Volume 36, Issue 11, November 2001
Nashville Tempered Glass Adopts New Principles to Raise Profitability
by Leslie Shaver
From top: one of four numerically controlled Glassline edge grinders a multi-wheel Besana edge polisher and a large, multi-purpose silk screening machine are just a few pieces of state-of-the-art glass fabrication equipment in the NTG facility.
The folks at Nashville Tempered Glass (NTG) had a problem.
The company, a provider of niche glass that can be found in a lake (on boats), cornfield (on combines) or kitchen (microwaves and cutting boards), had not been profitable in a while and had what may best be described as an efficiency nightmare in its manufacturing operations.
The Tennessee-based company had overproduced its products to such an extent that its three warehouses had piles of inventory covering the halls. Much of this excess inventory had taken a roundabout way to reach its final destination.
“They would be shipping it out from one plant to another and then shipping it back,” said Kyle Killian, director sales/business development and administration at NTG.
The company’s products were being returned at an alarming rate—almost 4 percent. It had high employee turnover and language problems with those who stayed on board.
Even the sales effort was not focused, with the sales force effectively separated from the other parts of the company.
“It was an operations nightmare,” Killian said.
When Engineered Glass Products (EGP) bought the company in 1999, it was obvious that change was needed. But it was a surprise when the Chicago-based glass manufacturer looked to find solutions to its manufacturing problems in Nashville.
NTG has been in Music City since the company was founded in 1984. It began as a flat glass fabricator and was family-owned until EGP bought it. It moved into the bent glass business arena ten years ago.
It has more than $10 million in total sales volume, generates about 40 percent of its revenue in flat glass and 60 percent in bent glass and has about 100,000 square feet for manufacturing and distribution.
Its flat glass products include insulating glass, appliance glass, glass for cutting boards, glass for cabinet doors and office furniture, backlites and sidelites for boats and agricultural products manufactured by John Deere, International and Case.
Its bent glass products include windshields for boats, agricultural and off-road vehicles and door assemblies (including doorframes and latches, etc.) for Case, a manufacturer of agricultural equipment.
To produce its bent glass, Nashville Tempered relies on a vertical furnace that can bend larger pieces of glass to greater depths than horizontal furnaces, which are used for auto glass manufacturing.
Since these pieces are large with a great amount of bend depth, Killian thinks his customers, including the agricultural equipment manufacturers, are more selective.
“They tend to be real picky about what the glass looks like,” he said.
All of these products are manufactured in the company’s factory and headquarters in Nashville. They are shipped from a nearby warehouse to customers in North and South America and Europe.
Nashville Tempered’s main competition for this slice of the glass business is Taylor Industries of Payne, Ohio. “They are the only company that produces glass to meet the depth of bend and shape that is required,” Killian said.
With almost 100,000 square feet of manufacturing space, NTG has the flexibility to move equipment and create new work
cells. Here, a new centrifuge and separator are being installed to provide recirculated waste water for the recently created N/C edge grinding cell.
Trimming the Fat
Killian arrived at NTG as part of the sweeping changes made by EGP when it bought the company.
The first step was to hire a president. This turned out to be Brett Jacobson, who came from Textron/Aerostruc-tures in the aerospace industry. Next, Jacobson brought in Killian from Dell, director of operations Joe Futcher from Textron Automotive and director of materials and customer support David Yates, also from Textron Automotive.
“We redesigned the company from the ground up,” Killian said.
While all four men were coming into to a new industry with different backgrounds, they had some key manufacturing principles to guide them as they tried to turn around the sagging fortunes of Nashville Tempered.
The company did not have the money for significant capital investments, such as automated systems and new equipment, so it had to look inward for ways to become more profitable. The first thing the leadership did was find the company’s value-added services, which are the parts of a manufacturing operation that generate revenue.
If a process was not value-added, it was eliminated. Under the old regime Nashville Tempered would have excess inventory laying in the aisles and the halls of its factories. Since these products were not making the company money, they needed to be eliminated.
“Packing products and moving them [around] is bad,” Killian said. “You make the product when the customers need it and only when they need it.”
The company’s practice of making a product, shipping it away to another facility and then sending it back was also eliminated. Its regular customers, such as Case and International, which manufacture agricultural equipment, usually give the company four to six months lead time for tractors and combine doors and their hardware. This means the company can plan for shipments and does not need to have inventory lying around.
