Case Study: DJO Global, Tijuana's Binational Success Story
With more than 17 years of operating in Tijuana, DJO's has received U.S. and International awards for its quality and operational excellence, including AME's Manufacturing Excellence award, IndustryWeek "Best Plants," and the Shingo prize for operational excellence.
Tijuana is located in the northwest corner of Mexico. The city is connected to the Pacific Basin and just across the U.S. border from San Diego, California. Tijuana is one of Mexico's top industrial cities with burgeoning manufacturing activity; it's home to 570 industrial companies with a work force of nearly 150,000.
Since the 1960s, Tijuana has become a strategic destination for consumer electronics production. During the 1980s it was called the TV manufacturing capital, and since then, it has established a reputation as a preferred destination for manufacturing. Today, the city has 50 years of experience in manufacturing, offering a unique combination of speed to market, competitive operational costs, and high-tech capabilities. Tijuana has developed expertise in key sectors like medical devices and aerospace as well as a broad supplier base.
A Regional Operations Strategy
The 40 medical device companies operating in Tijuana have gained a significant competitive edge, exemplified by the continuous expansion of DJO Global.
DJO is a worldwide leader in rehabilitation products, with headquarters in Vista, California, and nearly 4,700 employees in 25 countries. The company started its Tijuana's operation in 1994 with three stock keeping units (SKUs) and 20 people. Today based in a philosophy called "The DJO Way," it has reached 11,000 SKUs and over 2,000 employees .
The DJO Way
With more than 17 years of operating in Tijuana, DJO's has received U.S. and International awards for its quality and operational excellence, including AME's Manufacturing Excellence award, IndustryWeek "Best Plants," and the Shingo prize for operational excellence. And, during the last two years, DJO has ranked in the top three places of Mexico's "Best Places to Work."
DJO strives to motivate all levels to exceed quality requirements through operating principles, industry's best practices, and proven tools used to transform and continually improve its business. With six manufacturing locations around the globe, Tijuana's facility achieves the highest productivity rates with the lowest part per million defects rate. Based on local employee experiences and management leadership, the company has been able to integrate programs such as Kaizen, Value Stream Mapping, 5S, Six Sigma, Kanban, Cellular Manufacturing, First Pass Yield and Mistake Proofing.
In 2010, DJO Global reached an average growth of 4.2% in the international market and faced the challenge of lowering its total cost to the market, evaluating two business strategies of near-shore-onshore vs. offshore manufacturing.
The re-shoring of production from Asia to South Dakota, South Carolina, Texas, and Mexico allowed the company savings and better operational control achieving reduction in lead times (days vs. weeks), reducing transportation and logistics costs, lowering inventory carrying costs, strengthening IP protection, and accelerating new product development .DJO mapped out the options in a value stream map and total cost to the market model. The combination of cost reduction and manufacturing excellence was reflected in a lead-time reduction of 80% and inventory reduction from 84 to 14 days.
In an effort to address the opportunity in Tijuana for those companies in the medical device sector, the Tijuana EDC has put together a series of e-seminars, industrial tours, and B2B meetings that will be held in San Diego California in September within the UBM "MeDevice" show. For more information or event registration go to our website - www.tijuanaedc.org - or contact us at firstname.lastname@example.org.
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