Navigating a Lean journey

AME Manufacturing Excellence Award recipient NovAtel offers a culture of continuous improvement.

By Chris Crawford February 17, 2016

The Association for Manufacturing Excellence (AME) recognized NovAtel’s 93,000-square-foot facility in Calgary with its 2014 Manufacturing Excellence Award.The company produces an extensive line of OEM receivers, antennas and subsystems using a two-shift workforce of 400 employees.

NovAtel Inc. in Calgary, Alberta, Canada,designs, manufactures and sells high precision OEM positioning technology, and its GPS products are used by system integrators in more than 60 countries to deliver precise positioning solutions in precision agriculture, autonomous vehicles, defense, mapping, survey and other industries. Its Global Navigation Satellite System (GNSS) products have set the quality/performance standard for more than 20 years.

Part of the Hexagon Group, Sweden,NovAtel has transformed itself using Lean principles to deliver on-time product, strengthen supplier partnerships and increase customer satisfaction.

To achieve these successes, the company used pull (pull signals, kanban and shop-floor material delivery), heijunka (leveling the work by product and resources) and demand smoothing(through work with customers).

Mike McAloney has served as vice president of operations at NovAtel for 13 years, and he is responsible for leading the company’s lean transformation.

McAloney said NovAtel started its lean journey in 2003, when the company had just started receiving a lot of customer orders. "So our business was picking up and we were struggling with quality and delivery, and we could see a wave of new business coming toward us. We knew we had to do something," he said.

Dennis Ho, senior manufacturing manager,said McAloney and he first heard about lean at the AME Annual Conference in Toronto that same year.

"Mike and I said, ‘Let’s go and see what other companies do and see what we can learn,’" Ho said.

By Wednesday of that week, McAloney said, they had found "effectively a new religion when it came to manufacturing things."

Lean achievements

McAloney said in the early days of the company,if the facility could make a product in three weeks and actually deliver it to customers, that was considered a success."

Today, we live in an environment where we have two-day customer request dates," he said.

Isabel Murguia, manager of order management,said lean has allowed NovAtel to manage two to three times the volume and complexity of orders it had previously with the same amount of employees.

Ho said the culture of continuous improvement is ingrained in the whole company now—everybody is involved in the process.

"I always tell people, ‘If there is no problem,we have a problem,’" he said. "If you don’t have a problem, either you aren’t looking hard enough or we actually need to lower the water and see the rocks."

McAloney added that in the GPS business, accuracy is addictive, and now for NovAtel, the same can be said for continuous improvement.

"Once you have accuracy, you can’t give it up," he said. "On the supply side, once (a customer) is used to being able to call up and get next-day delivery, how do you stop doing that? How do you move into a model where you have to forecast and wait weeks for your delivery?"

You don’t, and NovAtel won’t be going back to its old ways.

Plan for continued lean success

McAloney said NovAtel plans to keep up the good work in its lean journey by redoubling its efforts.

"Selection as a Manufacturing Excellence Award recipient has inspired us to continue our lean journey, confident in the direction we have chosen,"he said. "We took the AME Manufacturing Excellence assessment feedback very seriously. It has motivated us to challenge some of our long-term beliefs."

For example, it has inspired NovAtel to implement heijunka and production load leveling by product and resource, which has benefited its employees, overall business and customers."

All of the changes we are making are setting us up for growth and success as we expand into new markets," McAloney said. "Our awareness that lean is first and foremost a management system is shaping our views on what to measure and how to focus our efforts on the most important objectives."

Also, policy deployment now is an important tool that brings focus and alignment to the company strategy.

"But most importantly, we believe our people are our future and a great lean culture is key to our long-term success," he said. "I am proud to say that improvement is part of our regular work every day and no longer seen as something to be done when time permits."

The author is Chris Crawford. This article was originally published on AME Target Magazine. Get access to the magazine using the Target App. AME is a CFE Media content partner. Edited by Erin Dunne, production coordinator,

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