In its August 24, 2011, cover story, U.S. 1 profiled Steve Sashihara, president and CEO of Princeton Consultants and author “The Optimization Edge,” subtitled “Reinventing Decision-Making to Maximize All Your Company’s Assets.”
U.S. 1’s Scott Morgan tracked down several Princeton-area companies that have put optimization to work:
#b#Legacy Converting: Look Up!#/b#
When Legacy Converting, a maker and distributor of paper towel products, including medical grade wiping products, set out to move its manufacturing facility out of Carlstadt, New Jersey, last year, it looked to the sky. Back in Carlstadt, under low ceilings, the company’s growth came with sprawling lateral moves in an already crowded space. The bigger the operation got, the more floor space it occupied (U.S. 1, September 7, 2011).
So CEO Jason Slosberg and his team sought a place that would allow the company to expand vertically. Legacy moved into a 70,000-square-foot space at 3 Security Drive in Cranbury (smaller than its plant in Carlstadt) because the new site has 32-foot ceilings. This, says Slosberg, allows Legacy to stack its automobile-sized rolls of product 30-feet high and thus take up considerably less floor space.
This also allowed Legacy to rearrange its flow, and flow in a multi-step manufacturing enterprise is a big deal. “Everything has a place,” Slosberg says. “There is the spot where the skid always goes. Twelve-inch rolls go in one spot; thirteen-inch rolls in another. This way people aren’t always working against themselves.”
Slosberg and crew found these inefficiencies the old-fashioned way — by watching people work. When you do that, Slosberg says, you see people backtracking over the same piece of ground; you see them expending a lot of energy on time-consuming minutiae that turns a few extra minutes a day into hours of wasted time over the course of a year. “Our people were always working hard,” he says, “but not always smartly.”
Legacy also has embraced specialized technology systems and equipment, including a modified forklift attachment that allows workers to stack and retrieve rolls from the floor’s product skyscraper. “You absolutely must embrace technology,” Slosberg says. “Our machines are the best. We have machines that can process 1,000 cases a day.”
That number, by the way, is up from Legacy’s former 200-cases-per-day capabilities. And it saves the company money because rather than having three workers processing 200 rolls a day, the same three process five times that amount.
Investing in its technology has allowed Legacy to save tons of time on packaging, which despite technological advances remains human-labor intensive, Slosberg says. This, he says, offers Legacy a huge advantage in its market — the ability to be flexible. Legacy does mostly private-label work for smaller enterprises, meaning that its customers want things customized, and not always in the same quantities that large-scale, generic customers might want.
“We sell commodities,” Slosberg says. “We’re very aware that manufacturing is going overseas, so we constantly ask ourselves what we can do that’s efficient and that can insulate us from China.”
The company also has invested in heavily customized software that allows it to analyze sales, study metrics, and work with orders, from end to end. Altogether, Slosberg says, Legacy’s new location and all its upgrades have saved the company between 60 and 70 percent on its manufacturing, process, and variable costs.
For Legacy, efficiency stems from constant change, which Slosberg says has been built into the company’s culture from day one. Slosberg, a former surgeon with an M.D. from Brown, founded the company with his brother, Darren, in 2007 on the idea that sitting still is death for any company. From the hiring process on, he says, the mantra of “resist inertia” guides the company’s operations.
But Slosberg admits that change brings its own baggage. Change, after all, makes people uncomfortable. People get cozy with what they do and they don’t want to try new things at which they might not be so adept. By starting everyone off with the idea that change is the norm, Legacy heads off the element of surprise.
The company also promotes and rewards its employees regularly, to keep them thinking about innovations and strategies to make operations smoother. “There’s constant communication with the plant floor,” Slosberg says. “We’re always incentivizing.” And that, he says, is how you stay efficient.
Legacy Converting Inc., 3 Security Drive, Cranbury 08512-3263; 609-642-7020. Jason Slosberg, president. www.legacyconverting.com. firstname.lastname@example.org
#b#Learning Ally: Leaner & Tighter#/b#
It isn’t just a physical move that generates a closer look at how efficient a business’ practices are. At Learning Ally, a major streamlining effort came as part of a name change.
Learning Ally, based at 20 Roszel Road, used to be known as Recording for the Blind & Dyslexic (U.S. 1, April 20,2011). The company, which seeks to bring learning materials to those who have difficulties with physically reading, changed its name to reflect a more universal approach to its customers.
