Less WIP = Improved OTD for Leather Goods Company!

Bins are a thing of the past as we implemented one piece flow at Rustico, a high end leather goods company. But why in the world would a company want to go to one piece flow? It’s much more difficult than batching orders together into functional work areas.

The reason is flexibility and On Time Delivery. It all comes down to Little’s Law.

Lead Time = Cycle Time X WIP

Lead Time: the time it takes a customer order to make it through your process)

Cycle Time: the time from 1 order being completed until the next order is completed

WIP: Work in Process, the number of parts or orders you have in process.

The math is simple, reduce WIP to reduce Lead Times. If you have hundreds of orders coming in for Christmas you need less WIP and faster Cycle Times. This is exactly what we did at Rustico which resulted in an estimated increase in Revenue of over $800k.