When James L. Solberg, executive director, Ford Powertrain Manufacturing Operations, described how the company's engine manufacturing capacity was being expanded in Windsor, Ontario—an increase of 100,000 engines announced in April, on top of 50,000 that were announced in January 1999 (all of which adds up to an output of 950,000 units from the Windsor Engine Plant in 2000)—Solberg said something that was, well, unconventional: "Our team had to do some unconventional, `out of the box' thinking to come up with a strategy that would allow us to increase the flexibility of the Windsor plants." Note the plural plants. Solberg continued, "We were able to take advantage of lean manufacturing principles like the Ford Production System and other important initiatives to find new and more creative ways to increase our engine capacity without sacrificing the integrity of the production process, product quality, or our own environmental pledge."
Importantly, they are working to develop this additional capacity without putting up a new building and filling it up with new equipment.
How to Increase Engine Capacity: The Traditional Approach
Before the Ford Production System (FPS), Solberg explained, the approach would have been fairly traditional.
He would have been told that X additional engines were needed.He would reply that the plant capacity is Y. In order to produce X+Y, he'd need money. With that money he'd build a new structure, into which he'd put a new line. And because he and his colleagues are engineers, they wouldn't install just any new equipment: they'd opt for the latest engine-making technology they could get their hands on. It would probably have some of the proverbial bells and whistles.
So, to review:
And one way to look at that series:
•Questionable shareholder value.
•A new structure with related overhead costs.
•Time required to build a building and to design, engineer, produce, install, and debug a new line.
•New technology that, while if not incompatible with existing equipment, would be sufficiently different to add complexity (training, use, support, maintenance) to an already-complex business.
The traditional approach, in retrospect, isn't all that it is cracked up
Windsor Operations: The Background
The Windsor Engine Plant, in its modern configuration, was opened in 1994 for producing modular-style truck engines. It was originally built in 1922, and was shuttered in 1990. The plant was stripped down to its girders and then reconstructed. The modern configuration was built with FPS in mind. It is a plant with a certain amount of flex that's staffed by a group of some 2,400 people who have undergone training in the new way of doing things.
Presently, three engines are built in the plant. There are a 4.6-liter V8 (for the F-Series, Econoline and Expedition models), a 5.4-liter V8 (for the Expedition, F-150/250, SVT F-150 Lightning, Econoline, and E-350 recreational vehicle chassis), and a 6.8-liter V10 (for the Econoline 250 and 350, E-350 chassis, Super Duty F-Series, and the Excursion).
What do these engines have in common? They are being fitted into some of the most-popular vehicles on the road today. In 1998, there were a total of 769,800 of these engines built, of which 615,840 were the 5.4-liter Triton, which is a mainstay of the F-Series pickup. Not surprisingly, the first announced engine capacity increase—the one made in January—was for the 5.4-liter engine. The additional 100,000 will encompass both the 5.4- and the 6.8-liter engines.
Average daily production at the plant is—pre-expansion—3,333 engines. Ford describes it as "one of the most productive engine plants in Ford worldwide."
Beyond the Windsor Engine Plant
But the Windsor Engine Plant is just one part of what are called "Windsor Operations." That category encompasses the Essex Engine Plant, Windsor Casting Plant, Essex Aluminum Plant, Windsor Aluminum Plant, Casting Aluminum Research and Development, and International Distribution Operations.
The Essex Engine Plant, which employs some 1,500, produces V6 engines for vehicles including the Mustang and the Windstar.
The resources of this plant are important to what is being created at Windsor Engine, because it is becoming a source for V8 blocks and V10 crankshafts. And the walls of this plant aren't being extended, either, although the space within Essex Engine is undergoing a radical redeployment.
Recall the recommendation to note the word plants earlier on? Essex Engine is one of those plants. There are others (e.g., Ford Woodhaven Forging, which produces the 5.4-liter V8 and 6.8-liter V10 cranks) that are supporting Windsor Engine. But we'll look at Essex here.
Victor E. Kane, Manufacturing Operations manager, Essex Engine Plant, cited the implementation, in the late 1980s, of the Ford Total Productive Maintenance (FTPM) program as being key to the current capabilities at the engine plant.
|The 2000 Ford Excursion XLT is just one of the trucks equipped with an engine built in Windsor. As the demand for trucks grows, Ford has had to find the best means to fulfill the requirements. Lean production is instrumental.|
The primary purpose of the plant is manufacturing V6 engines. To do so, the plant is equipped with a full complement of high-volume equipment carrying such name plates as Cross and Bendix—the sort of machinery that can be used to produce over 500,000 engines per year (the plant made 590,170 engines in 1998). In addition to the dedicated transfer equipment there was a low-volume line, consisting of CNC machines and turret-style units.
