Category Archive:Lean Manufacturing

Lessons from Detroit, for manufacturers ( admin posted on August 6th, 2013 )

Dr. K. (Subbu) Subramanian
President
STIMS Institute Inc.

 “Automotive industry is doing well in the USA; Detroit goes bankrupt” – What does this headline tell us about the claimed resurgence of manufacturing in USA?

In the past, there was a close connection between the innovators and investors. Both of them lived and worked in the same place like Detroit. The role of investors and innovators was inseparable and inter-mingled. Today, the roles of investors and innovators have been separated.

Innovators are those who Discover, Develop and Deploy a stream of new solutions of added value. These end to end innovators displayed unique Transformational Skills to render new ideas into reality. Their impact also helped the community around them flourish. While they relied largely on local resources, the financial fruits of their labor was also shared and enjoyed by the community around them. They also invested their rewards for further growth of the community. As a result Detroit flourished.

The innovators and their Transformational Skills are needed today as well. To identify a need as an “opportunity,” frame that as a solution in a comprehensive manner (as an input/transformation/output system), and execute that to completion is the need today as much as it was in the hay days of Detroit. The global reach for resources across the globe as well seeking out customers across the globe is a great boon for all innovators.

While the innovators live and work in the main streets, the investors now work in the Wall Street. The investors also live (or at least park their wealth) across the globe. The focus of the investors on their needs vs. the need to focus on the community around them has also been separated. These divergences have been evolving for the past four decades. “Let Detroit go bankrupt” was the slogan. Now Detroit is indeed bankrupt!

What are the lessons to be learned, If you are a manufacturer?

Do not wait for some investor to tell you what you are good at? Do not wait for someone to define what “Manufacturing” is? Products, Processes and Applications knowhow are your core capabilities, which are embedded in the knowledge of many people connected with your company – through your employees, suppliers and customers and their customers. These three core capabilities and the value exploited through them is manufacturing.

Product is something of value to someone (the user), who is willing to pay you (the manufacturer) the value you deserve.

How well do you know your Processes to manufacture your products? They are not “black box” that nobody knows anything about, after Joe Smith retires from the company! They are not merely SAP, ERP, MRP or any of the myriad of IT driven tools. All processes are “Input/Transformation/Output” systems. In the past years, the few who knew about the physics of the process intuitively could tweak them and keep them going, while others were simply pairs of hands to help them out. You can no longer think like that.

You would not like to see any medical professional without a stethoscope and a thermometer. Then, why would you not want all your manufacturing process professionals – your employees as well as suppliers and customers – have similar capability to measure and diagnose and cure the problems with respect to all the manufacturing processes and their health?

How well do you know your customer’s processes (Application) and how can you add value in their processes through your products? You can make your Applications Technology (AT) the enabler for your growth and success in the manufacturing industry, just as you have IT solutions providers for your computers and IT systems. It is about time, you helped your customers in a “health checkup” on their processes, while they use your product. After all, strong and healthy customer processes are essential for your long term strength and success.

Product, Process and Applications know-how are your core capabilities. They are the bench strength of your team. Build your bench strength and then you can do more with them enabled by all the plug and play IT capabilities. Your journey for the future can start right here and now, by developing a common definition of your “Product” and the key “Physical Processes” that enable your product, as well as the “Applications”. Then develop a system view to study and manage these core capabilities across all your business functions that support them. Build further alliances based on these core capabilities with your customers and suppliers. Let this manufacturing eco-system flourish. If you do, then Detroit along with others will also flourish.

You certainly need investors to help you out. But, you cannot build a manufacturing industry without the brick and mortar (i.e) Product, Process and Applications Technology. Have you taken the time to cultivate the manufacturing eco-system based on these core capabilities? The alternative is to repeat the history of Detroit in many other cities and communities in the USA. ME

 

Dr. K. (Subbu) Subramanian, Fellow – SME, is the President of STIMS Institute Inc. www.STIMSInstitute.com. His company specializes in growth strategies and innovation for industrial manufacturing companies and education / training for mid-career professionals and their development. After graduating from MIT, he has worked across the globe in the manufacturing sector for over 34 years. His new book, “Thriving in the 21st Century Economy: Transformational Skills for Technical Professionals” is co-authored by Prof. Srinivasa Rangan.  

- See more at: http://www.sme.org/MEMagazine/Article.aspx?id=74574&taxid=1433#sthash.P6pX8sST.dpuf

Next Generation Manufacturer Newsletter – May 2013 ( admin posted on May 7th, 2013 )

Events for Manufacturers
May 2013

Attend one or all of MassMEP’s events and you will learn and gain real-world knowledge that you can immediately apply in your company. Below is a sampling of some of our upcoming events. For a complete list of course descriptions and registration information on all of MassMEP’s events, visit the MassMEP web site.

MassMEP Programs & Events
For complete details about these programs for manufacturers, visit the MAC Events Calendar.

Partner Events

April 2013: Next Generation Manufacturer Newsletter…

From the Desk of Jack Healy
The Demand of More for Less Falls on Small Manufacturers’ Shoulders. Jack Healy.

Workforce Strategies
Manufacturing Skills Academy Network News. MSAN.

Critical Skills Assessment: Identifying What Needs to be Taught and to Whom. Critical Skills Assessment.

Business Owners’ Corner
You’ve Got a New Product Idea. Scared S**tless? Now What? Part 3. The Inventing Life.

