Swagelok Co. excels by looking to the future
2020 Plant Engineering Top Plant: Focus on training, workforce development and digitalization enable success
“I believe American manufacturing is strong. When you look at the diverse industries Swagelok serves, it’s unusual for all of them to be either up or down all at the same time. At the moment, for example, semiconductor is performing well, while oil & gas markets are sluggish,” said Ward Dumm, senior vice president, operations, Swagelok Co., Solon, OH.
Swagelok is a privately held, $2 billion maker of gas and fluid system components, such as tube fittings, valves, tubing, hoses and flow measuring equipment. With headquarters in the United States, the company operates 20 manufacturing facilities and five global technology centers – each with substantial resources in materials science, engineering and logistics. Swagelok products and services are sold through more than 200 authorized sales and service centers in 70 countries.
Like so many of the technology providers to the process industries that Plant Engineering covers, Swagelok was founded in the immediate post-World War II period, i.e., 1947 to be exact. Located in Northeast Ohio, it is part of the U.S. Midwest industrial heartland.
In a year like no other, Plant Engineering has awarded its 2020 Top Plant award to Swagelok, for best practices related to safety, commitment to training, workforce development and digital transformation, noting in particular the company’s forward-leaning response to the Coronavirus (see sidebar, Keep an eye on the road ahead).
Yet even during a discussion of Swagelok’s success, Dumm recognizes one of the biggest challenges faced by today’s U.S. manufacturers.
The biggest challenge facing American manufacturing today, Dumm said, is finding the labor to support its continuing growth. “We’re trying to target more than 250 people for our assembly and manufacturing operations here in Northeast Ohio, just to keep up with the demand. Most immediately, that may be driven by activity in semiconductor markets, but we’re looking for some markets that are sluggish at the moment to come back next year.”
Dumm himself grew up as part of a family of engineers and he is convinced too many people have an antiquated idea of what manufacturing is all about today. “They only imagine someone on an assembly line doing dirty or hazardous work. Nothing could be further from the truth. First, we’re committed to providing a clean manufacturing environment with state-of-the-art assembly processes and safety protocols. Plus, there are careers to be had, including in automation, data engineering, production planning and asset management,” said Dumm.
Another aspect of the manufacturing industries many don’t know about is the career development opportunities it has to offer. “Many manufacturers are willing to pay for continuing education. The same goes for leadership. Many of our frontline supervisors and department managers started on the shop floor and have embraced the opportunities the company has to offer.”
Swagelok’s career development program brings interns, co-ops and recent graduates into the company every year. “Realizing about 10 years ago that we had experienced individuals that were due to retire soon, especially in our supply chain operations, we’ve taken steps to ensure we have a pipeline of new talent coming into the organization.”
Despite the challenges, Swagelok’s annual associate retention rate is near 90%. These associates, domestically and abroad, have an average tenure with the company of 11 years. Many have been with the company for decades.
Addressed by technology
Swagelok keeps 6,200 standard parts in inventory worldwide. In addition, it furnishes assemble-to-order, make-to-order and engineer-to-order products.
The company says it owns its manufacturing process from start to finish, buying bar stock direct from mills to forge, machine, electropolish, weld, assemble and test, among other processes.
However, Dumm says one of the biggest investments the company has made is in an enterprise-wide SAP implementation. SAP is one of the largest suppliers of enterprise resources planning systems, used for manufacturing, supply chain, human resources and other company functions. The implementation, Swagelok says, required more than one-half million hours to complete.
“The origins of the system go back 10 years,” said Dumm. “As the company grew, we pursued something of a best-of-breed approach. At some point we realized that risks were growing with having unsupported or out-of-date solutions. It wasn’t a quick decision, but we decided that SAP was best for us. That led to a global design and a broader implementation of SAP.”
The enterprise system provides a single source of truth for Swagelok. Dumm said benefits extend to the plant floor with SAP MII (Manufacturing Integration and Intelligence), which is a manufacturing execution or integration solution, offering real-time production monitoring and providing data analysis tools.
“We’re now leveraging some of the benefits of having a broader SAP system with real connectivity. On the plant floor, the operators get the right information at the right time. It’s the single source of truth. In addition, I would mention that with the variant configurator, we’ve been able to reduce by 75% how often engineering has to intervene in the order flow,” Dumm said.
A continuous improvement and quality team is dedicated to how, starting with the connected factory made possible with the ERP system, Swagelok can achieve a global approach to incorporating the industrial internet of things and analytic approaches into operations.
Keep an eye on the road ahead
For a year like no other, Plant Engineering editors have chosen an outstanding annual Plant of the Year winner: Swagelok Co., Solon, OH, the maker of fluid system components.
Swagelok exemplifies many of the best practices the brand’s editors want to write about, including for safety, commitment to training, workforce development and digital transformation.
However, in presenting the award to Swagelok, the editors are especially cognizant of how Swagelok, at the arrival of the pandemic on U.S. shores, took proactive steps to ensure its continuing operations as an essential manufacturer – based on prior preparation.
“Several years ago, we did a table-top exercise for the eventuality of a pandemic that served as a good tool for guiding our initial actions,” said Ward Dumm, vice president of operations.
What’s more, Swagelok shared that knowledge with its manufacturing peers through a briefing that took place April 8, hosted by MAGNET (Manufacturing Advocacy and Growth Network, a consultancy that supports manufacturers in northeast Ohio.
In a kind of list that is now familiar to most of us, among the steps Swagelok took in its facilities and shared in the briefing included the following:
- Enforcement of social distancing measures
- Associate self-check prior to entering sites
- Enhanced hygiene protocols in production and operation areas based on Centers for Disease Control (CDC) guidelines
- Mandatory remote work for all office associates and, as feasible, support associates, to a total of about 800 associates
- Quarantining of associates reporting potential or confirmed exposure to someone with the virus
- Staggered shifts to reduce population overlap
- A structured approach to communications within the management team and with its employees, associates, customers and supply chain.
Since the MAGNET briefing, Swagelok has also implemented a Hardship Paid Time Off policy for any associates who experience a COVID-related hardship that prevents them from completing their regularly scheduled working hours.
Swagelok has remained open as an essential business throughout the course of the COVID-19 pandemic, ensuring its customers — especially those working in critical industries and applications across the globe — have access to the reliable products and support needed to operate effectively. Now, as manufacturing companies and other organizations that were previously closed gradually reopen worldwide, Swagelok continues to adjust its approach to best serve its customers while promoting the wellbeing of associates.
The Coronavirus emergency has highlighted the benefits of having a strategic plan or approach that allows some anticipation of challenges on the horizon.
“If you don’t have a dedicated team that’s looking at where you want to be in the next three to five years, you’re in danger of getting too caught up in dealing with the daily crisis. COVID is a good example of this. I know it’s something extremely unusual, but you could argue that every year there’s something that could throw a monkey wrench into your operations,” Dumm said.
For Swagelok, having an eye on the future and making sure the resources are there is combined with values focused on safety, quality and respect for the individual.
“That makes it easy when confronted by a challenge like the Coronavirus to know what to do next,” Dumm said.
Dumm believes that coming out of the Coronavirus crisis, labor constraints and finding people to work in manufacturing will be one of the biggest challenges going forward.
It leaves Swagelok, and manufacturers everywhere, plenty to think about going forward: How will manufacturers transition to more efficient operations? How do they manage a changing skill set? Can a manufacturer double its business without doubling the number of people? What technologies will enable that?
It will be interesting to see how it all unfolds.