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Integrated Report OM300 Team 5
- 1. The Full KitProject Link Engineering Dante Cicchelli, Andrew Choraszewski, Shannon Manalel, Nathan Taschler OM 300 Section 001, Team #5
- 2. Agenda Company (description) Interviewees Project Overviewand Drivers Project Steps Show and Tell Project Challenges & Solutions Project Benefits Future Opportunities Leader Career Lessons
- 3. Business Description • PrivatelyHeld • Multinational • Headquartered in Plymouth, Michigan (Interview) • In business for over 75 years • Employs 400 worldwide, 175 at the World HQ • $80 million in revenues • Since implementing Lean production increase of 30%
- 4. • Manufactures Dynoameters(Dyno’s) for Automotive, Train, and Aerospace • Dyno’s test parts under all weather conditions and stress tests • Can conduct in-house testing and refurbishing at customers choice • Plymouth location builds the model 3900 and 3000 Dyno • Ships worldwide Business Description (Continued)
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- 7. Interview Info Jerry Verkerke •VicePresident of Test Operations and Director of Operations •Oversees day to day operations at Plymouth shop Headquarters •At Link for 5 years •Spent 25 years working for Ford Motor Company •Brought in to make a change •Student of Lean
- 8. Project Overview • ProjectStarted January 2013 • Completed end of the year, December 2013 • Link Engineering Implementation of Lean Manufacturing • Verkerke was brought in to make a change • Project Team consisted of 12 people • Needed cooperation and commitment from all employees • Project Team looked for employee input • Consistent shipping intervals
- 9. Before the Project •Unorganized plant shop • Waste • Unwanted materials and machines • D-O-W-N-T-I-M-E
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- 11. Project Description Eliminate waste(Sell/Scrap) Launch 5S system that welcomed input (Company Wide) Re-organize floor plan The Crib (Inventory) Kitting Dividing the plant into assembly bays Product begins simultaneously in different areas
- 12. Project Description Meet inthe middle at the scheduled bayMeet in the middle at the scheduled bay Improve motion (Wheeled Mobility)Improve motion (Wheeled Mobility) Standard paintStandard paint Paint when readyPaint when ready
- 13. The “Kit” ofthe Kitting Project
- 14. Link Shop Layout: (PostProject)
- 15. How and WhyFull Kit? “It just works” Lead time was too high Efficient use of space Full Kit eliminated D-O-W-N-T-I-M-E Better communication between departments
- 16. Project Challenges & Solutions Barriersto the plan Employee Resistance Rewards for “speaking up” Mobilization (waste in time/resources)
- 17. Project Benefits: Quantitative •Importance of improvement • Customer satisfaction and attraction • 30% increase in production and revenue • Significant decrease in inventory • Getting rid of “wasteful misfortunes” • Decrease in excess machinery and equipment • Consistent shipping intervals
- 18. Project Benefits: Qualitative •Improvement in: • quality of products • in Link Engineering’s production rates • in customer satisfaction • Reorganizing • Employee morale • Attracted more business
- 19. Future Opportunities • AppliesKaizen • Brainstorms new ideas • Advancement in shop’s floor – 19 bays • Expanding World Headquarters in Plymouth, MI • Optimize/Improve logical flow • Reduce costs by using space • Relocating offices – desk jobs above the floor • Employees’ input
- 20. Leader Career Lessons •Be persistent • ALWAYS room for improvement • Do what YOU want • Mentors, mentors, mentors! • Exchange ideas • Professional networking
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- 22. Thanks for yourtime • Questions
Editor's Notes
- #2 Interview and Project location: Link Global Headquarters Link Engineering Company, 43885 Plymouth Oaks Blvd Plymouth, Michigan 48170 USA
- #3 Include main topics of Agenda. Since most agendas will be similar, only discuss what is different about your teams agenda.. Or, use the slide to tell the class what you are most excited about explaining.
