Original Date: 09/14/1998
Revision Date: 01/18/2007

Distributed receiving and supermarkets are key factors to achieving production agility. Raytheon Missile Systems Company’s (RMSC’s) seven-phase systemic approach promotes continuous improvement through the elimination of waste. This approach uses agile manufacturing processes to deliver parts directly to the production lines on an as- needed basis. Prior to 1995, RMSC housed and inspected all purchased parts in a central receiving area located 14 miles from the production facilities. The parts remained there until the individual production areas requisitioned them. Over the years, the increased usage of certified vendors and source inspections has decreased the need for a central inspection area. Four years ago, RMSC began decentralizing its receiving process by setting up individual storage locations (supermarkets) in the production areas.

Parts that do not require a receiving inspection are shipped directly to these supermarkets from the vendor. This approach enables RMSC to store parts as close as possible to the manufacturing process which uses them. By setting up the supermarkets in existing production space, the company freed up 26,000 square feet of storage space in its original receiving area. The first production area to change to the supermarket concept was the Tomahawk missile line. Since then, five of the manufacturing factories and eight of the production areas have been converted. In some cases, the company established receiving hubs to serve smaller parts storage areas or mini-marts. Today, 50% of RMSC’s production materials are delivered directly from the vendor to these hubs and supermarkets. By increasing the availability of parts at the production area, the company reduced total planned cycle times by up to five days, and decreased actual receiving processing time by more than a day.

Since implementing these processes, RMSC eliminated unnecessary transportation and repackaging costs, and reduced the receiving-to-floor cycle times from one to five days for various production lines. In addition, production teams can directly control the response time for parts and kits to the production site. RMSC continues to set up additional supermarkets as other missile production lines are switched over to agile manufacturing methods.

For more information see the Point of Contact for this survey.