17 Aug Manufacturing group says efforts led to big improvements
Madison, Wis. – Wisconsin manufacturers made $215 million in efficiency and other operating improvements through the assistance of the Wisconsin Manufacturers Extension Partnership (WMEP) during the organization’s last fiscal year, it reported Tuesday.
WMEP is a state-supported, non-profit organization providing consulting services to small and medium-size manufacturers in the state. Its report was based on a survey of its clients. It was the first time that WMEP’s assistance topped the $200 million mark.
One company it helped was PDQ Manufacturing, a De Pere-based business that consulted with WMEP three years ago to learn more about lean manufacturing and to move from a traditional material requirements planning system toward kanban techniques — a Japanese method related to drawing up materials orders, and manufacturing toward current orders and market demands rather than starting out with set market forecasts.
“We employed a simulation of traditional manufacturing practices, batch-manufacturing processes,” said PDQ plant manager Scott Vander Heiden, who credited the conversion with cutting inventories by 50 percent, saving 50,000 square feet of work space and boosting profits as both the manufacturing and office ends have been streamlined.
“Then they showed us some of the tools and techniques that can be utilized by lean in a simulation type setting with our supervisors and team leads, and how when you apply all of these techniques how it really changes the flow of material through your shop, and really increases your efficiencies and reduces your inventory,” he added.
According to the WMEP report, benefits for the group’s 459 clients during its last fiscal year included:
– $159 million in increased/retained sales;
– $21 million in cost savings;
– $35 million in investment in new plant and equipment;
– 2,381 created/retained jobs.
WMEP executive director Michael Klonsinski pointed out the importance of preserving industry in Wisconsin. “Overall, we’re talking about a $46 billion industry in the state of Wisconsin. Probably the largest contributor to the state’s economy is directly through manufacturers and then, indirectly, all of the service organizations and everything else.”
About 80 percent of the more than 10,000 manufacturers in the state have fewer than 100 employees. Those smaller firms often lack the resources to adopt the latest in performance strategies, WMEP says. That’s where WMEP comes into play.
Wisconsin manufacturers remain under the continued challenges posed by foreign competition, but observers say they can better compete by working with groups like WMEP to gain greater operating efficiencies.
Klonsinski said Wisconsin manufacturers can maintain advantages over foreign operations through speed and flexibility, but also have to refocus their efforts on restructuring toward longer assembly runs, greater research and development, and more flexible high-tech operations.
“The bigger challenge long term is, are we going to have the people, both in the skilled labor side, technicians and management, available in this state to run and make that new manufacturing economy succeed,” Klonsinski said, emphasizing the need for a more educated labor force to remain competitive. “Nationally and even in the state are we graduating enough engineers, scientists and technicians to go ahead and fill what’s going to be necessary for a 21st century manufacturing firm? And that’s sort of an open question.”