- #4 Business Description Link Engineering is a privately held, multinational manufacture and test company that produces high quality and precise test equipment. Link has been in business for more than 75 years and designs test systems called, “Dynos” that test car and truck suspension systems, brake rotors and a wide variety of train and airplane parts. These Dynos range in size depending on the customers’ needs and wants, and can test parts in all types of scenarios. The two Dyno systems we observed, being built at Link, were models 3000 and a larger 3900. These contraptions are test systems inside chambers that can change temperature from 60° to 120° Fahrenheit, giving the specific piece a thorough test through all types of conditions. Link not only manufactures the Dynos, but can conduct in-house testing and provides a refurbishing service at the customer's choice. Link Engineering employs approximately 400 people worldwide, and 175 at their world headquarters located in Plymouth, Michigan. There, they oversee Dyno design and manufacturing, and can send it all over the world to be tested; though while we were conducting the interview, Link did not have test system being manufactured for a North American company. Links total revenues for the past year were approximately $80 million, and since their implementation of Lean at Link Engineering’s manufacturing facility in Plymouth, Michigan, they have been able to increase production by roughly 30%.
- #6 Dynoameter 3000 is a test machine that stress test a variety of automotive, train and aerospace parts. This is a hydraulic machine that test the input and output of a particular part being tested.
- #7 Dynoameter 3900 is a test machine that is used to test parts like brake rotors in a variety of weather conditions. This chambered machine has the ability to create conditions from 60 below to 120 degrees Fahrenheit.
- #8 Our contact at Link Engineering is Jerry Verkerke. Mr. Verkerke is the Vice President of Test Operations and the Director of Operations at Link Engineering, and oversees the day-to-day operations of the Indian River, Michigan Tool Division, and the Plymouth Manufacturing Facility, where he is primarily located. After 25 years of working for Ford Motor Company and its partner companies, Mr. Verkerke has been at Link for five years and was initially brought in to make a significant change to Links operations. Verkerke solves the daily problems that face the shop, while continually trying to improve flow and reducing waste. Mr. Verkerke led the implementation of the Lean manufacturing at their Manufacturing facility in Plymouth. The Full Kit project that was conducted was about creating a better flow in manufacturing by reducing waste (‘Muda”) and increasing efficiency. Verkerke and his team worked on waste reduction techniques like getting rid of inventory, and useless equipment, which allowed for more manufacturing techniques to increase work production. The project was finished off by what Link calls “kitting,” which will be discussed in detail later in this report. Contact information: Jerry Verkerke Phone: 734-233-3897 Email: [email_address]
- #9 See Phase IV.A.4. a & c Project Overview This project started in January 2013, and was completed at the end of the year in December 2013. The project falls under Lean manufacturing with a strong Supply Chain Coordination aspect. We learn in class that Lean is all about reducing waste and maximizing efficiency, and their Full Kit project was designed around that idea. As stated earlier, Mr. Verkerke was brought in to make a change. Link’s CEO, Roy Link, told Verkerke that he instills full trust to improve their operations - knowing that Verkerke wanted to make a change that would significantly benefit the company, but with the least amount of risk for lack of a better term. Links business drivers, for conducting this project, were to make improvements to the flow of production. They wanted to make one machine a week for 8 weeks instead of eight machines in eight weeks to constantly move Dynos to make room for the next customer. Link, who is one of the leading competitors in their industry, wanted to make itself more available to take on more jobs and produce them at a faster rate than their competition. The project team was made up of twelve people under Verkerke’s direct report, and the key operators at Link are Manufacturing, Inventory Managers, and Project Management. Since this project took place at the Global headquarters, the project team was also made up of leaders of Engineering, Finance/Accounting, and the representatives of the shop workers (i.e. Assembly, Electrical, and Fabrication). Thus said, Verkerke wanted and needed everyone to be involved in this project to maximize effect and reduce risk. According to Verkerke, “It is important to have all aspects of a business covered. This way everyone can have an input and help implement the new process with utmost effect, I want the problems.”
