Less Inventory, Shorter Setup: OEE at 76% in Defense Manufacturing

Starting Point: Complex Routes, Unbalanced Flow

Machining in the defense and aerospace industry demands high quality standards, complex production routes and precise delivery schedules. Even a small disruption in flow increases work-in-process inventory and hurts machine availability and on-time delivery.

At a defense industry client, production routes did not support flow well enough, creating an unbalanced flow between operations and high work-in-process inventory. The main problems were:

• Accumulating work-in-process inventory: WIP rose between operations, making it hard to complete orders on time.
• Long setup and changeover times: Machine waiting and capacity losses occurred.
• Low availability: Losses cut available shift time by 37%, and overall equipment OEE stayed at 65%.

Approach: Manage the Flow, Unlock the Capacity

The core need was not more inventory or machines but managing the flow of existing production capacity correctly. Production flow, work-in-process inventory and equipment utilization losses were addressed together:

• Production routes of parts were re-analyzed; new flow routes were created to reduce unnecessary movement and waiting.
• WIP levels between operations were balanced.
• Sources of setup losses were examined on the shop floor; internal and external setup activities were separated through SMED work.
• Preparation tasks were standardized, reducing machine stoppages.
• OEE losses were tracked regularly and turned into improvement actions.

Result: The Transformation Scorecard

At the end of the twelve-month transformation, production routes became more balanced and manageable, machine capacity availability increased, and flow losses that blocked on-time delivery decreased. The results were achieved by using the existing production system more effectively instead of investing in new machines.

If you face high work-in-process inventory, long setup times or low OEE in your machining processes, we can build a flow-oriented system so that parts move on the right route, with the right inventory level and minimal preparation loss.