Partner Highlight
Mass Growth Capital. Mass Growth Capital.

——————–

About the Manufacturing Advancement Center
The Next Generation Manufacturer Newsletter covers the business of manufacturing in New England. Running a manufacturing business requires attention to countless details. To compete in this new, global economy, you must pay attention to the entire business process — from front office marketing and accounting, to back end inventory management. The Manufacturing Advancement Center is here to guide you in your quest for continuous improvement throughout the enterprise. For more information, see http://www.massmac.org

From the Desk of Jack Healy ( admin posted on January 24th, 2013 )

Facing the New Challenge of Growth Through Innovation

Jack Healy, MassMEP Director of Operations

Jack Healy, MassMEP Director of Operations

By Jack Healy, Director of Operations, MassMEP jackh@massmep.org

“Finding ways to help smaller firms to innovate could help many of them remain competitive and expand their operations.” – 2012 Staying Power II Report Card on Manufacturing

Over the past decade, the continued job losses in US manufacturing have been attributed to a variety of causes — productivity increases, production offshoring by large manufacturers, even a general lack of US manufacturing growth. The good news is that we have seen a leveling off of job losses over the past two years and this is now reflected in our state’s manufacturing Gross State Product (GSP).

Manufacturing Gross State Product Increases
Massachusetts’ manufacturing GSP for 2000 to 2007 was mired in a slow growth mode, increasing by only 1.3%.  From 2010 to 2011, Massachusetts manufacturing Gross State Product increased by 20.9%! What happened?

This turn-around was engineered by manufacturers remaining committed to continuous improvement activities to boost productivity, innovation, and, subsequently, competitiveness in their respective sectors.  The “2012 Staying Power II report card on manufacturing1 found that the initiatives pursued over the past five years to grow manufacturing operations in Massachusetts produced results.

  • Nearly five out of six firms (83%) invested in new manufacturing equipment.
  • While investments are certainly part of the story, half of all firms (50%)invested in education and training of their employees in order to keep their skills current with new technology.
  • Just about half of all firms (47%) expanded their sales and support efforts.
  • Almost the same proportion invested in product research and development, including more than one third (34%) of the over 5,000 small manufacturing enterprises (under 20 employees) and nearly three quarters (72.9%) of larger firms (over 101 employees).

The Staying Power II study validated these findings when they surveyed manufacturers on the use of borrowed funds. They found that 16.8% of the small manufacturing enterprises (20-100 employees) and 30.4% of the larger manufacturers (over 101 employees) used their borrowed funds to support their research and development initiatives. This finding came as a surprise in that most small manufacturers have traditionally managed with fiscal agility, i.e., by making small bets. While few manufacturers suffer any shortage of ideas, their fear of risk has always minimized their ability to turn concepts into cash. It is reassuring to see that a significant number of small manufacturers have learned the lesson of 2009 — that there is not enough business to go around and in order to get it you have to work at it.

Because innovation is “so critical to the survival and prosperity of Massachusetts manufacturing,” the Staying Power survey probed extensively about the type of innovations manufacturers were utilizing. The results of this are contained in the following “Innovative Activity and Innovation Score.”

For anyone who wishes to assess their own firm’s innovation performance, grade your company according to the above and then benchmark against the survey participants, as follows:

Survey Innovation Score

Innovation Level

0-10

Very low

11-20

Low

21-35

Average

36-50

High

51 +

Very High

Innovation Index and Increased Production
One of the major survey findings was that only 29% of the firms who scored “very low” on the Innovation Index expected to increase their production levels over the next five years.  This is in sharp contrast to the 88% of the firms who scored “High” or “Very High” on the Innovation Index; they expect to increase production over the next five years.

Of all the firms in this manufacturing survey, the firms with fewer than 20 employees, who represent over 72% of all manufacturers  in the state, had only 6% of their firms with “Very High” Innovation scores.  Over one third (35%) of these firms were in the “Very Low” category, with more than half (56%) scoring either “Very Low” or “Low” on the Index.

Significantly, the survey indicates that “finding ways to help smaller firms to innovate could help many of them remain competitive and expand their operations.”

Continuous Improvement Enables Innovation
Over the past decade, the small manufacturing community has focused on implementing continuous improvement techniques such as Lean, Six Sigma, etc. This acceptance and application of the continuous improvement programs was an enabler for manufacturers of all sizes to deal with the changes and market demands of the last decade. However, market demands change and today we find many of today’s large manufacturers are asking their suppliers to move up the technology ladder.  This change, in turn, offers the small manufacturing community the opportunity to compete on innovation rather than on price, as well as provides a significant opportunity to grow their respective companies.

Manufacturers looking to access new technologies in order to grow their companies can find assistance from the MassMEP. Contact Greg King at 508-831-7020.

1. Prepared by Northeastern University, Kitty & Michael Dukakis Center for Urban and Regional Policy.

From the Desk of Jack Healy ( admin posted on January 9th, 2013 )

A Story of Knowing Customer Requirements & Exceeding Expectations

Jack Healy, MassMEP Director of Operations

Jack Healy, MassMEP Director of Operations

Conventional wisdom at the time was that only a small segment of dissatisfied customers ever complained as few believed there would be any reaction to the complaint.  Nevertheless, smart companies took the approach that those who did complain provided a chance to rectify problems and turn opinions around before they could affect other consumers.  As a result, consumer service departments were focused on answering and rectifying consumer complaints.

