A profile of success

Focusing on value and customer satisfaction

When you see a company with 25 manufacturing plants, more than 135 service centers, and more than 5,000 employees around the globe, you are looking at success personified.You're also looking at a leader in sealing system solutions. A couple of weeks ago I made a visit to this company--John Crane Mechanical Seals --and thought you would want to know a little more about about its successful approach to business.

In keeping with its goals for growth, John Crane made an acquisition recently--E G & G Sealol. E G & G Sealol is known for welded metal bellows, mechanical seals for high -temperature applications in refining and petro-chemical plants. In that acquisition, John Crane acquired another product line and a significant level of expertise and technology.

Another goal is improving performance. When management at John Crane speaks of performance, they refer to the ability to satisfy customers. That means delivery, responsiveness, flexibility, and quality products. Their term is the Value Proposition--the embodiment of the least sum-of-
all-costs.

A learning organization
Clearly, no company holds innovation captive. When acquiring a company, one has the opportunity to look inside that company and discover the innovations they are buying along with the product lines. In the acquisition of E G & G Sealol, John Crane will benefit from a number of opportunities in the process area in which E G & G Sealol does things differently and better. John Crane refers to this as identifying best practice centers of excellence and this allows management the ability to transfer processes and superior techniques from site to site.

From the point of view of the value proposition, the focus is on customer satisfaction and the customer needs. Since customer requirements are rising continuously, the bar continues to go up as well. John Crane knows it has to continue to move operations ahead through learning and developing.

As an organization engaged in continuous learning, it supports continuous process improvement. Management approaches this issue by communicating to employees that the process of getting better never stops.

Evidence of this message--the process of getting better or continuous improvement--is present throughout the manufacturing facility. Up-to-date machining centers, sophisticated in-house designed-and-built manufacturing equipment and recycling systems tell of John Crane's success in continuous improvement.

The approach to customers
John Crane's focus is on customer uptime. With elevated customer expectations, the turnaround on seal repairs expected is a maximum four or five days, but the objective that management has is for the company to bring that turnaround time down to twenty-four hours, thus driving the value side.

Here, supply-chain management plays a major role in that effort. Supply-chain management is a way to improve the system as it applies to customers. This translates to a complete technical library and office that can be set up at customer locations to focus on quick turnarounds on repairs.

Again, the issue is improving service and reliability to customers as they improve the availability of supplies to the internal manufacturing operations within the company. There, the focus is on internal customers--the machine shops, the people in the office, everyone that works at John Crane.

Information management
As more companies turn to focused factories, they eliminate vertical towers of specialization and functionalization. Therefore, elements of the supply chain must react more dynamically and faster. This implies that information access becomes a critical factor. With this understanding, management is taking the notion of manufacturing to a higher level of thinking and using the benefits
of technology.

John Crane is centralizing the expertise required for programming and customer maintenance support to a central location and then distributing the machining operation.

John Crane has a Distributed Numerical Control System that runs on a local network and information can be transmitted from location to location easily. This leverages John Crane's expertise, standardizes the process, and lends consistency in the field. This avoids having to replicate the center of knowledge every place management wants to duplicate the operation.

In the manufacturing facility, there are two distinct types of operations--assembling and machining. They machine parts and assemble products. That means the machining operations look like, in some cases, a supplier to the assembly operation and appear to be very much like an external supplier. Further, focusing factories leads to bringing machines tools directly into a dedicated cell of a product line.

That arrangement allows machining, assembly and shipping to customers directly from the factory floor. Also, the external materials come directly to the factory and merge with operations. The thrust is speed in moving things in and getting them out quickly.

When management took the theme of customer satisfaction and the need to improve company responsiveness radically--twenty-four-hour turnaround--it cascaded down to the manufacturing floor. In turn, the process needed to reflect a twenty-four-hour turnaround. As well, the seal components have to be produced in factories that are organized to achieve that goal.

Process uptime, then, is critical and constant movement of facilities within the plant--machine movement, rearrangements, moving of power and air--became a way of life. It's a part of the process of continuous improvement.

Where there were once fixed locations, now machines may move every six months or every twelve months. Additionally, a preventive maintenance program has been supporting the equipment for about seven years. This program has its own dynamic and changes constantly as part of the improvement process.

