There is no question that the manufacturing sector has been hit hard by the current economic downturn, but an air of measured optimism permeates the mood in 2010. As manufacturers reflect this optimism, is this the right time to consider changes in the way their factories and distribution centers (DCs) operate and invest in capital improvements?
Jim Tompkins, CEO of supply chain consulting firm Tompkins Associates, would answer unequivocally, yes. Tompkins says, “In my 35 years of business, I have never dealt with as many challenges as I have in the last 18 months. Challenges equate to excitement and change. I truly believe that now is a time when we can make historic changes to the global supply chain.” He adds, “However, in order to make changes in the global supply chain, leadership must engage their own management team, IT experts, plant engineers and maintenance people to modify their internal supply chain.”
Tompkins likens industry movers and shakers to the leaders in the Tour de France. The classic bike race meanders approximately 2,200 miles through France and neighboring countries. Cycling for about 21 days, riders encounter challenging weather, mud, Alps and flat tires. The best climbers usually win. And, so it is with industry chieftains. They must navigate the difficult times and, metaphorically speaking, climb the mountains.
With an eye to the bottom line, many manufacturers think first of cutting costs by slashing shifts, reducing inventory and delaying buys. Larry Tyler, co-founder and principal of K-Tec, a manufacturer of lean material flow systems, encourages management to place material handling at the top of the list. Typically, the movement of material throughout the plant or DC is the last lean frontier to get attention and, more importantly, allocated investment dollars.
Tyler says, “It is essential to evaluate current material flow, design a lean flow plan and invest in the factory infrastructure changes to accommodate present and future volume.”
When we talk about lean material flow, we are talking about eliminating waste and freeing up resources by analyzing how materials move on the factory floor. Efficiently moving parts and inventory within plants and DCs offers an opportunity for cost reduction by speeding up production, freeing employees to move on to other work, saving energy and eliminating material waste.
R.W. Beckett Goes Lean
In reality, few companies approach lean conversion in a systematic way. They usually identify a bottleneck, put together a kaizen event and put out a fire. However, R.W. Beckett, an Ohiobased manufacturer of oil burners for residential and commercial heating applications, implemented a well planned lean approach to manufacturing that included material handling to improve efficiency and profitability.
Beckett managers found the company was not making optimal use of the space in its 165,000-square foot plant. The factory floor was cluttered with wire containers filled with parts. Storage had become a challenge. Logistically, there were problems getting parts from the receiving area to the assembly line. Managers felt production could be streamlined and increased.
To remedy the situation, the company shifted from a traditional, straight assembly line to a cellular model, with approximately five workers all facing the center of the cell. Unfortunately, there were problems with this setup because whenever parts were delivered, workers had to turn around to unload them. The company’s lean managers quickly realized this could cause ergonomic problems as a result of all the reaching, turning and bending involved. Also, there were too many handoffs, causing worker downtime.
With these problems in mind, Beckett reconfigured the factory floor to accommodate a series of U-shaped work cells, setting up material “supermarkets” in the cells’ receiving areas, thereby changing the way materials were delivered to the floor. As part of the new arrangement, Beckett integrated a number of delivery carts that ultimately proved integral to the company’s improved workflow system.
Carts pulled in a train by a tugger now skirt the perimeter of the work cells. An operator loads each cart in the parts supermarket, tugs three or more carts loaded with bins organized by cell number, drops the bins in designated chutes on a mobile cart and moves to the next cell. Shelves are clearly marked with the cell number. Carts allow for easy changeovers.
Working in the new U-shaped continuous flow cells and facing out, workers can now perform a task or series of tasks and then slide the product to a co-worker until the product is finished. The improved flow within the cells has made it possible to reduce the number of workers in each cell from five to four. Additional benefits include a 10% overall space savings; 85% inventory reduction; decrease in line-side inventory from 2 days to 2 hours; improved ergonomics, with parts all within 18 inches of workers; and a reduction in lift truck traffic.
Kevin Beckett, president and CEO of R.W. Beckett, sums it up: “Beckett has a culture of lean thinking. From the front office to the assembly floor, we strive to find ways to improve our processes for greater efficiency, product quality and an enjoyable work environment. The implementation of a lean culture gives Beckett more resources to pursue growth opportunities, such as the distributed energy storage project that recently received an Ohio Third Frontier grant.”
Implementing Lean Flow
A systematic approach to lean material flow includes the following steps:
• Plan for the future. Optimal material flow is critical to productivity and the bottom line. Implementing a lean manufacturing program requires time and commitment, from top to bottom. Although the mandate to go lean may emanate from the management team, there must be employee buy-in as a lean program includes reducing waste in all segments of a manufacturing enterprise. Waste can include too much inventory on the factory floor, poor packaging design from suppliers, ineffective parts presentation in the operator work zones, material delivery delays and convoluted material delivery routing.
• Evaluate work methods on the factory floor. Ask yourself if your plant floor is designed for optimal use of space for value-added tasks and minimal WIP (work in process inventory). If not, consider redesigning your plant floor to a cellular model with parts being delivered to the individual cells on carts. Investigate flexible assembly systems where carts/cart systems become moveable build platforms that can easily be redirected for more complex product variation. This material handling approach can reduce lift truck use and wait time for replenishment, minimize part touches and damage and increase overall efficiency.
• Implement a balanced approach to material flow. A balanced approach to lean material flow is critical to the success of today’s manufacturing and distribution operations. Since the invention of the lift truck in the 1920s, this vehicle has been the established method of moving materials and goods. Lift trucks will always have a place in factories and DCs. However, in evaluating the gains of implementing a lean material flow approach, leaders must ask if the factory floor is designed for optimal usage and minimal waste; if and when the lift truck is the right tool; and if there is a different way to move materials that eliminates waste and reduces costs. Use lift trucks when necessary; if possible, confine them to the floor perimeter. On the floor, a cart-andtugger system can free up resources to work elsewhere. The total cost of a tugger and two, three-cart trains can be less than that of one lift truck, if you take into consideration items such as purchase costs, maintenance expenses, energy use, operator training and certification costs.
Strive to handle most of the material handling chores with as few cart variations as possible. The corollary to this is to consider reducing container size and weight to allow ergonomic movement/handling (and reduce WIP). Using a few of the most common cart platforms can significantly reduce fleet management costs and simplify logistics. Often, using a roller deck, rotational flat deck or custom presentation upper on a standard cart base in conjunction with cart lifts and/or conveyors can meet most production or warehouse needs.
• Simplify and reduce product and employee movement. Carts can be moved in a train by a tugger, or an employee can move up to a ton of material with less than 50 pounds of push effort (breakaway). For example, one manufacturer manually positioned multiple drums of fluid needed for machining centers into tight areas. Trains of drums, with two to five carts per train, now quickly move throughout the plant instead of lift trucks with drum clamps moving only one or two drums at a time.
The transition to lean material flow is a culture change. Like all changes, there will be resistance to doing things differently, reorganizing the factory floor and using different material handling equipment. There are no shortcuts, but the payoff is definitely worth the effort. Making an investment now in converting a plant or DC to lean material flow is a winning strategy.
Carol Lazerick is a freelance writer based in Cleveland Heights, Ohio.