Archive for July, 2008

A Fresh Look at Lean Systems

July 22, 2008 by NateS

I have always been amazed at the steps taken by Setpoint to create an innovative atmosphere.  Pioneering ideas have kept Setpoint in business while similar companies have proven unsuccessful.  With innovative thoughts always on the forefront, essential changes are typical here.  Lean systems were the motivation behind the latest change of revamping the receiving process.

Our current receiving process involves on-or-before deadlines from vendors and scads of steps.  You may think it’s harmless but we have seen that as parts trickle in valuable assembly time is wasted.  There is a lot of waste (MUDA) when parts are used to assemble only to stop before it is complete because not all of the parts have been received.  To solve this first issue we have moved to a just-in-time system with our deadlines on Thursday so all receiving can be done and parts are ready to assemble first thing Monday morning.

The second issue will require time to refine.  In order to lean down and streamline our receiving process we required fresh eyes.  It was time to educate and diversify our engineers by training all in the art of receiving.  Subsequently, this proposal was received with several grumbles but has become a great asset in understanding various facets of our company.

Lean thinking is a part of the Setpoint way.  Although engineer induced part discrepancies are inevitable, we feel this is a resourceful way to refine our process and increase productivity.

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The Four Day Work Week

July 15, 2008 by Roger

Are we doing our part to battle the energy-crunch, or just lounging around on 3-day weekends???

In 1938 the U.S. Government passed the Fair Labor Standards Act (FLSA), standardizing the eight hour work day and the 40 hour work week.  At the time it was a major improvement for the average American worker, since prior to the FLSA, many companies forced their employees to work 60+ hour weeks with no regulations whatsoever requiring employers to exercise fair and humane treatment on their workers.  “Sweat shops” were the norm, not the exception.  Since that fateful day seventy years ago, every Monday, Tuesday, Wednesday, Thursday and Friday workers all over the country wake up, get dressed, eat breakfast and go to work from 9 to 5.

Over the years situations have come along that have made people question the ‘absolute’ effectiveness of this 5 day 40 hour week.  My first personal memory of such a situation was during the gasoline shortage in the early ’70s.  It was a crazy time as cars lined up at gas stations only being able to fuel up on odd or even days.  People were literally fighting in the streets over gasoline.  During that crisis, some forward-thinking companies realized that they could work 4-10 hour days instead of 5-8 hour days, still get their required production quotas complete, and save 20% in fuel usage for the employees with the shortened weekly commutes.

Obviously the 4-day work week didn’t become the standard overnight but it has been around for decades now in one form or another with many manufacturing companies utilizing it for their blue-collar workforces.  It is often used as a perk in recruiting, and most employees find it to be a great benefit to them.  As flex-shifts became popular in the 80’s & 90’s more white-collar companies started instituting 4-day weeks too.  Again it was considered a benefit and people were very much in favor of the resulting 3 day weekends.  Employers also became fans of the 4 day week as they took note of improved morale, increases in productivity and decreases in absenteeism.  So did these companies find the ‘ultimate schedule’ for the employees and their shareholders?  Some say yes, some say no but I think all agree on one point.  There are some very tangible energy savings to be considered when setting a company’s work week, both for the employees and the company.  When skyrocketing energy costs are bold headlines in every newspaper across the country every day, any and all ideas must be seriously considered.  We find ourselves at that crossroad today.

Here at Setpoint, we have weighed the options and the potential benefits and drawbacks carefully and concluded that a 4 day week seems to be a good fit for us.  With all factors considered, we have undertaken a 90 day experiment to try and implement a more efficient schedule that balances the needs of our employees, our customers, and our shareholders.  We have adjusted our work week to a “four 10s” mode, or Monday through Thursday 6:00 am to 4:30 pm.  This change comes in response to several key points that have become more relevant by the day:

  1. Public gas price comments have quickly transitioned from things like “Oh my goodness, these gas prices are steep!” to “Without a doubt, we should immediately invade and occupy all foreign oil-producing countries!”
  2. The Great State of Utah, led by our friend and Governor Jon Huntsman Jr., has moved all state employees to a similar work week, with practically all state offices closed on Fridays.
  3. For some time now, Setpoint employees have requested a four-day work week.  After weighing every possible angle, we feel that we can be just as effective (if not more) as we were in a Monday through Friday, 8 hours per day shift.  At the same time, everyone gets an extra day to relax, pursue their hobbies, spend time with their families, etc. and of course, there are those nifty energy savings to consider.

The primary payoff for this schedule for employees is obvious, with an extra day available every week for whatever they may choose to use it for, and an immediate 20% reduction in commuting costs.  But there are also a number of less-obvious benefits that should be noted: less wear and tear on vehicles, less time spent inhaling polluted air while stuck in traffic and less commute-related stress for everyone.