But Killian says his company can have a product ready in about 24 hours if needed. “If they order something one day, it can be in their dock by the next morning,” he said.
Value-added processes, (often called lean manufacturing) have some less pleasant repercussions. After studying their situation closely, Jacobson’s team decided that the company had more factories and workers than it needed. Unfortunately, this meant the loss of jobs.
The company cut two of its three factories, both located in Hendersonville, Tenn., and cut half its workforce—about 100 workers.
“You have to make decisions like that sometimes to save the business,” Killian said.
The workers who are still around will get bonuses based on the amount of work they do, though the company is careful to avoid unreachable goals.
“We are always looking for incremental improvements,” Killian said. “If you do one thing and do it incrementally better as a company, you will get incrementally better.”
The team also consolidated sales and manufacturing, which had been separate entities. “We did not have a focused sales effort,” Killian said.
An NTG employee strives to make incremental improvements in the IG assembly area.
Killian thinks there is room for more efficiency in the glass industry.
“The glass industry is more established [than industries where the Nashville Tempered management team came from],” he said. “The technology in manufacturing is more old-school.”
He thinks the industry will take notice of the changes at Nashville Tempered are successful.
At Dell, Killian sold to both businesses and consumers, but at Nashville Tempered he markets to other businesses. While this is a challenge, he welcomes the opportunity to work with business customers.
“When you are selling to another business, you have to prove value,” he said. “It takes a lot more documentation and effort.”
The company has felt the effects of this year’s economic slowdown. Since its products go into high-dollar items, like combines and boats, the company does feel the effects when consumers keep a tighter grip on their pocketbooks.
“We have seen a slow down with our customers,” Killian said. “Buying patterns for the third quarter of the year were down.”
He thinks the company’s focus of efficiency will help it weather this storm.
“You have to be very cost conscious to get business,” he said. “Your good companies are figuring out how to get leaner. Companies that are not lean will have problems.”
Nashville Tempered’s ability to turn around orders quickly, its design expertise and its proficiency in how to use glass, will serve it well during a downturn, Killian said.
“If they [the customers] talk to us, we can give them a concept and bring it to life,” he said.
With this ability, it’s little wonder Nashville Tempered can look past the rocky economy and see success.
Production worker Gani Neziri strives for improvements in the bent furnace loading area.
Nashville Tempered Uses Japanese Program to Cut Fat
The boardroom looks as if it has been through a fierce corporate battle. There are Coke cans on the tables, empty potato chip bags on the chairs and charts on the wall with figures and graphs that would make any high school algebra teacher’s head spin.
Production employee Walter Crockett points out a way to make the work flow in his area more streamlined.
Inside the room, a group of employees spend as much as 80 hours a week discussing how they can save Nashville Tempered Glass money and work more efficiently. In the process, they look at what they do, the order in which things are done and what parts and tools they use.
“They are so committed to making changes happen that they will stay in here,” said Kyle Killian, director sales/business development, administration, as he pointed to the room.
But the people making these key strategic decisions are not high-powered and higher-salaried executives. They are Nashville Tempered’s foot soldiers.
The employees are taking part in the company’s week-long Kaizen event. This import from Japan is the centerpiece of the company’s low-cost revamping effort and something revolutionary in manufacturing circles. Kaizen, which requires everyone in an organization to make continuous improvement, pulls workers off of the shop floor and brings them into the boardroom to discuss how the manufacturing process could run more smoothly.
There is also an added benefit: Kaizen can empower workers.
“The time you invest for Kaizen is worthwhile,” Killian said. “The gains are better and the morale is higher.”
The main focus of Kaizen, which was used by Toyota and Sony to propel the Japanese automotive and electronics industries to global prominence, is to maximize manufacturing efficiencies by keeping all the parts a worker needs in his work space—or “work cell.” By doing this, some steps and tools they once used could be eliminated.
One boardroom discussion centered on how the company could produce the door assembly for case more efficiently. The company assembles the hardware and frame hinges at its factory, meaning there are lots of components and tools to move around.
After putting their heads together, the employees decided that changing the ways the parts are organized can save precious manufacturing time.
As the employees developed streamlined processes for each installation, they also developed installation guides for future generations of workers.
“With these [instructions] someone who does not know what they are doing can build the door,” said one worker.
Leslie Shaver is a contributing editor for USGlass magazine.
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