Since LEGO was spending millions of dollars in TV advertising to build its consumer base, there was a real sensitivity in this startup to the high cost of customer acquisition and the need to retain every consumer. A complete Consumer Services department was established, even with minimal sales in the first year. We found that consumers of LEGO, both young and old, had a passion to share their experience with the product. We started to receive hundreds of letters endorsing product along with their ideas for improvements and future products.

Many of these endorsements were used as part of our sales presentations. They made it easier to increase distribution channels as few purchasing agents could say “no” to a product that had such strong customer support.  The consumers helped to sell the product. The letters received soon ran into the thousands and were closely monitored. They played an important and continuing role in shaping future product offerings.

These testimonials were important input that the LEGO Group companies continue to promote by asking for customer feedback through their web sites, loyalty VIP clubs, and a myriad of sales collateral materials.

All of this does seem to be in direct contrast to the general manufacturing sector where customer input is rarely sought unless you are an ISO registered company (which requires that you do so).  The recent study of the Massachusetts manufacturing industry, Staying Power II: A Report Card on Manufacturing, completed by Professor Barry Bluestone of the Dukakis Center for Urban and Regional Policy at Northeastern University, summed up the industry’s perception relative to customer demands in the following table.

MASSMAC Image

MASSMAC Image

This summary lists the changes expected to occur over the next five years by the surveyed manufacturers. Across all firms, nearly 46% responded that to a “Large Extent” or “Great Extent” their customers would be coming back to them asking for lower prices. The manufacturers also believe that customers will not only demand lower prices but improved service delivery and better product quality. Only one in eight did not expect greater pressure on service and quality, while 40% of the firms felt that there would be a substantially increased demand for better service, and 36% suggested a very strong demand for quality.

About a quarter of all firms (27%) expect grater pressure to increase the use of new technology and 24 % expect that this would lead to increases in productivity.

The study also found that to a “Large Extent” or “Great Extent,” 51.3% of the companies over 100 employees, expect substantial increases in new technologies. These medium to large size companies are representative of the Original Equipment Manufacturer (OEM) population. This information gives supply chain manufacturers an early indication that they will be required to understand how their OEM’s will innovate and evolve over the forthcoming years. Support must be provided movement into new technologies. Changes in technology will take much longer to react to, plan for, and support than the previous requirements of price, quality, and delivery. Manufacturers will need to develop and implement plans that coordinate external customer feedback and required improvements to their own technology. The one thing that is certain that over the next five years is that businesses will continue to evolve and change, and delighting the customer will be essential for any enterprise in a slow growth economy.

What does it take to delight a customer? Let’s return to the LEGO example. It has evolved into responding to thousands of phone calls, e-mails, letters – all in ONE DAY.  Watch the video demonstration of how LEGO delights its customers, exceeds expectations, and builds a sustainable company.

VIDEO: Why LEGO is the BEST Company in the World

Growth Manufacturers Case Study ( admin posted on December 12th, 2012 )

Growth Manufacturers Case Study

Product Diversity, Quality, Manufacturing Flexibility Lead to Growth in Down Economy

By Karen Myhaver, MassMEP

Curtis Industries is the leading designer, manufacturer, and supplier of weather-tight cab enclosures for commercial, specialty, and recreational vehicles from John Deere, Polaris, Yamaha, Kubota, Cub Cadet, and Kawasaki. They also manufacture snow and ice equipment like plows, blades, and spreaders. Curtis employs 140 employees in Worcester, Massachusetts.

Challenges of Rapid Growth

“While we did experience the macroeconomic declines in 2009, we were able to flex the organization as needed to remain fiscally solvent.  This was in a large part because we implemented continuous improvement activities and supply chain strategies that paid dividends even in the decline. We also had a constant pipeline of new products, and the addition of a few new customers that helped offset other drops in demand.”
— Gabor Hajos, VP of Operations, Curtis Industries

By 2006, Curtis Industries had built a reputation for high quality products within their industry and OEMs orders were increasing. With a heavy focus on meeting production schedules, maintaining quality, and satisfying customer demand, little attention was paid to their manufacturing facilities. As a result, the operation became disorganized. As is typical during periods of rapid growth, Curtis Industries had fallen victim to the practice of locating machinery and items “wherever they fit” on the shop floor. Eventually this resulted in operational inefficiencies and quality issues, leading to customer and employee frustration. The situation also cost Curtis Industries money. They recognized the need to implement top-to-bottom quality and continuous improvement programs to manage their growth effectively.

CI & Workforce Development
The Massachusetts Manufacturing Extension Partnership(MassMEP) worked with Curtis in the areas of quality, systemic continuous improvement, and workforce development. These activities helped Curtis meet the demands of a product evolution, allowing them to efficiently and successfully increase and diversify their customer base.

The initial evaluation showed that the flow was terrible across all three of Curtis’ buildings. Issues were addressed – from front office and engineering to shop floor and shipping – by cross functional employee teams who studied each area and developed plans for new layouts. Six months of planning and another six months of moving went smoothly because the employees were involved in the projects and understood why changes were needed.

 

Efficiency and quality were further improved through process, and 5s Kaizen activities. Another critical strategy the company tackled during this period was evaluating their supply chain and individual vendors to determine where to reallocate or consolidate or make changes.

