College of Business Awards Annual Shingo Prizes

Utah State University's College of Business has announced the names of this year's recipients of the Shingo Prize for Excellence in Manufacturing, dubbed the "Nobel prize of Manufacturing" by Business Week magazine.


Two Utah manufacturing plants are among the list of recipients for this year's Shingo Prizes, administered annually by the College of Business at Utah State.

"We're very impressed with the lean manufacturing achievements of this year's recipients," said Ross Robson, Shingo Prize executive director. "In a time of economic recession, it's a comfort to see plants that are prepared to weather economic uncertainty by not wasting precious manufacturing and business resources."

Robson said the Shingo Prize is recognized as one of the most significant awards in North American manufacturing circles. The competition received a record number of applicants, and there were 25 finalists and 15 recipients (winners) for 2003. Companies from across the United States and Mexico were honored this year for cutting costs, improving quality and improving on-time delivery for their products.

Robson said the Shingo Prize has grown in prestige over the years, enhancing the credibility of Utah State's College of Business in the manufacturing field throughout North America.

"Our board of governors is comprised of many of the leading names in the manufacturing industry," he said. "If you take the top names in the business, 10-12 of the most recognized lean manufacturing executives are on our board — people from companies such as Toyota, Lockheed Martin, Maytag and O.C. Tanner, to name just a few."

This year Robson took 15 MBA students from his Contemporary Manufacturing Management class on three-day site examination visits with professional examiners from the industry.

"It was an invaluable hands-on experience for these students to see how some of the most efficient manufacturing organizations in North America are doing business. It was a great learning opportunity for them."

The Shingo Prize is the only industrial excellence award in the world that focuses on lean manufacturing techniques first implemented in the Toyota Production System. The prize was established in 1988 in honor of Shigeo Shingo, one of the world's leading experts in improving manufacturing processes. Utah State University recognized Shingo for his lifetime work with an Honorary Doctorate in Business in 1988.

This year's Shingo Prize recipients are listed below, along with brief company sketches.

Utah Recipients

Autoliv ASP, Airbag Module Facility, Ogden, Utah — This facility produces a variety of airbag applications including driver-side, passenger-side, side-impact, knee and side-curtain airbags for customers in North America and Asia. With more than 30 customers and 300 airbag configurations, the Airbag Module Facility applies lean manufacturing principles through the Autoliv Production System to every facet of its organization, ensuring first-time quality, on-time delivery, and cost-effective products and processes. Since the implementation of lean manufacturing principles, Autoliv has boosted labor productivity more than 50 percent, reduced customer PPMs by 90 percent, reduced production cell floor space by 66 percent and increased inventory turns by 80 percent. As a result of these significant achievements, Autoliv's Airbag Module Facility continues to receive numerous quality and supply awards from its customers.

Autoliv ASP, Inflator Facilities, Brigham City and Ogden, Utah — Autoliv Inflator Facilities are comprised of the Ogden Inflator Plant, the Brigham City Inflator Plant and the Administration and Engineering Facility. These facilities design, support and produce over 30 million driver, passenger and side impact inflation products each year. Autoliv Inflator Facilities serve virtually every automaker in North America, Europe and the Pacific Rim. The Autoliv Inflator Facilities' transition to lean manufacturing begins and is driven by its 2,020 employees. These facilities apply all the tools of the Autoliv Production System (APS). Dedicated efforts to apply lean manufacturing principles have resulted in a 52 percent reduction in scrap costs, 32 percent reduction in defective parts per million, productivity improvement of 36 percent and over 12,000 kaizen suggestions submitted last year.

Small Business Recipient

Affordable Interior Systems, Inc. (AIS), Hudson, Mass. — AIS is a leading national manufacturer of office systems furniture, and the only manufacturer of its kind in the furniture industry to be a recipient of the Shingo Prize. With state-of-the-art metal, wood and light assembly factories, AIS is considered one of the industry leaders for quality and value systems furniture products to the consumer. Companywide lean practices have so far resulted in productivity gains up to 88 percent and lead times of less than eight days. In addition, the company delivers 100 percent on-time shipments based upon shipped the "day-of" requested delivery rather than industry standard "week-of" delivery. While most manufacturers in the contract furniture market have seen sales decline by as much as 60 percent over the past two years, AIS has seen its national business increasingly grow.

