Vertical integration broadens company's horizons
Chrome plater grows from service provider to product manufacturer
Senior Editor Eric Lundin visited Industrial Hard Chrome, a chrome plater that provides chrome-plated components for hydraulically powered equipment such as graders and backhoes. He traces the company's development from a plater that provided its services to the paper and pulp industry four decades ago to a plater and OEM with its own product line today.
You might not notice them, but if you look closely, you'll see them. They're on graders, backhoes, forklifts, cranes, bulldozers, and nearly every piece of equipment used by construction workers, warehouse personnel, and road crews. They're piston rods, the long, cylindrical sections that are exposed when a hydraulically powered device is in use, whether it's moving, lifting, scraping, or dumping. Other than having a small streak or two of hydraulic fluid, the pistons' surfaces usually are gleaming and flawless, the result of a complex process that applies a layer of chromium over the steel underneath.
Gleaming is the key. Anything other than a pristine, reflective surface is likely to be evidence of steel's No. 1 enemy: ferric oxide.
If you heard it called by any of its aliases, you wouldn't think it was a threat to steel or anything else. Hematite. Red iron oxide. Colcothar. Ferric oxide is actually a useful compound that has several modern applications—it's a polish for optic lenses and metallic jewelry, and it's also a pigment. When floppy disks were commonly used, it provided the magnetic layer that stored information. Even its chemical formula seems harmless, a combination of just two elements, iron and oxygen.
Despite all this, it's steel's biggest curse. You probably know it by its informal name: rust. Platers do everything they can to prevent the iron (Fe) in steel from combining with oxygen (O) in air and turning into a big expense (Fe2O3) that their customers didn't expect.
How big an expense? A study undertaken by CC Technologies and the National Association of Corrosion Engineers, and funded by the Federal Highway Administration (FHWA), found that corrosion costs the U.S. approximately $276 billion every year.
Steel's main guardian against corrosion? Chromium (Cr), and it doesn't take much. A protective layer can be as thin as 0.0005 inch. One plater that lays down chrome in such a fine layer is Industrial Hard Chrome Ltd. (IHC), a company that plates bar and tubing, mainly for hydraulic piston rods. It provides plated tube and rod stock in 24-foot lengths so OEMs can fabricate finished piston rods. It also provides to manufacturers piston rods that are ready to go—steel rod or tube that is plated, cut to length, threaded, and even case-hardened if necessary. But it wasn't always this way.
From Services to Products
"In the beginning IHC was a chrome plater," said Steven Schaus, vice president of sales, engineered products. "We didn't have our own product. We did chrome plating for the paper industry. We learned how to put on thick layers of chrome without any defects and with a very smooth finish. This was a natural lead-in to the fluid power industry and piston rod applications."
The plating process itself is straightforward. Simply stated, plating is three steps: cleaning a steel item to be plated (removing mill scale, tramp oils, and any dirt or grime), polishing it, and running it through a bath of chromic acid (H2CrO4). An electric current in the bath, at high amperage, causes the chrome to bond to the steel's surface, and the result is a corrosion-resistant layer that protects the substrate.
"However, the steel requires quite a bit of preparation before it shows up at a typical plater's receiving dock," said James Segerson, vice president of sales. "It goes from the steel mill to a turner, who takes it down to the right diameter, and then it goes to a grinder if the turner doesn't provide grinding services; then it goes to the plater."
At the outset IHC worked this way. It also did some repair and salvage projects, but its work in the paper industry was its bread and butter. It was also a big challenge. It required applying a thick coating, then grinding it down to 0.003 to 0.005 in.
"When chrome gets that thick, it gets very difficult to control, Schaus said. "If you have a defect, it becomes very expensive to correct—it becomes a major cost. To prevent defects, you have to have extremely clean baths. That was the main thing we learned when we were plating rolls for the paper industry."
Its repair work required coatings that were much thinner and easier to control, 0.002 to 0.003 in. thick. This sounds paper-thin, and in fact it is. The paper stock used for The FABRICATOR® is 0.0021 in. thick.
