Precision Technologies Makes Phenomenal Comeback
Using Lean Techniques and Value Stream Mapping (VSM)

Company Profile
Precision Technologies Inc. (PTI), located in Douglasville, PA, is a privately-owned manufacturer of quality investment castings for a number of different industries, including food processing, aerospace, chemical, nuclear, pulp processing, sporting goods, military and machinery manufacturing. Then company specializes in the manufacture of complex parts with intricate configurations, extremely tight tolerances, and fine surface finishes. Their products range in weight from 0.1 lbs to 100.0 lbs. In addition, they offer a wide range of materials including stainless steel, high alloy steel, low alloy steel, special purpose alloys and carbon steels.

Situation
Today, the company does a healthy $5 million in sales, but that wasn't always the case. In fact, just three years ago the company was about to go out of business. Inventory at the 30,000 square foot facility was a major problem. Orders were often lost in the maze of excessive inventory and would end up being produced twice. As a result, delivery was less than 65 percent on-time and customers were constantly complaining. 

Solution
According to Mike Carr, the new operations manager, "We weren't doing anything to distinguish ourselves from the competition. We weren't faster, cheaper, or any better in terms of quality." Determined to turn the business around, Mike and the new owner, Greg Wolf, who purchased the company in 1999, attended the half-day seminar on Lean Manufacturing. "We realized at that seminar that there were things we could do to improve our processes," recalls Mike. Impressed and encouraged by what they learned at the seminar, Mike and Greg took the next step and contacted the Manufacturers Resource Center (MRC) to find out how lean techniques might be applied at PTI. An MRC field agent came out to meet them, toured the facility, and sat down with them to outline a plan to begin implementing Lean Manufacturing. In addition, the MRC field agent helped them process their application for PA WEDnet funding, which helped them invest in additional training.

First, MRC conducted a half-day Lean Awareness Workshop to demonstrate the tools and techniques needed to identify and eliminate waste. Then, MRC spent two days with the client using Value Stream Mapping (VSM) to illustrate the production and information processes from beginning to end. The Value Stream Mapping event depicted the current state, as well as a future improved state the company envisioned. The current state reflected a lead-time of 28.7 days, while the future state depicted a lead-time of just 6 days.

Results
An implementation plan was developed and teams were assigned to each improvement. Improvements included the development of work cells, which dramatically reduced work in process materials. At the same time, it increased throughput. In just three months, all of the improvements identified on the Value Stream Map were implemented, and the results were phenomenal.

The creation of work cells helped reduce work-in-process inventory by an incredible 80 percent. On-time delivery increased from 65 to 95 percent. Lead times were reduced form six weeks to six days. Overtime was dramatically reduced and financial results were much improved. Quality was also improved. "Now we are faster than everyone else I know of," says Mike, "our price is competitive, and this is just the beginning."

By eliminating waste and improving processes through training in lean techniques, Precision Technologies was literally able to salvage its business. However, commitment form management and employees was contributing factor to their success as well.

Testimonial
"Overall, we are an excellent example of what positive results, can happen when Lean Manufacturing techniques are properly applied utilizing the expertise available at MRC."

Greg Wolf
President