One of the consequences of FTPM is that people within the plant started working in small "teams" on keeping the machines going through FTPM methodologies. And they started making changes. All of which means enhanced productivity.
Ken Williams, site manager for Windsor Operations, pointed out, "The technology on our equipment has improved over the years." He noted, for example, the use of friction, disc brakes on the transfer machines. These brakes were prone to wear and required frequent replacement. Which meant downtime. But now those brakes have been replaced; four to five times the life is attained. Which means less downtime.
Simply: The main line at Essex can handle all of the required production. The low volume line, the flexible line, isn't necessary. Windsor Engine needs more V8 blocks. And since the Essex line isn't dedicated, it can be retooled comparatively quickly (as in less than one year rather than the two years that the traditional approach typically requires. Kane noted: "If it takes two years to get capacity, you can miss demand.")
So Windsor Engine has a new source for blocks at Essex Engine.
Kane observed: "When you are able to reuse equipment, your investment cost is much lower, which is one of the things this process [i.e., FPS] has done."
Less Is Better
Just as some people say that you can never be too thin or too rich, plant materials managers have tended to observe that you can't have too much stock on hand or too many places to put it. Bill Beaton used to be in charge of materials at Essex Engine. Now he's FPS coordinator. He remarked that he used to be always pushing for more storage areas. Now his point of view is significantly different.
Which brings up the issue of space.
"Under our old production mentality—I won't even call it a `system'—we had spare parts," Jim Solberg said. "Something breaks. We had to have a spare part for it. Our approach was to have all the parts we'd ever need. But here comes the change: "When you get into FPS, you're going to maintain equipment on a JIT basis through FTPM and have small work groups that know what's going on with the machines."
Things are less likely to break unexpectedly when there are vibration analyses, infrared surveys and constant attention. And if they do break: "We have lots of parts suppliers"—and Solberg means repair parts, not just engine components—"supplying on a JIT basis."
Which brings us back to Essex Engine and Bill Beaton. He pointed to an area that was once high bay storage, an area once stacked high with all of those repair and service parts they once maintained. The storage racks are gone. The area is being prepared for the V10 crank line installation. Or at least most of the line will be installed there. The crank line is bigger than the space that the elimination of high bay storage opened up.
Time Is Space
Victor Kane talked about how Michael Dell of Dell Computer met with Ford executives. Dell told them about fast inventory turns. Considering that Michael Dell has revolutionized the way that mass quantities of products can be built (with customization to boot), the executives were apparently impressed. They, in turn, promoted this kind of fast thinking throughout the organization.
To note that Essex Engine has implemented a JIT system would be to provoke a yawn. Lots of people have done it. But consider this: Kane observed, "If you look at the literature, if a company tries to implement JIT on its own, they'll fail or just achieve limited success." JIT deliveries must be part of a system that includes other elements. A system like the Ford Production System.
Solberg explained, "If I can have stable production and my machines are better, I can predict what I'm going to run. If I can predict what I am going to run, I can tell the supplier what I need. As long as I can take advantage of stable schedules, I can be efficient as to how we bring materials into the plant."
At Essex, there is one area adjacent to the former high bay storage area that had 15 loading docks. But because they have worked on the equipment, because they have stable production schedules, and because they have established (with the help of an outside logistics consulting outfit) JIT delivery windows with many of their suppliers, the people at Essex don't need as many loading docks. What was once inventory-related—the high bay storage, the loading docks—is becoming productive space.
Breaking the Paradigm
There is much more to how Windsor Engine is attaining the capacity for the 150,000 engines. They are adding shifts. Working with other suppliers. Reconfiguring equipment within the walls of Windsor Engine and a low-volume annex. Essex Engine is just one part of it. But an important one.
What all of these activities have in common is that they are part of a method that is being methodically rolled out, a method that requires plenty of training and reinforcement. People who go on a diet know that getting lean isn't easy. They also know that they have to stick to it or they'll end up where they started out. Lean production isn't any different.
Jim Solberg noted, "If we just plodded along and didn't pay attention to what we are doing, we would just do the same things again. What we're trying to do is break the paradigm."