Applying Lean thinking to equipment rentals
By Peter Tibbetts
Lean thinking is often been applied to repetitive processes with similar outputs. Challenges arise when managers struggle with idea that “everything we do is different” and believe Lean will not work. Some examples are:
- “Every house we build is different.”
- “Each product we develop is different.”
- “Each patient we treat is different.”
- “Every car I sell and every customer I meet is different.”
Managers need to think about their outputs differently. Sure, every house, every product, every patient, every car and every customer is different, but the process is not different and neither is the output. The output of the “house building” process is, quite simply, a “built house.” A “built house” will continue to be the output and the only difference are the specifications for the critical to quality requirements will change. Understanding those changing needs is the subject of a future blog post.
GPS has been coaching a leading equipment rental business to improve in the following areas:
- Improved percentage of equipment available for rent
- Improved on-time delivery performance
- Improved pick-up time performance
- Decreased dependency on third party hauling
The interrelationship diagraph (figure 1) shows the impact of the different metrics. The lines from the “Branch Turn Time” are heavier than “Customer Turn Time” because the branch typically consists of unloading and loading equipment while the customer site consists of either unloading or loading of equipment. As expected, the turn times for the branch were about twice that of the customer site. Analysis showed that if the amount of time is (greatly) reduced, then drivers would be available for more trips, which favorably impacts on-time delivery, on-time pickup, third party hauler utilization, equipment available for rent.
Through the process, the driver was “100% busy” during the entire 33 minutes! The next step was for GPS to help the team understand about value add vs non-value add flow analysis and the eight elements of waste. For the step to be value added:
1) The customer must care about the step and is willing to pay for it
Example: Deploying cones is a safety factor that both the customer and business care about. Having to operate the trailer manually, because the remote does not work is not.
2) The step must be done correctly the first time.
Example: Having to load then unload and then reload the equipment for in a different order for the delivery route.
3) The “thing” must change in the process.
Example: Removing binders and chains is necessary to unload the equipment, but while that is being done, the equipment (“the thing”) is remaining idle.
The team also reviewed the eight elements of waste, using the acronym “DOWNTIME”
- Over production
- Not willing to change
- Extra processing
When the team looked at each, and every step in the process, they were stunned to realize the equipment (“the thing”) was moving only 1 minute and 42 seconds of the 33 minutes of the time the driver spent in the yard!
Some examples of identified wastes included:
Motion: Driver removing every binder, chain, and strap by himself
Not willing to change: Driver having to walk inside branch to learn of next dispatch
Extra processing: Storing binders, chains and straps that were necessary for next piece of equipment Transportation: Driver having to drive offloaded equipment significant distance from fueling area to return area and new delivery from ready line to loading area.
The team brainstormed ideas to decrease the time spent on wasteful activities and some of the implemented ideas were:
1) Change yard assistant’s primary responsibility to assisting driver in unloading and loading of equipment.
Impact – Reduce time spent by unchaining and chaining (motion) by 50%!
2) Driver contact yard assistant when 15 minutes from branch and alert yard assistant of what was on load, so yard assistant could prepare in advance (don safety harness, prepare yard fork lift, if necessary)
Impact – Contributed to above impact.
3) Yard assistant would stage outgoing equipment in advance of driver arriving
Impact – Reduced time spent returning or retrieving equipment by 80%!
4) Yard assistant would fuel equipment when loading of equipment was complete
Impact – Reduced time spent fueling by 100%!
When then team and drivers piloted the new process, they driver exited the yard after only 13 minutes for a 60% improvement! Perhaps more importantly, they identified additional time savings opportunities!
|Trips per day||2.3||3.1|
|Third party hauler trips||2||0|
|On-time delivery %||92%||96%|
|On-time pick up %||90%||93%|
|Equipment available for rent||69%||74%|
|Table 1. Results Summary|
Table 1 summarizes the improvements. These improvements will have the opportunity to be replicated throughout other branches in the US and Canada. Not only is the branch and the corporate office pleased with the measurable improvement, they value how the improvements were realized. There was no blaming of the driver. They recognized the driver was doing his best in a process that would always average around 33 minutes until they looked at the process from the point of view of “the thing” going through the person, rather than from “the person” working in the process!