Deployment of Lean Manufacturing in Palm Oil Mill for Maximum Yield: A Case Study of Leading Palm Oil Producer in Nigeria

Abstract

The deployment of lean manufacturing in the palm oil mill companyaimed at maximizing yield, was thoroughly investigated. The company has been experiencing a decline in palm oil production, adversely affecting productivity and customer satisfaction. The methodology employed for optimization encompassed a comprehensive system description, detailing the case study company's history, operational modalities, production machinery, and system challenges. To gather a holistic understanding of the company's current situation, data was meticulously collected through questionnaires, examination of company records, and other relevant sources. Microsoft excel software was then utilized to analyze the acquired data. The implementation of lean manufacturing tools, such as the fishbone diagram, identification of eight deadly wastesand takt-timeplayed a pivotal role in streamlining operations. In addition, a quantitative model of the supply chain was applied, utilizing critical path method (network analysis) to determine the optimal route. The results derived from the application of lean manufacturing tools and the supply chain quantitative model exhibited a remarkable improvement between (2012-2016) and (2018-2022). The average oil palm extraction increased substantially from 8.67% (2012-2016) to an impressive 30.52% (2018-2022). Furthermore, the management tools led to a significant reduction in machine downtimes, decreasing from an annual average of 5,498.6 hours to 2,472.4 hours. This improvement resulted in a considerable reduction in the annual total average cost of machine maintenance, plummeting from #1,899,578.6 to #261,853.8. The optimization efforts also extended to the supply chain, where selecting Path-2, exhibiting the least total supply time of 11 hours, significantly reduced the cost of supply from an average of #2,168,402 to #1,893,186. Overall, the net revenue of the company witnessed a remarkable surge of 71.99% post-implementation of these management tools. This comprehensive approach not only addressed production challenges but also had a substantial positive impact on the company’s financial performance. The strategic deployment of lean manufacturing emerged as a catalyst for sustainable growth and enhanced operational efficiency.