Man working on equipment AGCO Jackson

2017 IW Best Plants Winner: Technology, Culture Nourish Manufacturing Success at AGCO Jackson Operations

Engaging employees in problem-solving and equipping them with cutting-edge technology proves a winning formula for this farm equipment manufacturer.

If you want to see the junction of advanced manufacturing technology and lean culture, make sure you visit AGCO Jackson Operations. The plant manufactures products worth more than $500 million annually on its two assembly lines – one for a variety of large (200 hp and up) tractors and one for self-propelled vehicles with application equipment for spraying fertilizers, pesticides and other products.

Look at either of the production lines and you immediately appreciate the Swiss watch nature of modern manufacturing plants. Jackson is producing tractors for different AGCO brands such as Challenger and Massey Ferguson. The plant works with more than 500 suppliers, domestic and international. Each product typically has more than 5,000 parts and vehicles are offered with thousands of options. About 25% of AGCO’s Terragator applicators are engineered to order. “It is common for us to build one tractor configuration that we don’t see again for the rest of the year,” says Eric Fisher, director of operations.

Plant officials say it is critical for the quality of AGCO products to be considered the best by customers if they are to increase market share in North America. To that end, Jackson uses a metric called Right-First-Time (RFT). Any part shortage in the assembly process or any test that doesn’t meet specifications is considered a fail. Company leaders say this metric is designed to produce a flawless product for customers and highlights any gaps between the assembly process and what would be perfect results.

AGCO Jackson Operations

Jackson, Minn.

Employees: 856, non-union

Total Square Footage: 1,033,000

Primary Product: Agricultural equipment, application and tractors

Start-up Date: 2001

Achievements: 99.7% first pass quality yield for component fabrication; 17% decrease in days of total inventory over past 3 years; 46.8% decrease in OSHA recordable injuries/illnesses; implemented 4.98 suggestions per employee in 2016; 98% on-time delivery rate to customers

To keep this massive operation running smoothly, facility leaders have built a “strong culture of policy deployment,” says Peggy Gulick, director, digital transformation, global manufacturing. Each June and July, plant leadership meets to develop goals and select key projects for the following year. Project leaders meet monthly with plant leadership to discuss the status of these projects. Teams have been working on big data, wearables and supply chain projects as part of the plant’s goal to become a “completely digitalized smart factory” in four years, Gulick noted.

AGCO has vigorously pursued new technologies to help improve productivity and safety. For example, more than 200 employees wear Google Glass so that they can instantly access work instructions, bills of material and other information for the exact model they are working on. Along with assembly, the glasses have been put to use in welding, paint preparation and many other areas. Replacing paper work orders or instructions at a computer terminal with the smart glasses has provided a productivity return twice what AGCO leaders had originally expected. The smart glasses take a little time to get used to, but Jim Croxton, director of manufacturing, cited an employee in his sixties who had quickly adapted to the glasses.

“If you have a tool of any type, if it works for you and makes your job easier, people will grab on to it,” Croxton said.

The facility has a number of initiatives to attract new employees and upgrade the skills of current employees. At Minnesota West, a local community college, AGCO employees can earn credits toward an associate’s degree in mechatronics. AGCO worked with the school to develop the program and has classes scheduled so that employees can continue working while they pursue further education. In return for paying their tuition, AGCO requires that employees continue working at the company for two years.

Central to Jackson’s continuous improvement efforts has been encouraging employees to be problem-solvers. For an hour each week, plant production is shut down so that employees can work on problems in their areas in order to improve quality or safety and to make jobs more cost effective.

In 2013, AGCO created an online tool on the plant intranet so that employees could enter ideas for safety and quality improvements or reduction in costs in their areas. In 2016, employee ideas resulted in savings of nearly $1 million.

Download an application for the 2018 IW Best Plants Awards competition. 

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