics: CPM-1998 VOLVO-2 Variable Mean StDev Minimum Median Maximum 0.15 E xp.1156 0.2518 0.71 O v erall C apability Pp * PPL * PPU 0.5 0.2 0.429141 O bserv ed P erformance P P M < LS L * P P M > U S L 214285.3 0.

1 0.99 P P M Total 209497.5878 CPM-99DBL-SLP2 0.6 Maintenance Cost Reduction Project JWS August 4.13 P pk 0.565691 O bserv ed P erformance P P M < LS L * P P M > U S L 187500. O v erall P erformance P P M < LS L * P P M > U S L 209497.5 0.00 O v erall C apability Pp * PPL * PPU 0.Descriptive Statistics: CPM-1999DOUBLE-SLEEPER-2 Variable Mean StDev Minimum Median Maximum 0.0 0.1395 0.99 -0.0552 Process Capability of CPM-99DBL-SLP2 Calculations Based on Lognormal Distribution Model USL P rocess D ata LS L * Target * USL 0.22 S ample M ean 0.2 0.9713 S cale 0.4 0.13 E xp.165798 S ample N 16 Location -1.1658 0.00 P P M Total 187500.3 0. 2008 20 .1259 0.

96525 S cale 0.05048 0.26 O v erall C apability Pp * PPL * PPU 0.20 0. and a reporting plan will be designed to identify under performing shops and individuals. 2008 21 .04 P P M Total 230106. Standardized performance metrics coupled with a data collection.13951 0.25 E xp.10 0. Training through our Maintenance Cost Reduction Project JWS August 4.149314 O bserv ed P erformance P P M < LS L * P P M > U S L 256410.17 S ample M ean 0. analysis.133106 S ample N 39 S hape 2.0 Control To control what we have implemented we will use the following tools: • • • • Standardized work Data collection and reporting Control charts (I-MR and X-bar) Run charts and Pareto charts for trending The newly created staffing model for each shop location will provide process consistency as to how we establish headcount and labor hours based on asset counts.04 -0.25 P pk 0.03007 Process Capability of CPM-05INTLSLP-2 Calculations Based on Weibull Distribution Model USL P rocess D ata LS L * Target * USL 0.23276 CPM-05INTLSLP-2 0. O v erall P erformance P P M < LS L * P P M > U S L 230106.15 0.Descriptive Statistics: CPM-2005 INT’L SLEEPER-2 Variable Mean StDev Minimum Median Maximum 0.26 P P M Total 256410.05 0.13311 0.25 6.00 0.

identified specialists will limit variation and ensure proper efficient training application throughout the shops. We will continue and expand this level of analysis to all fleets and asset type i. We will use Pareto and run charts to visually trend this data over time.36 $ 0.75 $ 0.00 1 5 9 13 17 21 25 O bser vation 29 33 1 1 U C L=$ 0.e.86 __ M R=$ 0. An example of the I-MR control charts has been included for the focus four fleet’s cost per mile analyzed in this project.25 $ 0. and breakdowns.50) 1 5 9 13 17 21 25 O bser vation 29 33 37 41 $ 1. and forklift in the future. 2008 22 .00 LC L=($ 0.00 M oving Range $ 0. CPM. analyzed.50 $ 0.00 Individual V alue U C L=$ 1. Data will be collected.26 LC L=$ 0.34) ($ 0. tractor. trailer.00 37 41 Maintenance Cost Reduction Project JWS August 4. unit odometer reading. miles utilized.50 _ X=$ 0. I-MR Chart of CPM-98INTL-2 1 $ 1. and a reporting plan established to measure asset costs by component code.06 $ 0.

20 U C L=$ 0.25 1 $ 0.40 $ 0.36 $ 0.48 M oving Range $ 0.00 1 4 7 10 13 16 O bser vation 19 22 25 28 LC L=($ 0.00 1 4 7 10 13 16 O bser vation 19 22 25 28 LC L=$ 0.10 $ 0.44 _ X=$ 0.60 Individual V alue 1 $ 0.20 __ M R=$ 0.17 $ 0.34 __ M R=$ 0.01) 1 1 U C L=$ 0.00 1 3 5 7 9 O bser vation 11 1 1 U C L=$ 0.24 $ 0.45 $ 0.00 LC L=($ 0.51 _ X=$ 0.15 $ 0.10 $ 0.00 I-MR Chart of CPM-99DBL-SLP2 $ 0.12 $ 0.60 Individual V alue $ 0.10 LC L=$ 0.30 $ 0.32 $ 0.11) 1 3 5 7 9 O bser vation 11 13 15 $ 0.00 13 15 Maintenance Cost Reduction Project JWS August 4.30 M oving Range U C L=$ 0.I-MR Chart of CPM-98VOLVO-2 $ 0. 2008 23 .

8%. 1999 International Double Bunk Sleeper.I-MR Chart of CPM-05INTLSLP-2 $ 0. Maintenance Cost Reduction Project JWS August 4. The focus four fleets included the 1998 International Conversion Daycab Tandem. and 2005 International Conversion Ext Cab Tandem Sleeper.00 1 5 9 13 17 21 O bser vation 25 29 33 1 U C L=$ 0.01) $ 0. we stratified our tractor units by fleet type to determine our highest cost units. miles driven. and utilization by our operations group.20 $ 0. These units were decomposed to root cause issues by component code.00 37 7.05 LC L=$ 0.00 1 5 9 13 17 21 O bser vation 25 29 33 37 LC L=($ 0. DCE. A 16% reduction was achieved on our focus four highest cost tractor fleets. We also had limited productivity metrics in place to assess performance. We understood to gain an immediate impact we would first start to analyze labor costs and second engage the more complex problems driving our tractor fleet’s part consumption. 2008 24 . We engineered the shopstaffing model.30 Individual V alue U C L=$ 0. inconsistencies were determined to exist in the shop’s scheduling and staffing requirements.15 $ 0. our primary service provider.20 _ X=$ 0.18 M oving Range __ M R=$ 0.13 $ 0. Executing a data driven philosophy. This approach led to an overall tractor unit CPM reduction of 9. 1998 Volvo Conversion Daycab Tandem.10 $ 0.10 $ 0. Following a Six Sigma strategy. built in standards and accountability to reduce labor payroll costs by 24%.28 $ 0. has challenged us to reduce costs in parts and labor expenses as a percentage of their revenue.0 Conclusion With rising fuel costs and a slow freight cycle.05 $ 0. From there we dug deeper to understand what was driving the high costs in four primary fleet types.

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