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CultureclubThe Gund Company and Webasto Americas adopt the Barry-Wehmiller people-centric leadership model

Meeting themastersOn arollRecipe for success

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BY CHRIS CRAWFORD

Evansville, Indiana-based Accuride Corp. began its lean journey in 2011 and has ridden this continuous improvement to continued success.

AME recognized this leading supplier of components to the global commercial vehicle industry with two 2015 AME Excellence Awards for its Erie, Pennsylvania, and Rockford, Illinois, facilities. AME also recognized Accuride’s Henderson, Kentucky, operation with its 2014 Manufacturing Excellence Award.

The company’s products include com-mercial vehicle wheels (steel and forged aluminum), wheel end components and assemblies (brake drums, disc wheel hubs, spoke wheels, rotors and slack adjusters) and specialty cast iron compo-nents for industrial end markets. Accuride operates 10 facilities in the United States, Canada, Mexico and Italy, and in 2014, had roughly $700 million in net sales.

Jd Marhevko, vice president of quality, lean management systems and EHS at Accuride and Manufacturing Institute 2016 STEP Ahead Award honoree, said receiving the AME Excellence Awards and related assessments for three of its facilities has bolstered the company’s

ability to secure new business, as AME’s objective third-party validation strength-ens customers’ confidence in the com-pany and its products.

“Customers take you more seriously,” she said. “They recognize the validity of the AME recognition, and they see the physical results in ACW’s dependable performance. We are able to be more competitive when quoting and securing long-term business with our improved process results.”

In addition, sharing Accuride’s lean journey with both current and prospec-tive customers is evolving into a value proposition, Marhevko said. “Customers

On a ROLLWheel manufacturer Accuride Corp. rode its continuous improvement since 2011 to AME Excellence Awards in 2015

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have asked us to show them how to do lean processes,” she said. For example, an original equipment customer asked the Accuride purchasing group to do a site audit to reduce the company’s lead time.

“We worked together to create a mar-ket and pull system for their key part numbers,” Marhevko said. “Their on-site inventory was reduced by half, and pre-mium freight was largely eliminated.”

Pillars of success

To continuously improve its business in its lean journey, Accuride focuses on four areas: lean operations, transaction-al processes, alignment of key value streams across the business enterprise and incorporation of outside partners, such as customers and suppliers. These areas require interactive engagement from Accuride employees. Many of Accuride’s sites are union-based. The company feels it could not have attained these levels of sustained and integrated improvement without the support of its employees.

First, Marhevko said, lean operations is not sustainable without the three other areas.

“Using lean practices has led to reduced inventories and improved working capital and inventory turns,” Marhevko said. “Everything is firing at all levels.”

Second, transactional processes also need to improve their flows. “If these

teams aren’t equally focused in rapid and accurate delivery of their informa-tion, operations suffers.

“Getting these transactional processes streamlined across the support teams is critical. These teams include supply chain, finance, engineering, sales and marketing,” Marhevko said.

At the start of its lean journey, Accuride used Harris Lean Systems (HLS) to get things started. It grew in scope to add the transactional and partner processes. HLS practitioners still support ACW teams with its fresh-eyes approach.

Next, the company worked on improving its value streams across the enterprise inside the company using value stream maps on inventory traveling between facilities by truck, train or boat.

“We’re leveraging an ‘inside out’ approach by focusing on the ‘microflows’ within the facilities. We are better positioned for success when we can build upon a more stable platform,” she said. “We are five years into our journey, and we continue to see op-portunity as we expand our scope. We believe that there are millions of dollars of more opportunity in our finished goods, in-transit raw materials and work in process inventories.”

Finally, Accuride turns its attention outside the company to its external supply chain partners. A plan for every part (PFEP) is created for incoming raw materials and MRO supplies.

For customers, lean on the transactional side of things also is important. “Cus-tomers order goods and take delivery in different ways,” Marhevko said. “You need to be agile in managing orders and optimizing the logistics of the delivery process.”

Visual operating systems (VOS) are very important at Accuride. The company uses more than 20 unique forms of VOS across its sites. VOS make processes visible to the people using them. And since the VOS is standardized, anyone can under-stand and use the system at any facility.

Accuride uses the Toyota Production System model for its lean deployment. Initiatives are tied to the company’s strategies by the use of Hoshin Kanri. The Kanri is developed by a lean council in a face-to-face session. The council, made up of members from each facility, then meets monthly to review performance to objectives and to share lessons learned.

Results of a lean journey

Accuride has seen many notable improve-ments during its lean journey to date.

Since lean is about flow, one of the more critical metrics is lead time (LT). Since first establishing its baselines on nine value streams, Accuride has reduced its LT on average by 54 percent.

