‘We turned our employees loose’

Ingersoll Rand’s Southern Pines plant measures winning and losing on a daily basis—and it’s piling up the victories.

By Bob Vavra, Content Manager April 23, 2012

Yellow tape stripes off about 2,000 sq ft of space in the middle of Ingersoll Rand’s Southern Pines, N.C., facility. A new production cell soon will occupy the space that cardboard box stock used to take up. This is just another example of the way Southern Pines transforms the 110,000-sq-ft plant on a continuing basis.

If it’s true that work expands to fill time, then so it is true for space. Southern Pines has taken the opposite approach. The company has spent five years transforming not only Ingersoll Rand’s production of its impact wrenches, air starters, piston pumps, and diaphragm pumps, but also the process of that production. In doing so, it shrunk production space dramatically, making it possible to absorb two other production facilities into the Southern Pines plant.

For plant manager Brian Lugenbeel, the transformation is all about doing more with less. In this case, it’s not about less people or less profit—simply less space. “When I got here five years ago, there were 95 employees,” Lugenbeel said. “We needed to work on the transformation. We had an 110,000-sq-ft facility, and we were able to free up 60,000 sq ft. We improved our delivery time. One line moved from 100 ft long to 10 ft long, using Lean principles.”

“The footprint is a subset of what we do. We tried to look at it from an operator’s perspective. We asked them to work smarter. They’re already hardworking. It was a matter of changing the way they are thinking,” he adds. “It was a matter of changing the culture. All we did was turn our employees loose. Now they can see what’s possible. We are empowering workers to manage their own space effectively and to drive business improvement,” Lugenbeel said. “In their work areas, we want them to feel like they are in charge of a $20 million business.”

The culture change over the past five years came amid two other fundamental changes at Southern Pines—the absorption of the production lines from Bryan, Ohio, and Athens, Tenn., and engaging all employees in the data tied up in running the business.

“Now we have 310 employees, and we’ve tripled sales coming out of the facility,” Lugenbeel said. “We measure every single thing every single day, and we react to it every single day.”

Part of that measurement process is not being happy with achieving benchmarks for everything in the production process. Takt time is a good example. At first, Southern Pines measured Takt times in weeks, then days, then segments of days. Once a goal was hit, a new goal replaced it. “We got good at making numbers. We’ve now gone to measuring our Takt rate every single hour,” Lugenbeel said. “It was fixed for a long period of time, so we broke it again to make it better. If we keep doing that, we will be a premier plant.”

The plant has five measurements that are posted on the board for every one of the plant’s 310 employees to review every day. Southern Pines posts data on safety, quality, delivery, cost, and cash. “We measure winning and losing on a daily basis. Everybody knows where we stand on a daily basis,” Lugenbeel said.

If all of this sounds somewhat regimented, there’s a good reason. Lugenbeel served in the 82nd Airborne in Iraq and taught ROTC at Appalachian State University before finishing his military career with the 101st Airborne. He’s also gone to nearby Fort Bragg to recruit military personnel for the facility. “It’s a good transition for them. They’re self-motivated, they take instruction, and yet they can think for themselves.” About 20% of the salaried personnel at Southern Pines are ex-military. 

Expansion and contraction

The only new building added to Southern Pines was a 30,000-sq-ft warehouse that also is being run strictly on Lean principles. It’s also allowed the plant to run all production in a straight line from north to south. Materials are received at the north docks, where the warehouse is located. Materials are moved through on carts (which also serve as Kanban cards—when they’re empty, they need to be returned and refilled) to workstations. Finished products flow to the south end for shipping.

There is a real sense of ownership at every stage of the production process. From the individual responsibilities for warehouse lines to production to quality control, Southern Pines has a strong sense of individual ownership within the framework of Lean production. While Lugenbeel continues to lead the push for improvement, there is room to push back.

“We have what we call a 51% rule that an operator can call a halt to the changes,” he said. “We had one operator come to us to invoke that rule when we made a change to his work cell, and he was right; we weren’t ready at that time to make that change. The employees have got to be open minded, but it if doesn’t work, we’ll put it back the way it was.”

Another area of emphasis is quality, which is something Lugenbeel learned well during his time with Tier 1 auto supplier Delphi. “We’ve created a diligence around quality,” he said.

The plant also made a fundamental change in its machine shop.

“In order to be competitive, we had to have a vertically oriented machine shop,” Lugenbeel adds. “We’re bringing the right parts to the right places. We’ve reduced cycle times and change times in our machine shop. That becomes a competitive advantage.”

The next phase in that transformation is the creation of the Product Quality Product Routing machining process, which organizes machinery by parts and types of tools the operator works with. A pilot cell showed output triples, overtime was reduced, and the machine’s footprint was cut by 50%—all while doubling production capacity. That process is being rolled out throughout the plant.

The merged nature of the businesses at Southern Pines means that the three businesses operate under a common strategy, but there is little crossover in the product lines.

“We do have common suppliers, and this gives us more leverage with the suppliers,” Lugenbeel said. “Material handling is now more of a people-oriented process. We’ve gone from 20,000 SKUs to 12,000 SKUs. So we’ve been working on supplier development.”

By implementing Lean practices and incorporating common principles across the plant floor, past due backlog for products has been cut by 65%. But in an organization relentlessly pursuing continuous improvement, there’s still more be done.

The next tasks are to finish integrating the two production lines, streamlining the warehouse space, and continuing to look for more floor space for production. That 2,000 sq ft of space is available, for example, because the plant reduced its cardboard box inventory by working with suppliers to deliver only daily quantities to the plant.

So much has changed at Southern Pines in the past five years. Through the changes, the consolidation, and the occasional upheaval, Lugenbeel has found one constant in his facility.

“The difference is the approach of the employees,” he said. “They understand what it takes to survive.”