Large Business Recipients

Delphi Corporation, Delco Electronics de México, Delnosa 1-4 Operations, Reynosa, México — With more than 4,000 employees, Delnosa 1-4 manufactures over 100,000 vehicle electronics products daily to customers in 11 countries around the world. Delnosa's product line includes Driver Instrumentation, HVAC controllers, Chassis, Safety and Security modules and Powertrain electronics. Through the use of lean manufacturing principals the facility has been able to increase productivity by 34 percent, double inventory turns and achieve 100 percent employee participation. In addition, Delnosa has implemented improvement ideas that cut customer defects in half, improved first time quality by 45 percent and achieved 25 million-man hours without a lost workday.

Delphi Corporation, Energy & Chassis Systems, Sistemas Electricos y Conmutadores, Juarez, Mexico — Sistemas Electricos y Conmutadores is a state of the art facility that is known as a leader and innovator, employing and developing new lean manufacturing techniques. Products manufactured and assembled include emission control devices, transmission controls, anti-lock brake systems, cruise control, and fuel system components. The 286,761 square feet facility began operations in February 1980. The more than 3,600 employees working at SEC are dedicated to continuous improvement and exceeding customers' expectations. This commitment to customer satisfaction is evident in SEC's growth as it currently satisfies customers in Australia, Brazil, Canada, France, Germany, Japan and the United States.

Delphi Corporation, Flint Operations, Flint, Mich. — This plant proudly supplies instrumentation assemblies and components showcased in General Motors cars and trucks, Harley-Davidson motorcycles, and the Segway Human Transporter. Applying the concepts found in the Delphi Manufacturing System, this facility and its UAW Local 651 workforce have achieved rapid, year-to-year, double-digit improvement in the primary aspects of the business, particularly safety and quality. Productivity has improved 45 percent during the period 1999 through 2002. Manufacturing expertise includes plastic injection molding, laser-cut lenses, electronic circuit board assembly, and final product assembly and test.

Delphi Corporation, Packard Electric Systems, Plant 19, Warren, Ohio. --- Plant 19 was established in 1996 as a North American hub for the manufacture of Bussed Electrical Centers (BECs) and related molded components. Nearly 600 employees assemble well over 100 combined original equipment part numbers and service-part BECs on 17 U-cell assembly stations, with average annual production approaching five million units. Through comprehensive implementation of the lean-driven concepts within the Delphi Manufacturing System, Plant 19 employees have been able to drive significant operation improvements in cost, quality, delivery and productivity, and have integrated continuous improvement methodologies to ensure continued success. Some of those improvements include an 86-percent reduction in rejected/returned parts per million since 2000, a first time-quality improvement of over 50 percent, and a reduction in scrap of 50 percent since 1998.

Lockheed Martin Aeronautics Company, F-117, Palmdale, Calif. — The 4000-employee Lockheed Martin Aeronautics Company (LM Aero) facility in Palmdale, Calif. is home to the famed "Skunk Works" and the revolutionary F-117. The F-117 is the first platform in the US Air Force inventory to exploit Stealth technology. Responsible for design, development, production and total life cycle support of the F-117 Nighthawk weapon system, LM Aero is now a benchmark for Acquisition Reform, under the unique F-117 Total System Sustainment Partnership (TSSP) with the US Air Force. TSSP encourages an innovative, Lean approach to aircraft logistics support, repairs and upgrades, providing unsurpassed combat readiness to the warfighter.

Medtronic Xomed, Jacksonville, Fla. — This Medtronic facility is the world's leading manufacturer of medical devices used in the treatment of ear, nose and throat disorders. The plant produces products ranging from powered surgery systems to nerve integrity monitors to middle ear prostheses. Through the application of Lean Principles, Medtronic Xomed has made significant improvements, including reducing manufacturing cycle time by 97 percent, labor cost per unit by 47 percent and scrap and rework by over 50 percent.

Merillat Industries, Atkins, Va. — The Atkins facility produces 23,000 hardwood cabinet doors and fronts in four different species, nine different colors and 40 different product lines for daily delivery to Merillat Assembly Plants. Since the adoption of lean manufacturing in 1998 the facility reduced plant cycle time from five days to 17 hours, work in process reduced 80 percent, quality increased 66 percent, reduction in lost work days by 98 percent and on-time delivery of 99.7 percent. Targeting waste elimination throughout their processes, the Atkins facility has pioneered the use of lean manufacturing principles in the Woodworking Industry.