And with the name change came a steady stream of cost-trimming and time-saving measures that stands to save Learning Ally several hundred thousand dollars a year. Andrew Friedman, the nonprofit organization’s president and CEO, says optimization started with the internal.
Learning Ally’s computer system has received a $40,000 upgrade that Friedman says is expected to save the organization $250,000 a year. The company is building an entirely new back-end system that unifies its half-dozen databases into one outsourced database.
Part of the upgrade also includes “data capture” on the front end, meaning that Learning Ally has zeroed in on its direct customer service interactions to find out what works and what doesn’t. This, in turn, affects product development, Friedman says.
In mid-December Learning Ally installed a new call-routing system that eliminated a third-party router the company had been using to handle its overflow. The new phone system gets calls to the right place faster, and with the improvements to the network and the customer service, Friedman says, operations have become much more efficient. “That’s going to save us probably $10,000 a month,” he says.
Another big money saver for Learning Ally is streamlined production facilities. Volunteers who read for audio books head to production facilities all over the country. Up until recently the recordings they made were put onto discs and sent through the mail. But Learning Ally has upgraded its booths to allow recordings to be transferred via the Internet to a central system.
The discs would come in daily, Friedman says. And when they arrived, someone had to put them into the system, which became an unnecessary use of manpower. With the new system, there is no mail and no cost for discs — plus, no waiting time, meaning that recordings can get to the market faster. Altogether, Friedman says, the upgrades to the recording and compilation process will save the company more than $100,000 a year.
Something else that will save Learning Ally $100,000 a year is having moved its recording space from the St. Joseph’s Seminary grounds on Mapleton Road to its headquarters on Roszel Road. The American Boychoir School, which moved into its new home on the seminary property around the same time Recording for the Blind & Dyslexic became Learning Ally, let the company out of its lease, Friedman says. Learning Ally is in the process of remodeling its space on Roszel Road to “make it more of a community center environment,” he says.
Learning Ally also is in the process of making its website more customer-friendly — and finding ways to save its customers money on the devices they use to experience the company’s products. “Our customers used to have to use niche devices,” Friedman says. “They could run $450.” But with new mobile and digital technologies, Friedman says, customers can now download software — “anywhere from $20 to free” — to use on their computers and iPhones.
Learning Ally is working on getting its products accessible on Android smartphones, but working out the technology will still take a little while, he says.
Friedman, a former CFO at Rosetta, the American Metro Center-based healthcare marketing firm, says the streamlining came about because of his background in the corporate world. “I’ve always seen the need to run a company as effectively and efficiently as possible,” he says. And that’s as true about operations as it is for employees. “People don’t get stale when you make things more efficient,” he says.
Learning Ally, 20 Roszel Road, Princeton 08540; 609-452-0606; fax, 609-520-7990. Andrew Friedman, president/CEO. www.learningally.org.
#b#Merwick Care Center: Relevance Counts#/b#
Ken Keegan wanted to make sure that when Merwick Care Center moved from its longtime (and obsolete) site on Bayard Lane last year, the entire idea of optimization was in place before the moving vans showed up (U.S. 1, January 12, 2011).
The first thing to streamline was the telephone system. At the old site, calls often were taken by nurses, regardless of what the call was about. Keegan says that calls now are filtered for relevance, meaning that nurses only take calls related to patient care.
Out of 40 phone calls, he says, 30 are not important enough to concern the nursing staff — calls for directions or hours, for example. And Merwick gets a lot more than 40 calls in a given day. Thanks to the new phone system, Keegan says, Merwick’s nurses are able to concentrate on patient care, saving time and a lot of discomfort for the patients who no longer need to wait out a call.
Also helping the nurses is the new arrangement of supplies. Keegan says Merwick is working with the nursing staff to refine how to best locate the most needed supplies on all floors and nurse stations. The idea is to reduce the amount of time nurses spend walking to different areas of the building looking for items that should be at their fingertips.
Merwick also has added a concierge position to handle non-clinical day-to-day things such as getting the newspaper and scheduling appointments — something else Keegan says nurses used to do but shouldn’t have. All told, these procedures are saving about 55 hours a week in wasted time for Merwick’s nursing staff. The new supply layout alone accounts for 10 to 12 hours a week in saved time, particularly on the 3-11 p.m. shift, which Keegan says often is the one facing supply shortages.