Independently, Curtis Industries worked to create a quality organization by establishing an internal team of key employees to focus on quality and continuous improvement. In 2011, the company decided to take their system to the next level by participating in theMassMEP ISO9001:2008 Collaborative program. They successfully passed the ISO audit and became certified early in 2012. The certification opened new doors for international business and allowed expanded opportunities with current clients.

 

Gabor Hajos, Vice President of Operations, mentioned that all of Curtis Industries’ employees were encouraged to attend round tables and other training events to gain exposure to new ideas and methods and observe other successful companies. Keeping employees involved and engaged helped with retention and demonstrated that they are valued and that their ideas matter. Workshops in Team Involvement Problem Solving (TIPS), shop math, and English as a Second Language (ESL) were offered to enhance other training experiences.

“Today you have to empower your employees so that they make a difference, so that they’re actually looking at what we call continuous improvement, which is one of our core values at Curtis,” says Scott Nelson, the company’s new President and CEO. “But that means having visual metrics so that the worker always knows through communication what’s important and that what they’re doing makes a difference.” 1

 

Layout changes and Kaizen activities took care of most of the older quality issues. “Now Curtis is doing a wave of higher level work focused on sustaining their improvements,” says Hajos. “Safety is an integral part. Items are addressed as the company is able to prioritize them and devote time and resources, but there is always something being worked on.”

Good process and procedural controls gave Curtis the ability to understand their business better and literally see what is going on. More effective production planning and enhancements and a new layout with improved flow allowed Curtis Industries to react to the flexing market. Enhanced efficiency meant the company was able to meet higher demand with the same number of employees. They could “right size” the organization as customer needs and volumes changed.

“The information helps us analyze situations and allows us to manage capacity and people more effectively,” says Hajos. Continuous improvement and quality activities created additional opportunity for growth.

“Suddenly customers were asking for more cab styles to go with each new type of vehicle,” explains Hajos. “It evolved from us producing one type of cab for a few client vehicles to producing a few styles of cabs for 30 types of vehicles for several different clients. We were agile enough to be able to meet the demand and produce new and innovative designs to satisfy our customers’ needs.”

CI Program Results

  • ISO 9001:2008 certification received, producing new opportunities nationally and internationally such as the retention of $1.5 million annually from a current customer and addition of new customer with sales at $200k so far this year.
  • Development of quality management system and team
  • Addition of one employee and retention of eight
  • Added flexibility that supports quicker reaction to clients’ changing demands
  • Development of systems that expand or contract with the market
  • Ability to design and manufacture in smaller lots efficiently, which allows:
    -   Introduction of new products for new clients
    -   More diversification
    -   Profit gains rather than loses
    -   Investment in employee training, development and growth
    -   More effective management of capacity and personnel

Rick Saia, “Walking the Plant Floor Again,” Worcester Business Journal, October 15, 2012

Employee Training Success Stories: Adhesive Applications Boosts Business, Jobs ( admin posted on December 11th, 2012 )

Easthampton Company Sticks to Strategy of Improving Skills of Workers

By Karen Myhaver, MassMEP
First in a series of stories about how Massachusetts companies are using the WorkforceTraining Fund to boost productivity and become globally competitive. The Workforce Training Fund Program was established in 1998 to help employers train current employees and new hires.

First in a series of stories about how Massachusetts companies are using the Workforce Training Fund to boost productivity and become globally competitive. The Workforce Training Fund Program was established in 1998 to help employers train current employees and new hires.

Adhesive Applications of Easthampton is a manufacturer of pressure-sensitive adhesive tapes and films. In March of 2007, the company was investigating ways to improve its performance as a company, position itself to be more competitive domestically, and keep foreign competition at bay.

Adhesive Applications discovered that it could apply for Workforce Training Grants available from the commonwealth.  Bill Baldino of Associated Industries of Massachusetts and Jim Gusha of the Massachusetts Manufacturing Extension Partnerhsip guided the company through the grant application, planning, administration and reporting process.

“Working with AIM and Mass MEP made the process uniquely simple,” said Wayne Tangle, Adhesive Applications President. “They were instrumental in ‘walking us through’ the grant process, explaining the purpose of each inquiry within the application and helping us coordinate the required information to best present our goals in utilizing the grant monies.”

The two organizations subsequently helped Adhesive Applications with programs and training modules that allowed the company to make improvements for its employees and to the manufacturing process.

“Over the course of the training period, our associates received constructive, professional information that they have utilized to become better managers and supervisors. The results have allowed us to be a healthier company that communicates effectively, up and down the organization.  This has enhanced our ability to meet growing business demands over the last couple of years,” Tangle said.

“All training and interaction took place within the Adhesive Applications facility for associates integral in meeting the goals of being more competitive and growing our business. The results have yielded a noticeable increase in business whereby we have invested in additional production equipment and personnel and expanded our operation to meet the increase in demand.”

A Story of Knowing Customer Requirements & Exceeding Expectations ( admin posted on November 28th, 2012 )

Jack Healy, MassMEP Director of Operations

Jack Healy, MassMEP Director of Operations

From the Desk of Jack Healy

A Story of Knowing Customer Requirements & Exceeding Expectations

By Jack Healy, Director of Operations, MassMEP jackh@massmep.org

Some years ago I had the opportunity to join a micro startup for an international company. The goal was to reestablish a brand that had failed using a new corporation that had the U.S. license for the product for the prior 10 years.  This new company, LEGO Systems Inc., was a typical consumer-driven enterprise with a focus on establishing brand acceptance for LEGO Brand building bricks.  With such an outward focus, it was natural that the supporting functions of this start-from-scratch company were established as needed vs. a preplanned part of the system.  One such function that was immediately put together was Consumer Services.

