Material Handling in America's Best Plants

Here's an inside look at the award-winning operations for some of Industry Week's Best Plants of 2002. Featured Plants: Boeing C-17 Production Complex and Collins & Aikman Rantoul Products.

High-Flying Productivity

A brand-new approach to manufacturing airplanes more than doubled production while cutting needed labor by two-thirds. Find out how this Boeing C-17 defense aircraft division landed a manufacturing miracle.

Kevin Byrne, supply chain integrator for Boeing Integrated Defense Systems — Long Beach, California, remembers an unhappy past at the Boeing C-17 aircraft assembly plant. Before Boeing re-engineered its plant, processes didn’t function well. But by adopting new warehouse management system (WMS) software, a horizontal carousel orderpicking system, new MRP software and supply chain management techniques, the operation began to take wing. “Every day was a battle to get work done. Now, workers and management collaborate and vote on changes to be made, and workers like the opportunity to get their ideas on the table,” says Byrne.

Implementing these new systems has reduced the cost of building aircraft by reducing on-hand inventory of parts, by tracking better the 30,000 SKUs and 8,000 kits, and by reducing the need for expediters. “We’ve passed the cost savings on to our customers. Recently, we sold 60 aircraft at a significantly reduced price,” says Byrne. Boeing was building only eight aircraft a year at Long Beach. But last year 17 planes were built, more than doubling the output with two-thirds fewer workers assigned to assembling the planes.

“Now the day-to-day running of the business is done by the MRP and WMS software, which creates a schedule toward which everyone in the assembly plant and the nearby warehouse works,” says John Bouza, director of manufacturing.

Material handling at Boeing

Boeing once had multiple stockrooms on its manufacturing floor where airplane mechanics would wait in line to receive kits, individual components and consumables like drill bits and fasteners. All this time spent in line waiting meant an aircraft wasn’t being worked on. Boeing had a general idea of how many parts were being used and how much consumable product was needed per month, but these at best were estimates. Before the re-engineering process began seven years ago, 25 percent of the 30,000 SKUs were unavailable when needed. It took two-and-a-half years to turn around the expectations of workers and Boeing’s 800 suppliers to meet a Just-In-Time delivery schedule for kits and major fuselage components.

The solution to these problems was moving all the parts and kits storage to an off-site warehouse where a warehouse management system (Catalyst International) and a radio frequency data communications network (Intermec) were used to keep track of all inventory. Orderpicking of small parts and kits is managed by a horizontal carousel system (Diamond Phoenix) comprised of two carousels. The storage system is 20 feet tall by 65 feet deep and 35 feet wide. Workers are raised and lowered to pick from the carousel system with a scissors lift table. The carousel houses 8,000 kits and other SKUs.

Bulk items are moved to cantilever racks and workers transport loads with a fleet of powered trucks including orderpicking trucks (Crown), scooters (Cushman) and lift trucks (Yale and Hyster).

By moving the storage of bulk parts and kits to the off-site warehouse, Boeing increased its production floor space to accommodate twice as many planes. The warehouse software keeps track of inventory levels and communicates to vendors so that stock levels are maintained.

At the manufacturing floor, kits are bar code scanned upon receipt at any workstation. By carefully monitoring the amount of parts needed for any kit and mechanic task, there are no extra or leftover parts at the end of the day. This used to be a problem for mechanics in that leftover parts had to be somehow entered back into inventory and gotten back into storage locations at the end of a day’s work.

Systems integration

Part of Boeing’s systems integration work is to keep better track of consumable parts across its U.S. network of 40 manufacturing facilities. It is using Crib Master software to track perishable and portable tooling. “All of Boeing’s various operations across the country buy safety glasses, fasteners, drill bits, for example,” says Byrne. “With this software I can see if there is inventory in Seattle or St. Louis that can be moved to our location rather than our plant buying yet more material.”

