Identified Cost Reductions to the Value of $500k in a Six Week Period

Client

Sequal is a saw mill that is committed to the customer and to operational excellence, supplying custom-cut radiata pine lumber – producing exactly to the customer’s needs, delivered just in time, and eliminating all waste.  Products are exported throughout the Australasian, Asian and Middle Eastern markets, supplying a variety of end customers including the furniture, construction, pallets, and packaging industries.

Sequal is based in Kawerau, on the edge of the largest Radiata Pine plantation in the Southern Hemisphere, with access to relatively inexpensive geothermal energy and close proximity to Tauranga port, Sequal has the distinct competitive advantage required to compete in a global market of lumber suppliers.

Challenge

Sequal was experiencing high levels of operational downtime, low log recovery, and high material losses, which resulted in low operational productivity. Line balancing issues also existed with bottlenecks in several areas of the plant.

Approach

Sequal’s Executive Director David Turner realised that to exploit its competitive edge and achieve the desired growth targets, the business first needed to achieve operational excellence.

After an initial gap analysis, Sequal focussed on strategy deployment to build a business case for Sequal as a world-class organisation. This was followed by an organisation-wide introduction of DMS and the development of improved business systems through continuous improvement. Training and coaching sessions ensured buy-in and capability development of staff.

Result

Significant opportunities for waste reduction were unearthed in a very short time and within weeks, simple fixes reduced losses projected to save the company in excess of $500k a year.