Case Studies

Case Studies

Story Title:
Making Lean the Universal Language at Universal Forest Products

(Reported by National Institute of Standards and Technology, NIST, Department of Commerce website case studies 2007).

Client Profile:
Universal Forest Products (UFP) began by selling to the manufactured housing industry in 1955, and today has grown to become a major supplier to several markets, currently manufacturing wood and wood alternative products, components, structural lumber and wood packaging, for site-built construction, retail home centers, industry and manufactured housing. Universal is the largest manufacturer of engineered roof systems and is a leading producer of pressure treated lumber nation wide. UFP is also the largest customer of North America's mills. Headquartered in Grand Rapids, Michigan, there are over 100 Universal Forest Products locations in North America. The facility in Chandler, Arizona employs 150 people.

Case Study #1 Situation:
Universal Forest Products strategic planners decided to improve their corporate philosophy to make improvements in the way they operated the business. At the Arizona facility, the main objective of improvement was customer focused, with an emphasis on improving on time delivery to all customers. Donnie McDonald, Plant Manager, received his Lean training through Georgia Tech and recognized that this was the direction Chandler UFP needed to move in. McDonald also recognized that the company needed help to make this transition and sought the help of the Arizona Manufacturing Extension Partnership (Arizona MEP), a NIST MEP network affiliate.

Solution:
Arizona MEP Project Managers Fred Cone and Joe Murcko performed a Lean Assessment at UFP Phoenix, determining that UFP was eligible for H1B grant funds to assist with training expenses. They were successful in being awarded a grant which reimbursed half of the training costs. Based on the findings from the Lean Assessment, Donnie and the project team from Arizona MEP knew that their work would not be successful unless there was a culture change and the UFP employees were on board with lean improvements. The production staff needed to be involved in the planning and decision making as well as the change implementation. Employees wondered why management wanted to make changes and implement "Lean." The term Lean does not translate well in Spanish and most of the production staff were Spanish speaking. They were concerned that jobs would be lost. The Lean team had to prove that this was not the case. One method that helped was using video to film the processes that the team wanted to improve. For example, videotaping helped illustrate the benefits of maintaining changes and improvements made during 5S implementation, and showed why everyone's involvement was so important to the success. This process gave the group something that they could see and understand. Visuals helped transcend the language barrier and gradually employees realized what the project team was trying to do. Getting the employees to accept change at Universal was nearly a three year struggle. After this breakthrough, Arizona MEP members were able to design a Lean implementation program that gave UFP Phoenix the tools they needed and skills to use the tools. Once this was accomplished, the MEP staff stepped back to allow UFP time to use the tools in a way that made sense for their company's specific needs.

So far, Universal Forest Products has had about 20 of their 95 employees participate in Time Wise 102 events off site. The TW102 is a one-day, basic lean training workshop that combines classroom learning with hands-on manufacturing simulations. Participants learn Lean concepts and then put them to use in a simulated manufacturing environment. For the first event, UFP sent employees from production, sales and shipping and receiving departments. The next round was primarily made up production supervisors. Afterwards, these people were able to come back to Universal and share their knowledge with other staff members and become in house "go-to" people. "UFP made sure that sales people were included in this training because Lean has to start the minute they get on the phone with the customer," said McDonald.

UFP wanted assistance in learning how to use the lean tools correctly and to implement them to maximize their use. Jason Gerros, Arizona MEP project manager, stated the main objective in doing the Value Stream Mapping and Kaizen work was to improve UFP's on-time delivery rate. From mapping out the processes, it was determined that in order to improve, Universal needed to work on their finished goods inventory and the layout of their yard. The sales department was also included in these exercises since communication issues between departments have a big effect on delivery, In January 2007, UFP held a Kaizen event to reorganize their yard. They eliminated waste in their processes and have made the procedures more visual and convenient for the employees. Bays are labeled for correct product and the fork truck drivers can easily see where completed orders are located to load trucks more efficiently. This has drastically reduced time spent looking for shipments, and has resulted in an over-all increase in on-time delivery.

Working on communication between departments has also created substantial benefits. Sales used to waste a lot of time trying to explain to customers why things went wrong or were not possible, and then making a flurry of follow up calls to try to "fix things". Now there are visual queues in the sales office which show available production capacity so the sales people will not make promises they cannot keep. They have added leader boards, another visual control, which indicate what machines are available and help manage production. This allows employees to make educated estimates as to when customers can expect delivery. Salespeople now see what is going on in the manufacturing process. They know which machines are used for which product and can negotiate among themselves and make calls to clients if there will be delays due to a problem or a rush job. Communication keeps people much happier and better informed and gives everyone more insight into the process so they know what can reasonably be expected from the factory. "The ultimate goal, said McDonald, "is for Universal to become adept enough at using lean tools like Value Stream Mapping and Kaizen, and to use them on their own. These processes and the way the Arizona MEP staff presents them are very well thought out. They allow you to analyze before you make the changes and then encourage the group to come up with the answers and make the improvements together. We are trying to tailor make things to fit our (UFP) applications and to try to standardize so that everyone clearly understands."

Results:
* Increased on-time delivery rate by 77 percent.
* Eliminated waste.
* Established visual queues in the sales office and on the shop floor.
* Improved communication between departments.

