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"The results are a consistent process that eliminates variability, and improves quality." Pearson Packaging Systems' Michael Senske on his company's application of lean/Kaizen/Six Sigma principles.
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"There's more to building a solid relationship than price, said McPheely, addressing the importance of supplier and customer partnerships. "Some customers consider a discount as a win, but everyone has to make a profit or something falls apart along the way."
"Low-cost goods are a positive for everyone," continued McPheely. "While seemingly crippling obstacles such as shortages of North American engineering talent, high costs of labor, benefits, and taxes are quite real, we need to realize that government cannot force change."
Hartness' experiences brought them to a clear realization: "We must compel our customers to do business with us because we provide the greatest value," he said. "There are no excuses."
McPheely said following a traditional business strategy didn't do what Hartness needed. "We spread our risks, diversified our equipment across major packaging segments, pretty much did what the textbooks said, but costs and competitive pressure brought us to realize we had to embrace lean manufacturing," he stated.
McPheely pointed to the rollout of Hartness's flagship Dynac conveying system that, while providing significant and unique user benefits, "didn't make us the premier machine supplier we expected it to. It was time to become a complete solution provider."
During the past 15 years, Hartness has added European, Latin America, and Asia/Pacific Rim operations, a joint venture with Australian robotic deployment experts VISY, formed its own conveyor manufacturing arm, and added its integration business. Hartness builds 80 machines a year in Europe. "We first went to China for the parts," said McPheely, but we'll build 30 machines there this year and next."
Michael Senske, president and CEO of Pearson Packaging Systems, opened his remarks by supporting the Hartness notion that lean involves far more than just the manufacturing operation. The constraints of time made Senske focus on his company's manufacturing successes gleaned from a lean/Kaizen/Six Sigma approach. Pearson builds end-of-the-line packaging equipment.
"We build to customer spec," said Senske. "Our machines are low-volume, high-variability, and often are modified and customized from machine to machine."
Pearson customers demand shorter lead times, more functionality for the dollar, and more machine and system reliability, stated Senske.
The question for Pearson was how to take lean principles into a low-volume/high-variability business? "Most companies rationalize that they can't do it. Lean is supposed to be for high-volume, low-variability operations, isn't it?" Senske believes many facets of lean manufacturing are best suited to his type of operation.
The starting point for Pearson is emphasis on standard operation procedures. "We can design and build most machines the same way, even if customization is involved," Senske said. "The results are a consistent process that eliminates variability, and improves quality." He pointed to a "5S" Kaizen mantra: Sort: get unnecessary items out of the production space. Set in Order: arrange manufacturing cells the same everywhere so the builders are familiar with the environment. Shine: Make it clean, keep it clean. Standardize: establish standards for the build, for the parts, and follow them. Sustain: Keep doing it.
A large part of the company's lean success is inventory management. "We buy parts today that we'll use tomorrow," said Senske. "Eighteen months ago we turned inventory 6-7 times. Now we turn 19-20 times, with multiple daily deliveries from our suppliers, often right to the manufacturing cell."
Flow is another important mantra. "We'll do anything we can do to improve flow," he tells fellow employees. "When you improve flow, everything else improves with it."
Special emphasis on achieving reliability means Pearson tests components and sub-assemblies in accelerated conditions. "Establish component reliability in an extreme condition, and you dramatically increase overall machine reliability," he stressed.
The results have been rewarding. "Assembly time now is around 70 hours, down from 180 hours," said Senske. Lead time dropped to about 35 days, from 90 days. It means being able to pass cost reductions along to the customer."
Finally, recommended Senske, "Involve customers in creating functional spec. Involved customers don't require as much future customization."
