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Firm’s continuous improvement philosophy paying off

Industry                                                                               
Machining

Company City
Decatur          

Company State
Alabama                                             

Company Name                                                                     
Automatic Screw Machine Products      

Project/Activity Year
Lean Continuous Improvement / 2008

Company Profile
Automatic SMP, a subsidiary of the Illinois-based firm Lawson Products, manufactures precision turned parts and specialty fasteners for the aerospace, defense, automotive, heavy equipment and marine industries. Automatic SMP was founded in 1914 in Chicago, Ill. Annual sales total
some $20 million and the company employees 131 in its Decatur, Ala.

Situation
Sustaining continuous improvement is the business philosophy for Decatur, Ala.-based Automatic Screw Machine Products Company and since 2005, the company has partnered with Auburn Technical Assistance Center (ATAC) for its guidance and expertise in leading, implementing and sustaining lean processes.

Working with Automatic SMP on a variety of training and coaching programs, ATAC has helped the firm improve processes, quality, performance, and equipment reliability. Automatic SMP recently reported progress achieved in its Cross Drilling area that suggests the benefits achievable through adopting a business philosophy of continuous improvement.

Automatic SMP, a subsidiary of the Illinois-based firm Lawson Products, manufactures precision turned parts and specialty fasteners for the automotive, aerospace, heavy equipment and marine industries. The Cross Drilling area is where small, high-temperature-tolerant hex nuts are precision drilled to allow for the installation of a stainless steel locking wire.

“These specialty nuts are used primarily in aerospace and defense industry products,” explains Automatic SMP Director of Manufacturing Jonathan Long. “The lock wire is installed at the end of an assembly process as both a quality signal as well as a security measure.”

Solution

Lean, a continuous improvement system focused on reducing or eliminating waste and non-value-added activities in a process, promotes the use of visual work instructions, standardization, systematic equipment maintenance and efficient workplace organization.

Working with the firm in the Cross Drilling area over several months, ATAC lean instructors have helped the company in the key areas of value stream process mapping, 5s waste reduction and work area improvement, and Total Productive Maintenance (TPM).

It has been one of the most successful events that we have done,” said ATAC Lean Specialist David Hicks, who has been the primary ATAC continuous improvement facilitator working with Automatic SMP in the partnership, and continues to coach the firm on a regular schedule.

Results
Automatic SMP credits ATAC with enabling the following economic and business impacts through its training and project assistance:

Job Retention & Job Creation
• Retained two positions
• Created four positions

Increased Sales
• $143,000 annually

Retained Sales
• $450,000 annually

Maintenance & Overhead Reduction
• $50,000 annually

Key Area Improvements
• Improved equipment uptime from 65 percent to an average of 98 percent.
• Consolidated processes so that product now goes from manufacturing directly to shipping. Before implementation of continuous improvement, parts were transported back and forth across the company’s 61,500 square foot facility numerous times for multiple process steps to be accomplished.
• Production volume has increased from about 7,500 parts per shift to 10,000.
• Workplace visual instructions are in place and are credited with resulting in a 30 percent production enhancement.
• Business volume increased without lowering product price, simply by freeing up additional production capacity and maintaining lead times below current market standards.

Automatic SMP officials say ATAC assistance has enabled tremendous process and bottom-line improvements.

“Conservatively, I would say that the assistance provided by ATAC has helped us to increase annual sales by more than $143,000,” Long said.

Additionally, Long credits ATAC assistance with enabling retained product sales of some $450,000 annually; reduced maintenance and overhead costs of $50,000; $600,000 in plant equipment investments; and an additional equipment savings when process improvements enabled the company to delay purchase of a new $85,000 machine that it discovered it did not need once manufacturing capacity was increased.

ATAC’s assistance also is credited with enabling Automatic SMP to retain two jobs in the Cross Drilling area alone and create four new positions, according to Long.

Randy Osborne, Automatic SMP’s lean manufacturing engineer and a more than 30-year employee with the company, speaks to the quality of ATAC’s services.

I have seen a lot of improvement efforts over the years, but this has helped us more than any other I’ve seen,” Osborne said.

Long adds that it is the hands-on involvement provided by ATAC that has made the relationship successful.

“ATAC – particularly David Hicks – has taken the time to get to know and understand our business,” Long said. “That knowledge, coupled with an objective eye, makes it easier for us to implement and sustain improvements.”

Automatic SMP was founded in 1914 in Chicago, Ill. Annual sales total some $20 million and the company employees 131 in its Decatur, Ala. plant, where it has been since 1948. Its market demographics include about 40 percent aerospace customers; 35 percent heavy equipment; 15 percent automotive; and 10 percent various other commercial entities.

Testimonial

“Conservatively, I would say that the assistance provided by ATAC has helped us to increase annual sales by more than $143,000,”
-- Jonathan Long, Director of Manufacturing