Reassembling the assembly line

Engine rebuilder Reviva becomes 'lean' showcase

BY JOHN WELBES

Pioneer Press

Reviva is in the business of resurrecting broken-down diesel engines, but managers there decided that the plant itself needed some renewal.

In recent months, the company's Fridley plant has implemented a "lean manufacturing" process, a strategy that thousands of companies around the nation embrace.

Lean manufacturing processes are commonly associated with Toyota, the Japanese automaker that found ways to refine assembly-line methods dating to Henry Ford. The goal is to root out inefficient operations and cut costs.

The popularity can be seen in a state government program that has given out dozens of grants since 1999 to help Minnesota companies implement lean strategies.

Though Reviva, which is based in Brooklyn Park, hired a private consultant for its project, by late July the resulting changes turned the plant in Fridley into a showcase for other companies wanting to learn what lean manufacturing really meant.

Chief Operating Officer Duane Wanner can point to dozens of changes across the factory floor, which is almost the size of two football fields.

Before lean manufacturing, the plant's floor "was almost like a mouse maze," Wanner said. Low-slung knee walls separated work areas, and the huge inventory of parts crowded others.

As part of the move to lean manufacturing, teams of workers and managers came up with ideas for changes.

The plant started cleaning the engines' exteriors before they were disassembled, its assembly line was reorganized, and its work force was trimmed of temporary employees. The low walls were taken down. The company also managed to reduce its inventory by $2 million and empty its floor space, making room for potential expansion.

"We have freed up a ton of cash that we can reinvest in the company," said Melissa Sawin, Reviva's director of continuous improvement.

The Minnesota Job Skills Partnership also has seen the wisdom of helping the state's manufacturers implement lean strategies. Since 1999, the state has given out $13.3 million in lean-related grants to 56 companies. The program requires a company match for a portion of the grant.

While many manufacturing companies turn to more efficient, cost-cutting strategies to keep up with competitive pressure from China and other overseas locations, the impetus at Reviva was different.

"It wasn't competitive pressure," Wanner said. Reviva's competitors are domestic, because any overseas competitor would have to contend with two-way trips for the engines. That means slower turnaround times for customers and higher transportation costs.

Reviva had a plan to grow its business before the "lean" move, but its leaders weren't satisfied. Sales were flat. The business, which uses hundreds of engine parts, appeared to be running out of space, and at least one consultant said a bigger plant was needed.

To launch the lean process, Reviva started working with Dusty Duckett, managing director of TBM Consulting Group Inc. The Durham, N.C.-based company works with dozens of firms around the country to streamline their manufacturing processes.

About 25 to 30 percent of productivity gains typically come from reconfiguring the assembly line, Duckett said. That was also true at Reviva, where the reorganized line allowed the company to reassign five workers, he said.

Close to 70 percent of the plant's employees are part of a "Kaizen" team, working to refine their portion of the operation. The word Kaizen refers to a Japanese management philosophy of incremental improvement.

One relatively small change involved how parts move through the plant. Hundreds of parts are used on each diesel engine, and the plant remanufactures several varieties and makes of engines. In the past, workers walked over to rows of shelves to grab parts as needed.

Now, as part of the "lean" process, the parts are picked off the shelves ahead of time and put on a cart. The cart follows the engine through its remanufacturing process, saving time.

"In the old world we had tons of bottlenecks everyday" in various parts of the plant, Wanner said. At the testing station, where the finished engines are hooked up to a fuel line and fired up, there was always a line of engines waiting their turn. Now, the changes made in the early part of the process mean the engines come off the line at a steadier, more manageable clip.

Reviva managers emphasize that the lean strategy didn't cost any full-time workers their jobs, though it did mean the loss of about 30 temporary employees during the process. Most of the temps had worked for the company for about six months before the new strategy, and the company typically used temps to find new full-time employees. Reviva now has 65 workers remanufacturing various parts of the engines. Its employees are not unionized.

Not all the employees liked the new way of doing things, said Sawin, the plant's improvement director. Plant workers now wear uniforms, and Reviva doesn't allow employees' radios to add to the din of the various machines. A handful of employees quit over those changes, she said.

In late July, more than 25 managers and employees from other manufacturers around the country spent a week at Reviva to see what the company has done differently. The tour, organized by the TBM consulting firm, included representatives from Pella, the window company; Sealy, the mattress maker; Clorox; and Waterloo Industries, which makes tool-storage equipment.

While many industries respond to overseas competition by moving their operations there, that's not always the best move, said John DuBiel, managing partner at Supply Chain Edge, a business consulting firm based in Ohio.

"One of the mistakes that many companies make is they run offshore … before they get their own house in order," he said. Before doing that, companies "need to benchmark those costs against doing the job the right way in-house first."

John Welbes can be reached at jwelbes@pioneerpress.com or 651-228-2175.

Source: Twincities