Watlow is a designer and manufacturer of industrial heaters, temperature sensors, and controllers. They hold over 450 patents and employ over 2,000 people working across the globe.
This project took place in a 105,000 square foot facility with 300 employees, which manufactures temperature sensors, thermo couplers, and thermistors for the medical, food service, automotive, semiconductor, and aerospace industries. The sales for this facility were in the tens of millions with the goal to double sales.
Difficult availability of labor
Manufacturing layout on two floors
Batching constraint due to setup times on shared equipment
Lack of synchronization between processes
We focused on transitioning the facility from a traditional “batch-and-queue” manufacturing system to one that could accommodate, in an agile manner, higher mix and smaller lot production based on actual demand from customers. We started by walking through the value stream to establish the current state of the operation and the management of that operation. It was clear that cycle times and stagnation of inventory were key to a number of issues faced by Watlow and its management. We identified the truly value-added steps and set to change the information flow to facilitate the smaller lot size production needed. In the end, we established ‘broken-line” manufacturing cells and rapid flow lines.
Through changing the flow of production we were able to reduce PVC inventory within the system from 11,000 pounds to only 4,200 pounds. By collaborating with their supplier, we were able to reduce the floor space needed for this inventory by 50%.
We visualized the communication systems on the factory floor, thereby establishing flow management between processes in the factory with no expenditure on information systems or management systems. This allowed us to reduce travel flow of product information by 70% as well as cut the lead time by 46%.
We also focused on the priority customers for Watlow. One such customer for tapered thermo couplers for a large semiconductor account provided Watlow with $1.6 million annually in profit. This change in method at Watlow was realized across other accounts too. Transportation of WIP parts was reduced from 4486 to 1309 feet and work order open times went from 15 to 8 days. Finally, setup time was reduced 79%.
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