E3 Program Benefitting Alexander City Firm's Bottom Line

AmTech – Economy-Energy-Environment (E3) Improvements

Industry

33441 Semiconductor and Other Electronic Component Manufacturing

Company City

Alexander City

Company State

Alabama

Company Name

AmTech, L.L.C.

NOTE: The Alabama E3 Program was launched in 2010 to focus lean continuous improvement tools and strategies on the three areas of Economy, Energy and the Environment. The program is comprised of 26 federal, state and local partners and is administered by the Alabama Technology Network (ATN). To date, the ATN has assisted some 40 companies through the E3 program saving thousands of dollars in cost reductions and avoided expenses through the implementation of efficiency improvements.

Company Profile:

AmTech manufactures wiring harnesses and controllers for buses, heavy equipment, medical equipment and for the defense industry. With about 250 employees within a single 130,000 square-foot facility, the company has embarked on a mission to become more productive and efficient. AmTech partnered with the ATN-AU center to launch a Lean Manufacturing program even before combining its two plants in Montgomery and Kellyton, Ala. into a single location in January 2006.  

Recently, the company garnered a large defense-related contract with an aircraft company and annual sales are approaching $20 million to a market that is largely U.S. based. Now some seven years into its lean journey, AmTech has made significant progress in efficiency improvements and continuous improvement (CI) management and operating philosophy.

Situation:

With the advent of the ATN’s role in facilitating the Alabama E3 program, AmTech wanted to tap into the opportunity to focus its CI initiative to include more efficient use of energy as well as space and resources. During the months of March and April 2011, AmTech enlisted ATN-AU Lean Team members to facilitate a plant-wide E3 Assessment and E3 kaizen on its #138 product line, which assembles wiring harness components for a major medical equipment manufacturer of portable monitoring systems.

Assistance:

An ATN E3 Assessment team was mobilized and conducted an extensive energy efficiency and sustainability assessment within the plant over a multi-day period.

ATN-AU led a cross-disciplinary kaizen team of seven in the facilitation of six separate improvement events on the #138 assembly area. The work consisted of an E3 review to identify current conditions and to develop the kaizen strategy. The review identified the following areas as efficiency improvement opportunities:

• Not prepared/organized for the next order
• No documented standard work for how work is to be performed
• Lack of 5s discipline and visuals – which extends lead time
• Long distance to transport wires between operations
• Performing extra inspection process that is not required
• Work not balanced to Takt Time
• Overproducing sub-assemblies and finished goods

The team implemented the following countermeasures:

• Balanced work to Takt Time
• Moved terminating press closer to work cell
• Moved wire stripping machine closer to work cell
• Cross trained personnel to build panel sub-assemblies
• Rearranged the work cell to minimize motion
• Identified tools required for the cell and established point of use
• Developed standard work for each work station
• Simplified scheduling by creating a finished goods supermarket and an in-process supermarket (pull systems)
• Established 5s activities and auditing mechanisms
• Installed a visual management board

Results:

The plant-wide E3 Assessment identified $165,000 annual energy savings opportunities that involve changes in lighting and compressed air leaks and pressure reductions.

The E3 kaizen activities immediately reduced the need for four assembly operators in the #138 assembly area to two. This freed up two operators for reallocation to other areas. Additionally, lead time to build to current customer demand was reduced from four days to two days. Moreover, a reduction in labor costs is credited with increasing company revenue for the #138 product to $62,000 annually. AmTech credits the E3 initiative for the retention of four jobs as a result of cross-training and reallocation. By reducing the amount of heat guns and soldering irons required in the assembly process by 50 percent, AmTech also says electricity consumption has been reduced by half in the #138 sector.