Symbol Technologies, Inc., Holtsville, New York; McAllen, Texas; and Reynosa, Mexico — This facility, founded in 1975, is a global leader in secure mobile information systems that integrate application-specific hand-held computers with wireless networks for data, voice and bar code data capture. Symbol products and services increase productivity and reduce costs for the world's leading retailers, logistics and transportation companies, government agencies, manufacturers and providers of healthcare, hospitality and security. Symbol has a proud tradition of innovation and quality. The Senior Management team oversees quality planning, implementation and results. Through innovative customer-focused solutions including first call resolution rate of over 90 percent and Lean/Kaizen activities Symbol has improved productivity and manufacturing efficiencies 10 to 45 percent.

The HON Company, Cedartown, Ga. — In operation since 1969, the Cedartown facility is staffed with over 625 member-owners and produces over 1.2 million metal and wood office furniture products per year. The facility's culture of rapid, continuous improvement utilizing lean manufacturing and business practices has achieved the shortest lead-times in the industry, a safety recordable incident rate 80% below the industry average, a 44 percent reduction in customer complaints, a 24 percent reduction in warranty costs, a 42 percent reduction in downtime, a 32 percent reduction in scrap costs, a 97 perceent improvement in raw material and work-in-process inventory turns and a 51 percent improvement in return on assets. Our success is a result of our members' dedication to continuous improvement and exceeding customer expectations.

TI Automotive, Caro, Mich. — This plant produces over 4 million fuel pumps and approximately 400,000 dampers annually for Tier 1, Tier 2 and automotive OEM (Original Equipment Manufacturer) customers. The plant maintains a "best practice" strategy and operates on principles of Common Sense Manufacturing (CSM) and Common Sense Administration (CSA), which are TI Automotive's own lean systems. Using these "process focused" models, TI Automotive has achieved 1.7 percent employee absenteeism; 42 percent internal scrap reduction; 95 percent on-time delivery; 86 percent reduction in premium freight costs, and virtual elimination of ergonomic issues. At its more than 130 facilities worldwide, TI Automotive is dedicated to continuous improvement.

TI Automotive, New Haven, Mich. — The New Haven Plant has applied the principles of Lean Manufacturing to an automated, high volume automotive assembly operation. The principles are embodied in a complete lean manufacturing system called, "Common Sense Manufacturing." This plant annually produces over 50 million fluid connectors and components for the automotive industry. Core competencies include plastic injection molding and automated assembly and leak test. Since 1997, the application of lean principles has resulted in single digit customer PPM rejects, 98 percent on-time delivery, 38 percent improvement in inventory turns and a 30 percent improvement in operating profit. New Haven is just one of 130 TI Automotive worldwide facilities. All TI Automotive facilities are dedicated to customer satisfaction and continuous improvement.

Vibracoustic North America, MCU Products Lead Center, Manchester, N.H. — Formed in 2000 by Freudenberg-NOK, Vibracoustic North America is part of Vibracoustic Worldwide, one of the largest automotive vibration control enterprises. This facility produces microcellular urethane (MCU) noise and vibration components, including jounce bumpers and body mounts. As a result of its 93 kaizen events and 15 Six Sigma projects, the facility has reduced waste from 40,000 pounds to 250 pounds, improved inventory turns by 54 percent, decreased safety incidents by 89 percent, reduced scrap by 28 percent and cut the design cycle from two days to four hours.

Finalists

In addition to the Recipients listed, other finalists included Arvin Meritor, Columbus, Ind.; Collins & Aikman, Port Huron, Mich.; Delphi Automotive Systems, Columbus, Ohio; Delphi Automotive Systems, Saginaw Steering Plant, Saginaw, Mich.; Freudenberg-NOK, Northfield, N.H.; Harley-Davidson, Pilgrim Road Operations, Milwaukee, Wis.; Maytag-Newton Laundry Products, Newton, IA; Maytag-Jackson Dishwashing Products, Jackson, Tenn.; Stewart & Stevenson Tactical, Sealy, Tex.; and Vibracoustic, Ligonier, Ind.

"Each of these plants are also outstanding in their manufacturing processes," concluded Robson.

Awards for the Recipients and Finalists will be presented at the 15th Annual Shingo Prize Conference and Awards Ceremony to be held May 14 at the Detroit Marriott Renaissance Center.