“The cliché of ‘time is money’ is true,” Marhevko said. “Lead time reduction has enabled an average 60 percent increase in productivity. Days inventory on hand (DIOH) has also been reduced by 38 percent.

“As we evaluated standard work in the direct labor positions, we grew the applica-tion of the tool to indirect roles, as well. This has led to increased business efficiencies and process knowledge,” she added.

In 2015, about 3.3 percent of its work-force was redeployed as a result of lean initiatives in workload balance and non-replacement of personnel due to attrition and/or reduction.

The cliché of ‘time is money’ is true. Lead time reduction has enabled an average 60 percent increase

in productivity. Days inventory on hand (DIOH) has also been reduced by 38 percent. As we evaluated standard work in the direct labor positions, we grew the application of the tool to indirect roles, as well. This has led to increased business efficiencies and process knowledge.

JD MARHEVKO, VICE PRESIDENT OF QUALITY, LEAN

MANAGEMENT SYSTEMS AND EHS AT ACCURIDE

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Down the road

To grow its footprint in Europe, Accuride acquired a majority stake in Gianetti Ruote, a steel wheel manufacturer locat-ed near Milan, Italy, in November. Before the deal was finalized, representatives from the Italian plant visited Accuride’s American facilities to see how it ap-proaches making wheels.

“Some parts of where they are today is where we were four years ago,” Mar-hevko said. “We have the systems and methodology to work together in a short-er lead time to help Gianetti regain the process efficiencies.”

Accuride employees are working with the Gianetti team on a rotational plan to create the facility’s VOS, including de-veloping value stream maps and PFEPs. Accuride intends to learn from the Milan site and cross-pollinate improvements between them.

Across its business units, Accuride is nearing completion of its implementation of Plex, a new lean-friendly, cloud-based enterprise requirement planning (ERP) system. Plex has the ability to either automate some of the aspects of the lean process or allow the company to do them manually. Currently, Accuride uses a blend.

“Plex has some very powerful features that we have enjoyed,” Marhevko said. “It has the ability to do electronic kan-bans and pulls. We can run shipping and receiving boards in Plex and automate gauging and SPC runs to verify control of the processes.”

Accuride continues on its lean journey. It’s not done, nor can it ever be, as long as it wants to be a viable, competitive player in the markets it serves, she said.

Marhevko closed by quoting Will Rogers, who once said, “Even if you’re on the right track, if you just sit there, eventually you will get run over.”

Accuride’s neatly organized cells are a great example of lean principles implementation on the floor, including 5S, cleanliness, ergonomics design, visual management and a team-based operation.

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BY CHRIS CRAWFORD

Last June, a team of AME Excellence Award assessors visited the Accuride plant in Erie, Pennsylvania, and they were impressed enough for AME to present the Accuride

Erie Operations with a 2015 AME Excellence Award.

Accuride Erie Operations is one of two Accuride plants in the United States

dedicated solely to the manufacturing of forged aluminum wheels for the North American commercial vehicle industry. Erie Operations uses forge presses and advanced heat treat technology, coupled with best-in-class automated aluminum wheel machining and polishing technolo-gy to produce its product.

In its feedback report, the AME assess-ment team highlighted Accuride Erie Operations’ continuous improvement philosophy of observant management

A well-wheeledMACHINE

A focus on material flow improvements and improvements in team cooperation and communication earns a 2015 AME Excellence Award for Accuride Erie Operations

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driving a culture of metrics-based perfor-mance to satisfy customer needs.

Joe Johnson, supply chain manager for Accuride Erie Operations, said the com-pany has used the facility since 2000, commencing its lean journey in 2010.

Recognized lean successes

AME assessors praised the facility’s standout strengths of detailed level planning of plan for every part (PFEP), well-organized product development data and its strong focus on material flow improvements using value stream mapping (VSM) and visual Kanban pull processes.

The Erie facility plans PFEP to consider all variables (e.g., demand, inventory, supply source, replenishment lead time) when establishing the maintenance plan for each component to be controlled.

The plant’s focus on material flow improvements through a mix of VSM, PFEP, visual Kanban pull processes and its tugger system have reduced its lead time from 19 days to six days and on-hand inventory from 26 days to 10 days.

“We primarily did this by implementing internal and external pull systems,” John-son said. “It was something we commu-nicated with people, that we can make this work outside and inside our facility.”

When developing its tugger system, the Erie Operations team analyzed when workers needed to leave their machines to get supplies and how much time that took. Then, a timed delivery route was created with a card system identifying when supplies needed to be replenished. One employee per shift delivers supplies as they are needed.

