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Automotive supplier using downturn to improve

Industry                                                                               
Automotive Supplier 

Company City
Auburn                

Company State
Alabama                                             

Company Name                                                                     
Hoerbiger Automotive Comfort Systems, Inc.            

Project/Activity Year
Lean Enterprise Certification Program (LECP) / 2008-2009

Company Profile
The HOERBIGER group of companies has been operating very successfully as a subcontractor of automotive comfort systems for the automotive industry. The company, a member of the internationally active HOERBIGER corporation based in Schongau, Bavaria, has done exceptionally well over the past few years. HOERBIGER Automotive Comfort Systems develop and produce hydraulic, pneumatic, electronic and mechatronic systems for automotive engineering. The Auburn, Alabama-based plant manufactures hydraulic lift cylinders for convertible tops and trunk lift gates for a number of the top automakers, including General Motors, Ford, Mercedes Benz, and others.

Situation
The company desires to use the present economic downturn as an opportunity to strengthen its competitive position not only for when the economy improves, but now, under a global recession.

Solution
Hoerbiger has embarked on a Lean Enterprise Certification Program (LECP) with the ATN-Auburn University (ATN-AU).

Nationally recognized by the Society of Manufacturing Engineers and the Association for Manufacturing Excellence, Lean Enterprise Certification prepares an organization to implement lean manufacturing improvements. The program involves training in lean continuous improvement tools and techniques, on-the-floor implementation and application assistance, coaching in sustaining management and it prepares company personnel to take the AME/SME Lean Bronze Knowledge Certification examination.

ATN-AU has trained more than 85 percent of Hoerbiger’s 35 production employees through the LECP initiative in the areas of Principles of Lean Manufacturing, Value Stream Mapping; 5s; Total Productive Maintenance; Quick Changeover; Pull Systems and Cellular Flow; Sustainment; Problem Solving; Lean Accounting; and other areas. Nine employees to-date have passed the Lean Bronze Knowledge exam. ATN-AU lean experts also have facilitated two rapid improvement (kaizen) events on two production lines.

Results
ATN-AU began its work with Hoerbiger in July 2008. To-date, the company credits more than $240,000 in cost savings and efficiency improvements to the program.  Among the benefits: Plant officials say the program has prevented the loss of at least three jobs on two production lines; freed up floor capacity to enable an additional production line producing some 200 units per day; has saved the company in the range of $2,000 or more in avoided equipment expenditures; enabled about $2,000 in new equipment investments; reduced the need for overtime; and is helping it to establish better goals and objectives as it pursues additional improvement applications.

“We also have greatly reduced the amount of our work in process, which significantly holds down inventory costs,” says Production Coordinator Marie Buchanan. “And by improving the cross-training of our operators, we have not only improved production efficiency, but we have avoided layoffs.”

Improvements netted during the two rapid improvement (kaizen) events include a reduction in overall cycle time of more than 53 percent on one line and a reduction in operator distance traveled of nearly 9,000 feet per shift. The second improvement event – focused on start-up of a new product line – established an efficient material flow layout plan, created a standardized pull system and an implementation plan for continued improvement activities.

The initiative also has shown bottom-line results in the area of quality, according to Human Resources Manager Kimberly Couch.

“Before embarking on the LECP, quality inspection was a separate step in the manufacturing process,” Couch said.

Couch notes that quality inspection is now integrated into the manufacturing process and not a separate and disconnected step.

Impact Summary
Hoerbiger Automotive Comfort Systems Inc. credits ATN-AU with enabling the following economic and business impacts through its training and assistance:
           
            Investments
            • $2,000 in additional plant equipment
            • $113,144 in workforce development

            Job Retention & Job Creation
            • Retained three positions and prevented need for layoffs in other areas

            Cost Savings
            • $129,600 in labor overtime
            • $2,000 in avoided equipment expense

            Additional capacity
            • Start-up of additional production line producing 200 units/day
            • Significantly reduced work in process (WIP)

Testimonial
Hoerbiger officials call the LECP initiative a highly effective undertaking.

“The training is excellent and the instructors are very knowledgeable,” Buchanan said. “They are extremely helpful and make the material and processes easy to understand.”

Couch adds, “It is the participative component that is particularly effective in making the lessons stick. The program has vastly improved our standardization across the board, as well as our production cross training.”