by Dianna Brodine, managing editor, Plastics Business
” title=”Viking Plastics received the 2015 Supplier Quality Excellence Award from General Motors. Photos courtesy of Viking Plastics.”>
Viking Plastics received the 2015 Supplier Quality Excellence Award from General Motors. Photos courtesy of Viking Plastics.
” title=”The drive for daily improvements led one employee to repaint a forklift.”>
The drive for daily improvements led one employee to repaint a forklift.
In the last five years, Viking Plastics has undergone a radical shift, one employee at a time. It started at the top, with President and CEO Kelly Goodsel moving his office out of the main production building and empowering a strong management team to lead the company. It continued with daily meetings where all employees were asked to share their thoughts on making the company better. It expanded when Viking Academy was born, sharing financial and strategic planning information with those who committed to a series of classes.
US sales have doubled in the same time period. Employment is up 50 percent. And, Goodsel knows its not a coincidence.
Daily drumbeats shift the thought process
Established in Corry, Pennsylvania, in 1972, Viking Plastics produces injection molded sealing solutions and custom products primarily for the automotive and HVAC markets. Volumes range from 200 pieces to several million, and 121 employees are on staff.
Viking Plastics is located in the center of a heavy steel and plastics manufacturing region. Its customer mix is 80 percent automotive, but the Great Recession didnt hit the company as hard as it could have, mostly because of the plants custom products line. Still, Goodsel wanted the company to achieve more, and a conference keynote speaker provided what Goodsel called a cornerstone piece to transformation.
I heard Paul Akers talking about “2 Second Lean” at a Manufacturers Association of Plastics Processors (MAPP) conference, said Goodsel. Revolving around recognizing and eliminating eight forms of waste, 2 Second Lean gives employees the tools to recognize opportunities for improvement and implement solutions immediately. However, empowerment cant occur without education.
We started with teaching the eight forms of waste to our employees, because knowing and seeing the forms of waste is the first of three pillars in our 2 Second Lean process, he explained. The second pillar asks employees to fix what bugs them, and the third asks them to share what they fixed.
Goodsel pointed out that every company has a machine maintenance program or a capital investment plan, but most companies dont have an employee maintenance program. Every company says their employees are their best asset, he continued, but few put thought into how to ensure thats really true. Here was a way to educate our employees and ask them to make our company better.
As a management team, our goal was to have an engaged workforce, said Rob Elchynski, operations manager. We read Paul Akers book, and we liked the simplistic approach to what he was doing, although I think there were questions about how exactly it would work.
Viking Plastics began to hold daily drumbeat meetings for each shift, laying the foundation for employees to become educated not only about the business in which they worked, but also the community in which they lived. In the very beginning, there was little participation from the workforce, said Elchynski. It was new to them and to us we didnt know exactly what we wanted to do, other than share company information with our employees so they could make better decisions out on the floor. As we continued to meet for daily drumbeats, sharing information helped us build trust it showed our employees that we trusted them to make good decisions with the data we were providing. In turn, they were willing to trust us enough to start to engage in the process.
Elchynski added, We are continually learning how much more our employees can contribute beyond their job descriptions when we give them the ability to fix the issues that bother them without having to take it to a supervisor.
Viking Academy advances the mission
About a year into the process, Shawn Gross came to me and said, We need to juice the process, said Goodsel. He told me the drumbeat meetings were a great start, but we needed more people sharing the message and understanding the end goals.
Gross, engineering manager for Viking Plastics, explained, In my career, Ive observed that companies dont do a great job of explaining the company to its people. If you want engaged employees, they need to understand why the business exists. I felt there needed to be a technique to bring people together who are interested in learning and then take steps to increase their knowledge, which would help them become better practitioners of the values Viking wanted to live.
Gross laid out an initial eight-week, eight-class curriculum, with information on everything from the sales prospects in the pipeline and budget projections to the IT department.
Goodsel then wrote a letter to all employees as an invitation to Viking Academy. He asked those interested to submit a written letter of interest whether typed or handwritten expressing what the candidate could bring to Viking Academy and what the individual hoped to learn. Twenty-two employees submitted a letter, and each received a gift card for making the effort. Ten were selected for the first class.
We give that first class a lot of credit, said Gross. They were signing up, and no one knew exactly what this was going to be. Employees in the first Viking Academy class were from diverse areas of operation, including the IT director, a customer service representative, an operator and a quality technician. We threw people together who didnt interact on a daily basis and asked them how we could get better. It was an opportunity to get different perspectives on how to create an atmosphere they wanted to come to every day.
