Improved Manufacturing Techniques Contribute to Company’s Growth

October 25, 2013 by njmepdevadmin

BACKGROUND:

Innovative Power Solutions (IPS) invested its resources in developing better manufacturing techniques. Its investment resulted in reduced lead times, increased inventory turns and reduced operating expenses. With the help of NJMEP, IPS introduced Lean manufacturing techniques that changed its manufacturing operation. Innovative Power Solutions, LLC (IPS) was founded in 1999 by former key AlliedSignal employees. Their vast experience in the commercial and military aerospace electric power systems market assured the company it had the workforce to succeed.

IPS develops, designs and produces generators, generator control units, power conversion and conditioning units for airplanes and military ground vehicles (tanks). Its cutting edge technologies helped IPS win programs with Bombardier, Cessna, Saab and the U.S. government.

CHALLENGE:

IPS wanted to continue to grow and to do that required both improved cash flow and increased production capabilities. Cash from operations would be used for product and process development. New Jersey Manufacturing Extension Program, Inc. (NJMEP) was invited in to assure IPS would meet its objectives.

SOLUTION:

NJMEP conducted a Lean Opportunity Assessment. The assessment included a comparison of a company’s current metrics to so-called world-class metrics. The assessment indicated IPS would need to improve these critical metrics: lead time, On-time delivery rate, labor turnover, employee productivity, first pass yield, scrap & rework, and inventory turns. Implementing a Lean training initiative would help to change those metrics.

IPS’ goal was to train its forty employees in Lean manufacturing techniques. To help with the cost of training, NJMEP assisted IPS in applying for a New Jersey Department of Labor Customized Workforce training Grant. A grant would dramatically reduce the cost of training for ISP.

Once the grant was approved, training in the following processes began:

Value Stream Mapping
Workplace Organization
Production and Inventory Pull/Kanban
Implementing Continuous Flow Work Cells
Financial Benefits of Lean Manufacturing (Administrative Lean)

RESULTS:

The Lean training improved the skills of its current workforce, which resulted in improved efficiency. Employees gained greater responsibility for the production processes. There was less product waste, excess inventory was reduced as was lead times and the defect rate. The improved skills also increased opportunities for employee promotions. Eli Liebermann, the President of Innovative Power Solutions LLC, noted “The training providers had an innate understanding of our rather complicated processes and were able to teach us how to simplify and accelerate the flow and eliminate wasteful activity.”

Generator production went from two months to just nine days.

The costly errors that held up production were eliminated.

When surveyed for NIST as a result of its work with NJMEP, ISP reported:

$750,000 increased sales
$1,000,000 retained sales
10 new employees
$500,000 cost savings
$25,000 saved on investments
$75,000 invested in workforce training

“We appreciate the training NJMEP provided and the funding that came from a New Jersey Department of Labor grant. Our aerospace customer base laid off 15 –30% of their workforce as orders were being cut by the same percentages. Innovative Power Solutions did not have to lay off anyone. We attribute this to the improvement in flow and the efficiency the Lean training that was provided by NJMEP,” added Dr. Liebermann.

NJMEP’s Main Service Areas:

Business Development Services
Contingency and Emergency Planning
Destination Innovation
Energy Alliance Program
ExporTech™
Human Resources Solutions
Lean Business Solutions
Quality Management Systems & ISO
R&D Tax Credits
Six Sigma
Supply Chain, Transportation and Logistics Services