The integrated WMS and MRP system keeps track of parts more accurately and predicts precisely how many parts of any kind will be needed for a production run, rather than just average monthly consumption figures. This allows the network of 800 suppliers to gauge the demand at the Long Beach plant.

Boeing is moving away from highly customized software to more off-the-shelf varieties. “We integrated our new Catalyst WMS and MRP systems with our host software and with Intermec’s RFDC equipment. It will take us a while to move away from our dependency on our mainframe, but we’re moving closer to putting data into Oracle-type data sets to manage our data better with more relational databases,” says Byrne.

Boeing was able to double its plane production by working more closely with suppliers to set up time event management. This reduced the amount of late-arriving goods and freed time for making kits and presenting parts to the workers more ergonomically — more intelligently.

Worldwide benchmarking

As part of Boeing’s commitment to lean manufacturing, teams of workers from the C-17 plant and other plants were sent around the world to automotive manufacturing sites like Porsche and Volkswagen. “This helped us uncover best manufacturing practices used around the world, which we brought back to Boeing,” says Bouza. Though the automotive plants weren’t exactly like the more parts-intensive and labor-intensive aerospace manufacturing, there were lessons to be learned about job scheduling and working with vendors for Just-In-Time manufacturing.

“Our operations deal with world-wide sourcing of goods,” says Bouza. “It’s more challenging to control inventory and work-in-process because some of the asset costs are just enormous.”

Fuselage components are very costly, as are the fixtures that transport them across the country or across the world by railcar or airplane. An important part of keeping the planes moving through manufacturing means returning these fixtures quickly to the vendor site so another component can be shipped to Long Beach.

Boeing gets is manufacturing operations together for regular lean manufacturing and benchmarking meetings so that what one plant learns can be communicated to others.

“Material handing is very high on Boeing executives’ list of priorities,” reports Bouza. “An executive vice president for manufacturing carefully assesses our operation for inventory, labor and warehouse utilization. We are challenged to report back on improved efficiencies and are required to develop a five-year plan.”

Bouza says that in terms of supply chain performance, the quality of his work life is better now than in the past 38 years with Boeing. “I can spend my time working on special projects now rather than having to worry about inventory being in the right place at the right time. The system we have put into place allows me to work on engineering changes that support our airplanes during this wartime effort,” says Bouza. He’s free to better serve his Air Force customers as they plan to alter aircraft design to meet the changing needs of wars and threat of war around the world. And the biggest sign of confidence that the Air Force has in Boeing’s new manufacturing procedures is a contract for 60 planes at $8.6 billion. “That’s a vote of true confidence in Boeing,” concludes Bouza.

Suppliers to Boeing

These material handling vendors supplied equipment to the C-17 plant in Long Beach, California:

Catalyst International, WMS, www.catalystwms.com.

Crown Equipment Corp., orderpicking trucks, www.crown.com.

Cushman (Textron), electric scooters and trucks, www.cushmanco.com.

Daihatsu, gas truck and scooter, www.daihatsu.com.

Davis Bacon Material Handling, cantilever racks, www.davisbaconmh.com.

Diamond Phoenix Corp., carousel system, www.diamondphoenix.com.

Flambeau Products, compartmentalized tote boxes, www.flambeau.com.

HK Systems, conveyor system, www.hksystems.com.

Hyster, lift trucks, www.hysterusa.com.

Intermec, RF network, bar code readers and printers, www.intermec.com.

Rite-Hite, dock truck restraints and dock levelers, www.ritehite.com.

Taylor-Dunn, electric trucks and utility carts, (714) 956-3130.

Toyota Industrial Equipment, lift trucks, www.toyotaforklift.com.

Yale, orderpickers, electric tugs and lift trucks, www.yale.com.

Managing the Mix

This smart blend of supply chain data management, assembly, lift truck fleet management and expert packaging makes for a world-class manufacturing operation at Collins & Aikman Rantoul Products’ automotive plants.

