Rutter Technologies - performance improvement

"Our overall productivity has increased upwards of 28% and best demonstrated at 44% improvement in various areas throughout our organization. I definitely recommend Grant Thornton Productivity Improvement."

Fraser H. Edison, Executive Vice President

Productivity improvement - manufacturing services

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Objectives
Through our review of the current management system, technology systems and business processes across the organization, we determined three key objectives:

reduce working capital requirements
improve data accuracy
increase labour productivity

Approach
The Grant Thornton Productivity Improvement team used the following approach:

Utilized the "Structured Approach" in all business functions
Redesigned cross functional business processes to: streamline production, improve cash collection efforts, and eliminate non-value added activities between departments
Created production planning and control department to level-load production cells to increase throughput
Identified opportunities to increase capacity

Implementation
We achieved our objectives by:

Developing new tools and procedures for resource planning and scheduling, target setting, and performance reporting
Clarifying roles and responsibilities to improve accountability surrounding management of data and information
Redesigning business processes across all operational functions to eliminate non-value added activities
Building departmental dashboards and balanced scorecard

March 30, 2009

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Client

Rutter Technologies Inc. is a global enterprise providing voyage data recorders, enhanced radar solutions, marine certified interfaces, custom integrated electronics systems and electronic subassemblies for clients in the marine, defense and telecommunications sectors.

Market capitalization of $10MM
Offices throughout Canada & Europe
Fully integrated – research and development, manufacturing, marketing and sales

Industry trends

Downward pressure on gross margin as overall unit prices decline across the industry
Significant customer demand to decrease order-to delivery lead time
Investment in R&D required to diversify product/portfolio to capture market share

The situation

Strain on working capital resources as inventory and accounts receivables increased
Increasing number of late deliveries
Inherent distrust in system data leading to manual checks to validate data
Lack of fact-based decision making
No formal schedule execution and follow up leading to poor labor productivity

The goal

Reduce manufacturing labor costs and overtime
Decrease average monthly inventory on-hand
Lower accounts receivable to sales ratio
Improve on-time delivery and reduce number of units on backorder for manufacturing services

Results

Overall productivity improvement of 28% across all production areas and best demonstrated of 44% in various areas

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