At Erie Plastics Inc., a new law pervades the production floor and affects every part coming off an injection molding machine: Those parts are only to be touched once by human hands - any more than that is a waste of time.
``If decorating or assembly or something else is needed, it should be done in one motion,'' said Ronald Walters, president and chief technology officer. ``You don't put a part in a box or put it in inventory if you have to rehandle it later.''
Erie has large ideas of how to make a go of it as a midsize packaging company. The custom molder has used its 4-year-old, 430,000-square-foot plant as the foundation for a full-throttle approach to lean manufacturing and automation. And the company has achieved about 60 percent of its goal, Walters said in a March 23 interview at the firm's Corry headquarters, in northwestern Pennsylvania.
The plant is a model of efficiency. Today, the company's workforce is about two-thirds what is was in 2001 - from 600 then to 400 today - but its parts manufacturing has increased 50 percent, Walters said. Those workers are barely noticeable on the plant floor, and few forklift trucks prowl the grounds.
Chief Executive Officer Hoop Roche has been a ``lean'' believer for many years. But the cramped conditions of Erie's former, 156,000-square-foot building in Corry delayed his plans of having a wide-open area in which to execute his strategy, Roche said March 21 by telephone.
Roche, who served in the U.S. Coast Guard in Vietnam, said he needs to run a tight ship at Erie. In the packaging business, keeping costs under control is critical, he said, and reliability and speed are essential.
Automated processes eliminate some mistakes, but just as important is succeeding in a competitive marketplace. Although Erie does not compete for jobs with Asian molders, it faces what Walters called the ``indirect effect.'' As electronics molders have lost business to China, they have entered the packaging arena, to compete with Erie.
Erie, with about $95 million in sales last year from two U.S. plants, makes an assortment of small plastic parts - spouts and caps for laundry detergents, lids for coffee canisters, battery boxes, sprayer components and closures for pill bottles. The company has attempted to gain market share by offering well-designed, precise products, Roche said. But with resin prices continuing to rocket, Erie knew that new product offerings were not enough. It also needed a unique plant, he said.
When Erie moved to its new location in 2001, it had an opportunity to build something different, Roche said. The firm sought help from equipment supplier Husky Injection Molding Systems Ltd. Bolton, Ontario-based Husky offers lean systems and automated processes at its advanced manufacturing center. Erie ``blatantly copied'' that system, Roche said, while borrowing from others. Husky President and CEO Robert Schad was one of the first outsiders to walk through the new Erie plant, a model of cleanliness and robotics that few molders its size have matched.
A Schad mantra over the years has been ``automate or die,'' said Husky's packaging Vice President Bruce Catoen. ``He was a visionary that way many years ago,'' Catoen said. ``Today, you don't make a single thin-wall molded part with no automation.''
Husky helps many packaging customers set up lean-operating turnkey systems, Catoen said. Some common suggestions include centralized resin-distribution centers, manifolds that take the place of numerous hoses and piping, and quick-change molds, he said.
``You don't even discuss automation anymore [with customers],'' Catoen said. ``Like quality, it's a given.''
Roche already has seen some of his former molding brethren, including several near the Erie plant, go out of business. He does not want his firm to be a fatality.
``Our belief is that [becoming leaner] is unavoidable,'' Roche said. ``We think the companies that are left are doing reasonably well. But we don't think we are done [with lean processes] by a long shot.''
The approach at Erie has been echoed by others. Competitor Precise Technology Inc. of North Versailles, Pa., also prides itself on self-running, automated plants. Greer, S.C.-based Jarden Plastics Inc.'s plastic cutlery plant in East Wilton, Maine, is an extreme example of using robotics to move parts, according to Jarden.
Nypro Inc. of Clinton, Mass., is another believer in lean. Nypro President Brian Jones said automation is one key to a creative management strategy. Manufacturers can point to China for a disruption in business, but they have to find answers within their own companies, Jones said.
``It's not a China labor problem,'' he said. ``Our customers simply are not going to pay [as much] for tools anymore. If we've got a problem here, we have to get pre-emptive. It's an urgent situation. You have to rethink the entire process.''