The Rantoul Products plant featured here is one of three plants placed strategically in Rantoul, Illinois, to service several major automotive assembly plants. The plant makes injection-molded parts for several kinds of trucks and uses them to assemble instrument panels and interior panels. It’s a top-to-bottom Just-In-Time (JIT) operation.

“We receive from our automotive customers a daily JIT ship schedule,” says Dale McBride, materials manager for Collins & Aikman. “We use this information to schedule our shop. The JIT schedule has quantities, colors, part numbers and the actual hour ‘bucket’ that parts must be shipped out the door.”

The auto plants project two days of hour buckets by part numbers and an additional seven days for their JIT production schedule.

Molded parts are put directly into customers’ returnable containers because Rantoul keeps very few finished goods on hand. Most are shipped within hours of being manufactured.

“I would say that our executives felt that improved material handling was one of the larger factors in implementing our new, lean manufacturing system,” continues McBride. He says that value-stream mapping was critical to reducing on-hand inventory, material movement and time spent handling goods. Value-stream mapping takes a product line, maps it from the customer’s demand for the product and shows how demand is transferred to all of Rantoul’s many suppliers to bring material into the shop. “During this process, we measure how much movement and handling is happening between processes and how much work-in-process [WIP] we can eliminate. We aimed for one-piece workflow rather than batch processing,” says McBride.

Teams make the difference

With advice from Chrysler on lean manufacturing, Rantoul spent a great deal of time and effort establishing and training teams of workers and supervisors involved in the day-to-day process. Workers were taken off the assembly line and given a week’s training. They spent two days studying the process flow, including taking documentary photos. A day was spent mapping the current operation, and then the team brainstormed on what could be done to reduce parts movement and WIP. The teams then implemented the changes by assigning tasks to other workers and established timetables for accomplishing the task. Eventually, a report was made to management and key plant workers as to implementation success.

This lean manufacturing operation was driven by the CEO. Early in the process, Chrysler shared its expertise in value-stream mapping and work groups, acting as a consultant of sorts.

Supply chain data management

Rantoul implemented bar code scanning in both shipping and receiving. This improved accuracy and required a new discipline of labeling every product and recording its location. Labeling speeded reporting to the Brain MRP software for received and shipped goods.

“There was a big improvement in error reduction, especially in labeling finished goods for our customers. Bar code labeling cut down on a lot of mismarked boxes, which had been causing big, big headaches downstream at the automotive assembly plants,” says McBride.

With the Brain MRP software, Rantoul sends daily JIT information on daily requirements to all its suppliers. This gives suppliers the advantage of more timely information on the demand of Rantoul’s automotive customers. Many custom modifications were made to the MRP software to allow the input and transmission of much data with minimal manual data entry. McBride reports that Brain was able to take these changes to its MRP and package it as an upgrade for other manufacturers.

Here’s an example of a supply chain improvement at Rantoul: Rantoul was required by one of its customers to supply a component part, which Rantoul was purchasing and keeping on hand from a vendor. The way the process worked before is that Rantoul would buy these parts, relabel them, keep inventory on hand to avoid stockouts and ship parts out to the customer on daily trucks. “This procedure required a lot of work, cutting purchase orders to the supplier, sending releases to the supplier and waiting to receive and then reship to our automotive clients,” says McBride. Rantoul re-engineered its operation so that parts were shipped directly from the supplier’s plant to the automotive assembly plant, with Rantoul’s software managing the operation. This eliminated:

• Storage space requirements;

• Labor needed to receive, relabel and repackage goods.

Rantoul still profited from the arrangement by managing the JIT shipments through its software.

The supply chain improved because a software module called Supplier Web was added so that suppliers could sign on to Rantoul’s Web site and query their part numbers to see what current balances were. “Then the vendor can check on minimum and maximum inventories. This also improved communication between our expeditors and our suppliers in terms of e-mail capability. That was a big improvement,” observes McBride.

