Below is a tale of my journey as a young manager going through the enterprise transformation process as I know it, our Lean conversion, and the key lessons I learned.
After graduating from the University of Texas in Austin in 1993, I moved to Dallas to join one of my friends in helping his business grow. His company was a pioneer in remanufacturing laser toner cartridges. At the time it was about a three-million-dollar business. We provided cartridges and services to businesses all over the DFW area. And we had some great clients.
We soon developed a process that worked well: Spent toner cartridges were picked up, delivered to our factory, disassembled, rebuilt with new components, and refilled with toner powder. The remanufactured cartridges were then hand delivered back to our customers. We had a charismatic owner, excellent salespeople, and a young, eager management team. We were on a roll as one of the early entrants into a new and growing market.
Soon we were busting at the seams and moved to another location nearby. We called in an industry expert to help us design our new production line. His background was with Kodak, a company that received thousands of rolls of film every day. Each of those rolls had to be developed and shipped back to customers by the following morning. So that was the business model he knew well.
Mr. Consultant advised us to build a long production line and to work in batches of a specific cartridge model. We were to break down all the cartridges in a batch into constituent parts, then send the batch of parts for processing throughout the plant. And then deliver the parts back to production stations along the line for reassembly.
Batch sizes ranged from 200 to 500 units. Once reassembled all cartridges were put into a batch and sent for final testing. We thought we were high tech and invited customers and industry partners to visit and learn more about our great processes.
Some days went great (we thought) with few quality issues. But other days we would start having defects which would show up in final testing. This led to rework of some, often many, and occasionally all the units produced. Customer returns became a problem. Sometimes almost 10% of our products were returned.
After moving we decided to embark on a Continuous Improvement journey. We enrolled with the Hogan Center for Performance Excellence and began to learn some best practices to improve our business. I became involved in the Texas Quality Award, later known as the Texas Award for Performance Excellence (TAPE), based on the Malcolm Baldrige Quality Award criteria.
We formalized our Mission, Vision, and Values, began strategic planning, and formed teams. Those early teams focused on areas of the business outside of financial and quality, including an employee development team (The MOD Squad – Maximizing Ongoing Development”), and a Customer Focus Team (that team was not original in naming itself)!
Soon we implemented a problem-solving model and assigned teams to work on problems in their areas. Leadership was in sync, and we were largely managing by fact. We also implemented a quality management system and became ISO 9001 certified. All of these improvements took place over about a three-year period.
Despite these positive changes we were still having substantial problems pushing product through the plant. None of the ideas we tried impacted the bottlenecks, massive amounts of rework, and intense crowding in the plant. We literally had several hundred blue WIP bins. Parts were stacked everywhere. (See photo below)
To make matters worse we also could not solve our materials shortages. No matter how much safety stock we had there was always something we were short of that would bog down production.
No worries though, we would just build hundreds of units without the needed part, then set them aside. And when the part came in it was ‘all hands on-deck’. People would jump to install the part, test them all and get the shipment out. We had lots of ‘heroes’ in those days. Folks stood out by going the extra mile, staying late or driving four hours away and back to get a part. We thrived on the “git ‘er done” mentality.
Looking back, we were in a constant firefighting mode. I recall there was almost always a line of people waiting outside my office. They had problems and were looking for answers. I had to scramble to come up with solutions to many issues on a daily basis. At the time I thought this was just part of my job as the production manager.
Somehow, despite ourselves, our customers loved us, wanted more, and we had grown over five times the size when I started! After about five years of this flailing, we knew we had the solution: We just need more space! Then we can double or triple our inventory and process thousands of cartridges more per month!
Soon the management team had decided: We definitely need the additional space to keep all of those in-process parts and raw materials. Let’s move again!
In Part 2 of this blog Wiff shares how his company used Lean Best Practices to dramatically improve their business and develop leaders in the process.