“For example, in the past, an employee had to go find the right part number and valve stem,” Johnson said. “We figured which part numbers went to each line and how many you need per time period. As they are working, the tugger comes through about every four hours. This

eliminated inefficiency by ensuring that employees had the right materials on hand to do their jobs.”

Accuride Erie Operations also upgraded its product offering. In 2010, Accuride invested $4.5 million to improve the facil-ity’s finish technology for its extra-pol-ished, high-gloss wheel. The following year, it put $12.5 million into the instal-lation of its advanced new Mega-Line machine line. This new system produced the same amount of product that took three of the old machining lines to manufacture by eliminating much of the manual handling involved. From 2011 to 2014, scrap was reduced by half, and even more so since.

Using a time-to-replenish model, the Erie facility tried running 500 wheels at a time instead of 5,000 and successfully reduced work in process by 30 percent.

“Going from 5,000 to 500 wheels offered lots of opportunity in changeover,” John-son said. “We achieved a 50 percent changeover reduction. It’s not about

having no inventory; it’s about having the right inventory at the right time to maintain stable operations.”

Improvement through teamwork

During its visit, the AME assessment team noted, “One of the most impressive aspects of the site visit was the obvious and visible cooperation with the UAW union. Union leadership clearly respects management and supports the continu-ous improvement effort. It was obvious there is a great deal of goal sharing, collaboration and respect.”

Johnson said better communication with Local 1186 of the United Auto Work-ers led to more regular team meetings with hourly team members and, in turn, helped employee buy-in. They better understand the purpose of lean manu-facturing and have been able to provide feedback to improve processes across the work environment.

Also beneficial has been the regular practice of having team members from

Michael Bremer, vice president of the AME Excellence Award process, spoke in September 2015 to employees at Accuride’s Erie plant, which received a 2015 AME Excellence Award during the ceremony. photo by sarah crosby/erie times-news

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various areas of the company walk the shop floor to see how they can help floor staff improve production.

“We implemented cross-functional process engineering reviews to help optimize the manufacturing process to better eliminate waste,” Johnson said. “Now the process people can help reduce any machining issues. And having the people who make the parts explain how they do so really helps the process.”

Representatives from the Erie Operations also participate in the Accuride Lean Council that meets periodically to identify which lean practices work best for each facility and what can be borrowed from one to improve the other plants.

Johnson said there is a glass wall in every Accuride facility (Erie’s is right outside its central breakroom) that offers key performance indicators and metrics to communicate information to the peo-ple on the floor on daily performance, deliveries, costs and safety in an effort to promote the results of lean method-ologies.

“This shows employees how they are doing,” he said. “If we achieve these es-tablished benchmarks, we have pay for performance. The teams can influence several aspects of their compensation with this process.”

The Erie facility teamed with an outside supplier to integrate material handling methodology to improve one of its die

tools. “We went to a universal system that didn’t need to be unhooked until the work was done,” Johnson said. “This saved manual handling and time that had previously been wasted.”

In addition, the plant boasts that it hasn’t required involuntary layoffs during its lean journey and actually improved its equivalent units of hours worked by 75 percent.

Of using lean principles to improve the business and work environment for Erie Operations employees, Johnson said, “We owe it to team members to make their work lives better. As a result, we make wheels differently now than we did five years ago. And we’ll continue on with our journey.”

Michael Wyrosdick, plant operations manager at Accuride’s Erie plant, left, gave visitors a tour of the facility in September 2015. photo by sarah crosby/erie times-news

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Last June, Accuride Rockford Operations impressed a team of AME Excellence Award assessors so much that it was presented with a 2015 AME Excellence Award, making it

the second Accuride location to receive the award last year.

Accuride Rockford Operations in Rockford, Illinois, manufactures Gunite-brand brake drums, hubs, slack adjusters and other wheel-end components for the North American commercial vehicle industry.

This achievement is even more impres-sive when you take into consideration how far the facility has come just since 2011.

Compound SUCCESSBY CHRIS CRAWFORD

At AME Excellence Award recipient Accuride Rockford Operations, they rebuilt bigger, stronger, faster

Accuride’s Rockford plant was presented with a 2015 AME Excellence Award.

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During a ceremony to present the award to the plant back in September 2015, Accuride CEO Rick Dauch explained that when he took over leading Accuride in 2011, the Rockford plant was operating without any significant capital invest-ments in the previous decade.

“This was a dirty, dangerous, money-los-ing, fast-hemorrhaging business that had been left for dead by its previous ownership,” he said during the ceremo-ny. He described it as the worst factory he’d seen anywhere in the world, includ-ing China and India.