Conventional wisdom at the time was that only a small segment of dissatisfied customers ever complained as few believed there would be any reaction to the complaint.  Nevertheless, smart companies took the approach that those who did complain provided a chance to rectify problems and turn opinions around before they could affect other consumers.  As a result, consumer service departments were focused on answering and rectifying consumer complaints.

Since LEGO was spending millions of dollars in TV advertising to build its consumer base, there was a real sensitivity in this startup to the high cost of customer acquisition and the need to retain every consumer. A complete Consumer Services department was established, even with minimal sales in the first year. We found that consumers of LEGO, both young and old, had a passion to share their experience with the product. We started to receive hundreds of letters endorsing product along with their ideas for improvements and future products.

Many of these endorsements were used as part of our sales presentations. They made it easier to increase distribution channels as few purchasing agents could say “no” to a product that had such strong customer support.  The consumers helped to sell the product. The letters received soon ran into the thousands and were closely monitored. They played an important and continuing role in shaping future product offerings.

These testimonials were important input that the LEGO Group companies continue to promote by asking for customer feedback through their web sites, loyalty VIP clubs, and a myriad of sales collateral materials.

All of this does seem to be in direct contrast to the general manufacturing sector where customer input is rarely sought unless you are an ISO registered company (which requires that you do so).  The recent study of the Massachusetts manufacturing industry, Staying Power II: A Report Card on Manufacturing, completed by Professor Barry Bluestone of the Dukakis Center for Urban and Regional Policy at Northeastern University, summed up the industry’s perception relative to customer demands in the following table.

MassMAC Image

This summary lists the changes expected to occur over the next five years by the surveyed manufacturers. Across all firms, nearly 46% responded that to a “Large Extent” or “Great Extent” their customers would be coming back to them asking for lower prices. The manufacturers also believe that customers will not only demand lower prices but improved service delivery and better product quality. Only one in eight did not expect greater pressure on service and quality, while 40% of the firms felt that there would be a substantially increased demand for better service, and 36% suggested a very strong demand for quality.

About a quarter of all firms (27%) expect grater pressure to increase the use of new technology and 24 % expect that this would lead to increases in productivity.

The study also found that to a “Large Extent” or “Great Extent,” 51.3% of the companies over 100 employees, expect substantial increases in new technologies. These medium to large size companies are representative of the Original Equipment Manufacturer (OEM) population. This information gives supply chain manufacturers an early indication that they will be required to understand how their OEM’s will innovate and evolve over the forthcoming years. Support must be provided movement into new technologies. Changes in technology will take much longer to react to, plan for, and support than the previous requirements of price, quality, and delivery. Manufacturers will need to develop and implement plans that coordinate external customer feedback and required improvements to their own technology. The one thing that is certain that over the next five years is that businesses will continue to evolve and change, and delighting the customer will be essential for any enterprise in a slow growth economy.

What does it take to delight a customer? Let’s return to the LEGO example. It has evolved into responding to thousands of phone calls, e-mails, letters – all in ONE DAY.  Watch the video demonstration of how LEGO delights its customers, exceeds expectations, and builds a sustainable company.

VIDEO: Why LEGO is the BEST Company in the World

Growth Manufacturers Case Study ( admin posted on November 8th, 2012 )

Stoughton Steel Enters New Markets and Raises Funds Through Crowdsourcing

“We have equipment and capacity and even though our competencies are in another market we knew we needed to look for new ideas for steel!” —Eric Lagsdin, VP of Operations

Andris and Eric Lagsdin of Stoughton Steel are sitting at a conference table in their facility in Hanover, Massachusetts. Not long ago the day-to-day pressures that are practically synonymous with running your own business, often kept them working seven days a week and prevented them from taking time to plan, to create, and just to step back and breathe.

Stoughton Steel’s Eric and Andris Lagsdin

Their parents, Andry and Dolores Lagsdin, started Stoughton Steel in 1974 to manufacture stabilizer Flip Pads®, a product invented and patented by Andry for use on the stabilizer feet of backhoes. The company moved to Hanover when they outgrew their Stoughton facility. Eric became Vice President of Operations and Andris, Vice President of Sales and Marketing. Their Flip Pad® product was in demand and they were busy designing and producing new variations to meet customer needs.

Lean & ISO Certification
Five years ago, an important client suggested Stoughton Steel obtain their ISO certification and do some Lean Manufacturing training. Soon the company began working with project manager Rick Bowie of the Massachusetts Manufacturing Extension Partnership (MassMEP) who brought in a resource to assist Stoughton Steel with their ISO preparation. Rick also facilitated employee training in Basic Lean tools, Value Stream Mapping, and Kaizen improvement to help manage their rapid growth. Stoughton Steel racked up the achievements: the ISO certification necessary to develop future business and continue work with current customers, a 10-15% productivity improvement for manufacturing, improved safety, improved morale, decreased down time, and 100% on-time delivery to Caterpillar, a major client.

