The SCGM Way

Posted on 25 Nov 2011

Month after month, the Lean Management Journal will observe the lean journey of Serbian-based injection tools manufacturer SCGM. Share your comments, suggestions or thoughts – this is what the Lean Diary is for, learning from others and discussing issues.

After being conceived as the Toyota Production System by Toyota Motors in Japan, lean management has proved to be a very effective tool for many other large corporations. They fully understood what Toyota pioneered and the tremendous potential of lean, and they learnt how to use it to their advantage.

And then there are small and medium enterprises, which constantly struggle to keep their place in the global market. Looking up to larger companies, they too have recognised continuous improvement is a way of reducing costs while increasing the quality, thus achieving, to some extent, world class performance.

The Republic of Serbia, shaken by political instability and economic crisis for years, has been in a slump for a very long time, with high unemployment rate, low income, corruption and general dissatisfaction among people. These factors made the country very unattractive to foreign investment and kept it out of international affairs. However, after a change in the political regime, the overall situation has started to gradually improve. A highly skilled and qualified workforce, in particular, has made Serbia a much more appealing market for foreign investors.

There is some good ground to work on, hard-working and skilled people to work with and a will to improve things, locally and nationally. And this is our starting point.



SCGM is one of several SMEs operating in Serbia. It is a multinational enterprise (present in Germany as well), founded in 2004. Since then, when it counted only two directors, the company has grown and now has 50 employees. SCGM is specialised in the design and moulding of injection tools, injection moulding and assembling.

Our philosophy is to achieve top quality and knowledge. In order to do so, the simple tools we used along the way proved not to be enough. We constantly faced losses, waste and poor workplace organisation.

Having found out about lean methodology, the owners visited a seminar in Kragujevac, Serbia, where they sought a deeper understanding. The idea of continuous improvement, presented by experts in that field, immediately appealed to them and stuck in their minds. Recognising the various types of losses in the process, analysing the main causes and reasons, defining the right actions, improving processes and performances and eliminating losses is what the lean was offering them. They soon decided to introduce the new methodology in SCGM.


The beginning of the journey

The methodology proposed by Tecla Consulting, the consultancy called to support the company’s journey, is oriented towards the improvement of the overall operational and managerial performances, systematically involving everybody working inside the company and organising work within it.

This involvement results in a behavioural change focused both on continuous improvement and on the maintenance of the improved operational standards. The empowerment of people at all levels of the organisation and the definition of precise operational standards allow for the delegation of daily management activities (such as autonomous management of workstations): a strong training effort is being made to develop management capabilities necessary for improvement.

The solution of complex and crossfunctional problems – the basic requirement to achieve performance improvement – remains a greater responsibility of top level management that will work against problems with specific teams.

The role of leaders is to lead the development of the overall capabilities in a harmonious manner, and, in particular, to orient the strategy, choose the themes and fix the targets starting from the deployment activity.



The SCGM Way to continuous improvement consists of four phases: a Foundation phase and three development phases (Pilot, Expansion and Stabilisation).

The project started in September and, until now, the first two phases have been introduced into the company.

The Foundation phase helped people to understand the meaning and main activities of the SCGM Way programme. Various tasks and simulations of the problems and solutions were provided, one of them being the Tennis Ball game. People were divided in two teams of six, and they were given tennis balls that they had to pass to each other in the shortest possible time. Through the game, the employees recognised the issue of time loss and the importance of team work.

Besides this, the main tools were utilised, a Steering Committee was created and future activities were planned.

By the end of the phase, PDCA for the various activities was carried out – employees worked on reorganising the workplace, cleaning up everything, both in the offices and on the shopfloor, taking photographs before and after.

In the next phase, pilot teams were launched with the aim of attacking some of the most critical problems the company faced and also of starting to prepare for data collection. However, like in the first phase, people were first taught how to do it and given examples as well as tasks. This time, they were given the task to complete a weekly data collection of one company and, based on it, they had to understand and calculate the OEE. This way they found out which and where the main losses were and where to ‘attack’ first. The task was successful, and the application of the lesson they have learned will soon follow.

The Steering Committee, together with the consultant, visited the assembly department, recognising waste on the very spot. Assembly employees were involved in the whole process, to let them know their role is crucial.

Over the next few weeks, the programme will focus on the project areas identified by the committee, pilot teams will work following a PDCA approach, kaizen activities will be reported to follow up on the improvements in terms of results and benefits for SCGM.

To be continued…