2010 TOP PLANT WINNER: Toyota Industrial Equipment Manufacturing

What TIEM did to find its way through the recession and the challenges in manufacturing was not to wait for the recession to end. The operations staff and employees at TIEM met the recession head on.

By Bob Vavra, Plant Engineering December 10, 2010

It’s easy to focus on the system.

The vaunted Toyota Production System, a series of highly-focused, detailed policies and procedures that cover every aspect of the manufacturing operation, is among the world standards for production excellence. It covers how, when and why the operations staff conducts business each day – how it keeps people safe, focused and productive at all phases of the manufacturing day.

TPS covers just those things plant personnel have direct control over. It can affect maintenance, but not prevent power surges from the grid. It defines and reinforces human behavior, but people make mistakes. It can manage the cost controls of a plant but not the global macroeconomic forces that plunged the world into recession two years ago.

The system, it turns out, is the easy part.

Excellence is the goal, but under the most challenging of conditions, it’s harder to maintain that focus on excellence. Executing the goals and objective of whatever production strategy you have in place over the past two years has been a monumental challenge. One manufacturer who has not just met the challenge, but thrived in the process, is Toyota Industrial Equipment Manufacturing (TIEM) of Columbus, IN, the 2010 Plant Engineering Top Plant winner.

“Winning the top plant award is an immense honor,” said Kazue Sasaki, president of TIEM. “Continuous improvement is at the core of Toyota’s philosophy, and it is very rewarding to see those efforts, and all of our Associates, earn TIEM the title of Top Plant in the U.S.”

What elevates TIEM as a Top Plant winner isn’t TPS. Every Toyota manufacturer and many manufacturers around the country use TPS as the backbone of their production and maintenance processes. What TIEM did to find its way through the recession and the challenges in manufacturing was not to wait for the recession to end. The operations staff and employees at TIEM met the recession head on.

“We looked at that period of time as an investment in our people,” said Tim Hollkamp, assistant manager for human resources at TIEM. “This year as we’ve started to grow and our production schedule has started to increase, we’ve identified individuals, who have been through pre-training, and added those Associates as leaders. If we had not done the training during those hard times, we would not have had those individuals ready.

 “A couple of years ago, we were working three to four days a week, and we were looking at doing some additional training,” Hollkamp said. “We put all of our Associates and management through the original training to reinforce those principles, and then we put them through Toyota Business Practices and Problem Solving Training. We were committed to maintaining those core principles.”

Overcoming the challenges

Principles are one thing, but the economic reality of the past two years forced not just the production cuts, but also cuts in the workforce at Columbus. TIEM cut its workforce by more than 140 in all departments between 2008 and 2009. All were painful cuts for an operation that has expanded 11 times in the 20 years since TIEM landed in Columbus, a community of 40,000 about one hour south of Indianapolis on I-65.

In 2010, contract workers are coming back to TIEM as production ramps up. The operational challenges are the same, and so is the way the contract workers are regarded as they come into the facility.

From the first day, safety and quality are the core principles. That means safety for both the process and the worker, and quality for both the process and the product. It is the first topic, every day, at the beginning of each shift. Safety incidents are reviewed daily, weekly and monthly with all Associates and management. This includes all near misses first aid and recordable incidents.

There also are semi-annual lunch box meetings, an open communications meetings with human resources where Associates can bring up any ideas or concerns and TIEM pays for lunch. All communication forms have answers given back and most are posted on bulletin boards for all to read.

And it goes deeper than just OSHA recordable incidents, which were at just one lost time accident in the last two years and an average incident rate below five for the same time frame.

“The processes are set up with ergonomics in mind,” said Wendell Crouch, manager of production engineering, maintenance and facilities at TIEM. “The production process is audited by the safety department. If they find processes that have issues, those are reviewed with the Engineering Department. We have tables set at the right height for the Associates. We have 325 cranes to assist with lifting items. But the idea is to engineer it right in the first place.”

“On an annual basis, before the beginning of the calendar year, every process is reviewed, and a risk assessment done,” added Dixon Churchill, who manages EH&S and building and grounds at TIEM. “It used to be just an ergonomic risk assessment, but now we’re doing acute risks and chemical risks. We’ve been doing that close to 10 years, and it’s developed into a very useful tool.”

But unless the culture is such that employees buy into the system and use it to improve operations, it’s just a system. That’s one area TIEM’s managers count on the Associates to help lead new employees.

“When they  get hired, the orientation has a lot of information,” said Hollkamp. “When they actually see that this is our process, this is how we do business, it creates a high expectation from them. We have Team Improvement Groups. We want them to be included in those. If Associates have an idea, we encourage them to form a TIG (TIEM <s>Toyota</s> Improvement Group) group.

The message also gets sent to interns and temporary workers. “Previous to the downturn, we used high school co-ops and college students in summer intern programs, distributed throughout the organization,” said Hollkamp. “In the recovery, we’ve used a temp service that has partnered with us, and we’ve educated the temp service as to what we’re looking for.”

Sharing maintenance

One area where TIEM has made fundamental changes, and found vast improvement, is in maintenance. They key has been pushing the maintenance function out to more Associates.

“Right now we have 19 maintenance Associates and nearly 4,000 pieces of equipment to maintain. The only way you can maintain that high a number of equipment is to have maintenance part of everyone’s responsibility,” Crouch said.

