Aerospace & Defense Case Study
Ontic Manufacturing and Engineering, Inc.
Headquartered in Chatsworth, California, Ontic Manufacturing and Engineering, Inc. (Ontic) is a leading Aerospace producer of Original Equipment
Manufactured (OEM) licensed components and assemblies. Ontic provides quality services for repairing aerospace valves, fuel pumps, actuators, control
products, and has recently added electronic components. Ontic had 103 employees at the project start and has been in business for 53 years. The business
is projected to reach $28M in 2004, up from $24M in 2003.
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“CMTC made a huge difference to us. Their full
service approach provided extremely effective
productivity improvements.”
Jim Gerwien
General Manager
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Issue/Needs
CMTC completed an enterprise assessment of Ontic’s operations in May
2003. The result of the assessment clearly established the priorities for
improvement in order to achieve the company’s objectives which were:
improved integration of new aftermarket licenses in the aerospace industry,
increased profitability while improving margins on incremental business,
better focus and management of resources especially in work scheduling,
production, and inventory management, improved communications
across the enterprise from order entry through the billing cycle and more
accurate and timely data from the existing IT platform. Ontic’s strategic
business challenge was to grow revenue per employee while improving
customer satisfaction.
Implementation Highlights
In June of 2003, CMTC and Ontic embarked on a Lean Enterprise Value
Stream Mapping project, which included consulting, implementation and
employee training. Due to the complexity of the business model, the
project began with a high level business process map. Processes such as;
product engineering and design supplier outsourcing, and customer
mapping. Based on the analysis, recommendations were developed with
Ontic team members to streamline processes by eliminating waste in
operations.
Improvement Description
CMTC facilitated the implementation of several improvement projects
including: Cellular Workflow and Information Technology Solution in
the Document Control area. Training classes empowered personnel to
pursue other improvement projects on their own such as mapping the
Electronic Work Release Process and the Work Order Process. Seven
process improvement changes were identified with the future state resulting
in cycle time improvements. Kaizen Events and continuous improvement
projects came from the training sessions as employees viewed their roles
as both supplier and customer in the internal supply chain at Ontic.
Financial and Investment Impact
The above projects yielded the following benefits: future state improvement
amounted to a 39% improvement over the productivity in Document-Control Process resulting in a savings of approximately $50,000 annually.
Other VSM improvements included an administrative labor reduction
from 17 to 3 minutes in document process saving 573 hours per year.
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