Recently, Shandong SEM Machinery Co., Ltd. (SEM) received an award from China Machinery Enterprise Management Association. Among hundreds of manufacturing facilities across the country, the company's new Axle/Transmission Value Stream facility became one of 42 winning workshops to be honored "National Machinery Industry Outstanding Workshop" during a nationwide competition. This is the first time that SEM received this award.

Established in 2003, this annual competition serves as a platform for grass-roots facility management professionals to promote and exchange facility management approaches and experiences. The Qingzhou-based facility was recognized for excellent operations performance by establishing effective structures and processes, which resulted in positive gains in employee safety, product quality, cost savings, and workspace and equipment management.

Built in 2010, SEM's Axle/ Transmission Value Stream facility houses a construction area of about 28,000 square meters for manufacturing of various axle, case and cover components as well as assembly, testing and painting of SEM's products. Currently, there are nearly 300 workers in the facility, operating a total of 78 machining equipment.

The facility was entering a new era with the successful deployment of the Caterpillar Production System (CPS) since 2008. The average continuous improvement proposed by each employee reached over eight, leading to an annual cost saving valued at more than RMB 1.5 million. Till 2011, the facility has completed 154 Six Sigma projects, six of which won Caterpillar Chairman's Safety Awards.

In the past years, the facility supported the R&D team to expand product lines by introducing low- to high-end offerings to tackle different market segments. Meanwhile, the facility's production capacity has been improved from less than 10,000 to 23,000 units, which greatly contributes to SEM's business growth.