Case FHG Phoenix pallets

Customer challenge

FHG Phoenix Pallets, a subsidiary of the Faber Halbertsma Group (FHG), faced the challenge of improving declining margins on their products. As one of Europe's largest pallet manufacturers and a major player in pallet pooling, it was crucial for FHG Phoenix Pallets to increase their operational efficiency. The company produces and repairs more than 20 million pallets annually and supplies to various sectors, including the chemical industry and the food industry. The specific customer request was: Improve the Overall Equipment Efficiency (OEE) of two production lines by increasing productivity and reducing changeover times.

Approach

To address this challenge, UC Group implemented a structured Lean Six Sigma approach, focused on both process optimization and cultural change within the organization. The most important steps in the approach were:

• Initiating Lean Six Sigma Projects: Two separate projects were started simultaneously, in close cooperation with FHG Phoenix Pallets management and employees.
• Comprehensive measurements and analyses: By collecting and analyzing detailed data, bottlenecks in the production processes were identified.
• Defining and implementing improvements: Based on the analysis, improvement measures were identified and implemented, most of which could be achieved with minimal investments.
• Training and awareness: To achieve sustainable change, employees were trained in Lean principles and techniques, including Kaizen events and the Lean Game, to promote continuous improvement.
• Implementation of tools and methodologies: Methods such as 5S, Total Productive Maintenance (TPM), and OEE tooling were introduced to improve the efficiency and reliability of production processes.

This integrated approach resulted in significant improvements in both operational performance and employee engagement and awareness at FHG Phoenix Pallets.

Results

Our Lean Six Sigma approach at Phoenix Pallets has yielded great results, namely:

• Annual improvement in business turnover by approximately 2.5%, payback period of less than one year
• 35% performance improvement of the first production line
• Significant reduction in variation, resulting in more reliable output
• Reduction of changeover times by 35 — 40%
• Improving employee engagement inside and outside this project
• A strong improvement in Lean Awareness and behavior

Our solution

By running two different Lean Six Sigma projects at the same time and carrying out extensive measurements and assessing, UC has defined the problem. The projects were started in collaboration with management and employees. The results of the measurements and the collaboration with Phoenix Pallets employees made it possible to define and implement improvements. Most improvements could be made with small investments.

Some of the things we have applied:

• Lean Awareness & Training:
• Kaizen Events training;
• Lean Game
• Lean Six Sigma project management;
• 5S implementation;
• TPM implementation;
• Implementation of OEE tooling;

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