Value Stream-Based Order Fulfillment Process Analysis And Improvement

With the development of purchasing globalization and the deepen understandingof supply chain management, the competition between enterprises is not simply on theproducts or price in the traditional sense, but on the performance among various linksin the whole supply chain. With the consideration of how to meet customer demandsat the maximum level, it is the key to enhance core competitiveness that can eliminatewaste, innovate consistently, optimize business processes, improve continuously andachieve value-added chains effectively.As the leader in elevator industry, Otis Elevator Company stands out in thecompetitive market and occupies a favorable market share because of its uniquemanagement method and business philosophy. In this paper, we took Otis ElevatorCompany as the research background, on the basis of its value streams to study itsorder fulfillment process, especially its delivery time. This paper will focus on how toapply lean philosophy as the guiding principle to eliminate non-value-added links andoperations. This study concentrates on how to take customer’s demand as startingpoint, combining value stream mapping with manufacturing business processes inorder to find out the root causes of long production lead time and the time of customerresponsiveness. By analyzing the manufacturing process of OTIS Elevator Company,we find out ways to eliminate all non-value added activities and get rid of all kinds ofwastes. Through improving manufacturing process, we made a success in makinginformation flow and material flow pass on continuously in the supply chain system.Based on the value stream analysis, we review the status of information flow andmaterial flow in order to distinguish value-added links from non value-added links.Based on customer demand-oriented, we draw a future state of value stream mappingand make a plan for improvement through comparing the gaps between the currentstate and future state of value stream mapping. As a result, we improve the accuracyand effectiveness of information transmission in the manufacturing business process,and at the same time, improve the speed of material transfer, thus completely solvethe problem in terms of lead time and reply speed.According to the practical feedback, this study justifies that value streammapping can clearly describe the activities of each link in the supply chain, and reflect the root cause of waste. By reducing the non value-added links in the value stream,Otis Elevator Company made a great progress in shortening manufacturing cycleproduction and responding customer needs more rapidly. We hope theseimprovements of the order fulfillment process in Otis Elevator Company couldprovide a useful reference for other elevator companies as well as othermanufacturing enterprises.