Disc Makers is a leader and innovator in optical disc manufacturing for independent artists, filmmakers and businesses producing over 20,000 titles a year. The company, which was founded in 1946, operates one of the most vertically integrated manufacturing facilities in the industry, out of its Pennsauken, NJ plant. Its mission is to help independent artists – whether musicians, filmmakers, or small businesses – compete head to head with companies much larger than themselves. More than 70% of the employees are independent artists themselves, which brings a unique perspective to the company, allowing them to anticipate the next need in the independent content markets. The company has one manufacturing location, two distribution/fulfillment centers and 9 sales offices.
Disc Makers operates in a highly competitive, mature market where customers want the lowest price, quick turn and small order sizes. As a result of the economic downturn Disc Makers customers decreased the size of their orders further forcing the company to focus on bringing on more customers to maintain sales levels. It also forced the company to look very closely at direct labor cost and they unfortunately had no choice but to reduce staff via a layoff. It was very clear to the management team that in order to remain competitive and profitable Disc Makers needed to do more with less. The company had been considering implementing Lean manufacturing but never made the full commitment. Now, with the economic situation and change in the type of customer orders, introducing Lean became far more compelling. Lean would help Disc Makers lower cost, shorten lead times and be more flexible and agile for significant more orders without sacrificing quality thus enabling the company to remain competitive in the eyes of their customers. Keep in mind that the 20,000 orders are all custom and this results in a tremendous number of manufacturing changeovers. Michael Marie was recruited by the executive team to lead the transformation. Knowing that the company would not be able to implement Lean on its own, Marie looked for appropriate resources.
Marie contacted NJMEP after being referred to them by a colleague. NJMEP Field Agent Ron Eleuteri met with Marie, listened to his needs, and then recommended pursuing a New Jersey Department of Labor Customized Training Grant. Although qualifications were rigorous, Eleuteri determined Disc Makers was an excellent candidate to receive funding—an innovative, growing company looking for tools to remain competitive in their industry and that wanted to develop its workforce. NJMEP designed a training program and identified Lean resources that would meet Marie’s needs.
Working together Disc Makers, NJMEP and its resources began the process of identifying areas for change, developing its workforce and changing the organization from a “why change culture” to one of “help us change.” The company created a new position, a “Lean Leader,” Director of Lean and CI for Lance Svoboda, who would direct the transformation. They also created a Lean Steering Committee made up of an executive team and a Lean Champions Team, made up of eight volunteers, from through out the company that committed 15-25% of their time to the team. The key to the ability to sustain the transformation has been these Lean Champions and their unselfish, passionate support of the process.
For Disc Makers, the most powerful tool for change was Value Stream Mapping, which enabled the company to identify opportunities for improvement. Introducing a Kanban Pull System changed the entire production process. The company applies this methodology throughout individual departments as production schedules vary— disc manufacturing runs 24/7 while printing runs two shifts five days a week.
The appearance of the company changed, as well as its functionality, as a result introducing 5S. To assure the 5th S, sustainability, was maintained a very simple and easy to implement rewards and recognition program was implemented. Disc Makers original 5S sustain map included forty-six work centers such as: marketing, sales, project management, engineering, and the office. A recent audit indicated there had been an overall improvement of 25% within the entire organization since the introduction of Lean.
Lean at Disc Makers transcends the manufacturing floor. This is evident in the implementation of cellular flow techniques in the office. The management team views the Lean Transformation as a journey with no end. It is an ongoing process and Disc Makers has clearly communicated that to its organization. It has been presented to managers as a resource to help them organize, to do their jobs better as well as improve the overall operations and profitability of the company. To support its commitment to Lean, Disc Makers offers Lean 101 workshops on a monthly basis and requires employees to attend one workshop annually.
Although Marie had very clear operational objectives for transitioning to a Lean company, he also had a more non-tangible goal to develop his workforce, to expose them to Best Business, as well as, Best Manufacturing Practices.
As a result of the lean practices Disc Makers implemented, it was able to: reduce the numbers of touches in its production and non-production processes helping the company to increase customer orders by 40%, reduce time spent looking for parts – >90% improvement, shorten manufacturing lead time – >75% reduction, reduce over production – > 60%, reduction,
improve on time delivery – > 50%, better balancing and improved flexibility/agility to meet variable, un-forecasted customer demand.
Disc Makers was also able to grow its workforce by introducing a new department resulting in 12 new employees. In addition, the company realized a significant cost savings though reduction of “waste” throughout the value stream. In spite of current market conditions Disc Makers continues to meet its sales objectives.
“We are grateful for the world-class expertise NJMEP provided us with. Even though sales were down 15%, our profits remained at 2008 levels in a depressed marketplace. NJMEP was also instrumental is assisting us in an award of a NJDOL Customized training grant in excess of $165,000. This, coupled with our Lean Transformation experts, positioned us well into the next decade.” Michael Marie, VP Operations.
Disc Makers is a participant in NJMEP’s Made in New Jersey program. Click here to view their profile!