As time went on, IHC sought ways to set itself apart from its competitors, looking for specific markets into which it could carve out a niche for itself. One that stood out was the fluid power industry and its demand for piston rods. Many suppliers were already in this market, but IHC plunged in, confident that it could distinguish itself from other players.
"Everybody looks for product differentiation," said Fred Parker, vice president and general manager. "Differentiation with steel is particularly difficult. IHC brings to market a product that is differentiated from commodity products."
"Many of our competitors sell commodity items," said Segerson. "We can sell commodity items, but we try not to. We sell products that are highly engineered for high-end customers."
A company that provides chrome plating service doesn't turn itself into a product manufacturer overnight. To get a sense of how long it takes and what the company went through along the way, you have to turn the clock back four decades.
Relocate, Consolidate and Integrate
Founded in 1966 in Chicago suburb Elk Grove Village, the company grew until it had eight plating cells in its facility. This isn't necessarily the most efficient way to run a manufacturing operation, especially one that provides chrome plating services. The chemical used in the process, chromic acid, requires strict control to comply with Environmental Protection Agency (EPA) regulations. Keeping these scattered plating cells in compliance was more costly than if they were all together. It also requires extra effort to ensure consistency from one bath to the next. Finally, the products require quite a bit of material handling when they have to be moved from place to place.
Setting up a new location gave the company a chance to combine everything and ease quite a few regulatory and logistical headaches. It also gave it a chance to expand. Not horizontally, but vertically.
Expanding in Two Directions."When we moved to Geneva [Ill.], it wasn't just to gain efficiencies," Schaus said. "The intent was to expand. In addition to having a chrome plant, the campus would include a cold-finished bar mill, Bar Technologies LLC. And because the ownership is private, it was able to do something else unusual: It added another company which does value-added machining, Fluid Power Manufacturing LLC. So we actually added in both directions back when platers just weren't doing this. Platers did the plating, and every customer did his own cutting and machining. Now we have more than a dozen CNC machines and numerous saws that are working around the clock."
The process is straightforward, yet intensive. Bar stock goes through a four-step preparation process—straightening, turning (which removes surface defects ), a second straightening, and grinding. Tube stock does not get turned—it goes through only the grinding operation to remove surface defects.
The chromium layer is sometimes just one-tenth as thick as the plating used on rolls for the paper industry: 0.0005 in.
But what IHC does is less important than how it does it. Its control over its raw stock and its processes, its reliance on automation, and its strategy of minimizing material handling are some of the key factors in how it competes in its market.
Focusing on Raw Materials. Establishing Bar Technologies was part of a drive to improve the quality and consistency of the finished product. IHC felt that the surest route was to take charge of the quality and consistency of the incoming raw bar stock.
"One of the main reasons for Bar Technologies was control," Parker explained. "We found that when we were bringing in bar stock from the outside, we ended up doing rework for our suppliers."
Having its own supplier makes the company unique in the plating industry, according to Schaus. "To my knowledge, no chrome plater has its own cold-finished bar mill," he said.
Manufacturing Processes and Quality Control. Bar Technologies uses a laser micrometer to measure each workpiece's diameter. A color display makes it easy for the line operators to see whether the part is within the specification—green indicates that the current part is manufactured at one-quarter the commercial tolerance; yellow indicates half the commercial tolerance; red indicates three-quarters the commercial tolerance. For most sizes the diameter varies only 0.0002 to 0.0003 in. for the entire length of a 24-ft. bar.
Needless to say, manufacturing parts to such exacting tolerances means that the bulk of the work is best left to machines and their inherent consistency and repeatability. While people always will be necessary in the workplace, IHC's processes emphasize automated, mechanized processes and efficiency.
"The turning, grinding, and straightening steps are one-time-through processes," said Schaus. "The entire manufacturing process has been set up so that we don't have multiple passes or rework," he said. "Management's philosophy is that we charge our customers for an item once, so we process it just once."
