UT Electronic Controls: IW Best Plants Profile 2008

Dec. 12, 2008
Achieving Competitive Excellence: Continuous improvement is UTEC's 'ACE in the hole.'

United Technologies Electronic Controls, Huntington, Ind.

Employees: 730, union

Total Square Footage: 144,000

Primary Product/market: electronic controls for the heating, ventilation and air condition (HVAC) industry

Start-up: 1990

Achievements: over 3 million hours worked without a lost workday case; received the 2007 Carrier President's Award for Environmental, Health & Safety Excellence; named a VPP Star facility in Indiana since 2001

Continuous improvement initiatives typically focus on eliminating waste, driving down costs, reducing inventories and other efficiency improvements. Certainly, UT Electronic Controls, a subsidiary of United Technologies Corp. and a unit of Carrier Corp., has seen all of the expected gains from its continuous improvement programs, but there's an additional component that is particularly attractive to any U.S.-based manufacturer -- their efforts have brought in new business. Not only that, but the new business was brought in from China.

Automation technology gets some of the credit. A new thermostat design based on surface mount technology (UTEC assembles circuit boards into controls used for heating, ventilation and air conditioning, or HVAC, units) could be made in a shorter amount of time and with fewer operators here in the United States than over in China. Credit also goes to a value stream mapping project that UTEC undertook, which focused on moving a product line to flow manufacturing, eliminating waste, reducing setup time for the surface mount technology and improving overall productivity.

While Toyota is renowned for its Toyota Production System and Motorola for its pioneering Six Sigma efforts, United Technologies has its own corporatewide initiative: Achieving Competitive Excellence (ACE). As United Technologies describes it, ACE is "a customer-focused, process-based methodology to achieve higher levels of customer satisfaction and business performance. The ACE approach aligns decisions and resource allocation with those activities that will yield the most impact on customer-defined expectations," with "customers" defined as all stakeholders in the business, including employees, the environment, internal customers and the end customer. One of the ways UTEC drives its continuous improvement forward is through ongoing kaizen events, with more than 100 such events held over the past three years. Kelly Raugh, manufacturing manager, describes a kaizen that had as its goal improving product flow on one of the production lines, focusing particularly on the conveyors.

"During the weeklong kaizen event, the team learned the power of time observation," Raugh notes. "The team identified the waste that the conveyors built into their current operations. The conveyors were dictating the rate, the labor and the speed of the process. The team worked to build a process to eliminate the conveyors into board-level testing, assembly and packing operations." At the conclusion of the kaizen, the team was able to eliminate 142 feet of conveyor, while creating six work pods."ACE has got us to the point where we can tell potential customers to tour all other competitors and then see us last," observes Ken Cornwell, quality manager. "When we can show who we really are, we seal the deal. We're very visual-oriented here at the plant, and visitors can see that."

Building and assembling HVAC controls doesn't necessarily sound all that exciting, Raugh admits, until you analyze exactly what these products do.

"We're controlling an explosion in your home," he points out, "and that requires a discipline and focus on quality; you can't take any shortcuts." First-pass yield for all finished products is currently 98.9%. The bottom line, says Esther Johnson, vice president and general manager, "is that ACE drives business."

Training Must Keep Pace with Process Changes

Employees at UTEC now know how changes impact their job and operations.

At UT Electronic Control (UTEC), one of the plant's biggest challenges is change management, notes Terry Keel, HR manager. "The pace of change in manufacturing has accelerated so much that change can't be managed at the same pace any more. That time frame gets compressed, for all of manufacturing. We can be halfway through one change and well into the next change at the same time."

That makes communicating change throughout the plant more important than ever. "Our greatest success has been getting through all these changes and being able to increase sales while keeping headcount relatively the same," Keel says.

Implementing change requires thorough training to gain the expected results, adds Kelly Raugh, manufacturing manager. He cites a recent example: "UTEC undertook an initiative to implement process certification (ProCert) on all critical to quality processes on the production floor. During those efforts, several teams were formed to understand the best ways to reduce variation within the process and how to effectively monitor its performance. The teams included manufacturing engineers, process engineers, technicians and operators specific to each critical to quality process."

However, while the teams were well informed of the objectives and why the changes were being made, operators on the floor were not fully aware of the reasons behind the process changes, Raugh notes. "Operators had a difficult time understanding the importance of control plans and control charts to their process. Therefore, the operators were not always completing the actions they needed to ensure their process was robust."

UTEC determined that it should train all employees within the organization, so within a two-month time span over 800 employees learned the fundamentals of ProCert. "The training itself was geared to the audience receiving the training," Raugh says. The purchasing department, for instance, was shown how important their role is to the quality of the product, while technicians learned the importance of proper maintenance of the equipment to maintain good products.

When you can show an employee how a change impacts their job and why it is beneficial, Raugh points out, their buy-in is much stronger and the results are more consistent.

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