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A foundation for company expansion

A robust software infrastructure gives Anchor Fabrication and its parent company the flexibility to integrate acquisitions into the corporate fold

Figure 1
To assist with business development and project management, Anchor Investments has created a customized intranet that leverages the main database and allows employees from all the business units to see complete customer histories and order details in an easy-to-access format.

When The FABRICATOR last spent extended time with Anchor Fabrication, Fort Worth, Texas, it was 2005, and the fabricator was in the midst of reinventing its production operations (“Anchor’s a way down the road to improvement,” March 2005). It had invested in new press brake technology and expanded to create manufacturing space dedicated to precision fabrication activities, while keeping the original space for its more industrial-oriented work. The move saved thousands of dollars in material handling each year, and the metal fabricator had a firm foundation on which to grow.

And grow it did over the subsequent years. Tra Willbanks took over as CEO of Anchor Fabrication in 2006, replacing his father John Willbanks Jr., the founder of the company. The fabricator’s management team helped it to achieve several consecutive years of profitable growth, leading it to the point where expansion was in the cards. Buoyed by the confidence that the management team understood manufacturing and that the company culture could be replicated at other facilities with investments in talent development and skills training, the Willbanks family founded Anchor Investments about five years ago with the goal of finding other manufacturing operations similar to Anchor Fabrication.

Anchor Investments hasn’t spent those years on the sidelines, studying potential takeover targets. It has acted in a big way, acquiring Beacon Fabrication, Garland, Texas, a precision fabricating operation, in 2012; DFW Grating, Dallas, a manufacturer of bar and plank grating products, in 2013; and Abby Manufacturing, Walnut, Miss., a fabricator of small to medium-sized projects, in 2015. (This year the investment company also acquired Texacone, a manufacturer specializing in elevator cylinder heads, marking the first company in the corporate fold that resides outside of traditional metal manufacturing.) If fabricating is a core activity of many of the acquisitions, bringing these companies underneath the corporate umbrellas has become a core competency for Anchor Investments.

“We’ve gone from 100,000 square feet then [2005] to 350,000 sq. ft. now at the Fort Worth facility and more than 300 employees,” said Trey Thompson, Anchor Fabrication’s president. “Among all of the companies that are under Anchor Investments, we have 1 million sq. ft. now, 1 million man-hours, and more than 1 million parts that we ship per year.”

Anchor Fabrication, the job shop trying to find its way in 2005, is now part of a larger story. It’s part of an investment group looking to bet on small to medium-sized manufacturing in the U.S., and the desire to continue with the investments is strong. The most recent acquisitions have worked out well, according to company management, and its IT investments and flexible management practices have played important roles in allowing that to happen.

Starting With a Strong Backbone

This isn’t a story about a recent enterprise resource planning (ERP) software installation. In fact, this one is more than a decade old.

Anchor Fabrication went live with Epicor ERP back in 2007. Prior to that it had used smaller shop management software packages.

Tom Delicati, the company’s IT director who joined the team in October 2008, previously had worked with the Epicor product in a manufacturing setting. He knew what a strong ERP backbone could do for a company in growth mode, and he was certain that Anchor Fabrication had that.

From the start Delicati knew that having a centralized database made sense. If other entities were to join the company fold, they could simply access the common database. Multiple installs of the Epicor platform or running different software packages at other locations would simply be an IT headache that might never end.

With Delicati’s prior experience with the ERP software and the on-the-job experience gathered before the company jumped into full acquisition mode, Anchor Fabrication was running its software to benefit the managers’ need for information. The software wasn’t running the company in the sense that employees had to spend time wrestling with interfaces or requesting special screens to deliver certain key performance metrics. Delicati recognized the software as a tool that not only performed well for the small job shop, but also could be scaled as the company grew.

Figure 2
Details related to specific jobs on the shop floor, the schedule for what needs to be fabricated next, and overall key performance metrics are visible on flat-screen monitors that are no more than 30 yards from nearby work centers.

The acquisition of Abby Manufacturing is perhaps the most recent example of the software’s scalability. The Mississippi fabricator had all of its records in QuickBooks and Peachtree accounting software. With complete access to the information in those systems, Delicati said he was able to “massage” the information so that the import process was pretty painless.

“It was maybe a month or two of planning and getting the data in order. Then we had a cut-over date, moved everything in—all the open orders, payables and receivables—all over one night,” he said.

Migrating information from a source like Microsoft Excel could prove a little more complicated, Delicati said, because you simply don’t know how the original source organized the material. For the most part, however, working with a somewhat modern accounting software or more scaled-down version of a shop management software package makes the migration of data easy.

Anchor Investments also chooses to work with a Microsoft SQL Server on-site, which is a benefit when it comes to merging data from sources outside the core ERP system. The server is able to pull the data from all sources and supply end users with a complete picture, not just a partial story that lacks input from a certain department of the business, such as the shop floor.

Of course, it still goes back to the decision to have one centralized database (see Figure 1). The different arms of the company have the ability to pull the information they want to run the businesses as they see fit. Corporate oversight is there, but so is a freedom to let each business define success in their own way.

Flexibility Is the Key

“The way we have things set up is that each individual business uses the software to a different degree and capacity,” Delicati said. “So we are trying to be strategic and flexible in terms of how each business uses the software.