- #10 See Phase IV.A.4. b Before the Project Link’s CEO, Roy Link, told Verkerke that he instills full trust to improve their operations; knowing that Verkerke wanted to make a change that would significantly benefit the company, but with the least amount of risk for lack of a better term. Links business drivers, for conducting this project, were to make improvements to the flow of production. They wanted to make one machine a week for 8 weeks instead of eight machines in eight weeks to constantly move Dynos to make room for the next customer. Link, who is one of the leading competitors in the industry, wanted to make itself available to take on more jobs and produce them at a faster rate than the competition.
- #11 Links original layout at the time Verkerke was hired. You can’t see in this photo, majority of the open space was unorganized inventory, or machinery that was never used (Muda). Verkerke looked at this and saw a lot of room for improvement.
- #12 Project Description The reason to conduct a project is to improve a company’s current operations, or to implement something groundbreaking. Before Link’s implementation of their Full Kit project, the shop floor was unorganized, supplies were scattered, inventory was mismanaged, and there was an overwhelming amount of waste. Link Engineering defines waste with the term “DOWNTIME” (Defects, Overproduction, Waiting, Non-utilized talents, Transportation, Inventory, Motion, and Extra processing.). Therefore, Verkerke explained to us that there were, indeed, extraneous amounts of downtime within their facility. His thought process initially was to further improve efficiency from their past amount of twelve manufacturing bays. From the first day he walked into the facility, Verkerke noticed that the floor needed a complete uplift from where it started - logical flow being his main goal of implementing and improving to sixteen bays for optimal usage. He began showing us the prior floor plan of the facility upon entering the company, and we quickly agreed that there was little to no room for additional bays, let alone further and continuous improvement. Verkerke then took us onto the main floor, (while wearing safety goggles) where he presented to us the current floor blueprint, and we congratulated him on his changes and implementation of additional bays because, as mentioned earlier, the prior blueprint was very tight-knit, and seemed as if there was no room for improvement. Verkerke was initially brought into Link Engineering to completely re-optimize their company’s floor plan. Therefore, he implemented Link Engineering’s new Lean Manufacturing journey by first going out to the floor to analyze and understand the problem, since that is the most vital part of attacking a project like this. As stated above, he noticed that there was much room for improvement and planned for weeks on how he would tackle on doing so. He first began to eliminate excess material and machinery that was not in use on the floor. Verkerke had to make a tough decision on whether to sell or scrap the machinery, such as their Parker Majestic ID Grinder. On the other hand, he chose to sell unused or wasteful materials, and placed the rest into one inventory crib for simple and organized access. Once Verkerke cleared a good percentage of the floor’s space, he then knew where to start, and gathered a team consisting of twelve people from all over the plant. Launching a 5S system with all of the floor employees, created a standardized system to allow change and employee input was the next step of Verkerke’s team. His main goal was to create logical flow and always include employee input when reorganizing the plant because that was their environment they had to work in day in and out. With these few changes, Verkerke began to notice improvement.
