New Jersey Headwear Corporation of Newark, New Jersey was founded in 1992 by President Mitch Cahn as a manufacturer of union label apparel, including hats and shirts, to be promoted to unions, political campaigns, government agencies and socially responsible organizations. The company’s products, which also include a recently established line of custom bags and embroidery, are available only through a national network of union wear distributors.
Mr. Cahn, whose company has 100 employees and annual sales of $6.0 million, first encountered NJMEP when he attended a public Principles of Lean Workshop at NJIT in December 2005. An NJMEP field agent subsequently prepared a QuickView Assessment and a Lean Opportunity Assessment. These undertakings led to a number of relevant observations and raised pertinent questions and concerns, including excessive idle time during embroidery setup; a deficiency in communicating company goals and expectations to most employees; a flawed production and inspection process, leading to non-conforming products and non-value-added work; an absence of visual signs of any TPM programs; and a lack of accountability for product quality non-conformance.
Following these assessments, NJMEP offered recommendations that addressed the aforementioned areas of concern, identified specific improvement opportunities and estimated the positive impact on business should these improvements be implemented. New Jersey Headwear management discussed these recommendations with NJMEP and decided to proceed with a Lean Transformation Project. The field agent contacted third party resource Dave Hollinger for ongoing assistance.
New Jersey Headwear’s project encompassed ten workshops, including Principles of Lean; Team Building; Value Stream Mapping; 5S; Cellular/Flow Manufacturing; Pull/Kanban; Setup Reduction; and Project Mapping/Implementation. 48 employees participated, including the president, chief financial officer, marketing and sales manager, various supervisors, union stewards, and clerical and production workers. The duration of the project was one year.
Upon completion, New Jersey Headwear had grown into a more profitable and competitive business. Quantifiable results included a $750,000 increase in sales; cost savings of $1.2 million; capital investment of $150,000; 20 retained employees and 25 new employees; and a reduction of two thirds in the manufacturing interval.
New Jersey Headwear has since contracted with NJMEP for an additional five days of Lean Consulting, and has applied for a New Jersey Department of Labor grant for Lean training, to be applied to a recently acquired manufacturing operation and training in English as a second language. “This training program has significantly transformed our business into a more profitable and competitive business,” noted company president Cahn. “We freed up floor space, which will now allow us to expand our production operation. “Lean enabled us to migrate to self-directed work teams,” he continued, “which have reduced demands on management’s time, allowing a greater focus on other areas like sales and finance. As a result of this improvement to our business, we were able to absorb increases in hourly wage rates, and are now in a position to acquire another product family.
“We are looking forward to growing our business by ‘Leaning out’ an acquired manufacturing operation. NJMEP has been excellent to work with,” Cahn concluded.