Paper Converting Machine Company

Paper Converting Machine Company got serious about getting lean shortly after it was acquired in 2005 and has since turned in some of the best financial years in its history. Keith Regan learns how the journey is viewed as ongoing, but one capable of producing powerful results along the way Paper Converting Machine Company (PCMC) has been in business for 85 years, and as an independent, family-owned firm, it grew into a leading provider of automated paper converting solutions, which are used to produce tissues, packaging, flexographic printing and non-woven materials. Despite a solid reputation and a growing product line, the company also had its struggles with staying profitable. In 2005, Green Bay, WisconsinÔÇôbased PCMC became part of the Barry-Wehmiller Companies, Inc. (BW), a $1.2 billion supplier of machinery and services to the packaging and converting industries. The acquisition has helped usher in a different culture at the company, according to Craig Compton, vice president of operations. Though an earlier attempt had been made at implementing lean six sigma, the approach seemed to take too long for what was needed, which was a dramatic and urgent overhaul of operations. ÔÇ£WeÔÇÖve gone through an enormous amount of change since then,ÔÇØ Compton says. The current lean journey began even before the acquisition by BW was finalized. The company took the traditional 5S approach and added satisfaction and safety to make it 7S. The shop floor was tackled first, out of necessity and to plant a seed for additional changes. ÔÇ£From a commercial standpoint at that time, the last place where youÔÇÖd want to take a customer was into the manufacturing area,ÔÇØ Compton recalls. ÔÇ£We had a lot of cleaning up to do, not only to make us more efficient and effective, but to start to create the culture we wanted to build in the business.ÔÇØOnce the effort got under way, kaizen events began to come fast and furious, with 175 completed within manufacturing operations alone since late 2005. Six months later, the company embarked on its first major value-stream mapping project, targeting the after-market services parts division, which at the time was spread across four different facilities and eight departments. ÔÇ£There were disconnects everywhere in terms of communications and materials flow. There was a hero mentality; whoever screamed the loudest got the parts.ÔÇØ The entire system was consolidated into a single facility, and parts now flow much more smoothly and predictably. A company-wide shift took place around the same time when PCMC migrated from SAP to Infor XA for its enterprise resource planning (ERP) system. The shift was more than just a software swap, however, with every business process examined along the way. When the system was turned on in April 2008, the entire organization was retaught how the business should be carried out, with a heavy emphasis on visual techniques to help manage flow. The result is a new program of daily standard work and much more visual management of the production process. Evidence of progress is contained in a host of daily metrics the company uses. For instance, on-time performance in terms of parts delivery to assembly teams was probably around 75 percent a year ago. Today, it is consistently at or around 99 percent. ÔÇ£ItÔÇÖs a dramatic difference. WeÔÇÖre not assembling any differently, but the way we get materials to machines looks different.ÔÇØToday, PCMC and BW as a whole are turning their focus to simplifying their supply chains. At PCMC that means focusing on the core base of suppliers and also on standardizing components across product and model lines. It has also been working for the past year and a half on refining its strategy deployment process through an approach that includes weekly updates on major initiatives and issues that arise to keep the company focusing its resources on ÔÇ£must doÔÇôcanÔÇÖt failÔÇØ initiatives. The process has harmonized the companyÔÇÖs direction, with everybody clearly aware of how day-to-day efforts fit into long-term strategy.BW has also brought an emphasis on leadership that has helped PCMC evolve, says Compton, as well as the resources of a global manufacturing giant, including similar-sized divisions around the world that can be benchmarked against. In fact, Jerry Solomon, who has authored books on leading companies through lean, is the director of operations at sister BW company MarquipWardUnited, and Compton shares ideas with him on a weekly basis. ÔÇ£People know we have the resources behind us to compete in todayÔÇÖs world now,ÔÇØ he adds. ÔÇ£ThereÔÇÖs a lot of lateral learning that goes on and is shared within BW.ÔÇØPerhaps as important is the change in culture, stemming from the idea of living legacy of leadership, or L3, to the simple philosophy of celebrating progress. ÔÇ£The old culture was that your paycheck was your reward.ÔÇØ Now every kaizen event ends with a mini celebration, and every summer employees have a chance to win a week of driving one of the super sports roadster cars owned by BW owner Bob Chapman. Fellow employees nominate workers who exemplify leadership principles among non-formal leaders, and during an outdoor event each week in the summer, an employee is handed the keys and a gas card. ÔÇ£ItÔÇÖs just one example of how things are approached differently, but that kind of recognition and reward can have a big impact on the individual, and that in turn can help change the culture.ÔÇØThe bottom line results are there as well. ÔÇ£IÔÇÖve been with the company 21 years, and the last three have been among the best financially for the company,ÔÇØ Compton adds. ÔÇ£Even as difficult as economic times are this year, weÔÇÖll have a very acceptable year. But more important, weÔÇÖve gotten the morale back into the organization. This was a beaten team. There was a sense that no matter what we did, weÔÇÖd be beaten. Now thereÔÇÖs a whole new perspective and confidence. BW didnÔÇÖt back up a bus and drop off 100 new people. The same employees are here, but the leadership changed and the culture changed, and that has opened up enormous possibilities.ÔÇØ ÔÇô Editorial research by Dan Finn┬á