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Product portfolio


So what enables these champion plants to have a competitive advantage versus peers in the region?


Figure 1. showing the product portfolio of the champions and peers in EMEA.


Despite being more than 2.5 times larger in volume blended, the average volume packed in-house by the champion plants of 57,000 is only 30% more than the regional peers at 44,000 annually. This higher proportion of bulk is one aspect that enables the champions to have a less complex operation. Figure 2 below shows the packing distribution of the champions and the peers. The champions are filling almost 80% of their volume into drums in comparison to 52% for the EMEA peers. Notably, peers fill 30% of the volume into less than 10 litre packs, and this increases the complexity of operation.


Product portfolio


In Figure 3 we see that the blend batch size (on an equipment basis) of the champions is almost 6 times bigger in comparison to the regional peers.Although the champions have some automatic batch blending, majority of the production is undertaken via manual batch blending. Notably, despite manual batch blending, champions’ batch size is more than double that of the peers’ in-line blending.


Figure 2. showing the packing portfolio of the champions and peers in EMEA.


The average blending time per batch for the champions of 6.30 hours is 20% higher than that of the peers. However, this is excellent given the difference in batch sizes. When the batch sizes are evaluated on a product basis (see Figure 4), the champions’ have a substantial advantage across all product type aside from gear oil. The economies of scale in conjunction with faster utilisation rates boost productivity in the production department.


Continued on page 24 LUBE MAGAZINE NO.149 FEBRUARY 2019 23


Productivity and batch sizes: Champions versus the rest Table 1 below shows the productivity of the champion plants versus the peers in EMEA across all core activity areas of the plant. The champion plants in EMEA have a better productivity position across the board. In labour intensive departments such as small pack filling, the champions require a factor of 23% fewer full time equivalents in comparison to the peer, even though their focus (volume wise) is on large pack filling. In addition, the in plant General & Administrative operations is significantly more streamlined. In EMEA, 58% of the plant operating expenditure (OPEX) arises from personnel related costs such as salaries, benefits, social costs, etc. Thus, this streamlined effort enables the champions to gain a competitive advantage versus the peers. What is it about the processes of the champions that promote productivity?


Table 1. showing the productivity of the Champions and Peers across core activity areas of a lubricant manufacturing facility.


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