Manufacturing has changed dramatically since Nicolet Plastics was founded in the mid-1980s. That was especially true in 2009 as the American economy faltered and many multi-national firms started moving high-volume production offshore to avoid rising costs. During this time, Nicolet, a Mountain, WI-based custom injector molder, used a system called Quick Response Manufacturing to improve business at every level and target the low- to moderate-volume companies that remained stateside.
QRM was developed by Rajan Suri, emeritus professor of industrial engineering at the University of Wisconsin-Madison. Bob MacIntosh, Nicolet’s president and CEO, said the creation of accountable teams was part of the QRM philosophy. The goal of the program is to reduce lead time in all aspects of a company’s operation. QRM cells (teams) have ownership of the entire delivery process within their cells.
Nicolet has 63 employees and operates 16 machines. It offers 246 combinations of materials ranging from consumer-grade plastics to high-end engineering materials. “We work five days a week, three shifts per day,” MacIntosh said. “Our primary teams are our production teams that staff each of those shifts. Each shift has 12 individuals assigned to it. From there, we branch out to the various support units – maintenance, shipping/receiving, production support center, engineering and administration.”
The primary goal is “to be fast, fluid and flexible,” he said. “To be successful, we need to increase our manufacturing velocity. We are using our skills matrix, cross training and accountability to drive those results.” Nicolet used written and practical testing to determine skill levels and establish training necessary to create an ideal shift. Employees were rewarded for technical abilities and willingness to learn new production- and process-related skills. New pay ranges were defined at each skill level, so as employees began to handle more complex issues, value to the company increased and so did wages.
“Each team is responsible for successfully executing the orders that are listed on our dispatch list,” MacIntosh explained. “The dispatch list shows them what needs to be done, but not how. That’s up to them. Every day and every shift is different – people call in sick or go to meetings; there are drop-ins or rush jobs; and qualifications all challenge their ability to execute successfully.”
With the change in philosophy came a few struggles. “The challenges were twofold,” MacIntosh said. “First was getting employees to believe in what we were trying to accomplish and how it would improve the work environment,” he said. “Second, we needed everyone to understand that they and the team had the power to make a difference. Getting management to relinquish control was an important part of the challenge.”
Since Nicolet implemented the QRM strategy, sales have doubled and the company’s earnings before interest, taxes, depreciation and amortization quadrupled between 2009 and 2012. Nicolet recently was named the Small Manufacturer of the Year at the 9th annual Manufacturing Leadership 100 Awards for its business practices and was the recipient of the Workplace Excellence Award from the New North. In addition, Nicolet was a finalist in two categories – Workplace Development and Manufacturing Excellence – for the Wisconsin Manufacturer of the Year award.