Howard Nelson, Erie's vice president and general manager, said his firm has a two-pronged approach to lean manufacturing and productivity. First is the plant's physical layout. When Erie moved in in 2001, the former metal-furniture production site had corroded floors and walls, and its only inhabitants were nests of birds.
The company installed windows to bring in direct sunlight, cleaned and painted floors and walls and added air conditioning.
The company took just 21 days to move about 65 injection presses to the plant, installing them in clusters of six in about 200 truckloads, Walters said. All the while, the company's vision of lean was taking shape.
``The message was that we had to go `ultralean' for our customers and our environment,'' Nelson said.
Erie changed the plant, front to back. The firm installed pneumatic tubes to convey parts in the plant, and resin directly from one of 12 silos to each press, Nelson said.
Parts and resin fly at high velocity in crisscross paths through the overhead tubing like shooting stars. Parts are deposited in a continuous flow, tumbling onto conveyor belts that lead to decorating, gluing or boxing operations. Some machines have automated press-side assembly operations.
Overall, the effect is fewer workers and less transporting of equipment. Walters said tow-motor traffic from forklifts and carts is 60 percent less than in the old facility; Erie's goal is to reduce that even more. By opening a plant larger than it currently needs, the company can install a central conveying system. Automated palletizing units will organize parts and send them to the warehouse, according to Nelson.
``You want to avoid repetitive motion or redundant motion,'' Walters said. ``You don't ever want to have to go back and get a part and bring it back out to finish it.''
The warehouse is another work in progress. Much larger than Erie's previous warehouse, it only is 75 percent full because the company has become a just-in-time shipper with a goal of keeping finished goods no more than seven days.
``If you can make a product and get it out in five to seven days, why require keeping 30 days of inventory?'' Nelson said. ``We can both shrink inventory and improve cash flow for us and the customer.''
Injection molding machines are arranged in cells, with molding machines and assembly operations side-by-side. Even offices are more efficient, arranged modularly so they can be moved easily if the need arises, Nelson said.
``For the first time in the history of the company, we had a facility large enough where we could really plan it to do all the things we wanted,'' Walters said. ``Even if we built a plant from scratch, we wouldn't have made it any leaner than we did here.''
The plant's layout and equipment are the physical side of the change. The flip side is the process of ultralean.
One new addition is the use of Six Sigma techniques, allowing cross-functional teams to identify and eliminate waste.
The company uses a ``5S'' approach to lean: sort, shine, set-in-order, standardize and sustain. In simple terms, Erie is getting rid of what it does not need and moving equipment where it needs to be, Nelson said.
At Erie, the process includes visualization. If a hammer is taken from a pegboard, a picture of it remains to remind a worker where to return it. Bins are well-marked and coded.
Then there's the ``Jet Blue'' concept.
JetBlue Airways Corp. uses only two models of airplane so it can train workers rapidly and use standard parts, according to Nelson. Erie is moving to one type of injection press, Husky's Hylectric all-electric machines. Right now, about half of the presses at Corry are Hylectrics and any new presses come from Husky.
Nelson also relies on The Great Game of Business, a book by Jack Stack that encourages companies to share information with employees as a way to gain cost reductions.
At Erie, that means setting tangible performance goals, from turnaround times on parts or the amount of scrap produced, according to Nelson.
Workers look at performance trend data to gain a better sense of how well goals are met, he said.
``You can't stand on one nail, but you can stand on 100 nails,'' he said. ``The more people involved, the better we can improve.''
Erie is making changes quickly to stay sharp.
The outside of Erie's facility is brightly painted; blue squares frame the company's circular logo in a geometric frenzy. But a small, stark-white sign sits at the entrance to the parking lot with the message ``Support American Manufacturing.''
Roche said he believes in those words and he believes that reducing the number of laborers for efficiency's sake is necessary to maintain customer standards.
``We've downsized by about 200 people over the last four years,'' Roche said.
``Our parts output has increased where we make twice as many parts per person now. That's the way of American manufacturing. It's what we have to do,'' he said.