CONTENTS
1.0 Executive Summary………..……………………………………………………………………………………….2
2.0 Question 1: Has Siemen’s kalwa Plant been e ective in achieving Lean implementation…4
3.0 Question 2: How was the organization’s change process managed?…………..………………...8
4.0 Question 3: What resistance did Khandekar face in implementing the change and why?12
5.0 Question 4: How DID KHANDEKAR HANDLE THE RESISTANCE TO CHANGE?………………...14
6.0 Question 5a: How was the lean implementation Institutionalized in the new set-up?.....17
7.0 Question 5B: What more does Khandekar need to do so that the changes are not
reversed?…………….…………………………………………………………………………………..……………….…..18
8.0 Reference…………………………………………………………………………………………………….………20
CMGB6104: Operations Management Project
1.0 EXECUTIVE SUMMARY
Siemens started an office in Mumbai and Kolkata in 1920s. Due to World War II, the operations
were forced to shut down for a while. As soon as the war over, Siemen re-enter India and since
then Siemens grow and expand rapidly. In 1964, the company build a new complex at Kalwa for
switchboard, switchgear and motor assemblies. As a result, by 2009 40% employee of all
Siemens India employees were working in Kalwa factory and it contributing 45% of the total
Siemens India production among the other factories in Nasik, Calcutta, Aurangabad and Goa
respectively. The Kalwa factory comprises of three assembly facilities for switchgear (WSGR),
switchboard (WSWB) and motors (WMOT).
Siemens in India is structured into four business divisions: Industry, Energy, Healthcare and
consumer products. The above mentioned assembly lines belonged to Energy Division. In
October 2006, Siemens AG decided to implement lean manufacturing in the Kalwa factory as
part of a worldwide rollout of the Siemens Production System (SPS) in all its medium voltage
facilities under this division. The objectives of implementing lean system were to bring
significant improvements in labour productivity, lower inventory levels and higher throughput to
improve the factories’ financial performance. Translating into measurable goals, the lean
program will assist the factory’s current capacity of 4,000 panels per year could be increased by
approximately 50 per cent to 6,000 panels per year within two years and to about 12,000 panels
within the next four to five years.
The lean initiative was a 2 years project ended in 2008, the outcome as a result of strong
commitment from a dedicated team have brought significant improvement to Kalwa factory.
CMGB6104: Operations Management Project
During the implementation, the company faced several challenges, including restructuring the
organisation, getting staff on board to accept and facilitate the change, and handling resistance
from internal and external stakeholders. The paper has presented insight information of how the
management led by a team of key personnel Vaibhav Khandekar, Vedak and Manfred Gewarld
overcame the obstacles throughout the journey of implementation.
2.0 QUESTION 1: HAS SIEMEN’S KALWA PLANT BEEN EFFECTIVE IN
ACHIEVING LEAN IMPLEMENTATION
Even though the Kalwa factory was perceived as one of the good lean implementation models by
the Energy News platform, there had been both effectiveness and ineffectiveness in the process
of implementing the lean system. Therefore, we will analyze the effectiveness and
ineffectiveness in achieving lean implementation and inspect the problem of the independence
processing between lean and redesign projects.
Effectiveness in achieving the lean implementation
There had been some efficiency at the starting point of the lean implementation. It is because
when they implemented lean system, all workers from top management to blue color workers
had recognized the inefficiency of their previous manufacturing cycle. For example, before lean
system, because of batch manufacturing system (previous system), each panel which was in the
process could not proceed next stage until entire procedure were finished. Therefore the lead
time of one particular panel was very long period of time expressed below.
CMGB6104: Operations Management Project
When a company want to adopt lean system, it is very important that all of the members in the
company should know the needs of the lean system. In this point, this company had good
advantage when they install the system.
Furthermore, countless inefficiency of the logistics divisions deferred batch processing. In
majority of the cases, errors which had a ripple effect on the overall manufacturing process and
had caused rising amount of scrap in the form of metal modules were amended on the factory
base without noticing the facts to the relevant managers.
Another factor sparking lean implementation was coming from outside of the company, the
increase of customer orders in 2006. Until 2005, by using batch manufacturing they could
produce only approximately 4,000 panels and it was already their full capacity. Meanwhile from
2005 to 2006, the requests of the panels had soared more than 75%, being expected to reach
7,200 panels, which was difficult for the company to cope with.
In October 2006, Siemens AG proposed the implementation of lean manufacturing to the Kalwa
factory, with the expectation of increasing labour productivity, lesser inventory quantities and
advanced throughput. The specific expectation of the lean implementation was that the current
capacity, 4,000 panels per year, could be increased to 6,000 panels per year within 2 years and to
12,000 panels for the next 4~5 years.
In January 2008, when several key personnel of Kalwa factory visited some other plants which
had achieve successful lean implementation, they could see the lean plant in operation and
CMGB6104: Operations Management Project
uncover the benefits of the lean system. Therefore, this visit provided management self-
confidence that the lean implementation would be advantageous in various ways.
Beginning stage of lean implementation
When the team which was designed under Kulkarni to conceptualize the lean implementation in
the switchboard factory studied the present line in detail and clarified the possibility of
implementation on lean to VCBs, numerous structural changes occurred in switchboards from
October 2006 to October 2007. For instance several directors including Kulkarni and Khandekar
who were responsible for the mounting lean system were promoted to higher position, which
deferred the practice of lean project from the inauguration.
In addition, the installment of the lean system necessitated reorganization of both the layout and
