TRAVERSE CITY, MICH. (Aug. 6, 3:30 p.m. ET) — As the North American auto industry continues its climb back into higher production, management consultants from BBK Ltd. are spending more time working with second tier suppliers struggling to keep up.
For those firms who made it through the auto industry's downturn — only to struggle with the rapid increase of orders — one of the first lessons is to re-think operating efficiency, said Guy Morgan, managing director and global operations advisory group leader with Southfield, Mich-based BBK.
“If you go into a plastics factory, and someone talks about how good they are at regrinding scrap like that's a good thing, it's a bad thing,” Morgan said during the auto industry's Management Briefing Seminars Aug. 6 in Traverse City.
While it is true that recycling plastics is a good way to keep resin costs down, he said, it ignores many more issues involved in production costs.
“How much energy does it take to make it again? How much labor is involved in doing it all again?” he asked.
Firms who want to improve their bottom line need to focus on improvements that avoid scrap and bad parts in the first place, he said, rather than fixing it after it's broken. That often means changing the old way of doing things.
Ernie Green Industries Inc. of Dayton, Ohio, which includes injection molder Florida Production Engineering Inc., switched to a cloud-based system to track production statistics so it improve efficiency, noted President and Chief Operating Officer Larry Jutte.
Using the cloud — which places data in an off-site system where any approved group can see and use the same information — allows the company to catch and fix problems quickly.
Under the old system, big problems were easy to find, Jutte noted, but small issues from a worn tool or slightly-reduced fill time, would only show up as a small notation in the production schedule at the end of a monthly report. At that time, it could easily take another month or two before committee decided what should be done to fix it, validate the repair and put it in place.
With the new cloud-based system and open access, the company can now find and fix those minor problems within a day, he said, which means less scrap and lower production costs.