SUCCESS STORIES
Cabinet Door Service
Welch Allyn Monitoring
A.R.E. Manufacturing
AmFor Electronics
The McTavish Company
Cabinet Door Service
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Lean Manufacturing at Cabinet Door Service
Cabinet Door Service manufactures cabinet doors, drawer fronts, dovetail drawer boxes and other miscellaneous cabinetry components. Their market is small to medium sized independent cabinetry shops and cabinetry refacing companies. Besides offering hardwood cabinetry components, they also provide millwork, Thermo-foil components and custom pre-finishing services for the components. The company was founded in 1989, employing approximately 130 employees, of which 80% speak Spanish as their primary language.
Situation
CabDoor was trying to implement Lean Manufacturing and had an urgency to relocate their facility as their landlord had placed the current facilities in bankruptcy. In the course of their building search discussions with Strategic Economic Development Corporation (SEDCOR), one of OMEP's strategic economic partners, SEDCOR suggested contacting OMEP to bring in Lean Manufacturing expertise and expedite the new facility search process. All of this was occurring while CabDoor was experiencing compounded growth of 20% driven by the housing boom.
Solution
OMEP performed a business level operational assessment and through discussions with CabDoor's 4 business partners & key employees, determined the ownership and organizations "readiness to accept change" and who and what drove the organization.
A course of action was agreed to with the ownership as follows:
- A full employment strategy was deployed and communicated to all employees to eliminate employee fear about losing their jobs from the Lean Manufacturing implementation.
- A performance based wage administration system would be developed to share the financial gains from the Lean Manufacturing implementation with all employees.
- The entire workforce would be taught the Principles of Lean.
- Where necessary Lean English Essentials would be taught to the Spanish-speaking employees prior to their Principle of Lean class so they could participate and communicate in English.
- Value Stream Mapping would be taught to the core management and support employees.
- All employees performing the work would perform their own VSM observations and cycle timing of themselves in order to gain grassroots buy in for the changes.
- All manufacturing operations would be mapped and layout changes made in the old facility where immediate gains could be made; to validate flow improvements, equipment, and tooling changes in order to minimize process change risks on top of moving the facility; and to "right size the facility search".
- OMEP would provide training, technical process support, and coaching for the Lean implementation and plant layout.
Results
The engagement produced the following results:
- A purchase vs. lease analysis resulted in deciding not to purchase a 192,000-sq.ft building. A leasable facility was found consolidating the 3 buildings CabDoor was occupying. The new building was "right sized" to 68,000 square feet with the capacity to grow another 50% in the facility easily on the existing shifts. The resulting savings was $ 5,000,000.
- The VSM resulted in a first year labor productivity improvement of 33%, and a cost savings of $ 540,000.
- The VSM also increased the plant's capacity 25% and identified where the equipment constraints were for additional growth.
- The VSM process identified the automation CabDoor was evaluating would not result in a productivity improvement when the future state map was implemented. The VSM also identified the automation actually would constrain the new capacity created by the VSM. This resulted in stopping CabDoor from making an additional $ 260,000 capital investment they were planning for these machines.
- The Manufacturing Lead-time was reduced from 48 hours to 6 hours, resulting in CabDoor generating New Sales & Retaining Sales of $ 1,330,000 they could not have gotten without the shortened lead-time promise.
- 23 jobs were retained from the Full Employment strategy and 1 new job was created.
- Performance based wage administration and Gain Sharing systems were implemented, resulting in employees' wages coming up to competitive market levels.
Testimonial
When the decision was made to engage OMEP and launch our own Lean initiatives, the biggest concern was how to create a "true change in culture". As having dabbled in Lean for 3-4 years prior to our project, not much really got off the ground.
The OMEP approach to training and change within the organization has "rocket-launched" CabDoor to new heights in their Lean transformations during the 18 months of engagement, transforming our business model from the inside-out. CabDoor has become a legitimate market force and contender with the capabilities that have been uncovered, and has developed predictability within its operations that has never been seen before. It's been a ride of a lifetime!
Through their professional approach and a realistic understanding of learning, OMEP has impacted CabDoor beyond anything thought possible in the beginning. But, the real opportunity is not in what we started and accomplished, but in where we are now capable of going!
The Lean and Continuous Improvement philosophies are truly making extensive inroads into our culture, accomplishing what is considered the most important deliverable that OMEP could have brought to CabDoor as a client.
"Kudos" to the OMEP team, working to keep Oregon Manufacturing vibrant and strong!
— Cliff Stites, Owner-Mfg Manager
