When Steve Jobs decided to build his NeXT Computer factory in Fremont, California, in 1987, he bragged that all of his production workers had Ph.Ds. The NeXT factory was different from every other electronics mill at that time, a clean line of machines connected from start to finish, all repainted Wehrmacht gray on a shiny, spotless floor. It was quiet, unnervingly quiet.
Jobs envisioned a different way of building fully integrated systems in this new factory. But his concept didn’t last, even though NeXT demonstrated just how clean and integrated—with hardware and NEXTSTEP software—a factory could be.
What killed NeXT was not its look, not its customer response, not its performance (in fact, the Worldwide Web was created on a NeXT system) but the price. At approximately $5,000, the total cost of the components that made up a complete system was just too high—more than an average student or home user could pay.
But NeXT was also a revolutionary manufacturing idea because when U.S. manufacturing was being loaded on the boats and shipped to Asia, Jobs, ever the creative contrarian, was trying to “make it in the U.S.” Later, in fact, after Jobs rejoined Apple as CEO, he said (according to biographer Walter Isaacson) if he had 35,000 industrial engineers, he would have kept manufacturing in the U.S.
Obviously, Jobs knew that the only way we were going to innovate and make money doing it was to not only to design, but to build products, especially complex products, in the U.S. And it takes elegant, powerful, fully integrated and quiet systems to do that. “Quiet,” meaning the operation is not flooded with a surge of disruptive hourly system updates. “Integrated” meaning connected by intelligence. And “powerful” meaning a servant.
Fast forward 25 years, beyond the lean obsession and the web, and we see a manufacturing IT landscape dotted with great variety—integrated, stand-alone, legacy, in-house, cloud-based.
The applications market has grown and individualized so much—either through add-ons and modifications or simply new apps—that we are fast approaching custom software and custom automation networks. The challenge is selecting and quickly installing the right software and automation, often displacing legacy systems—a suit-up process that inevitably brings risk, extra cost, and human pain with it.
Fortunately we can point to manufacturing technology pioneers—profitable growth innovators, companies like Auto-liv, Polamer Precision, Cirtronics, Newcastle Systems, Locus Robotics, and Firstronic—as examples of how operations can manage the transformation from legacy un-integrated systems, to powerful web-to-customer solutions.
Lean is an assumption, IT a necessity
I’ve covered Grand Rapids, Michigan, based Firstronic several times in my column, but they’re worth revisiting. (I’ll cover the other companies in subsequent columns.) The 2017 IndustryWeek Best Plants winner is well on its way to hosting an integrated manufacturing system that supports great product variety with very demanding quality and tracking requirements.
Firstronic CEO John Sammut knew that the company’s system had to manage more production processes, but budget and time, as well as market pressures, would not support endless in-house systems projects.
The answer required Sammut and his team to make some difficult decisions from a seemingly endless number of choices—in-house, cloud-based, licenses, adds, no-adds, mobile apps—many of which were not truly designed for small- to medium-sized operations. The company needed immediate solutions. The ideal system needed to, first of all, track customer orders, production and inventories and tie into suppliers. Detailed quality data was key to the company’s growth, even survival, plans.
Sandy Kolp, Firstronic’s Director of Program Management and Grand Rapids’ Plant Manager, recalls when the systems decision was made. With 50 customers worldwide, 65% of them automotive, the company needed to be able to connect 24/7 with its suppliers. But their old system, an off-the shelf application that brought materials in and shipped product out, just wasn’t up to it. What happened in between was unclear, and it used paper, lots of paper.
Looking back, Kolp admits that the company had a few of the essentials, “We certainly had very basic ERP. It was called DBA, a stripped down off-the-shelf package with little ERP functionality. It allowed us to bring material in and ship material out, but there were no safeguards to ensure that we had the right part, or that we were shipping the correct part, and there was very little ability to track product through our processes.”
Kolp recalls pain-filled days: “There was lots of paper, lots of visual inspections to ensure that we were receiving and ordering the correct part,” she says. “And there were lots of outside applications to help drive the system. We had to access a database that was massive to download and manipulate just so we could see basic MRP functionalities.”
The system also showed NPI (New Product Introduction) launches, engineering change orders (ECOs), scrap document tracking, quality and work in progress (WIP) tracking. The complexity of this system required five to 10 people just to maintain it.
Front-line supervisors were spending “a good chunk of their time doing data entry and helping other people enter data,” said Kolp. “When we moved to Plex, their jobs changed.”
WIP tracking for every assembly took the form of hundreds of little paper printouts marked up by operators. Completion, collection and manual entries kept operators from working on product--a big, time-consuming distraction.
Choosing a New System
Firstronic looked at new solutions and narrowed the choices down to four, said Kolp. Their needs for the system were straightforward: one that would eliminate outside databases, be scalable to handle growth in product and process complexity and set the company on course to go completely paperless. The plan was to move away from paper and whiteboards to touch screens, and to make assembly instructions, for example, very clear and intuitive.
“Essentially the new system was intended to move responsibility to the floor, back “to where it belonged – with the operators,” said Kolp.
Firstronic ultimately chose a cloud-based ERP system from Plex Systems that would allow users to log in and connect from anywhere, from devices including smartphones and wearables. It is subscription- rather than license-based, which can be a more affordable alternative for smaller companies.
The system is browser- rather than local installation-based, which eliminated the need for some onsite work and maintenance costs. Fifty workstations run at Firstronic’s Michigan plants, and 20 at their plants in Juarez, Mexico. Data and updates are immediately shared throughout the entire system—both in the plant and with suppliers throughout the cloud. No more batched or nightly upgrades with big surprises in the morning.
The system also allows Firstronic to more accurately track their scrap, inventory, obsolescence and variance in real-time. Manual and pure visual methods or stripped-down pull systems have difficulty handling the enormous variety in complex manufacturing environments like Firstronic’s because they are not powerful or accurate enough to record and predict what happens between raw materials and product shipments.
After initial implementation, Kolp identified some additional areas for the system to handle, including preventative maintenance, a requirement that had been managed offline. The engineering group can now track life cycles of certain equipment. “We can now talk about predictive maintenance,” Kolp said, “and it is now mostly automated,” emailing work orders in advance to the appropriate maintenance technicians.
“The instructions are specific—change the oil, do these three adjustments, etc.,” she added.
Once the job is complete, the worker updates and uploads the completed work order and saves it in the system. “We see this as predictive vs. preventative maintenance,” said Kolp.
After 1000 cycles, for instance, the system would trigger work orders to launch review and maintenance with management-set parameters for a time frame or the number of cycles. Kolp calls this approach “advanced data gathering.”
Tony Maiani, Firstronic’s IT system administrator, tracks WIP, production status and quality stats on his smartphone. Suppliers have access through supplier portals to key data, including alternative components—and Firstronic’s big four suppliers frequently do check in.
“We are more connected, with more visibility into our requirements,” says Maiani. “Yes, we can restrict their view—suppliers will not see everything—but for their own parts, they can see just about everything.”
Plex monitors the equipment data, notifying Firstronic if there is aberration that needs attention, said Maiani. As the company grows, it can focus on performing at a high level without having to add more people to monitor the equipment.
Patricia E. Moody is a writer and manufacturing and supply management consultant with over 30 years of management consulting and 12 books to her credit. She is the publisher of Blue Heron Journal, an online resource for thought-leaders and decision makers. She was named by Fortune magazine as one of "Ten Pioneering Women in Manufacturing."