Testimonial:
""The lean tools that Arizona MEP has taught have become a template and now Universal needs to personalize them and keep them flexible so we can focus on the processes. The experience of working with Joe Murcko, Fred Cone, and Jason Gerros, the Arizona MEP team, has been very worthwhile. They were hands on when necessary, but allowed us to do the actual work as they observed. They engaged us and showed us how to use the tools ourselves with their guidance. This (Lean) will be a lasting experience for us since it will be ongoing. Now we have been empowered to continue the process on our own."
"

Donnie McDonald, Plant Manager

Activity Period:
2007-1

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Case Study #2
Kiesler Enterprises Inc.
Center Name:
Arizona Manufacturing Extension Partnership

Story Title:
Custom Cabinetry Company Builds with Lean

Client Profile:
Keisler Enterprises Inc., has manufactured and installed high-end custom cabinetry for private homes and residential complexes for over 40 years. Keisler also creates kitchen, bath and entertainment furniture of wood and laminate. The company was established in 1984 and employs 84 people at their facility in Glendale, Arizona.

Situation:
Kiesler's creative design and exceptional craftsmanship are highly regarded among its customer base. The company had grown consistently during the past few years and was having some trouble keeping up with the ever-increasing demand for their products. In 2005, Kiesler Enterprises brought in a new management team with the addition of a new company president and a new chief financial officer. Virland Johnson, the president, has a strong background in lean manufacturing and CFO, Dave Casebere is a Six Sigma Black Belt with a background in quality and process improvement. After observing their new surroundings, both men knew that if the company did not make some major changes and become more efficient they would not be able keep up with their growth and would not last in their industry. Over the years, sloppy processes and few controls had caused the company to lose ground even as they continued to get busier. They needed assistance getting back on track. Additionally, the workforce needed to learn about lean and its benefits and to see how it would work in their situation. Everyone had to be involved in the process and believe in the process in order for it to be successful. Kiesler contacted the Arizona Manufacturing Extension Partnership (Arizona MEP), a NIST MEP network affiliate, for help.

Solution:
Arizona MEP's project manager, Naidu Katuri, met with Kiesler to discuss the company's needs and do an initial lean assessment. He came back with a report and recommendations of where change was needed and what the MEP and their resources could do to help. Arizona MEP's Diane Morrissey facilitated a Timewise Le101 training which consists of both classroom and hands on simulation to illustrate the basic principles of Lean in a manufacturing environment. The hands-on simulation was a real eye opener for Kiesler employees at all levels. It helped the new management illustrate to the employees how desperately they needed everyone's input and ideas and to make significant improvements to their processes in order to stay in business. The response to the training was very positive. People were struck by how simple changes like organizing their workspace and providing ideas as a part of the solution, could bring about such tangible and significant improvements. The training was especially valuable because it drew out the shop employees who are typically very quiet. They got involved, shared ideas and felt empowered.

Joseph Murcko and Robert Allen, AZ MEP project managers, along with other Arizona MEP staff, took Kiesler teams through some very successful Value Stream Mapping (VSM) of their shop floor. The process uncovered many inefficiencies in the ways in which the business was operating. While the value stream of the company processes was diagrammed from start to finish the steps from current to future state were also mapped to show what they wanted to achieve and the steps they needed to take to get there. Joe and Rob then taught the teams how to conduct Kaizens (to make better) on the problem areas, so that solutions could be implemented as they went along. In addition to the training on Value Stream Mapping and Kaizen, Kiesler invested in kits for these procedures so that they would be able to continue doing the work on their own as they proceeded with lean implementation.

The solutions that were reached provided ways that Kiesler could work their processes more efficiently in order to reach their ultimate future state. The Kaizen process was used in a redesign of the shop floor to determine placement of equipment and the movement and flow of people and product thru the facility. This has brought about significant reductions to both people and product travel time. The Kaizen process was also used to redefine the relationship and interaction between sales and drafting. Previously, the salespeople would talk with the client and come up with a rough draft of the product. Next they would make the sale and take a deposit. Then it became the drafting department's problem as to whether or not the design was actually feasible. This way of doing things often cost Kiesler lots of extra time and money.

Using the value stream map as a guide, Joe and Rob were able to head the team toward their future state. The process included comparing three software programs for sales intention/engineering drawing, one of which was selected for purchase. Now sales and drafting/design teams work together and are involved in communicating and creating as a team instead of separate departments who are only concerned with their individual part of the process. The teamwork in the two departments has resulted in improved lead time since they are combining resources and steps. Finished product is built with far less reworking and error. Orders are completed faster so delivery has improved. AZ MEP staff and their resources continue to work with Kiesler in choosing a system for scheduling jobs and a shop floor tracking and control program.

Results:
* Improved lead time.
* Increased production.
* Improved efficiency of operation.
* Reduced travel time.
* Purchased new software program for sales intention/engineering drawing.
* Empowered employees.

Testimonial:
""This has been a very successful way for new management to come in to a company and win the employee's respect. Instead of coming in and dictating what was going to happen, the lean tools have allowed us to treat the employees as the valuable resources they are. This has been a very good beginning. We hope to continue building on what we have learned as we move forward. The Arizona MEP staff members are real professionals. I have been very impressed and satisfied by what they have been able to bring to this process.""

David Casebere, CFO

Activity Period:
2005-4

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For more information:
EM Consulting: SW Lean Associates
17454 W. Boca Raton Rd.
Surprise, AZ 85388 US
Email: jmurcko@emconsultingllc.com
(623) 537-9498
Fax: (623) 537-9424