Keegan says Merwick also is working on streamlining food distribution to its residents. One way is by stocking condiments on all the food carts as the orderlies make their rounds. It doesn’t sound like much, Keegan says, but when a resident calls the kitchen to say he didn’t get enough salt, it’s a long walk back to the kitchen just for salt packets. Keeping salt, pepper, ketchup, and other condiments at the ready saves a lot of walking and, therefore, a lot of time.
Merwick also is working with a selective menu and has been tracking call-backs to its kitchen to make sure food is prepared, distributed, and liked by its residents. If there is a common (and ongoing) issue, Keegan says, the staff can identify it, address it, and move on. Such measures, he says, are shaving several hours and scores of redundancies out of Merwick’s week.
“It lets everybody get back to doing what they should be doing,” Keegan says of the new streamlined operation. “Providing one-on-one care to our residents.”
Merwick Care & Rehabilitation Center, 100 Plainsboro Road, Plainsboro 08536; 609-759-6000; fax, 609-759-6001. Ken Keegan, administrator. www.windsorhealthcare.org/merwick.
Princeton Microwave Technology: Flow Is Everything
When it came time for Princeton Microwave Technology to expand, the company wanted to do it right. It wanted to make sure that when it moved into a larger space, operations would go smoothly.
Princeton Microwave, which has been manufacturing oscillators and amplifiers for the military and telecommunications markets since 1993, occupies a 2,500-square-foot suite at 3 Nami Lane. Soon, however, the company will move two buildings down, to a 7,000-square-foot space at 5 Nami Lane.
According to Sarjit Bharj, Princeton Microwave’s vice president of engineering, the company signed up for several classes and workshops provided by the NJ Manufacturing Extension Program, a Morris Plains-based non-profit that specializes in lean operations practices for small and mid-sized companies, to find out how to set up the most efficient operation possible. The biggest help, Bharj says, has been mapping.
Princeton Microwave mapped out exactly where each section of its manufacturing process would go and how each would relate to the process overall. “One step follows the next,” Bharj says. “The flow is critical.”
The streamlined facility-to-be is designed with time-to-market in mind, he says. “Shipping, for example, can’t be off in a corner where no one knows where it is.” End to end, the new order of things is expected to save Princeton Microwave 10 to 15 percent on the cost of making its products, he says.
Lean operations also mean light operations. Princeton Microwave will not maintain a large inventory, but rather a carefully maintained one without the clutter. This, Bharj says, accomplishes two things: less cost up front for supplies and less to keep track of at any one time. This in turn cuts manufacturing costs, in part by cutting down the time spent maintaining a large inventory.
The company employs six but is expecting to employ 10 by the end of next year, Bharj says.
Princeton Microwave Technology, 3 Nami Lane, Unit 10, Mercerville 08619; 609-586-8140; fax, 609-586-1231. Amarjit Bharj, president.
#b#PD-LD: Educate Your Staff#/b#
PD-LD, a manufacturer of customized laser products based in Pennington, did not take optimization lying down. The company just spent a year in a state-funded program (facilitated by the NJ Manufacturing Extension Program) in an effort to set up more efficient processes and cut wasted time.
Like other manufacturing concerns, PD-LD revamped its workspace flow, moving processing furnaces closer to operator stations in order to reduce time to get to them. According to Uri Abrams, the company’s president, PD-LD also had color-coded tool sets made for each work area. Such moves have saved the company 10 percent, Abrams says.
PD-LD also reduced its batch sizes by 90 percent. Smaller batches of parts produced earlier in the cycle mean less clutter and less waste. If there is a problem in the batch or with a set-up, Abrams says, time and lost product don’t amount to as much as it used to. Labor has not been reduced because of new batch sizes, but time-to-market has decreased dramatically. Under the old way, a product that starts today might not be ready for another 10 days. Under the new way, it could be ready as early as tomorrow, he says.
PD-LD’s biggest contribution to optimization comes in the form of training. Part of the company’s year-long program through the NJMEP involved training all senior staff and managers in more efficient work practices. It also involved a train-the-trainer program so that in the event a supervisor leaves the company, others will know how to train his replacement. “The key,” says Abrams, “lies in educating your staff.”
PD/LD Inc. (Photo Diode-Laser Diode), 30-B Pennington-Hopewell Road, Pennington 08534; 609-564-7900; fax, 609-564-7901. Vladimir Ban, CEO. www.pd-ld.com.