The rewards of rapid changeover

In-house program helps steel processor achieve new levels of productivity

By Colin McLoughlin

May 8, 2007

As part of its conversion from traditional to lean manufacturing principles, Oregon Metal Slitters wanted to initiate quick-changeover practices in its production operations. It also wanted to achieve this internally, without the overview of an outside consultant, so that the practice would be sustainable for the future. OMS found a SMED program from Enna Inc. that helped the company start the process right.

Many manufacturers, though they may not realize it, go into crisis mode when changing tooling or processes between production operations. By failing to analyze their changeover procedure, they cause poorly coordinated processes. Indeed, for some manufacturers a state of confusion reigns before the production operation is up and running again.

The amount of productivity that is lost in changing over from one process to another can be enormous. The more frequent or complex the changeover, the greater the potential for lost productivity. Whether or not the procedure is carried out efficiently can be the difference between profit and loss in the short term and in the long term, between survival and extinction.

This was the situation facing Oregon Metal Slitters (OMS), a Portland-based regional distributor and processor of flat-rolled steel since 1956. As part of its conversion from traditional to lean manufacturing principles, the company knew it had to initiate quick-changeover practices in its production operations. It also knew it had to proceed with the project internally, beyond the purview of an outside consultant, so that the practice would be sustainable for the future.

Definition

After lengthy consideration, OMS decided to implement SMED, a quick-changeover practice that Toyota developed over a 40-year period. SMED is an acronym for "single-minute exchange of dies," though that label can be misleading for two crucial reasons.

First, "single-minute" in this context does not mean in 60 seconds or less. It actually means that the changeover will be done in a single-digit minute; in other words, in less than 10 minutes.

Second, it does not apply only to dies. Changing dies might have been the original objective, but today SMED is a lean tool that can be applied to everything involved in the changeover process, including tooling, raw materials, machine speeds, and material handling.

Preparation

Many companies readily appreciate the need to integrate SMED into their lean efforts, yet they struggle with its implementation. Generally, it's because they ignore proper preparation for the event and an appropriate workshop structure. As well, they often place too much reliance on a small team of experts to implement textbook solutions.

OMS realized this and decided it needed a program that would be planned and managed by company executives and run by employees, who would therefore become trained and empowered to use the optimum changeover methods that would be implemented.

The company knew that to launch a different method of changing over and running a manufacturing line would be one of the most difficult challenges it could face, calling for a strategy that was carefully thought out and executed. It decided to develop a plan of action leading all the way through from initial implementation to full compliance, and it required a changeover method that would fully integrate with the broader concept of lean yet be entirely self-contained.

Research

Preliminary research led OMS management to the book A Revolution in Manufacturing: The SMED System by Shigeo Shingo. Though written mainly in terms of the automotive industry, it shows companies of all kinds how to reduce changeovers by an average 98 percent. It gave OMS the assurance that SMED would satisfy the company's needs on all counts by making use of the best combination of people, material, information, and setup processes.

This technical book offers sound principles and a compelling call to action, but it does not supply a detailed road map showing how to implement SMED.

At first the company attempted to conduct some workshops of its own but was hampered by the lack of practical methodology or even a structured plan that it could tailor to its needs. This left the company thinking that its machines might be too complex and that SMED would not work with its multistage slitting and stamping operation.

The company quickly realized, however, that if SMED works at Toyota, with which Shingo was associated for many years and which is clearly a complex operation, then it ought to work for OMS.

Action

An outside consultant confirmed that OMS should adopt a strategy that would allow it to sustain SMED internally. So OMS contacted Enna, a supplier of manufacturing training programs designed to help companies identify where lost productivity occurs in a process and create a plan for change and improvement. The companies make the changes themselves, without relying on outside consultants to conduct workshops or implement programs.

Of most interest to OMS was a SMED program that contains the materials and preparation instruction necessary for companies to conduct their own five-day training program leading to implementation. The program also provides the structure and physical material to help develop an environment that encourages change and minimizes the risk of failure.

The first step in implementation for OMS was to follow the eight points of the preparation instruction guide:

1. Select participants for the first few workshops. For SMED, the guide recommends choosing a group of eight to 12 people who are seen as knowledgeable and who command some degree of respect—natural leaders who can spread the message to other employees. It also recommends the appointment of a manager with proven qualities to assume responsibility for the program. For OMS, that person was the inventory manager, who has an engineering background, basic skills in facilitation, and shop floor experience.
2. Make sure that everyone is plugged into workshop timing and scheduling, even those individuals who are not directly participating. For OMS, that means alerting outside sales to allay their fears that customer service would be jeopardized during the weeklong workshop. In turn, the sales department is able to use the workshop's existence both as a sales tool and as a useful advisory for customers who might be dealing with changeover issues of their own.
3. Plan resource assignment in advance. It is not advisable to adopt a "seat-of-the-pants" approach, asking people outside the training group to drop everything to produce something right away. Not only is it an irritant, it is precisely the kind of action that SMED, when in full flight as an active program, is meant to eliminate.
4. Establish timely access to all setup operations. For a company like OMS, part of the workshop might have required the involvement of lengthy operations, such as a daily backup process. Arriving halfway through this process would not have allowed participants to see the motion and transportation of the data being processed as it relates to the SMED workshop.
5. Communicate the existence of the workshop. A communication document summarizing the coming workshop should be distributed a week ahead of time so that any advance issues and queries can be dealt with in a timely way. One of the problems with just dropping information on individuals on the Thursday or Friday before the workshop is that their minds tend to be focused on the upcoming weekend and they forget that the workshop may start and end an hour earlier than the regular workday. Incidentally, an earlier-than-normal start is a good idea, to underscore the importance of the workshop.
6. Advise the facilitator to learn all participants' names. The facilitator of the workshop should make a point of learning all participants' names and greeting each one personally at the beginning of the workshop. More than anything, it truly imparts a sense of getting down to business, and important business at that.
7. Ensure that all additional supplies are in place. In addition to supplied training materials, OMS needed to acquire a video camera and three cassettes.
8. Try to adhere to the schedule defined by the workshop, both chronologically and by duration. Each element of the workshop needs to start and stop on time, both for maximum efficiency and to emphasize the significance of timeliness in all SMED-related operations.

Results

By successfully conducting the preparation portion of their SMED workshops and putting everything learned there into practice, OMS was able to go far beyond its first level of improvement. Throughput at the plant has doubled, inventory is down 40 percent, and lead-times have been cut by 85 percent. In addition, space savings of about 35 percent have been achieved.

Even more significant is the impact on company culture, with improvements noted in such areas as ongoing suggestions and input, communication between individuals and departments, cleanliness and organization, and worker morale. OMS workers have control over their improvement activities, while management is able to plan and manage rather than lead on the shop floor.

OMS has seen growth and sales opportunities that it could not have forecast just two years ago, including a 200 percent improvement in productivity. It can accept new business and deliver faster than before, allowing it to remain profitable in a competitive industry.