The payoff for the environment is also easy to see, as theoretically we are facilitating a 20% reduction in the notorious greenhouse gasses that our cars emit by reducing the commuting days for every employee (in reality, it will probably be less than a 20% reduction since many people will still be driving SOMEWHERE on Fridays, even if they don’t have to drive to Setpoint anymore).  There is also the added energy savings of minimizing electrical and natural gas usage in the Setpoint facility on Fridays.

And finally, the payoff that the 4-day work week can bring to Setpoint should be noted.  For years government and academic studies have shown that employees are more efficient in a 4 day work week.  The reasons cited are 20% less ‘start-up time’ required every week (i.e. that protracted “where was I when I left off yesterday?” timeframe that we all go through every morning as our caffeine kicks in), improved employee morale, and a decrease in employee absenteeism (due to an extra day every week to take care of personal business).  This schedule also allows a more reasonable ‘flex’ when the workload is heavy and overtime is required to complete commitments.  Employees can work overtime on Fridays as required to stay on schedule and still have a two-day weekend to “recharge the batteries”.

With the changes that are taking place in the world today we all need to be flexible and open-minded to try and find more efficient ways to conduct business.  This means we need to occasionally look past some of the long-standing traditions that may no longer be as applicable as they once were.  With that sort of forward-thinking in mind, we here at Setpoint embark on our 90-day experiment with high hopes for a successful outcome.  The measure of success will be determined by the technical and financial effectiveness and efficiency in our efforts, as well as our employee and customer satisfaction levels.  If we are as successful as we expect to be, it’s probable that we will implement the 4-day work week as our standard.  Check back with us in 90 days to see how this grand experiment works out!

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Increasing Efficiency & Decreasing Waste

July 9, 2008 by Machel

twit-canO.K. so what’s with the steel garbage can with a Setpoint logo and the anti TWIT sign on it?

TWIT is now known around Setpoint as it “Takes What It Takes”.  To help cut costs and be more profitable we have been challenged to look for quicker, faster, better and cheaper ways to accomplish the jobs given to us while still maintaining the level of quality that the customers expect.  The TWIT program was setup to encourage thinking in new or different ways to solve problems that are more efficient and less costly than what they have been done in the past.

In the TWIT program, a time or money saving idea that is implemented is recognized at the weekly Huddle.  Those involoved, what the process was and the benefits are explained to the company.  An item representing the cost savings or process is thrown in the can and a brief description is recorded on the can.  The best part is the excellent green bonus for the employees involved.

twit-insideIn one example, a slide that was specified proved to be too flimsy for the application.  An equivalent slide could not be found with mounting holes that were close.  A redesign of an expensive weldment and other parts in the assembly were needed to accommodate a more robust slide, it Takes What It Takes.  The difference came with the thought, “let’s just make our own slide.”  After some consideration, a slide was built using common off the shelf components and simple customized machined components.  The final configuration worked exceptionally well, was about the price of the original slide, and fit the existing mounting holes configuration so that no other redesign was needed.

twit-lid1Getting things done quicker, faster, better and cheaper will take some thinking outside the TWIT can.  If we can save $$$ by eliminating unnecessary operations or by new or different processes we will be more profitable.  As employees we will also have a nice little boost to our wallet.  Besides, isn’t this how new technology and processes are started…by thinking outside of the TWIT can?

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Manufacturing in America

July 1, 2008 by Scott S

Recently a question was posted in the “Machine Design” forum asking “How can America get the manufacturing back from China?

I pose the question…why did America’s manufacturing move to China and Mexico, and can we ever get it back?

Here are my thoughts:

As more and more companies move to outsource manufacturing offshore looking for short term gains in labor rates what may be the long term consequences of these moves?

As shareholders demand a return on their investments, CEOs and CFOs look for ways to be profitable, after all this is how and why companies stay in business.

Mistakenly believing that labor per unit (LMPU) is the only factor to consider, and all other things being equal, many companies turned to lower labor rates in developing countries, with deficient environmental policies, safety standards, and often low product quality and substandard controls.

Recent examples are all around us, lead in paints, inferior steel, disease outbreaks in imported fruits and vegetables, staggering increases in emissions from these developing countries and rampant pollution.

Most of the companies’ leaders do not have technical backgrounds and do not realize that the problem of expensive labor could be solved here at home with automation, and the associated increase in quality that is inherent with automation.  Instead they focus on short term payback, and are further deterred from an automation solution because of the high initial development and installation costs.

Only after companies make the move offshore do they start to realize all the overlooked factors and start to insist on changes.

Unfortunately these companies are no longer in the United States so there is no recourse when trademarks, copyrights, patents, and just about all other intellectual property protection laws and rules are of no consequence to foreign governments who see this as an opportunity to increase their own standard of living.  Who can blame them?

They have learned manufacturing processes and assembly techniques.  They can maximize profits using the same cheap labor Americans were hoping to exploit and in the end get further gains by not having the constraints from environmentalists, labor unions, quality standards and regulations, nor do they really have to give back anything to the “American” company who showed them the technologies to start with.

So long term American greed, limited technical understanding, and short sightedness is the root cause of the decline of Americas manufacturing resources.

We did this to US!!

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