Strategies for Productivity Improvement in Manufacturing Industries (Case Study of Del Monte Kenya Limited)

Abstract

The basic goal of manufacturing industries is to maximize profitability in order be competitive and stay in the market. This is mainly achieved by producing products at low cost to maximize profits. However, low productivity has been the major problem facing most manufacturing companies. Del Monte Kenya Limited (DMKL) has been used as a case study in this research to represent manufacturing industries. Two major sections that are affected by low productivity in DMKL processing plant are labelling and Packing section. Productivity in these sections stand at an average of 50% of the rated capacity hence there is need for productivity improvement. Low productivity is attributed by many factors, which include low equipment performance, equipment unavailability, ineffective resource utilization and production wastes. The effects of low productivity includes increased production costs, decline in production thus difficulties in meeting targetf. and customer demands. The problem at hand that needs to be addressed is the low productivity at DMKL processing plant. The purpose of this study was to explore the factors affecting productivity and determining strategies to improve productivity in DMKL plant. This was achieved by investigating the impact of various variables affecting productivity. The causal factors behind low productivity were explored through root cause analysis techniques, 5 'Whys' and Ishikawa diagram (fishbone). Documentary review through context analysis was done to determine various strategies. Decision tree analysis was used to evaluate viable strategies in· order to come up with the most effective strategies for improving productivity in DMKL plant. From the study, it was found out that equipment availability, performance and inventory have a significant relationship with productivity. The problem of low productivity is caused by equipment unavailability, poor performance and excess inventory. The causal factors for equipment unavailability and poor performance were identified as breakdowns, power failure, stoppages and equipment setup. The root causes of equipment unavailability and poor performance were identified to be equipment breakdowns and power failures. Inventory was also found to be the greatest hindrance to productivity, the causal factors for excess inventory was identified as low sales, high product price, and high production cost. The root cause of excess inventory which directly affects productivity was identified as high production cost. Equipment availability, performance and inventory significantly affect productivity in DMKL plant. It is evident that improving equipment performance, availability and reducing inventory to an economical level in Del Monte Kenya plant improves productivity significantly. Total Productive maintenance (TPM) and Lean manufacturing system were identified as the most effective strategies to solve the problem of low productivity in DMKL plant. By applying and implementing these strategies, equipment breakdowns and production cost are reduced which significantly improves productivity. Similarly, investing in a cost effective green energy power plant would solve the problem of power failures. From this study, manufacturing industries can use the result to help identify the factors that affect productivity by using decision tree analysis to establish the best strategies to improve productivity.