CNH Industrial, in striving to consolidate and maintain high standards of excellence in its manufacturing systems, applies principles of World Class Manufacturing (WCM), an innovative program for continuous improvement originating from Japan.
WCM is a structured system encompassing the most effective manufacturing methodologies, which include Total Quality Control (TQC), Total Productive Maintenance (TPM), Total Industrial Engineering (TIE), and Just In Time (JIT). By applying precise methods and standards, WCM seeks to eliminate all types of waste and loss; in fact, it has identified objectives such as: zero injuries, zero defects, zero breakdowns, zero waste, reduced inventories, and punctual delivery of parts by suppliers to plants, and thereafter to dealers and end users. These objectives require a strong commitment from plant management and all concerned departments, reinforced by continuous communication between all organizational levels.
One of the main features of the WCM program is the direct relationship between an activity or project and its cost benefits. Actions for continuous improvement, in fact, are driven by the Cost Deployment pillar, which precisely identifies all plant wastes and losses, guides the activities of the corporate functions in charge of containing and eliminating the sources of waste, evaluates project feasibility, and assesses and certifies the results achieved by carefully monitoring specific performance indicators (KPI). Such a methodical and structured approach ensures a genuinely effective process to evaluate interventions, in that it measures and correlates all factors affected by the intervention itself.
The widespread use of WCM principles at all CNH Industrial plants allows the entire Company to share a common culture based on efficient processes and on a language universally recognized in all plants and countries in which CNH Industrial operates.
The WCM system is also integrated outside the Company since, on the one hand, it must be able to meet its customers’ needs with maximum flexibility and effectiveness and, on the other, it must be shared with its suppliers (see also page 155) to ensure product quality and efficient processes. WCM seeks to instill and reinforce the idea that everyone who is part of an organization must know their customers and strive to satisfy their needs, as well as those of all other stakeholders, regarding products, order processing, delivery, quick response services, and after-sales assistance. After all, the aim of continuous improvement is to increase customer satisfaction and loyalty, while also ensuring long-term profitability, by developing processes and adding value to products and services.
CNH INDUSTRIAL WORLDWIDE
The WCM system cuts across all Company boundaries and is applied to all departments, embracing numerous topics (known as pillars) including safety in the workplace, the environment, quality, logistics, in-house and specialist maintenance, human resources, and process and product engineering (involving the reorganization of work stations, the installation of new machinery, and new product launches).
One of the system’s strengths is the way it incentivizes people, who are an intrinsic part of the model, to engage and take responsibility, contributing directly to process optimization via a well-established system of collecting suggestions. They are an integral part of target achievement, as they are involved throughout the entire improvement project (universally known as kaizen), from definition to realization.
This allows individuals to acquire and develop skills and good practices that are then shared across plants, forming a network of expertise and knowledge at the service of the Company. WCM plays a role in creating an organization that is engaged and free of barriers, where ideas, knowledge and talent are shared between working groups, both within and across different plants.
At CNH Industrial, the use of tools for sharing information and collecting suggestions is well established; in 2013, about 375 thousand suggestions were collected across the plants where WCM principles are applied, with an average of ten per employee. In 2013, the projects implemented within WCM generated savings of €154.4 million.
Each pillar involves a seven-step approach and auditing process, culminating in several awards (bronze, silver, gold, and world class). Increasingly challenging targets are reached by means of a rigorous approach comprising three progressive levels: reactive, preventive and proactive.
In December 2013, 56 plants were participating in the program (33 in Agricultural and Construction Equipment, 16 in Trucks and Commercial Vehicles, and 7 in Powertrain), involving 90% of Company plants, 98% of plant personnel, and 99% of industrial revenues; 18 of them received bronze awards (11 in Agricultural and Construction Equipment, 3 in Trucks and Commercial Vehicles and 4 in Powertrain) and four received silver awards (Bourbon Lancy, Madrid, Suzzara and Valladolid).
During 2013, courses were held to train plant managers in internal auditing, so supporting the continued spread of WCM.
A steering committee (established in March 2012), consisting of Top Manufacturing management and CNH Industrial’s WCM managers, coordinates WCM initiatives, driving the relevant strategies and developing the required methodologies for the entire Company.