Targeting quality manufacturing

Rantoul maintains a measurable target for improving all its programs at the three city plants. Targets include:

• Inventory turns;

• Inventory accuracy;

• Quality.

Quality is a broad term that includes meeting JIT deliveries on time, daily tracking of discrepancies between what the customer wanted and what was shipped.

“We maintain the quality of parts internally by tracking part defects by workcenter. And if a defective part makes it to the customer, that, too, is tracked. We have a seven-step plan to improve any quality problem or RDR,” says McBride.

If the root cause of the problem isn’t apparent upon first inspection, then the firm applies a fix like 100 percent inspection until the problem is determined.

In considering the impact of re-engineering the company’s processes for lean manufacturing and improved supply chain management, McBride says, “All these changes have made us a more valuable supplier to our customers. The knowledge that was spread among workers at the plant increased the awareness of what our customers expect from us. Now when customers look at us, they see a supplier with many knowledgeable hands, and they feel more comfortable working with us.” MHM

Equipment Suppliers for Rantoul

Bar code scanners, Symbol Technologies Inc., www.symbol.com

Dock truck restraints, Rite-Hite Corp., www.ritehite.com

Lift truck distributor, MH Equipment in Danville, Illinois, 217-443-6965, Scott Alexander

Lift trucks, Caterpillar Lift Trucks, www.cat-lift.com

Lift trucks, Hyster Model S65 XM, 6,500-lb-capacity LP-gas trucks, www.hysterusa.com

Lift trucks, Yale Materials Handling Corp., www.yale.com

Manipulator end effector, Big 3 Precision Products Inc., 618-533-3251, ext. 232

Manipulator lifting arm, Zimmerman Handling Systems, www.irhoist.com

Modular, line-side gravity flow rack, Trilogiq USA Corp., www.trilogiq.com

MRP Software, Brain North America Inc., www.brainna.com

Plastic bulk containers, Linpac Materials Handling, www.linpacmh.com

Powered overhead conveyor, Magnum Automation Inc. (Canada), (905) 206-9399, ext. 601

Reusable racks, MHSI (Material Handling Systems Inc.), (248) 853-5660

Packaging Plays Key Role in Lean Manufacturing

Joy Brownridge, packaging engineer for the Collins & Aikman Rantoul automotive manufacturing facility, is in charge of intelligent handling when it comes to packaged parts. Her task is to use a combination of reusable, returnable containers, custom dunnage and smart ergonomics in the design of packaging systems for the various auto manufacturers that Rantoul serves.

“Packaging is a huge part of our business,” says Brownridge, “If you don’t have the right kind of packaging, you can generate quality problems. Typically, the better your packaging, the less you spend on transit and the less labor you need.”

Brownridge looked at a lot of packages they had and decided instead on partitions that workers didn’t have to manually remove. Sometimes, they use disposal dunnage with corrugated layer pads. “We determined that if you can use a one-layer package, there is less chance of product damage and much less required handling by the worker. One-layer packaging saves on time, labor and costs in the end,” says Brownridge.

Some packaging at Rantoul is difficult to use because it involves a lot of labor from the worker. Brownridge prefers to use partitions in containers because the worker can just slide the part in. “Some containers have foam cutouts and Velcro straps. Those kinds of packages take more time, so we redesign containers and dunnage so it is easier for a worker packaging the same parts eight hours a day,” says Brownridge.

Rantoul uses plastic bulk containers (Linpac) for work-in-process with layered pads of dunnage. Some of the firm’s packages have partition sets that go out to the automotive customers and are later returned. The dunnage protects parts that include hard trim and small instrument panel parts that aren’t assembled into the instrument panels at Rantoul, including steering column covers that are installed at the final automotive assembly facility.

Rantoul’s packaging department is constantly looking at the 12 packaging programs, mostly with Chrysler, some GM and Mitsubishi. Mainly they’re packaging truck parts for the Durango and the Dakota. For Mitsubishi, they make parts for the Galant, Eclipse and Montero Sport.