- #13 Project Description (cont.) The next step in the Full Kit project was implementing a communication plan that aligned a method to communicate real-time status throughout the business by initiating daily meetings in assembly bays to resolve any issues, and reinforce rejected material processes to ensure a closed loop with those in the Purchasing, Supplies, Tool Room, and Scheduling sectors of the company. Consequently, they shifted the Sales team with an improvement in visibility into the Manufacturing windows for assembly to drive attainable delivery commitments. Next, he launched a Manufacturing-Operating system (Linkage) to ensure alignment of the whole Link team Manufacturing, Engineering, Sales, and Accounting) to schedules and metrics that drive business performance. With using the new space within the plant shop, Verkerke and his team collected bits and tools from around the plant for all-in-one access. This improved crib organization by further adding more robust shelving, amongst other organizational advancements. With this, he was able to reconstruct all Link operations of the plant to create a logical flow. They did this by moving fifth wheel manufacturing to a new and unused location - to the balcony - again, eliminating waste. The team then moved the consolidated machinery (Stator Lacers) towards the northern end of the plant. Henceforth, they created staging areas for product-in and product-out of tool rooms, boring paint, mill, and assemble, which eliminated motion. Then, dividing the plant into assembly bays sized to accommodate a 3900 Dyno, which was Link’s most vigorous Dyno to date. Next, they did a combination of both dividing the bays for smaller machines, and used multiple small bays for larger machines. Ultimately, this lead to scheduled bays at staggered intervals, so bays 1-4, 5-10, and 11-16 are in different states of the process: such as mechanical, electrical, test, or shipping. Link Engineering currently ships at consistent intervals, and publishes bay schedules to provide visibility of current manufacturing queue and expected timing operations. Verkerke and his team chose to tackle this project using the above steps because, as he simply stated, “it just worked.” With any project, there will be downfalls, or failures, and working around them is how to find the perfect solution. First off, they decided to eliminate waste for the most obvious reason: to improve operations. There is absolutely no reason to keep materials or machinery not in use, so deciding to sell or get rid of it really helped with visualizing where change needed to occur. Applying a 5S system to create a standardized system to maintain with all employees was one of the most important steps of this project because he brought something to Link Engineering that they initially had little of: communication. This allowed and encouraged employee input for change in their environment. Moving the fifth wheel of manufacturing to a different location didn’t just create space for more operations, but also allowed the engineers to see what was going on beneath them and improved employee interaction. Lastly, creating staging areas for the paint, mill, and assembly sectors led to more space, which then introduced crib organization, again being another huge part of this project. It is safe to say that majority of this project was surrounded by creating space, and using it in the most optimal manner. The machine is then built traveling from engineering stations, mechanical stations, fabrication, and paint before finally being brought together to make the finished product. This new process dramatically cut time in the manufacturing process and in turn makes the customers happier. From step one, the carts are filled in the inventory crib and prepared for assembly. Any problems with inventory in a certain crib or any project in general are brought up in the morning meeting so Verkerke knows the problems and can resolve them quickly. Once a project is called to a bay, the manufacturing begins. The fabrication step starts and the frame is built. From fabrication, the process travels to the painting stage where the Link blue is applied to a majority of the projects. Not all projects must be painted this blue because companies can special order their machines with any color they choose. However, a standard paint is put on the interior of machines so there is no pause in production, and internal parts can be painted as soon as they are ready. Simultaneously, engineers are wiring the internal organs together and testing the electrical aspects of the project. Once these two steps are complete, they meet together in a designated bay where assembly starts. From start to finish, a project will take about a week to be finished. This new process Verkerke introduced has increased manufacturing production and efficiency.
- #14 These kits make up the lean manufacturing process; as illustrated below, these carts hold all the parts that are needed for assembly. Instead of running back and forth from the inventory crib, they have reduced the waste and supply needed to assemble in each individual work bay. These kits start off in an area by the inventory crib to be filled with the necessary material for each Dyno being produced. Once the materials from fabrication and electrical meet at a designated work bay, the kits are right there for assembly. Hard to see but there are a numbers that represent a Dewey Decimal system, Link uses to coordinate with the inventory crib. Also notice the wheels on the carts for ease of transportation, seems like a small addition, but has a big role for flow in Lean Manufacturing.
- #15 The floor plan for the new implementation at Link. This shows the 16 bays along with a new crib inventory system to allow kitting for each order. Notice that almost all available space is being used now.