To remedy this situation, Accuride has invested $63 million in the facility since 2012 to install new machining and as-sembly equipment, upgrade its casting operations and consolidate work previ-

ously completed in Elkhart, Indiana, and Brillion, Wisconsin, into the building.

The plant’s history stems back to 1854 when it was the Eagle Foundry, Rock-ford’s first foundry. Accuride acquired the business in 2005 and runs the Gunite facility as a stand-alone business. It spans 619,000 square feet on 34 acres and employs more than 350 employees.

In its feedback report, the AME assess-ment team highlighted the plant’s standout strengths, including the application of visual scheduling boards, which resulted in the launch of fourth-generation production pull boards and the use of value stream map-ping in the factory and for office processes.

The assessors praised the Rockford facility’s corporate and factory hoshin

kanri, strong relationship with Local 718 of the United Auto Workers and the execution program tied to the employee incentive/bonus program.

The AME assessment team also com-mended the Rockford facility’s partner-ship with a perishable tooling supplier and effort to use 100 percent of tool life.

The AME feedback report said, “Rockford has excellent plant leadership and support from corporate that is resulting in a continuous improvement system using automation combined with lean and Six Sigma tools.”

Lean journey successes

Gary Pecor, lean and continuous improve-ment manager, and area manager for Ac-

Accuride has invested $63 million in the facility since 2012 to install new machining and assembly equipment, upgrade its casting operations and consolidate work previously completed in Elkhart, Indiana, and Brillion, Wisconsin, into the building.

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curide Rockford Operations, said the facility started its lean journey November 2011, so 2012-2013 was its first full year of lean.

“During that year, we reduced working cap-ital by $1.27 million,” he said. “And we re-duced lead time by 14 days, or 61 percent.”

Pecor said the first thing Rockford Op-erations did was value stream map all of its value streams.

“We found where our inventory pockets were sitting and implemented pull systems for only quantities that were needed,” he said. “Now we knew what we needed to make and how many to make.”

The Rockford team also created stan-dardized work so that employees were doing the same job no matter what shift they were on.

To maximize overall equipment effectiveness

(OEE), charts were developed for machine and operator balance, improving OEE from a mid-60s percentage to 85.5 percent.

Also since 2012, scrap in the plant has been reduced by 82 percent.

Pecor described the Rockford Operations’ pull system as similar to the way a major retail grocery chain restocks its shelves — employees are signaled how much prod-uct is needed to replenish stock when inventory is low. The company figures out how many parts a customer needs per day and tags the end of a batch in finished goods to alert production that another batch should begin production to make enough inventory to fill customer requests without overproducing.

During the first 18 months of the facility’s lean journey, the drum machining value stream successfully created four pull loops, reducing $1.4 million in inventory and free-ing up 25,000 square feet of floor space.

Other key wins during this lean journey included the plant using an A3 process to reduce changeover downtime for cells that needed to change to make different parts. Via a cross-functional team focused on set-up reduction to minimize changeover time, downtime was reduced by 60 percent. As a result, productivity increased 53.4 percent, and parts per minute went from 12.9 to 19.8.

Helping customers learn lean

Rockford Operations also is sharing its lean knowledge with customers. Rep-resentatives of one of the plant’s global OEM customers visited the facility to

observe its lean operations. They were so impressed with the plant’s kanban and inventory management systems that they asked Rockford team members to visit their facility for a three-day workshop to map value streams for its brake drums.

“As a result, they were able to reduce their in-house inventory and save more than $100,000,” Pecor said. “We helped them establish a pull system on five brake drum parts at one of their assembly plants. We started with two part numbers — the highest running parts they purchase from Accuride.”

If the OEM plant uses 21 Accuride parts for its production today, an EDI signal is sent to Accuride and 21 more will be headed there tomorrow. “This allows us to reduce our inventory and them to have very low inventory, as well,” he said.

Accuride now is on a pull system with all of the OEM’s North American plants, Pecor added.

What lean has meant for the facility

For Accuride’s Rockford Operations, Pecor said, lean has meant reducing overtime, higher on-time delivery and the complete elimination of past-dues.

For its employees, it means less confu-sion, more streamlined processes and overall happier team members who know the company’s expectations and how to perform to those standards.

Personally, Pecor said, “Lean has made me a much better manager of people and assets. It’s given me a clearly defined system to manage equipment, invento-ries, customer suppliers and people.”

As to the future, Pecor said the plant plans to expand the lean successes that have happened inside its walls to its key external partners, including its suppliers and additional customers.

“Through one end of the value stream to the other, ideally, we’d want to share every idea on value stream mapping that we can,” he said.

This was a dirty, dangerous, money-

losing, fast-hemorrhaging business that had been left for dead by its previous ownership.

RICK DAUCH, ACCURIDE CEO