“With all the returnable packaging between the automotive manufacturers and us, I work with the customer’s design house to develop package concepts and review and approve the packaging that comes into our plant as well as packaging that comes in from our suppliers.”

The most important thing about packaging at Rantoul is worker ergonomics as it plays into parts presentation. “You have to look at the worker who packs the container and the unpacker, and then design the packaging so the worker comes in minimal contact with the part,” says Brownridge. “We take into account the need to minimize repositioning of parts by the worker — going instead for an easy, quick in-and-out.” She says this goal is especially hard to achieve when handling larger parts.

Smart Fleet Management Saves Auto Supplier $350,000

The Collins & Aikman Rantoul auto parts manufacturing facility in Rantoul, Illinois, has undergone a dramatic shift in direct material handling equipment cost as a result of rethinking the way its lift truck fleet is managed.

“We make instrument panels for Chrysler, Mitsubishi, Dodge and Chevrolet, mostly for trucks. We use lift trucks to take parts from where they’re molded to the assembly area and then onto a shipping staging station where stacks of instrument panels are loaded onto trucks,” says Larry Dubinet, special projects engineer. Dubinet oversees lift truck operations in three Collins & Aikman plants located within eight miles of each other in Rantoul.

Rantoul has some operations that run three shifts a day, seven days a week. Dubinet prefers to rotate trucks out of use to keep repair and lease hours down.

“We have two Hyster maintenance workers on site every day to perform preventive maintenance and repairs on our fleet of 91 vehicles,” says Dubinet. His fleet includes a number of new Hyster Model S65 XM 6,500-pound-capacity trucks as well as Yale and Caterpillar trucks.

In 2001, Rantoul’s fleet cost the company about $1.1 million to operate. But in 2002, the company, under Dubinet’s leadership, knocked the cost down to $750,000. This was accomplished through smart repairs, smarter handling of the trucks and better rotation of trucks through the 24/7 operation.

“Overall, we saved Rantoul more than $350,000 in lift truck expenses, mainly by carefully following detailed maintenance and having a good partner with our lift truck fleet distributor, MH Equipment in Danville, Illinois,” says Dubinet. He says that this Hyster dealership is the third largest in the U.S. and that it handles all preventive maintenance and repairs.

Hyster came to Rantoul with a fleet management plan, and the companies are negotiating a full maintenance plan on the whole fleet.

A major source of savings is fitting the existing fleet with new, 70-gallon LP-gas tanks. “These tanks allow the trucks to work over three shifts with just one filling, and that represents a huge cost savings,” says Dubinet.

Maintenance workers typically traveled three times a day to change a truck’s tank. Each filling takes 15 minutes. The new tanks save a half hour per day per truck, which translates to $8 in labor savings per truck. In addition, Rantoul’s fuel carrier charged it a hefty service charge to fill each tank, so in going to bulk tanks those fees are reduced significantly. These new gas tanks will lower cost of operations even further, by $60,000 in service charges and reduced labor. “When it comes to watching the buck, we know what we’re doing,” observes Dubinet.

Part of Rantoul’s fleet management strategy includes thorough training for lift truck drivers. The company’s course includes many hours of classroom and hours of driving. “We don’t let them drive in traffic areas during training. Truck training graduates get a driver’s license with special training for heavy containers full of automotive parts,” says Dubinet. The containers carry up to 12 instrument panels at 100 pounds each, and the carrier itself can run 1,000 pounds. As loads are stacked to 211 inches high, the heavy-duty capacity of the truck and special training for operators is needed when stacking racks up to five high.

Special training is offered for sideshifter attachments. “We use sideshifters when stacking containers high — to align the pegs to eliminate falling containers. There are also tight corners in the plant, which make it easier to move a load fitted with a sideshifter,” adds Dubinet.

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