The Irrigation division of Valmont Industries in Valley, Nebraska, manufactures center pivot irrigation systems in sizes from 180 feet to half a mile in diameter. Because of their size, these systems are typically assembled at a customer's site from components fabricated at Valmont's plant. Specific manufacturing processes performed at the Valley plant include bending, cutting, welding and finishing.
For most of its history, Valmont's Irrigation division employed traditional manufacturing techniques to produce its irrigation components. Capacity limitations led to long leadtimes, which became even longer during peak seasonal demand periods. The reality was that those who wanted irrigation systems were forced to wait. When competition increased, customers could buy from the equipment manufacturer who could deliver what they wanted, when they wanted it.
At one point, in an effort to improve performance in the plant, Valmont instituted a gain-sharing program. This ill-fated program never improved overall performance and was actually viewed by workers as an entitlement, rather than an incentive.
Recognizing the need to improve its manufacturing operation, Valmont implemented a Continuous Improvement Program with a cellular team focus. At the same time, Valmont implemented a Continuous Communication Process because company management recognized the need to change its communication style from "get the order out or else" to "what do we need to do to get the order out."
The initial manufacturing team was formed with volunteers, who then selected a team leader. A facilitator was also assigned to work with the team to help implement changes. The first priority was to have every member of the team participate in education and training. This included familiarizing everyone with Just-In-Time (JIT) principles, team leader training, facilitator training and Total Preventive Maintenance (TPM).
Once this training was completed, the team was assigned its own product, a gearbox, which was a key component of the center pivot irrigator. The gearbox was a product in high demand and production orders were constantly behind schedule.
The team evaluated the existing manufacturing processes for the gearbox. These process locations were spread out across the plant, so the team decided to move all operations together in a cellular format. The team then focused on capacity constraints, production volume and the labor content of each operation.
Resources beyond the team were also required to improve the gearbox manufacturing process. Cooperation was needed from the company's engineering department, suppliers, and, of course, management.
The improvements in the manufacture of the gearbox were almost immediate and were achieved mostly through JIT concepts such as minimum travel, reduced inventory, identification and elimination of delays, elimination of waste, paced manufacturing schedule and so on. Other reasons for improvement were that products had undergone a design-for-manufacturing review, TPM procedures kept key machines running and team members were cross-trained.
Valmont, however, did encounter some obstacles. Many undesirable practices were ingrained in the workers and difficult to change. In addition, the company may have trained too much, too early, and people forgot. Middle management's role in the team-based cellular manufacturing structure was not clarified early enough in the process.
Many managers became frustrated and left the company.
Despite these problems, the gearbox manufacturing team operates successfully in a cellular environment. The number of operations was reduced from 27 to 13, with non-value added operations being reduced by more than 60 percent. Labor content was reduced by 50 percent.
The Valmont Industries gearbox manufacturing team has proven that a cellular team approach can reduce product cost, improve overall quality, shrink leadtimes, and most importantly, satisfy customers.