When a machine shop’s first significant contract was making phonograph needles, the business has been around a while. Started by Calvert Erickson and Robert Armitage, Roberts Swiss (Itasca, Illinois) has focused on producing Swiss-type parts for more than 55 years and is still going strong. In that time, the business has dealt with a lot of change.
Phonograph needles have given way to a diverse customer base in general manufacturing and specifically medical, automotive, electronic, plumbing, aerospace and sports equipment industries. Through the years, the parts may change but the skill sets for machining complex, long, slender parts remain constant and in demand. Roberts is a 48-person family business that never took its eye off its niche of Swiss-type manufacturing yet has continuously focused on adaptation to its customer’s needs.
I came knocking on Roberts’ door on a referral from one of its important and long-time customers, Ethicon Endo-Surgery (EES). My goal was to write a follow up on an article we published about EES in our April 2006 issue (see the Learn More box for a Web link to this article).
That story focused on what a large medical equipment maker like EES looks for from its suppliers. Conversely, it occurred to me it might be interesting to visit one of those suppliers and find out what it takes to get and retain work from a major force in the medical industry.
My hosts for this visit were the shop’s president, John Makris, Sr., and general manager, Fernando Ortiz, Jr. John’s family owns the business, and Fernando was plucked from the jaws of an accounting career to run the machine shop. “Sometimes fate does you a good turn,” he says. He has been on the job for more than 10 years.
All Swiss, All The Time
Roberts’ goal is diversity within the niche of Swiss machining. Its stable of more than 60 production machines covers the gamut from coil-fed, cam-actuated Escomatics to bar-fed, cam-driven Tornos and Strohms as well as Star CNC machines. Capacity ranges for this shop run from diameters of 0.01 inch through 1.25 inches and lengths from 0.03 inch to 24 inches, running two full shifts.
“John’s philosophy is matching the right machine with the right part,” says Fernando. “In a strictly Swiss environment, that’s an efficient way to allocate the work. Our variety of machine types makes any need for process compromise much less necessary, which results in more productivity, less waste and lower operating costs.”
The shop’s drive toward diversity, like many other shops, came from necessity and hard learned lessons. John recounts, “Back in the mid 1970s we were making parts for Western Electric to the tune of 600 million parts over 10 years. Unfortunately, by the first couple of years in the 1980s, Western Electric didn’t even know us as a supplier. From that experience we decided to diversify, so that ‘one guy’ can’t hurt us.”
“Today, Roberts targets major OEMs,” Fernando says. “In the early 1990s when I came on board, we were doing business with Senco, from which Ethicon Endo-Surgery was formed. That of course got us into supplying parts for medical applications.”
That relationship has always been more than simply that of a customer/supplier. For example, EES wants its suppliers to be diverse. The company is also interested in helping suppliers succeed because a fair and equitable relationship between an OEM and its supplier base is ultimately in the best interest of the OEM.
“EES has been a driving force in changing the way we divide up our machining operations and encouraging us to look into other markets including the OEM market, which of course helped change the direction of Roberts’ business. It has helped us raise the level of sophistication about how we run our business,” Fernando says. The results include a cache of customers in commercial agriculture, hydraulic valves, plumbing, metering valves for oxygen distribution and sports equipment. Of course, the shop can also make a phonograph needle, if needed.
“EES is part of Johnson & Johnson, which is a huge multi-billion dollar global company,” Fernando explains. “Roberts Swiss is a small, Midwest machine shop. Why are these two talking?”
Competence in Swiss-type manufacturing is the expertise that Roberts brings to the party. The shop stays at the party because EES needs its parts, but beyond that, it also wants Roberts’ expertise.
“We are brought in at the very beginning of the process—at the design stage—and consult directly with EES design engineers,” Fernando says. “Through the years, we have demonstrated that when it comes to Swiss-type parts, we can give useful input to the customer if they are willing to listen. EES is more than willing to listen; it solicits our advice on manufacturability, tolerances and materials.”
Bringing a supplier into the development has benefits for EES. As part of the relationship developed with suppliers, it likes to work from prototype to production with the supplier that will do the work. The supplier is invested in the project.
“Being in on the ground floor enables us to allocate our diverse shop resources more efficiently by assigning the work to the best machine tool for producing it rather than the machine that has open time,” Fernando says. “Moreover, knowing the design intent of the workpieces we are asked to make allows us to more efficiently transition from prototype to production and offer more useful manufacturing advice. When we can take the longer view of a job for EES or any customer, we win and they win.”
Roberts has developed its process capability around the concept of diversity. The shop is experienced in machining virtually any material including ferrous and nonferrous metals as well as exotics, plastics, fiberglass and even composites using the Swiss process. A big part of this company’s success is its willingness to re-invest in the shop from capital equipment and personnel. Talking to John and Fernando, one gets the feeling of youthful enthusiasm for the business of manufacturing as well as a willingness to try new ways to make parts. And having talked to EES, I understand why it does business with Roberts; the shop fits EES’ supplier profile.