In the maintenance area, John Crane is in the process of deciding what they will handle internally and what will be let out to contractors. Like others, management is identifying suppliers that bring expertise and accessible information as well as products and services.

Also, like most companies, they want suppliers that know their systems and problems--expertise in the original equipment manu-facturer (OEM) and maintenance repair organizations (MRO) suppliers. Again, the connecting link is the information systems--the centralized source of knowledge.

When the system is complete, John Crane will have historical data, drawings, and applications available at a moment's notice on a global basis. The other part of the business system supports the manufacturing side and will be a combination of a manufacturing material resource planning system and distributed resource planning.

John Crane uses material resource planning internally for its manufacturing locations. It's used to plan production internally for manufacturing locations. This allows John Crane to forecast for its suppliers that, in turn, allows them to drive their production to square with John Crane's needs.

Management believes the competitive advantage and the business system, in addition to helping plan the production for the manufacturing facilities, will link the requirements of repair facilities into a common system also. This will allow John Crane to allocate the components properly that are coming out of its manufacturing facilities.

The human dimension--perception
There is a core of seasoned veterans as well as a younger generation at John Crane. Many of these people are highly educated and have advanced degrees. On average, the length of service in John Crane's work force is a bit over seventeen years, however, for maintenance mechanics and similar people, tenure is even longer.

An industry-wide challenge is that manufacturing, perse, does not attract young, high-skilled talent out of the universities and into the manufacturing world. The general perception of working in a manufacturing environment is less appealing than working in other professions.

Yet, the facts point to security in manufacturing. There are good wages and there are significant opportunities in technology. There are opportunities for growth for skilled technicians and professionals. The tools are sophisticated as well as the process equipment and programs. Now, almost every company supports or funds a college education in its entirety. If you give it a moment's thought, when someone goes into a manufacturing environment, they begin work and they can go to school.

In manufacturing, people can earn a good income, have a good insurance package, and get a college education--at a school of their choice. Further, anyone can do it. Education is subsidized and it's almost universal in this country, even in small companies.

At John Crane for example, the reality is that a young machinist with some experience and technical training is likely to earn a wage that is well ahead of what most college graduates would make. And, the machinist is likely to have more fun than someone in a bank.

Yet, with the perception of unattractiveness in manufacturing, coupled with a generally high comfort level in the population, John Crane--like other corporations--turns to technology to increase production capacity. Also, John Crane and other manufacturers attract engineers and technically oriented people into the manufacturing arena because the technology will be there.

To this end John Crane has a formalized training process and a focused effort that extends down through the organization. When one views the factory floor, it becomes apparent that training is not limited just to management. Also, like other manufacturing companies, John Crane confronts the reality that there are no trade or high schools that are a source for qualified machinists or other skilled employees. John Crane has used instructors from a junior college to teach print reading and the use of measuring instruments. Additionally, tool room supervisors give classes on basic operations of the machinery.

Training extends to sponsoring employees who are in a non-skilled area and training them in basic machining operations. Further, John Crane management has gone so far as to form alliances with some of the local trade schools and sponsor the development of a curriculum. The challenge in training is teaching employees to think and talk in terms of profit and loss, about balance sheets, about how total costs of ownership come together in terms of the dollars and cents.

As John Crane sees the situation, future seal users will buy seals with predictive technology on board. They will monitor the health of mechanical seals using sensors for vibration and temperature, among other variables. This means the ability to predict imminent seal or system failure.

This fits with desires to move from a preventive to a predictive maintenance environment. The technology will be hard-wired through the field bus environment and back to the control room. Diagnostic tools on PCs will analyze the measured parameters. There are significant correlations between the parameters and imminent failures so seal users can anticipate that their system is going to fail. This allows scheduling maintenance rather than waiting for the outage at an inconvenient point and time. As with most systems, one must consider the total cost of ownership for a rotating system. Ownership is not just the purchase price of the device. Cost of ownership is the purchase price, repairs, energy, and the cost of lost production when the system is not operating. To this, John Crane suggests looking at value as a fraction--the numerator is benefit, the denominator is the cost.