In 2009, the business, which deals primarily with construction equipment, took a big hit from the economy. Sales decreased by one third. They tried to develop new products or search for new opportunities but couldn’t juggle this with regular production schedules and customer issues. Ideas were shelved for “someday when they had time.”

The team attended CONEXPO, the largest international convention for the construction and construction materials industries, which open their eyes and got their creative juices flowing. Upon their return, senior management met in their conference to talk about transforming their company for growth with the new product ideas they gathered at CONEXPO. Eric warned that before they could successfully take on new ideas and products they their manufacturing process running smoothly again.

Kanban & 5S
“Sustaining improvements has always been tough,” admits Eric, “but the inspiration we got at the show in Las Vegas was the incentive we needed to develop procedures to make the improvements stick!” He suggested they bringing Rick Bowie back to help rejuvenate their processes and develop procedures that would assist them in organizing their work space, making it more efficient and easier to sustain thus allowing them to innovate and explore new product opportunities. This became the foundation for the continuous improvement work that brought about an infusion of new life, new products, and a welcome change of pace for the Lagsdin’s.

 

Visual Kanban

“We did several 5S events to clean and organize before we began,” explains Eric. Rick worked with employees to create visual systems and a game plan to help sustain their efforts. Visuals were imperative since not all thirty employees speak the same language. Color coding tools and areas of the shop according to team allows the shop floor to show when something is out of place or a team is not maintaining the standard. We have weekly group meetings to discuss what is going on and get employee ideas,” adds Eric.

Visual Kanbans virtually eliminated the need for scheduling. Team leaders in each manufacturing area were empowered to handle their own material re-ordering. Standard quality training was also essential and has made ISO audits much easier.

“Hearing why we need to make the changes from an outside source, other than one of us, seems to have a lot more impact,” added Eric. “Rick was able to talk to the employees without dictating and helped change the cultural mindset. He introduced the Pull Kanban process which the team adopted quickly.” Everyone is also accountable for their own work and its quality, freeing up the supervisor to oversee production and makes his job easier and more enjoyable.

“The (Pull Kanban) project helps us sustain ISO with a formal manufacturing process as well as a system to support it,” explains Eric. “Visual Kanban tags show when replenishment is needed and assists with better material control which reduces costs associated with excess inventory and other waste. Our employees really embraced the changes that have made their jobs easier!”

Results and New Opportunities

  • Decreased FlipPad® shipping time from 7 to 2.5 days.
  • Developed new product/market rubber edges for plow blades from same reinforced rubber as FlipPads® and stronger than standard edges.
  • Redesigned rubber cut for plow edges to be re-cut for FlipPads® as needed.
  • Brought work back in-house, purchased hydraulic presses to cut rubber in house. Cost savings paid for presses almost immediately.
  • Used powder coating equipment to take on small jobs during slow periods. Now coat 400-1000 units per week for one client.

“Primarily, we get ideas from talking to people,” says Eric. “I walked around home improvement stores asking people who were looking at mailboxes what they would like to have for options then incorporated the ideas into my designs. Now we have a steel plate customizable mail box that can withstand an explosion!”

What is “Green” and Bakes Pizza? An Innovative Product from Stoughton Steel
Andris Lagsdin spent many years in culinary arts, working under renowned chef Todd English, before returning to focus on marketing, advertising and customer service for the family business. Until recently, his time was consumed addressing customer issues. Now they go months without any.  Quality improvements mean happy customers and that means that Andris can devote critical time to investigating new markets, attracting new business, marketing their new products, and getting them ready for sale.

With his culinary background and vast knowledge of steel, Andris recognized the advantages of the consistent heat produced by using steel plates for some types of cooking. In Modernist Cuisine he read that by utilizing steel plates in a conventional oven you can recreate pizza oven baking at a fraction of the cost.  Baking Steel® was his “ah-ha moment” and Stoughton Steel’s foray into the household consumer market.

“Baking Steel® is also perfect for the little restaurant that can’t afford a regular pizza oven,” adds Andris. “We love the idea of using steel because it is one of the most recycled products on earth and are also having the one- of- a- kind covers for our Baking Steel ®made from recycled billboards!”

But…Will it Sell?
In August 2012, the Baking Steel® project previewed on Kickstarter®, an Internet funding platform, allowing  the general public to learn about and make small investments in a new product  to help fund ramp-up for manufacture. Within a month they had exceeded their funding goal by over 1000% and had received some media attention. A food blogger from New York tested Baking Steel® and reported “some of the finest crust ever made in his oven!”

Initial shipments of Baking Steel® are now being sent to eager Kickstarter® investors. Andris has completely redesigned the company websitehttp://www.stoughtonsteel.com with a new look and feel to help promote their new products and hopes to attract a lot of direct on-line business.

Andry Lagsdin commented, “Working with the MassMEP helped Stoughton Steel stabilize cash flow which enabled my sons to grow the business, organize their efforts, and have some much needed free time to create!”