The process begins with an e-mail from EES notifying Roberts that there are some parts that need quoting. This is followed by a 3D solid CAD drawing of the workpieces with dimensional renderings of the finished pieces. “We then open the files and take a look at the parts to see what they need (such as materials, mechanical properties, chemical analysis, dimensionality) and figure out how we can best produce them,” Fernando explains. “In effect, we develop a quote based on our cost drivers and the specifications EES is asking for. Next, we get with the designers and negotiate what they actually need as far as tolerances and then arrive at a price. We ask the design engineers, ‘Do you really need that tolerance spec here or can you open it up a little?’ It’s fairly unique to work this closely with a customer, but it’s based on EES’ philosophy and our long-term relationship. The goal is to help the customer get a competitive price and create a quote that is good for the longer term.”
Once the quote is accepted, Roberts prepares to run the prototype. They decide what machine is best equipped to deliver the specs needed; tooling is purchased and quality and inspection protocols are established. Each step of this process development is documented into what becomes a full-capability assessment. This assessment, in effect, becomes the history of the part from prototype through production and is kept in binders for each part number.
The next step in the process is validation of the instrument that will use the parts made by Roberts. EES conducts this validation using all of the various components from all of the suppliers involved in the project.
After EES gets its instrument approved, it shares the sales projection for the instrument with Roberts, which helps determine the production volumes. “They are usually very accurate in these projections, making our production planning simpler,” Fernando explains.
After all the approvals, the parts become “Portal Parts.” This is a contractual agreement between Roberts and EES that is, in effect, an ongoing purchase order. Instead of issuing a purchase order for each job run, like most customers, the portal gives Roberts access to the projection and forecasting system at EES. The supplier is able to manage part production and billing directly based on EES’ forecasted sales projections.
“By looking at EES’ sales forecast and history, the portal system lets us react much quicker to changes in volume requirements that affect our purchase of materials and machine allocation,” Fernando explains. “Our people monitor changes in these forecasts and adjust our production schedule, inventory and delivery accordingly. Inside the portal, we can look at the sales history of the instruments we supply parts for and adjust our production to it.”
This system reflects confidence and trust between the supplier and customer that is unfortunately too rare in much of the precision parts manufacturing industry. It also reflects an enlightened approach to long-term relationships that are mutually beneficial rather than working job to job and shaving a penny here and a penny there with the threat of losing the work constantly in the forefront.
It might seem that the relative security of the long-term stable relationship between Roberts and EES could lead to complacency but, in fact, the opposite is true. EES visits its suppliers. “We invite them to visit the shop and see firsthand what we’re up to,” John says. “It drives us to innovate.” John and Fernando use these visits as opportunities to demonstrate new process innovations and new capital investments. At the same time, the visits are a chance to show increased shop capability with an eye toward additional work.
An example is the CNC department. “We continue to invest in CNC Swiss machines to help us produce complex, multi-axis parts,” Fernando explains. “Our Star machines are all bar fed, and we are increasingly able to do some unmanned and lightly manned shift work on them. They are ideal for that. One of these machines is equipped with what the company calls its magic guide bushing. It eliminates the need to adjust the bushing and allows us to use drawn barstock instead of ground. That’s very helpful for unmanned operations.”
Likewise, Roberts puts its Esco, Tornos and Strohm machines to good use. For example, the Esco department has 24 machines on the floor, and they are run by four machinists. “We know the right kind of jobs to run on this equipment,” John says. “Our experienced machinists mentor our younger machinists. We kind of breed our own machinists.”
Keeping the older equipment competitive includes preventive maintenance as part of any job change-over. “As the machine is tooled up for a new part run, we include adjustments to all of the mechanicals as part of the process. Keeping the machine maintained and with some home-grown tooling innovations, we can hold 3 tenths on our Tornos machines,” John says. “We show those kinds of innovative things to EES when they visit.”
Looking down the road, John sees the gradual replacement of the cam-actuated department with CNC. However, he’s in no hurry. “These machines are very low-cost producers for us,” John explains. “We know the jobs that run well on the automatics, and we know the best jobs for the CNCs. It’s our expertise in all things Swiss that gives us a competitive edge with our diversity to do a wide range of work.”
Of its list of 300 active customers, no single one has more than 20 percent of Roberts’ business. EES currently has about 20 percent, and John hopes to grow the overall business to a point where EES is between 10 and 15 percent. “Long-term, it’s in our customers’ and our own best interest to remain diverse by managed growth of our capabilities and capacity,” John says.