Lean Without Layoffs
Lean manufacturing" is one of those terms that is used so much it can end up losing all meaning. But the dollar amount that Spencer-based FLEXcon attaches to its adoption of lean techniques in the last five years is enough to make you think the term isn't all rhetoric.
Between cutting physical waste, speeding product delivery times and reducing accidents, company officials say they have saved $8.2 million.
Systematic Training
Michael Engel, chief operating officer of the pressure-sensitive film manufacturer, said one key to the company's success story was its ability to win the trust and full participation of its employees. That started with promising workers that their participation in cost-cutting efforts wouldn't mean innovating themselves out of their jobs.
"If the first step is you send six people home, it's going to be very difficult to get people involved," Engel told an audience of manufacturers at a recent Massachusetts Manufacturing Extension Partnership meeting held at the company's headquarters.
Engel said FLEXcon began to see the need for something like lean techniques in 2001, when, after 44 straight years of revenue growth, the company began a three-year decline. The projected turn-around time for orders was too long to satisfy many customers, and even so, many shipments didn't go out on time.
So, using a $50,000 grant from MassMEP, company officials took part in "train the trainer" classes and then systematically educated its 1,200 employees about the goals and techniques of lean. After assuring them that "lean" would not be a euphemism for "layoffs," FLEXcon created the sorts of Kaizen, or "continuous improvement" teams made famous by Toyota. Composed of a mix of employees from different departments and different levels, the teams were charged with rethinking specific aspects of the manufacturing process.
Tom Kubacki, director of coating technology and production control for FLEXcon, said it is impossible for upper managers by themselves to come up with the specific changes that need to be made on the factory floor.
"They've got to come from the employees that are doing this day in and day out," he said.
The changes the teams came up with included having extra spare parts on hand to reduce downtime for cleaning machines, automating packaging systems to avoid back injuries and creating standard routes for lift trucks to reduce backtracking. Company officials said putting those kinds of improvements in place led to a 30 percent reduction in physical waste, a more than 30 percent increase in productivity and a major shift in FLEXcon's ability to meet its customers' expectations.
"We went from basically a disaster to now we meet our obligations on ship days," Engel said.
Engel said the company actually had to drag its feet in implementing some productivity-boosting changes to reduce employee numbers through attrition rather than layoffs. He said the company did end up closing some distribution sites, but it was able to keep its core facilities in Spencer and Nebraska relatively untouched.
One of the participants in the MassMEP event, Joseph Bocchino of Solutia Inc. in Springfield, said FLEXcon's approach was similar to what Solutia and other companies have done, but the focus on educating the company's entire workforce up front was unusual.
Bocchino also said making sure everyone in the company understood the lean concept probably made the changes easier to implement.
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