“Rick showed us the way to make our improvements stick and helped get the workforce, especially our management team, excited about the continuous improvement process.  Everyone has seen the benefits. Now we can listen to new ideas and opportunities because we have freed up capacity by being so much more efficient and because we have made our crew responsible and accountable for quality. Ideas create ideas. Once you bring one to life you learn so much from the process you will be better prepared for the next one and it will take a smaller investment of your time and efforts to get it going.” — Eric Lagsdin, VP of Operations

Increased Productivity is the Sole Source of a Nation’s Wealth ( admin posted on December 15th, 2010 )

Adam Smith’s words as written in the Wealth of Nations are as true today as they were in 1776. The importance of a continually productive economy however, is more important in today’s hyper- competitive marketplace than it ever was in 1776 when it was just a theory that very few could understand. We, as a nation, have been very fortunate to have the amazing capability to have a manufacturing base that has continually led the world in productivity and has contributed mightily to our nation’s wealth.  This outstanding productivity trait was amply demonstrated by  the Advanced Manufacturers who opened their companies to enter  the “Next Generation Manufacturer Award Contest”  and  whose overall  achievements  are ensuring their company’s  long-term competiveness into the next generation.

brownFrom this group, Tegra Medical of Franklin Massachusetts was selected to receive the 1st Annual Next Generation Manufacturing Award as an exemplary representative of advanced manufacturing practices in Massachusetts.  The Award was presented at the Associated Industries of Massachusetts Executive Forum.   U.S. Senator Scott Brown, the Forum’s featured speaker, presented the award   in front of an appreciative gathering consisting of many manufacturing leaders who understood that the need for continuing productivity is the reality of today’s manufacturing.

In accepting the award, Bob Roche, CEO of Tegra Medical, stated, “Without out people’s passion for the customer, their desire for excellence and commitment to accomplish those things that other companies cannot or are unwilling to do, we wouldn’t be standing up here today.”

This Next Generation Manufacturing Award (NGM) was established by the Associated Industries of Massachusetts Manufacturing Institute, the Massachusetts Manufacturing Extension Partnership (MassMEP), and McGladrey to recognize a Massachusetts manufacturer for its performance practices as measured against 21st century manufacturing standards, and to elevate awareness of what it takes to succeed as a manufacturer in today’s extensively competitive world.

Tegra Medical, founded in 2007, is the combination of four trusted firms that today focuses exclusively on precision machining and contact manufacturing services for the medical device industry, and the production of components and assemblies for leading surgical and interventional companies. Tegra Medical  employs 300 people, has 200,000 sq. ft. of ISO 13485-compliant manufacturing space and is headquartered in an 80,000-sq.-ft. facility built to its specifications in 2009.

The NGM Award is based in part on an in-depth survey of more than 2,500 manufacturers including firms in the Bay State that identified six key performance measures that, if addressed, should position firms to be competitive in the 21st century. The measures include:

  • Customer-focus innovation – the capacity to deliver new and better customer solutions at a faster pace that the competition
  • Advanced talent management – the use of systems and technologies to better recruit, hire, develop and retain talent 
  • Systemic continuous improvement – the ability to realize annual productivity and quality gains through a companywide commitment to continuous improvement
  • Extended enterprise management – the implementation of a flexible network of supply chains and partnerships to achieve competitive advantage in speed to the market, cost of goods and quality of output
  • Sustainable product and process development – the design and incorporation of waste and energy-use reduction measures that produce tangible cost performance advantages while increasing customer value.
  • Global engagement – the capacity to integrate people, partnerships and systems capable of engaging global markets, talents and resources

The eight finalists who were also considered to receive the NGM Award were subject to an onsite evaluation, a process which determined that the cumulative economic impact of these firms alone to the commonwealth’s economy reached more than $673.2 million. 

 During the review process, the sponsors’ evaluation team was particularly impressed by how Tegra measured up to several of the performance measures, including:

  • Consistently defining new equipment and processes to stay on the leading edge of the market, and establishing an 18,000-sq.-ft. Genesis Tech Center to help support new product launches
  • Comprehensive measures to retain employees and building pipelines to recruit new talent  
  • Systematic daily and weekly operational reviews at all levels
  • Supplier summits and reviews to communicate expectations and track progress
  • Specific recycling programs geared towards metals, plastics, papers, and water
  • Opening of offshore operation to meet customer demands 

It was obvious to all that the practices carried out by the people at Tegra Medical and the seven other award finalists highlight what manufacturers must do every day to meet the challenges of an ever growing and competitive world marketplace. The adoption of these best practices can serve to help other manufacturers to identify strategic goals to ensure they will be able to grow and prosper in the future.

In addition to Tegra Medical, the 2010 Next Generation Manufacturing Award Finalists included:
Barry Controls, located in Hopkinton, is a manufacturer of a wide range of motion control and anti-vibration products and systems used by the aviation/aerospace, defense and transportation industries. The company is part of the Hutchinson Group, a market leader in the industrial rubber sector and a division of Total Chemicals. 

Checkerboard LTD, located in West Boylston, is a family owned and operated designer and printer of invitations for every special occasion including weddings, parties and special events. The firm prints 100 percent of its products in the United States and sells them in both domestic and international markets.  

FIBA Technologies, founded in 1958 and located in Millbury, is a leading supplier of gas containment equipment and services for the industrial gas, chemicals, specialty gas, offshore oil/gas exploration, and alternative fuel industries around the globe.

Incom, Inc., founded in 1971, is a privately held company headquartered in Charlton. It is a leading manufacturer of commercial rigid, fused fiberoptic faceplates, tapers, and microwell arrays. Incom’s diverse products are used by customers in the dental, medical, defense, life science and homeland security sectors.