- #16 How and Why Full Kit? Management at Link knew that there was a problem with the facility’s organization, and Verkerke was the man they wanted. Link was very unorganized and not producing at the high potential rate it could. Old machines were crowding work environments and communication was subpar at Link prior to their project. Verkerke implemented his lean process and redesigned the workspace to achieve optimal efficiency. They chose his solution to the problem because they knew that they were in trouble. While observing the workspace, Verkerke knew that this solution, his lean solution, would be the best fit to the company’s way of production, as Link engineering put full trust in Verkerke when they hired him and gave him full reigns to execute his ideas. When Verkerke knew what system he wanted to use, an experiment was done. Using high speed film, he recorded a test run on one of the experiments. With not much surprise to himself, the experiment went fast and smooth. The team was brought in to this new way and was one of the key goals of why this test run went so well. Looking over this high speed film, he reviewed the steps and what ways his process could improve. After this initial run was done he asked workers involved in the project what they thought and what things they would do to improve the process. Talking to the people who add value to the project is very important and a good way of finding out the real inner workings of the process. To get people with a better understanding of the process, Verkerke did the training himself. He created a team to help him out during the training portion. They started by watching videos about building aircrafts to get his workers thinking in a different mindset. With the 5S program in mind of getting organized, Verkerke wrote all the training programs and personally trained them all. Other locations liked the job he did that he traveled to other locations to train other workers with the 5S program. Making workers adapt to a new process is not always easy. They like to do things the old way and change is not good to them. This is one of the many project challenges that need to be overcome.
- #17 See Phase IV.A.6 Project Challenges and Solutions Every project has it’s own set of challenges and problems. If they do not, you can guarantee you have either overlooked something, or will have a more catastrophic problem later on in your operations. Link had to overcome numerous problems when implementing Lean manufacturing. Verkerke and his team looked ahead and specifically sought out things that were barriers to the plan, and attacked problems as early as possible, and in some cases prevented them from occurring. One of the early problems the project team had was with the employees. Even though their supervisors in the project team represented all employees, most were opposed or tentative to the idea of change, since they had been doing what was “normal” for years. Verkerke wanted everyone to be on the same page and have influence on the process. He did this by conducting meetings which involved looking for input and keeping everyone updated on what was going on. Verkerke admitted to us that the first meetings did not go well; many employees were late and were afraid to make comments. Verkerke wanted to change the quiet and awkward meetings; he did this by encouraging everyone to get involved and make suggestions or improvements to the project. As project leader, Verkerke recognized that he doesn't know everything. For example, when implementing the project, the project team wanted to try positioning one of the work bays in a manner that would make it very difficult for assembly to do their job. A single shop assembly worker brought this concern to Verkerke and his team’s attention. Verkerke’s philosophy is to get enough minds on problems to solve them quickly with minimal impact on the company. Verkerke encouraged employees by giving them rewards for speaking up and did not punish people who brought him “bad news.” On top of this, another problem the project unveiled was mobilization. The test machines that are produced at Link are rather large and hard to maneuver. The basic layout of the shop illustrates that you have fabrication and electrical separated by assembly. The problem was the waste in time and resources that it took to meet the fabricated housings with the electrical innards from the electrical department. The old method used was to stop production to pull additional people to help move the individual pieces by crane. Hence, the solution was to use simple cartwheels and attach them to the bottom of the fabricated housings and to use wheeled pallets to move the innards of the test system to assembly. This allowed two employees to move either the cart or pallet to the assembly bay area, thus increasing efficiency.
- #18 See Phase IV.A.7.a Quantitative Next, Verkerke stated to us the quantitative benefits of their Full Kit project. It is above stated that there was an increase in quality and production, which then lead to customer satisfaction and attraction. We learned that Link Engineering saw roughly a 30% increase in production and a 30% increase in sales revenues. On the other hand, with implementing organization within the facility, they began to notice that there was a significant decrease in inventory and excess machinery; and depending on the machine, it added roughly $40 to $52 million in sales per year just by the elimination of waste. Lastly, with a steady increase in production, Link Engineering also noticed a better flow through consistent shipping intervals (i.e. one per week for eight weeks compared to eight in eight weeks) to constantly turn products. It was astounding to learn few of the total benefits of the completion of their project, and to learn how far lean improved Link.