The company also minimizes material handling. Because the existing campus was a greenfield project, the company had the luxury of setting up the Bar Technologies equipment exactly as it wanted, so for the most part, one machine's unload bed is the next machine's loading bed. Although turning, straightening, and grinding are separate functions performed on separate machines, Bar Technologies has set these up to be, for the most part, a single, seamless process with minimal human intervention.
The human touch is much more prevalent at Industrial Hard Chrome than it is at Bar Technologies. In addition to programming and monitoring the equipment, people use hand-held devices to measure the chrome layer's thickness. They also do a visual inspection of every piece before it gets shipped. While it seems unlikely that normal vision would be good enough to catch a defect in a 24-ft. length of chrome-plated tube, a visual inspection is more than enough to find surface flaws. Before plating, the surface is polished smooth. After plating, it reflects so well that text held up to the mirrorlike surface is easily readable. When the bar or tube is rotated at a low speed, surface blemishes are easy to spot.
Testing 1-2-3. It's not enough to straighten it, turn it, polish it, and plate it. You have to test it too. The industry-standard test, described in ASTM standard B117, involves keeping the tube or bar at a set temperature and exposing it to a saltwater solution—the salt spray test. The piece under test gets a visual inspection every 24 hours. Any speck of corrosion, no matter how minuscule, is a failure.
"The customer requirements may be 96 hours or 120 hours, but we go beyond that and test every lot until failure," Parker said.
"That's not quite true," Segerson countered. "We have some lots that go 3,000 hours without failure."
"That's right," Parker agreed. "When it gets ridiculous, we stop the test. For every specimen that does fail, we do a postmortem to see why it failed."
"The reason we do this is that a tiny amount of rust will ruin a hydraulic seal," Schaus said. "So we do a forensic analysis to determine the root cause. At the risk of oversimplification, the three main causes are a defect in the base steel, a defect in the workmanship, or handling damage. So when we find a defect, we immediately categorize it."
"If we get too many with the same root cause, we examine the process," Segerson said.
Systematic process improvements have reduced or eliminated many of the root causes and, therefore, the defects. The company also has looked beyond defects to see what else it could improve. It has tightened tolerances, improved tolerance consistency, and enhanced corrosion resistance, according to Schaus.
"Our corrosion resistance sets the standard for the industry," Schaus said. "Every few years we evaluate that standard, and if we think we can raise the corrosion resistance to a higher standard, we do so."
The obvious way to improve corrosion resistance, laying down a thicker amount of chromium, doesn't necessarily provide the obvious result.
In the old days people said, "If you want more corrosion resistance, you have to put down a thicker layer of chrome," Schaus said. "It's just not true. If the plating goes on thicker, that's just more that you polish off. That's waste. The idea is to plate less and remove less in polishing."
"There are reasons to have a thicker layer of chrome," he continued. "The main one is wear resistance, but that's not corrosion resistance. We can get excellent corrosion resistance with a standard-thickness layer of chrome. Improving the base metal preparation is the best way to get better corrosion resistance."
"Better corrosion resistance translates into fewer warranty claims for our customers," Parker said. "It's a very straightforward relationship" between better corrosion resistance and reduced costs, he added.
How much has IHC improved the corrosion resistance of its products?
"Ten or 15 years ago, 12 to 24 hours was a decent amount of time before failure in the salt spray test," Segerson said. "Now it's hundreds of hours. Every single year our standard gets a little bit better."
A Product to Call Its Own. Along the way, the company realized that it could start with bar or tube stock, plate it, cut it to length, machine it, and end up with a finished product—a piston rod that is ready to go. A piston rod marketed under the company's own brand name.
IHC didn't take the easy way into this market niche. "We approached our customers and said, "Give us the toughest parts, give us the parts you don't want,'" Parker said.
"That was the lead-in," agreed Schaus. "With many customers, once you can do the most difficult parts, the easy ones follow."
