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Successful Implementations in Lean

Nothing Fabricated About Great Results From Lean at ETM Manufacturing

By Karen Myhaver, Project Support Coordinator, MassMEP

In 2006, Rob Olney became the new owner and President of ETM Manufacturing Co., a precision sheet metal fabrication and machine shop in Wilmington, Massachusetts. The 40 year old company employed 14 people including Vice President George Kendall and Machine Shop Manager Kevin Foskett whose expertise and years with the organization were heavily relied on during the transition. Once the transition was completed, the management team started working on growing the company again.

After running the company for several months, Olney saw a need for technical and cultural assistance. He stated, "The previous owner had not done anything wrong but had been doing things the same way since 1970."

Olney recognized that they needed a different approach and felt that Lean could help change the culture. ETM’s management was receptive, but it was difficult to determine what needed to be done and when. They thought that an outside source would be helpful.

After interviewing three different Lean providers, they chose to work with the Massachusetts Manufacturing Extension Partnership (MassMEP) because of their long track record of success with companies similar to ETM. They had met Charley Lincicum, a MassMEP project manager, and felt that he knew their business and could connect with their people. Additionally, the MassMEP had a long term relationship with the state and was very well versed in assisting with the grant process. As a result of MEP’s Jim Gusha’s help with the small details and coordinating deadlines, ETM was able to sail through the approval process and obtain a $41,450 grant for Lean-related training.

The grant writing process helped ETM identify two areas for assistance. First, they wanted to become a "metrics focused" organization to help measure the results of Lean improvements. Charley Lincicum worked with other consultants to bring in overall corporate metrics and to connect those to their Lean work. Benchmarks and measures needed to be in place to see where the company was going and how well they had done.

Second, ETM wanted to start building a continuous improvement culture. Work with MEP began with the TimeWise® Le101 basic Lean training to get everyone on the same page and introduce Lean terms and processes. They shut down the shop for a day and brought the entire ETM staff off site to participate in this hands-on simulation and class. "It helped me identify Lean champions and introduced Lean techniques and language so we could all communicate," said Olney.

Removing the Waste in the Process
The MEP was most involved in helping ETM deal with the concept of "muda" or waste. When you do something the same way for 20 years, it is hard to see the waste in a process.  By breaking the process down through Value Stream Mapping (VSM), the employee team revealed wasted steps, wasted time, and wasted operations. These discoveries lead to many Kaizen events where waste was removed and processes improved.

During the Kaizens, the shop floor was actually rearranged three times. This involved major changes like moving large machines and rewiring electrical connections to simple changes like making a wall opening larger and adding a $99 printer for the shipping department. Kaizens are going on all the time as part of ETM’s Continuous Improvement – they are always looking for ways to make a process better.

High Impact
2008 was not a very good year for many businesses, but ETM saw a 20% increase in revenue and paid out over $30,000 in bonuses. This was achieved by hitting their metrics. Gross profit performance is tied into bonuses and shop floor performance is tied into gross profit.

Stated Olney, "One of our largest customers had a large ramp up this summer and because we were on the Lean path we could meet their demands and keep our other customers happy, which contributed significantly to last year’s growth. In the past, if a particular customer had a ramp up we could either produce for them and make our other customers wait or produce for the others and disappoint the client with the large job. This meant someone was always disappointed.  Lean increased our productivity and gave us the capacity to do both."

Olney continued, "Working with the Mass MEP was well worth our time and energy. We have lots of hours invested [in Lean training]. In particular, we appreciated Charley’s flexibility to adapt to our schedule and needs. We are at a point now where we recommend MassMEP to other manufacturers often."

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