Xuan Hoa Vietnam JSC confident to participate in global supply chain

Mechanical industry is entering a period of fierce competition in both domestic and foreign markets. To adapt, businesses must adjust themselves in time to improve competitiveness. From that fact, Xuan Hoa Vietnam Joint Stock Company has invested in technological innovation, applying productivity improvement tools, step by step participating in the global value chain.

As an enterprise specializing in manufacturing interior and exterior products, in order to join the global supply chain, Xuan Hoa company decided to invest in modern mechanical equipment. Mr. Le Duy Anh, General Director of Xuan Hoa said that in recent years, Xuan Hoa has continuously invested in machinery and technological equipment at modern advanced level of Japan, Italy and Taiwan such as 4-layer chrome-nickel plating lines with the most modern plating technology in the North today; mechanical processing line of CNC steel cabinets with punching machines AMADA (Japan); P2 bending machine of Salvanini (Italy), etc. In 2017 alone, Xuan Hoa spent 2 million USD to renovate technology, equipment and machinery, expected in 2018, Xuan Hoa continues to spend 2 million USD to serve this task.

Accordingly, the stainless steel electrochemical polishing line has an automatic technology that completely produces 2,000 products per day, the number of people working in the line also decreases from 9 to 7; labor productivity has increased to 70%. At the same time the product is high gloss, more durable, the error rate is reduced from 1% to 0.5%. The automatic continuous mechanical processing line including AMADA 2510 punching machines and Salvanini bending machines P2 produces 150 cabinets/day, 2 times higher than the old machines. The rate of failure is virtually absent, parts are punched/bended with almost absolute high precision.

According to Mr. Le Duy Anh, many partners have required the product quality to meet international standards. In response, in the middle of 2016, Xuan Hoa invited Japanese experts to consult and apply the method of productivity improvement. Accordingly, the expert has proposed the method of TPS production (Toyota production method helps flexible operation line). This method will eliminate wasted time and resources.

Along with building KPIs, implementing 5S, on average every month, 50 large Kaizen is applied by Xuan Hoa. Typically, the company has changed the production method, if in the past, 1 shipment vas 1,000 products, Xuan Hoa now only produced 100 products/shipment to reduce unnecessary inventory, reducing errors and failures.

Mr. Junji Hori, Consultant, former Production Manager of Toyota Vietnam said that the product quality control is set up more closely, associated with business and delivery plan, prioritizing the making of decisive products, preventing arising/rotating errors in all stages, preventing arising problems. Thanks to the method of producing each type of product, Xuan Hoa can defect error quickly. Xuan Hoa reduced errors from 0.25% to 0.20% and labor productivity increased by 1.5 times, while reducing unnecessary transportation or shipping time, reducing inventory due to overproduction, etc.

After 1.5 years of implementing TPS, the improvements that Mr. Junji Hori put forward, in addition to increasing labor productivity to 1.5 times, the delivery time reduced to 4 days instead of 12 days as before for 1 production batch, semi-finished inventory decreased from VND 13 billion to VND 4 billion. For maximum efficiency, Xuan Hoa continues to implement TPS and other productivity improvement tools according to Japanese production methods.

Productivity and Quality Office