Having the right knowledge about the processes and having the right equipment are two factors in handling any chrome-plated parts, easy or difficult. While chrome plating is durable enough to withstand the elements, plated parts require careful handling and machining, according to Schaus. This, in part, makes some parts difficult to manufacture. "If a typical machine shop goes to cut it or machine it, it's probably going to destroy the plating," Schaus said.
Clean and Lean Manufacturing
In cleanness, manufacturing operations run the gamut, from the hazards of a foundry to the antiseptic conditions of a clean room. A chrome plating operation usually bears little resemblance to a clean room.
"Chrome plants just aren't very clean," Segerson said, before contrasting that image with IHC, which he says is a case study in running a clean operation. Then Schaus rolled out the evidence.
The main chemical in the baths is hexavalent chromium, which is known to be both toxic and carcinogenic. IHC runs a clean operation—it discharges absolutely no chromium into the environment, neither into the air or a waste stream. A rule the company learned long ago for preventing defects is to keep the baths clean. "First, we use a dialysis machine that filters and cleans the bath," Schaus said. "Dialysis removes the dissolved iron, copper, and other impurities. Plating plants that don't use a filtration system just have to deal with the consequences. The bath quality deteriorates, and the plating quality deteriorates. They can compensate, for a time, by increasing the electric current that runs through the bath. This is an additional cost and it lasts only so long. When the current gets too high, they have to dispose of the baths and build new ones, and that's expensive. Since we moved into this building, IHC has never had to replace chromium in a tank."
"Second," Schaus continued, "with each load we automatically inject chrome as necessary. Some competitors do this just once a week. By doing this with every load, IHC maintains extremely consistent baths.
"Third, vacating a building used for chrome plating isn't as easy as it sounds, but it went smoothly for us. When IHC cleared out of its original building [about 15 years ago], the EPA checked out the site and gave it a clean bill of health," which was required before the site could be sold.
"Fourth, we meet or exceed every Occupational Safety and Health Administration [OSHA] standard," Schaus said. "When OSHA lowered the standard for the maximum exposure to hexavalent chromium in February 2006, we didn't have to change anything, because we were already below the new threshold."
Controlling Its Processes, Controlling Its Destiny
Expanding the company to include Bar Technologies and Fluid Power Manufacturing on the same campus is a lean guru's dream come true. Delivery distances are measured in feet, and delivery times are measured in seconds. Still, the company doesn't run lean to the bone. It believes in maintaining a healthy inventory for emergencies. A combination of the three factors—the inventory that Bar Technologies maintains, the plating capability that IHC has, and the machining that Fluid Power Manufacturing provides—means that this power trio can respond more quickly than a plating provider that outsources the raw materials and machining. Especially in emergencies.
"I got the call on a Friday," Segerson said, recounting how he managed to gain a customer he had been after for some time. "They said, "OK, here's your opportunity. It's an emergency. A truckload of nonstandard metric bar stock overturned, and we need a truckload right away.' They had already checked with the current supplier and because of a lack of availability, delivery was weeks down the road. At that point, I went to Bar Tech and explained that I needed a truckload of bar stock turned. That was OK until I said I needed it Monday. They just laughed. I told them I was serious, and they stopped laughing. Then I went to Fluid Power Manufacturing and explained the situation. Same story—it was OK until I said I needed it Monday. They laughed, I told them I was serious, and they stopped laughing."
When the production personnel realized Segerson was serious, they got serious, and then they got down to business and hammered out a plan.
"Within an hour I called the customer back," Segerson continued. "He wanted to know if he could have the order in a week."
"I told him, 'No, you can have it Monday.' He laughed, then I told him I was serious, and he stopped laughing."
The FABRICATOR is North America's leading magazine for the metal forming and fabricating industry. The magazine delivers the news, technical articles, and case histories that enable fabricators to do their jobs more efficiently. The FABRICATOR has served the industry since 1971.