ABB is a pioneering technology leader in power grids, electrification products, industrial automation and robotics and motion, serving customers in utilities, industry and transport & infrastructure globally. Continuing a history of innovation spanning more than 130 years, ABB today is writing the future of industrial digitalization with two clear value propositions: bringing electricity from any power plant to any plug and automating industries from natural resources to finished products. ABB operates in more than 100 countries with about 147,000 employees.

The Issue:

Operational excellence is critical to ABB and they had made great progress in achieving this.  However, improvement initiatives were hampered by each division and plant making improvements in isolation and these process changes were then not captured in IT systems.  ABB wanted to standardise its improvement methods and, at the same time, embed these methods into their newly acquired corporate SAP system – and they needed to do it fast across more than 300 factories.  Specifically they needed to solve issues relating to:

  1. Poor Due Date Performance
  2. Lack of Availability
  3. Long and increasing Lead Times
  4. Lower margins and profitability

The Solution:

Was it possible to create a common approach across very different operational, sales and cultural environments and then to have these standardised in a standard SAP ECC system?  

The first step was to create a Strategy & Tactics tree and then to determine what was the root cause of the key issues.

This was achieved and the solutions, based on enhancing the existing Theory of Constraints knowledge were detailed.

The final stage was designing simple solutions that could be run in the SAP ECC system.

The Results:

  • On Time Delivery average from <50% to over 98%
  • Significant inventory reduction
  • Delivery Lead Times average reduction of over 50%
  • Significant profitability increase
  • Rapid deployment from solution to design to end of pilot implementation <9 months