Eighteen years ago, IPA, a contract and design manufacturing company, found a niche in the marketplace while it was working with a linen distribution client. Hospitals at the time were using rotational conveyors or wire racks to hold the scrubs worn by hospital personnel. As a way to keep scrubs on the shelf and ensure they were returned for cleaning once used, IPA patented an idea for a scrub machine. The new product quickly helped hospitals reduce costs and thus fulfilled a need in the marketplace. The product was so successful that six years ago IPA founders, Bob Fitzgerald and Ward Broom, both graduates of Georgia Tech, were able to close the contract design and manufacturing side of their business to focus solely on manufacturing scrub machines. The number of machines per hospital depends on the hospital size, ranging from one machine to as many as 120.
For many years, IPA had been building scrub dispensing machines in a batch assembly process, which is the manufacturing of products in sequential stages. However for IPA, this non-continuous technique was resulting in a lot of back-up in the process and long lead times.
IPA was planning a move to a different facility, but before doing so, wanted to ensure that these issues didn’t move with them. Over the years, Joel Eisler, vice president of operations at IPA, had taken a series of lean courses from Georgia Tech. Upon returning from each course, he tried to implement a lean tactic here and there, but was having trouble getting these changes to stick. Knowing that Georgia Tech offered an assistance program to manufacturers, IPA reached out to Sam Darwin, project manager, at the Georgia Manufacturing Extension Partnership (GaMEP) at Georgia Tech.
Darwin, and Bill Ritsch, North Metro Region Manager at GaMEP, spent four days at the plant in May 2011, working with Eisler and his team on ways they could reduce lead time, increase production and free up warehouse space. By conducting a value stream mapping exercise, they determined that to become more efficient and increase material flow, they needed to convert the batch process to cell manufacturing, allowing for the sub-assembly areas to all feed into one center cell. Before the value stream mapping, IPA was producing 118 units per quarter, with each unit taking a total of 55 hours to produce. Once the initial conversion to cell manufacturing was made, IPA began producing 126 units per quarter (approximately 24 additional units per year), reducing production time to 43 hours per unit. Through continuous improvement since the conversion, IPA has improved even more – to 160 units per quarter at 31 hours of labor per unit.
To implement cell manufacturing, IPA rearranged its facility, freeing up 1,400 square feet of floor space and reducing the time it took employees to search for items.
IPA has since joined the Georgia Tech North Metro Atlanta Lean Consortium, a group of manufacturers interested in sharing ideas around lean concepts. Through a benchmarking tour at another manufacturing plant, the company gained numerous opportunities for improvement, including removing flat shelves in their center cell assembly area. The shelves were replaced with carts that could move material from subassembly to production, utilizing kanban techniques within the carts as a visual way of determining when material inventories needed to be replenished. As a result, their stockout, an event that causes inventory to be exhausted, for subassembly are next to non-existent.
Eisler says, “In the past, everyone talked about lean in terms of manufacturing. But lean is a process throughout the company, not just manufacturing.” As a next step, IPA is working with GaMEP to conduct value stream mapping exercises in both pre-production process and post-production processes, to include areas such as sales, administrative support, and accounting.
IPA is currently filing for the Georgia Retraining Tax Credit, a program that enables Georgia businesses to offset their investment in training of employees. For more information on the tax credit, visit http://www.georgia.org/competitive-advantages/tax-credits/Pages/retraining.aspx.
- By converting from batch manufacturing to cell manufacturing, IPA produces 26 percent more units per quarter (from 118 units to 160 units)
- IPA has reduced the amount of time it takes to produce one unit from 55 hours to 31 hours
- Additional results from this conversion include: 1,400 square feet of freed up facility space, 50 percent reduction in overtime and a decrease in lead time from 3 weeks to 4 days
- By implementing kanban in supply carts, IPA reduced work in process inventory to 10 percent
“The fact that Georgia Tech was an outsider helped make lean stick within the company. Through hands-on exercises, they really showcased how lean could help improve our company,” Eisler said.