MTD Micro Molding , established in 1972 as Miniature Tool & Die, quickly established itself as a leading manufacturer of miniature connector injection moldings for the electronic industry. Today, MTD continues to grow and designs and manufactures microscopic components for the medical device and electronic industry in its precision clean room facilities located in Charlton. 

John Matouk Company, Inc. was founded in Italy in 1929 to export Italian linens to the United States.  Forced to move production to the United States with the outbreak of World War II, the firm moved to Fall River from New York in 1985. Today under the third generation of family stewardship the company remains committed to designing and manufacturing the world’s best made linens for discerning clientele around the world.  

Savage Arms, Inc., organized in 1894, has been owned by numerous public and private firms throughout the years. However, since 1995 the firm has been owned by Savage Sports Corporation. Headquartered in Westfield, the company designs and manufactures centerfire rifles, rimfire rifles, shotguns, muzzleloaders and shooting sports equipment. 

Commenting on the NGM Award finalists, Jim Byman, a partner at McGladrey, a public accounting and consulting firm said, “The breadth and scope of the finalists involved in manufacturing advanced products ranging from firearms to nano-components used in aerospace and medical device applications underscore how important manufacturing is to the Commonwealth’s economic wellbeing, and the competence of our manufacturers is one reason why the Commonwealth is ranked as one of the ten top states in terms of merchandise exported to foreign markets, despite our rather modest population.”

The New Regulators:
Corporate America Takes the Responsibility for Environmental Improvement ( admin posted on May 27th, 2010 )

By: Jack Healy, Director of Operations, MassMEP

One of the more improbable business changes of our times, has been caused by a number of corporations , such as Walmart, General Motors, IBM and others , who have taken on the direct responsibility for improving the environment by ensuring that “ sustainability” is implemented throughout their respective supply chains.

Sustainability is a term that describes the goal that much of Corporate America is starting to take on that establishes the goal to increase share holder and social value through the reduction of the environmental impacts by the decreased use of materials and energy in both their operations and supply chains.  The seriousness of these efforts are reinforced in what are game changing goals which have been heralded very publicly in the press e.g. :

Walmart has announced that it will cut some 20 million metric tons of green house gas emissions from its supply chain by the year 2015 —- the equivalent of removing 3.8 million cars from the road for a year.  The company plans to achieve this goal by pressing suppliers to rethink how they source, manufacture, package, and transport their goods.  Essentially, suppliers are now being asked to examine the carbon life cycle of their products from raw materials used in manufacturing all the way through to the recycling phase.  Walmart, with its market strength, is very serious about this implementation and their  suppliers are reacting seriously as well.  In a survey reported in Forbes one of the Walmart suppliers responded that he “fears Walmart more than he fears the EPA “.

General Motors  (GM), automotive suppliers have joined the U.S. Environmental Protection Agency in formal  “Supplier Partnership for the Environment (SP) in order to increase the competitiveness of the companies while reducing environmental impacts.  SP is a forum for sharing environmental best practices throughout the automotive supply chain, especially for the benefit of the smaller manufacturing enterprises.  Unlike a number of past initiatives GM is actually practicing sustainability methods and not merely passing it on to their suppliers.  Sixty – two GM plants are now zero waste facilities by recycling or reusing more than 97 percent of the materials left from the manufacturing process that would otherwise be sent to landfills.  The roughly 3 percent of the remaining manufacturing waste is converted to energy at waste to energy facilities to help replace fossil fuels. GM’s sustainability commitment is world wide as they have joined and are active in the World Business Council for Sustainable Development, and is looking to have half of its major manufacturing facilities world wide to attain zero waste status by the end of this year.

Proctor and Gamble (P&G) has launched a sustainability scorecard and rating process to measure the environmental performance of its key suppliers.  The new scorecard will access P&G suppliers environmental footprint by measuring energy use, water use, waste disposal, and green house gas emissions on a year to year basis.  P&G says that the scorecard will be “open code” for use by any organization to help determine common supply chain evaluation processes across all industries.   Just as Walmart’s scorecard has had a large effect on its suppliers, P&G says its rating system has the ability to encourage environmental improvement across the global network of suppliers— which represents approximately 75,000 businesses and $42 billion in spending each year.  Suppliers are also being encouraged to use the scorecard with their own supply chains.
IBM has made a significant step in cleaning up their global operations and is now requiring suppliers in 90 different countries to install management systems to track environmental data like energy use, greenhouse gas emissions and waste and recycling levels.  All suppliers set their own environmental goals and publicly report their progress.  All suppliers will need to have these systems installed by early 2011 or IBM will cease to do business with them.

Given the near monopolistic clout that these and other large corporations now have on their reduced supply bases, there is little doubt that these environmental improvement requirements will be sustained for many years to come.  But unlike government regulations there will be much that the manufacturers will have to figure out for themselves as well as for their suppliers before they can start to implement their own sustainability programs

According to a recent Aberdeen Group survey sustainability has now become one of the top five market pressures facing today’s manufacturing operations, as noted in the chart below.   The report describes that many manufacturers today struggle with defining the scope of sustainability initiatives, i.e “ should such initiatives be facilities focused, product focused or operations focused —- or all of the above “

Despite the current lack of uniformity, there is little doubt that the Sustainability Movement, like the preceding “Quality” and “Lean Manufacturing” movements, will be changing the way we do  business.   Companies interested in meeting this change and who need in assistance to develop their own Green Supplier Networks can do so by contacting Mike Prior at 508-831-7020.

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