“We’re firm believers that there’s a big difference between data and information,” he continued. “To us, data is the ones and zeros in the background stuck in the database, but information is usable to make strategic or tactical decisions on a daily, weekly, or monthly basis to drive the business in the direction we want it to go. Being able to extract that data and get it into a usable format and produce the type of information we need, that helps us to make proper decisions.”

Thompson explained that Anchor Investments does believe that the business development, operations, marketing, and sales functions for each company should be based on core principles such as transparency, accountability, and honesty, but the individual managers of those businesses ultimately have the freedom to decide where people’s time and energy should be spent to get the best return on their efforts.

“We are stewards of these businesses and expect results, which would be asked of any business, but to be able to cater to the individual needs of the business is more important than us saying, ‘Here is the structured approach that you have to use

to run your business,’” Thompson said. “We definitely do not do that. We want them to have that latitude to be able to pull the information that’s important to their business.”

One of the best examples of this information sharing is the work done to improve shop floor scheduling at Anchor Fabrication (see Figure 2). The company’s management team has spent more than three years trying to create visibility of job information and key production metrics for shop floor workers. The goal was to improve sequencing of jobs and streamline communication to the shop floor.

The key was the development of dashboards that pulled information from the ERP system. Delicati said they were able to customize dashboards for the shop floor that instructed everyone as to what jobs needed to be completed first and whether the required materials were ready for a job to be completed. The shop floor now reviews this information on flat-screen monitors spread throughout a work area.

What’s been the biggest benefit of this new effort in information sharing?

“I would say it’s less management oversight,” Thompson said. “We’re running 2,500 jobs monthly just at Anchor alone. Think about the interaction that’s required for a guy or operator who finishes a job at a press brake and goes to the boss with this question: What’s my next job? You multiply that out across a day, week, and month, and that’s a lot of interaction time.

“We now have a system that says, ‘I finished this job. What’s the next most important job? Do I have the capability of doing that job? Yes. Here are the parts. Let’s go,’” he added. “We try to flatten out that decision-making time and the complexity of the decision.”

Delicati added that this approach has helped Anchor Fabrication sidestep the chaos associated with “hot-list emails,” which tell everyone to drop what they are doing to tend to a job that has to be complete as soon as possible.

“We’ve been really focused on doing the right things in the right order at the right time,” he said.

This access to on-screen details saves operators about two hours per day, according to company managers.

Understanding Business Processes

Maximizing efficiencies doesn’t have to be limited to the shop floor. Delicati said Anchor Fabrication found success in the front office as well after taking a hard look at invoicing practices and then developing a tool within the ERP system to help invoice reviews.

Like many shops, Anchor Fabrication had a person charged with reviewing individual invoices and making sure everything was set the way it needed to be. Upon review of the reviewing process, management decided automating the task could lead to some improved throughput.

Delicati said that, because of the way the Epicor ERP is set up, the IT department was able to create a dashboard that could manage the invoicing review process by exception. Now a person needs to step into the review process only if the software finds any discrepancies or variances, such as inappropriate freight charges or something with a $0 price, on the submitted forms. At that point, someone has to edit the order to fix it.

With this type of software assistance, the evaluation of a batch of invoices soon went from a couple of hours down to a couple of minutes.

“Also, rather than using the form directly out of Epicor, we developed some custom business intelligence tools to generate those forms and attach them in the body of an email. We build our contact list appropriately for our customers as to who’s supposed to receive those bills, and everything is now automated with a couple clicks of a button to ensure those invoices go out to who they’re supposed to,” Delicati said. “We’re handling all of that paperless.”

This newfound efficiency now allows one full-time person who once reviewed 180,000 transactions during a year to take on nearly double that number and need only half to three-quarters of the same amount of time to do it.

“In any case, we don’t want to throw people at problems. We want to try to think, ‘Is there a way to work smarter, not harder, with this process?’” Delicati said. “Typically, we can leverage technology or leverage our understanding of the software platform to get to a better tomorrow.”

For Anchor Investments’ companies, that better tomorrow might include paperless scheduling systems. If a change is made to an order, someone doesn’t have to run to the shop floor to retrieve the job packet. In the paperless world, the change is made seamlessly to the electronic file, and the worker is notified of the change through a nearby terminal, flat-screen monitor, or even a tablet. Everybody sees the change as soon as it’s made.

Meanwhile, Thompson looks to the future and is reminded of Anchor Fabrication’s origins. It’s still about being a reliable supply chain partner.

“It goes back to one of our core principles. We want to let our ‘yes’ be ‘yes’ and our ‘no’ be ‘no,’” he said. “We want not only our employees and our vendors but also our clients to know that if we say we will do a job and promise it by a certain date, we want to live by that date.”

That’ll be a lot easier with the continuous effort to eliminate shop floor and front-office waste.

Anchor Fabrication, 800-635-0386, www.anchorfabrication.com

Epicor, 800-999-6995, www.epicor.com

About the Author
The Fabricator

Dan Davis

Editor-in-Chief

2135 Point Blvd.

Elgin, IL 60123

815-227-8281

Dan Davis is editor-in-chief of The Fabricator, the industry's most widely circulated metal fabricating magazine, and its sister publications, The Tube & Pipe Journal and The Welder. He has been with the publications since April 2002.