- #19 See Phase IV.A.7.b Qualitative Benefits Verkerke, from the first few minutes upon our arrival to Link Engineering’s facility, thoroughly explained the importance of improvement. No matter what situation, or company one is facing, there is no value-added when he/she is not attempting to improve. “The time it takes to improve, whether you fail or not, is value-added time” Verkerke stated. He stated that it was pretty tough to measure the qualitative benefits of any project, let alone the Full Kit implementation as explained above. He began stating that through tough trial and error, he first found improvement in quality of their products. It was tremendous to uncover that something as simple as reorganization of a floor plan could do that to a company. Next, yet just as important, Verkerke explained that there was not just an improvement of quality, but also an improvement in Link Engineering’s production rates. Consequently, with the improvements in quality and production, he unveiled to us that there was an additional improvement in customer satisfaction, which has attracted more customers. “The more that we have improved our layouts and products, I have noticed that we have become one of the stronger engineering companies out there,” Verkerke stated. One of the last qualitative benefits of reorganizing, due to their project implementation, was an increase in employee morale. He quickly stated that employees were able to work faster with higher efficiency, due to the organization and cleanliness, and this was all a result of employees being in a better mood because everything was where it had to be.
- #20 Future Opportunities Following the Japanese, Verkerke applies a Kaizen, or continuous improvement, approach to his job, let alone his personal life. It was before mentioned that Link improved the amount of bays from twelve to sixteen in a matter of a year, as it takes a lot of time and effort in order to completely reorganize a company’s floor plan for optimal usage and flow. After hours, Verkerke says that he often stares at the work environment and brainstorms new ideas on how to improve the layout. Thus said, Verkerke is currently planning an additional project to further advance the shop’s floor to nineteen bays, which as he stated clearly, will take a lot of sweat and tears to do so. Verkerke has aspirations of expanding the World Headquarters in Plymouth; there is enough acreage on the current grounds to build multiple buildings, and Verkerke wants to use these buildings to optimize and improve their logical flow and reduce costs by using that space to produce more of the products Link usually has to purchase outside the company. Finally, at the end of our tour, Verkerke explained to us how he is planning on relocating offices for those with desk-jobs to the second floor, so they all can have a “birds-eye view” of what is happening in the shop beneath them. He extrapolated how this will call for more employee input, since everyone will be included. Though there were many ideas, Verkerke explained, he was not allowed to disclose some of this private information because some of the ideas were sure to make Link Engineering a more vivid and unstoppable company. The overall future opportunities, as listed above, truthfully highlight the change that was made to the Plymouth facility. It was such an honor to see the end result and opportunities of a project in our world of work at a first-hand basis. After all, Link Engineering’s vision is to be “the premier testing resource for the global transportation industry", and they for sure are headed in the right direction.
- #21 See Phase IV.A.10 Leader Career Lessons Mr. Verkerke suggested that there were various attributes to implementing a successful project. Some of them were persistence, vision, aligning the team, being open to feedback, and adjusting along the way. The most satisfying thing about working in Operations for Mr. Verkerke was the action of daily engineering operations. Verkerke loves the action that surrounds operations and the challenge which forces you to innovate on the fly. He claims that he has never had a boring day while working at Link Engineering, and loves the fact that his skills are always being challenged and though things don’t always go right, he works twice as hard to make it right. The thing that contributed the most to Verkerke’s success was that he had good mentors along the way. He emphasized to always find a mentor and to always find someone to bounce ideas off of. He still has mentors, today, to further improve himself. His mentors include professional networks and other companies around the nation. He said it is important to work for good companies. He modeled himself according to his father. He considered himself a student of the business. Mr. Verkerke gave us advice on pursuing a career in Operations. He said to always do what we want, to figure out what we want to be, and to make sure we like it. He said it is important to figure out where you want to live then base your career off of that. He focused on the importance that chasing money isn’t worth it, and to have a great balance between work and home life.
- #22 Include scanned copy of Thank you note ( See Phase IV.A.11) Note: Show and Tell materials should be integrated as appropriate. If there are additional items, they may be added at the end. Be sure to include explanation of the materials. See Phase IV.C for direction about steps to produce final submission in hard copy to the Instructor and file(s) to submit on Canvas.