“We get the operators involved in cleaning, tightening and lubricating and leave the more complicated repairs to the maintenance staff. It has always been the process but over the last three years, we have developed an autonomous maintenance program,” he added. “Some of the items we were doing like cleaning pits, cleaning the machining center coolant tank, were moved to the leader of that area – that is put into the autonomous maintenance program. Maintenance still schedules those tasks, but the leaders are responsible for performing them.”

That shared responsibility flows back from the fundamentals of TPM (Total Productive Maintenance). “The key is that maintenance is not the other guy’s job. Maintenance is what everybody does. You can’t show me a factory that produces good quality that has their machines in bad condition. Being a just-in-time facility, we have no duplication or back-up in our equipment.”

This system helped TIEM maintain production schedules while reducing emergency repairs from 14% of total maintenance in 2008 to just 11% in 2009 and allowed them to cut the cost per hour of downtime by 10% in the same period.

Sustainable energy success

Long before sustainability became the buzzword in manufacturing, TIEM was leading the effort locally to be a good environmental citizen. TIEM achieved zero landfill status in 2004, and reduced its carbon footprint by almost 4,000 tons of CO2 in 2008.

They’ve done all of the other things you’d expect from a green organization – distributing more than 1,000 trees annually to its Associates for planting and donating another 1,000 trees to other local agencies.  TIEM is a sponsor for the Bartholomew County Solid Waste Management District activities, including outreach on environmental issues to area children, and the donation of a lift truck for the area’s recycling center. For all of this, TIEM was recognized as an outstanding corporate environmental partner in 2008 by the Indianan Solid Waste Management Districts, Inc., and named the Indiana Governor’s Award Winner for Environmental Excellence in 2006 and 2009.

All of this doesn’t mean they can’t still learn a few new tricks. “We have for years tracked what the dollars per unit were,” said Crouch. “Every year we had aggressive reduction targets. One of the items we have on our check sheet talks about motors. There is a lot you can do on the front end to make it more efficient, such as minimizing the air line size.

“Since there is minimal activity at night it is an ideal time to hear and fix any air leaks.  Controlling temperatures is another obvious way to save energy. We have changed our paints to bake at lower temperatures. Some of the chemicals we used had to be heated, so we’ve changed to chemicals that can be used at room temperature.”

And sometimes, the solutions are simply a change in behavior. “In the past, leaders could not turn off the lights when they left for the day, between 3p.m. and 5 p.m., because the lights were often connected to other manufacturing areas. So security would go around at 5 p.m. and shut off the lights,” Crouch said. “We went through and rezoned the lighting so it is specific to a particular manufacturing area and the leaders can now turn off the lights when they leave and not affect another area. That has resulted in a good energy savings.”

“We cut down the number of lights in hallways and underutilized office areas and added motion sensors for low occupancy areas and calculated the savings, especially when we were looking for that carbon footprint reduction,” added Churchill. “Our focus is on continuous improvement, so we will probably never be satisfied. Small incremental improvements are the goal.”

Product development

The result of all of those measurements, with all of that attention to people and facilities and process and TPS, is a lift truck. More than 350,000 have come rolling off the assembly line since 1990, and Toyota took time to celebrate that achievement – and the launch of its new 8-Series 4-wheel drive electric lift truck, at a celebration in Columbus in August.

"Toyota prides itself on manufacturing products that embody industry leading safety, quality, durability and reliability," said Kazue Sasaki, president of TIEM during the August event. "During the last two decades, TIEM has achieved a number of manufacturing milestones thanks to the support of our customers, dealer body, Associates and community. We look forward to another 20-plus years of manufacturing excellence in Indiana."

When Toyota located in Columbus in 1990, it spent $60 million to put the facility on its feet. Over the years, another $120 million in investments have expanded the TIEM footprint to almost 1 million sq. ft. and established the National Customer Center and training center. That showroom includes the very first Toyota lift truck  sold in the U.S. more than 40 years ago. Such was the quality of that first truck that it took some convincing – and a new lift truck – to get the owner to give it up for display.

It’s that pride in the product as well that helps drive a quest for more improvement. “I took about a four-year detour to the quality department. I went out to a lot of dealers,” said Crouch. “I learned our forklifts operating cost is low over the product’s life. A lot of operators will tell you, ‘These things drive like a car.’ They’re smooth, quick within the process and reliable.”

“It is the safest product on the market,” said Churchill. “The (System of Active Stability) has revolutionized the market with its 4-point suspension system. My department uses an electric AC powered forklift and the speed and smoothness of operation is greatly improved over other types of electric forklifts.”

To achieve the goals of growing the business and to continue to bounce back from the recession will require a focus on more than the metrics. It will require the people at TIEM to keep an eye on the things that got them through the first 20 years, and got them to the 2010 Top Plant award.

“Everyone knows where we are at today is not satisfactory for tomorrow. We don’t ever stop trying to make improvements, said Crouch. “Whether it is safety, environment, we are never staying status quo. There will always be additional improvements.”

“The Toyota philosophy is you never do anything here without making an improvement over what was done before,” Churchill added. “The president will ask, ‘How is this an improvement over what you already have there?’ You have to have measurable results.”

“We had a teacher that came here from Japan, and he had a phrase: ‘All good is no good’,” said Crouch. “In other words, if you say everything is good then you aren’t challenging yourself.”

That isn’t the issue for TIEM. It’s built into the system, but also into the people. “Some of the things we try to do are move managers around to different areas. We don’t get stagnant,” Hollkamp said. “We get a different way of looking at the same issue. We challenge management personnel to solve those challenges.”