Soon after the first class had been completed, Goodsel and Gross realized the cart had gotten ahead of the horse. We had a class of 10 ready to hit the ground running and drive change, said Gross, but their supervisors hadnt received the same training.
We realized we needed the influencers, Goodsel added. We needed them to understand the company on a deeper level, because they were the go-betweens between the companys message and the people on the floor. Now, Viking Academy is on its eighth session, and 75 employees have gone through the training class. Initially, Gross led almost all of the classes in each session, but now other leadership team members are taking teaching roles, and the academy has expanded to 10 to 12 sessions that are completed over a 10- to 14-week time period.
The impact of the academy is seen daily in the drumbeat meetings. An assembly department operator asked what costs were associated with an expense line item and ended up sitting down with our controller to understand it on a deeper level, said Gross. The operator then came to a drumbeat meeting and talked to coworkers about keeping safety glasses at work and not throwing ear buds in the trash at the end of the day. When you start thinking like an owner, you have an appreciation for the little things that can add up to a big number.
Pulling back the curtain
From the beginning of the daily drumbeats, Goodsel and Controller Cathy Pitts led conversations that delved into the companys financials.
We want all of our employees to understand the basic financial statements income statement, balance sheet and cash flow, explained Pitts. By focusing on the line items they impact things like supplies or tooling repair were driving home the idea that each of their decisions on the floor makes a difference. Then, we show them how the numbers from the income statement affect net profit, and we have conversations about how net profit leads to reinvestment in the business.
This level of financial transparency can be difficult. First, the mix of educational levels in the workforce requires Pitts to teach employees to read sometimes complex financial data in simple ways. Second, it demands a great deal of openness from Goodsel and a willingness to answer questions about expenditures and investments. Rather than shaking the company from its path, however, Viking Plastics took another step forward three years ago.
I wanted our people engaged at a higher level, said Goodsel. I wanted them to understand our strategic plan our overall intent for the business.
The management team came up with a plan to bring the Viking Academy graduates together to give them a three- to four-hour state-of-the-business presentation. The presentation includes data on major customers, sales strategies, the sales pipeline, on-time delivery rates, scrap rates, labor costs and then dives deeper by going into growth strategies and expansion planning. Once the data is presented, we let them ask questions, said Goodsel. They become a board of directors.
The state-of-the-business presentation has been held three years in a row, and anyone who graduated from Viking Academy is invited. The management team presents to a full house. If we truly want our employees to contribute to our success, they have to understand every aspect of the business, Goodsel explained. The growth weve experienced over the last five years tell us were doing something right, but its also daunting: How do we keep it going? The answer is that we trust our employees to help.
He continued, While its difficult to directly connect a percentage of our growth as being attributed to the culture, we know that every customer, supplier and business interaction has improved because of our engaged workforce.
Preparing for greater success
Significant growth calls for significant investment. Viking Plastics has a strategic plan that identifies capital needs each year, and recent purchases have included six new Haitian molding machines. Last year, we replaced five older machines by buying three new machines, said Goodsel. Doing so freed up floor space, and we gained higher efficiencies, higher throughput and greater production output.
As sales have increased, customers have required additional processes. The company now offers two-shot molding and insert welding. Other investments have included a plant-wide material system, including centralized metal detection, mixing and drying; RJG eDART systems for several machines; and auxiliary equipment, including SRS grinders, Yushin pickers and Dri-Air driers.
Viking Plastics is on a steep upward trajectory, and culture has played an important role. For a guy like Goodsel, who likes quantifiable data and a solid hand on the wheel, its a little unbelievable.
Clearly, the 2 Second Lean culture has been a significant change for our company and drove some of the improvement, he said. I also had to get out of the way. I moved out of the building and made sure the right people were in place. Shawn Gross, Rob Elchynski, Cathy Pitts, Bob Senz (quality manager) and Rob Prindle (IT manager) took on the additional responsibilities of a true management team and set us on a different path from a culture standpoint.
More success for Viking Plastics is on the way, if the sales projections hold true. From 2010 to today, weve doubled the amount of business we do in the US. Weve quintupled the profit margin. We should finish 2016 with our sixth year in a row of record sales, and 2017 is already looking good for a seventh, Goodsel said. There are a lot of people who can run a small business the way I did. I needed to control every aspect of this business. But, lifting the ceiling and asking my employees to do more allowing them to do more and giving them the right tools theyve blown the doors off the place.