Making the switch from CAP to custom moulding

Since it opened in 1973, the Japanese transnational mould-er NojimaChemical (S) Pte. Ltd. of Singapore has had only one customer,one of Japan's multinational giants. In some areas of the world,the type of customer-dedicated business Nojima does is betterknown as Customer-Aligned Production (CAP).

With average annual sales of SD$ 12 million, the Nojima Singaporeoperation has grown considerably since following the customerto Singapore 23 years ago. However, times change. Like many multinationalsthese days, Nojima's customer found it is more economical to shiftits operations to other countries, like China. The rising labourcosts and the shrinking availability of land in Singapore arereasons why the manufacturers are moving. As a result, Nojimais now faced with the challenge of switching from CAP to the highlycompetitive world of custom moulding.

Nojima manufactures small, extremely precise electrical/electronicparts using somewhere between 40 to 50 metric tons/month of avariety of engineering resins that include POM, PA, PPS, PC, ABS,and PBT. Glass-filled grades are used. The smallest part weighsonly .01 g. It prefers to mould its small parts in small open-loopmoulding machines, 91 of them, ranging from 7 to 75 metric tons.With the exception of two 45-ton Toshibas, its machines are fromSumitomo. It performs no secondary operations or assembly in Singapore.The plant has 8,300 sq m of manufacturing space and 1,100 sq mof warehouse. Nojima has 80 employees that work in three shifts,six days a week. Just last year it added mould-making, and nowuses AutoCAD and Mastercam software for its moulds. Plans callfor pursuing ISO registration.

Yasushi Yamaguchi, Nojima's director, moved to Singapore fromhis native Japan only seven years ago. He is well aware of thechallenges he faces. "There are more than 10 companies inthe Singapore/Malaysia/Indonesia region that belong to our originalcustomer. They are involved in very different markets and products.We have always dealt with the entire group. So, in a way, it hasalways been like custom moulding to us. Still, we find we arenow faced with a brand-new sales and marketing approach-talkingto purchasing agents at other companies, I mean," Yamaguchijokes. "We have been very busy keeping up with orders fromour original customer. Now we want to shift production, but itis difficult to find even one free machine. But we must. Otherwise,we cannot survive."

Yamaguchi is confident that his company can keep some of the businessit presently enjoys when his original customer moves, largelybecause of Nojima's quality and expertise. Nojima manufacturesmillions of parts each year, yet it has only about .2 percentrejects. His customer "may do transfer moulding of some ofthe simple parts elsewhere, but precision moulding is our specialty.It is not so easy to find moulders that can keep their qualityup. Also, our production is mass production-high-volume precisionmoulding. That, too, is hard to find."

To better manage Nojima's change and growth, Yamaguchi says hehas found it necessary to divide the company into four divisions:production, mouldmaking, quality assurance, and administration.He has appointed people to head each division. He believes thatspreading his responsibilities among four directors will be amore efficient way of getting his job done. Also, Nojima now hasa sales force, a force of three, all Japanese. That is becauseYamaguchi plans on pursuing custom moulding business with otherJapanese transnationals with operations in Singapore.

Ready for the Future

As it has with its original customer, Nojima will concentrateon high-volume production of high-precision small parts. Yamaguchisays plans call for purchasing new closed loop moulding machines,bigger ones, to accommodate moulds with higher cavitation, ornumber of cavities, for new customers. "Customers want alow piece price. That means more cavities," he says. Still,he prefers smaller machines and low cavitation. "With bigmachines with many cavities, the part quality is not so good.Many customers have automated assembly lines. If the part qualityis not good, they cannot assemble, and they may have to shut downtheir lines."

Big or small, Yamaguchi likes Sumitomo machines. "They arevery good, and Sumitomo has a service center nearby. Good trainingis provided, and spare parts are available. With so many Sumitomomachines here, I think the Sumitomo man is here every day,"he jokes.

The addition of mouldmaking operations was done to support theswitch toward doing more custom moulding. Yamaguchi explains why:"Big multinational companies may be moving their productionelsewhere, but they plan on shifting their design engineeringactivities to the well-developed Asean nations with good infrastructure,like Singapore. With our addition of mouldmaking, we can get involvedin their projects early on, do their moulds, and hopefully, dotheir moulding, too." Nojima's design room houses two seatsfor designers, two for programmers, and one for transferring programsto the machine tools. "It is easy to find good CAD/CAM workersin Singapore," says Yamaguchi.

Nojima today has five mouldmakers and quite sophisticated equipment,including Mitsubishi wire-EDM and a Makino machining center. "We'vefound that making our copper electrodes in-house and EDM in generalis a good way to make moulds faster," says Yamaguchi. Themoulds are so small, Nojima can burn-in 24 cavities at once froma single electrode. Most of its moulds are stainless steel. Noneare hot runner sprues and runners are recycled and reused. Itbuys mould bases from suppliers on the island and sends mouldsout for heat treating, if required. Plans call for doubling thesize of the mouldmaking operation in the near future by expandinginto the existing warehouse space.

Quality assurance is very important to Nojima. The company qualityassurance division is staffed by six employees working a singleshift. Statistical process control and process capability measurementsare rigorously carried out. A noncontacting Smartscope measuringmachine from Optical Gaging Products is but one of the instrumentsthe QA division uses to check part quality. The QA manager prefersthe computerized Smartscope because it gives him the ability toconstruct a drawing after getting the points.

Nojima's parent company, headquartered in the Saitama Prefectureof Japan, has been in the general purpose custom moulding businessfor about 30 years. Nojima also has assembly operations in Indonesiaand China to support its customers. With such support, with hiscompany's concentration on small high-volume precision moulding,and with the growth-management changes he has instituted in Singapore,Yamaguchi is confident his plant can make the switch from CAPto custom moulding with success. He believes he can keep muchof the business he now enjoys, while attracting new multinationalsthat can profit from the high-quality expertise of Nojima.