SMEDA-Industry Support Program

Application of Lean Production

Case Study from Garment Sector of Pakistan
28 March, 2011
Presenters:
Mr. Haider Sagheer
Mr. Qasar Wasique Ahmed
Dr. Nabeel Amin

Background of the Project

Labor intensive
Huge variety of products with small quantity orders
Inefficient production systems
High need of flexibility
Large employment Opportunities and increased share in export

market

Evaluation Phase
1.
2.
3.
4.
5.
6.

House Keeping
Factory Current Efficiency Level
Factory Current Defect Rate
Material Handling
Space Utilization
Style Change Over Analysis

1- House Keeping-before

House Keeping-before

House Keeping-before

2. Factory Efficiency
Following were the major steps taken for calculating factory current
efficiency level:
1. SAM Calculation of major products
2. Calculation of Over time
3. Data Collection from Bundle induction to sewing lines
4.
5.

Data Collection of finished Bundles

Idle Time Calculations

2. Factory Efficiency

22%

3. Defect Rate
Data collection by introducing appropriate format's.
Data collection at end line and finishing stage.
Appointed end line checkers.
After collection of data for one month an average of

defect rate was observed.

35-40%

Inspection Sheet Finishing

4. Material Flow Analysis

840 Ft

Target Setting Phase

Following Key Performance Indicators were defined as project
target metrics:
1. Efficiency
2. Defect Rate
3. Material Handling
4. Space Utilization
5. Throughput Time
6. Cost/Pc

Implementation Phase

Implementing 5S/Visual Control Systems across the Factory

Implementation of IE functions
Conducting Style Change Over Analysis by SMED (Reducing
throughput time)
Running of Sewing Line at target efficiency level
Implementing Hourly Based Quality Monitoring System
Implementing SQC techniques
Introducing Incentive System for Quality Control

5S
Before
After

5S in Store

Before

After

 Savings of

machinery

135,000 PKR by sale of obsolete

Assignment Sheet

Standard Allowed Minutes (SAM)- Gundo CT Short

Critical path Analysis- Gundo CT Short

Pkt bag OL

Frnt rise OL, Back yokes

OL

Frnt rise att, Back

Yoke Att

Pkt bag att, Pkt TS

CP Time = 9.63, SM = 1.31
Frnt rise TS, Back
yokes TS

Back Rise OL

Bk yoke edge
OL
Side seam OL

Back rise att, Piping

making

O/L time = 1.31

Back rise TS, Piping att to bk

yokes, Back yokes att to back
body
Side seam att & lbl
att

Button hole

Bartack 4
pts

Inseam att
In seam OL
W.B elastic mkg, Side label
att, Elastic att at W.B, Main
label att
Bottom hem

Store Room

W.B TS

Style Change Analysis (Model Line)

Bundle Size: 15,
Date:13/5/10,

Style: Short
Time: 10:30

Activities to introduce Flexible Production Line

Reduction of Bundle Size
Hourly Basis Monitoring System
Advance Cutting in Shelves
Implementation of Checklist for Accessories
Layout Shifting of Special Machines
Selection Criteria of Operators, Payments, Disciplinary Issues,

Improved Material flow

328 Ft

Overhead cost Comparison (for 17 no of machines for

one month)
Before

After (Model hall)

Items

Description

Items

Description

Overhead Cost per Month for

170 machines

1,000,000

Overhead Cost per Month

1,000,000

Overhead Cost per Month for 17

machines

100,000

Overhead Cost per Month for 17

machines

100,000

No. of pcs/day produced @22%

225

No. of pcs/day produced @32%

325

No. of Pcs per mth @22%

5625

No. of Pcs per mth @32%

8125

overhead Cost/pc per mth

@22%

18

overhead Cost/pc per mth @32%

12.31

OH cost Difference per piece = 18-12.31 = 5.47

OH Cost Savings = 5.47*8125 = Rs. 44, 443

Quality
ControlHourly
System

Introduced
Basis Reports

End Line
Finishing
Check Sheets Major Defects

ISSUES:
Reports could not be properly filled due to large buddle size
Operators were not submitting small bundles on time
Low DHU is Key Factor for running model line, therefore immediate action
must be taken to properly fill the Q.C Reports

Introducing Incentive System

Defect Rate

DR reduces Upto 5%

Cost Savings Through Defect Rate Reduction

Avg. Production per Month = 60, 000 Pcs
DR Before =30%, Rework in Nos = 18000 pcs
DR After = 5%, Rework in Nos = 3000 pcs
Rework Difference = 18000 3000 = 15000 pcs
Avg. Operation Time =0.5 min
Total time = 15000*0.5=7500 min
Total time consumed in RW is 7* times of the operation 1st time performed.
Total time saved= 7500 * 7 = 52500 min
Avg. SAM per pc = 12 min
*According to KSA study this factor ranges from 7 to 14 times of the operation 1 st time performed.

Cost Savings Through Defect Rate Reduction

No. of pcs that can be produced = 52500/12*32 = 1400pcs

Avg. Profit per pc @15% (FOB=Rs.425) = Rs. 64

Cost saving in RW/mth@15% per Mth = 1400 * 64

= Rs. 89,600

Projected saving by sustaining the RW @5%over one year = 89,600*12

= Rs. 10,75,200

Cost Savings Through Defect Rate Reduction

(Inspection Cost)

Salary per month(25 working days) = Rs. 7000

Per day income (salary)=7000/25 = Rs. 280
Avg. pcs inspected per day per Inspector=250
No of days needed by one inspector=15000/250=60 days
Savings/Month By Reducing Inspection = 60*280
= Rs. 16800

Projected Saving over one year through Inspection

= 16800*12 = 201,600

Total Savings Per Month

Cost Savings by
Reducing DR/month + Cost Savings By Reducing Inspection
= Rs. 89600 + Rs. 16800
= Rs. 106400

Results
Sr.
No

KPI

Before

After

Percentage
improvement

Efficiency

22%

32%

45%

Defect Rate

35%

5%

85 %

Material Handling

840 ft

328 ft

61%

Space Utilization

0 sq ft

1254 sq ft

100%

Through Put Time

3 days

1 day

66%

Cost per piece

18 Rs

12.31 Rs

31%