Case study · Food & Beverage
Turkey processor gains $8.1M at its pilot complex without new capital
A turkey processor had tried to buy its way to profitability with automation, only to see overhead eat the gains. USC piloted a cost and yield program at one complex, then rolled it out to every complex.
Results
$8.1M
in gains at the pilot complex, with no new capital
34%
reduction in labor cost per pound in further processing
15%
reduction in labor cost per pound in the fresh plant
Pilot results came within six months; the processor then rolled the program out.
The situation
Facing rising costs and relentless competition, the processor invested heavily in technology and process automation to buy its way to profitability, but higher overhead soon ate away the gains.
What the assessment found
- More than 300 loss points in the fresh plant
- Waste and process variation lowering yields, throughput and productivity
- Non-value-added activity in the formal and informal operating systems
How the work was done
Fresh plant: attack loss points
Cross-functional teams ran value stream analyses, improved workstation layouts and material flow, trained key yield positions and worked down more than 300 loss points.
15%
reduction in labor cost per pound
Cook plant: control each step
Set process control parameters from raw material receipt through shipment for whole-muscle and ground products, and improved sanitation for clean start-ups.
6.1%
increase in yield
Maintenance: plan the work
Installed a management reporting system to plan resources, skills and preventive maintenance, improving uptime and line efficiency.
12%
reduction in maintenance operating costs
Supervisors: build the skills
Trained supervisors in waste elimination, process mapping, problem solving, statistical process control and management control systems to sustain the gains.
Lasting impact
The pilot complex gained $8.1 million without additional capital. The processor then took the program to all its remaining complexes, where nearly $100 million in gains was identified once the programs were in place.
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