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May 29, 2000

10 Min Read
IMM's Plant Tour:  Empowered employees power profits

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Lighted by 1000W Mercury halogen lamps high overhead, MSE's molding room is built for efficient processing and optimum production flow. Each press is in a cell supported by four-component gravimetric blenders; some have robots.

A visitor toured Mid-South Electronics (MSE) on July 5, 1999. He was impressed by what he saw while exploring the company's growing custom contract manufacturing campus in Annville, a small Appalachian town near the Daniel Boone National Forest in Kentucky's Jackson County. The visitor filled in just two boxes in MSE's guest register. Under "Name" he signed "Bill Clinton." Under "Representing" he printed "USA." 

Annville was one of the first stops in President Clinton's New Markets Tour, focusing attention on the untapped economic potential of regions like rural Appalachia that have yet to share the nation's prosperity. He came to honor MSE's accomplishments as proof of the good that can come from an Empowerment Zone (EZ). Annville is in the Kentucky Highlands EZ, one of the most successful in the country. 

Per capita income in Appalachia is just 71 percent of the national average, according to White House statistics. The poverty rate in the three counties in the Kentucky Highlands EZ was 33.3 percent in 1995, more than twice the national average. And 57 percent of people over 35 have no high school diploma. Officials at MSE say the unemployment rate in the Annville area was around 13 percent when their EZ was created in 1994. Thanks largely to their company, it now is less than 3 percent. 

Jackson County is populated by Kentuckians who prefer to be called "mountain people," rather than the less positive epithets popular in common vernacular. Jerry Weaver, a Jackson County native, is the ceo of privately held Mid-South Industries Inc. (MSI, Gadsden, AL). MSE is one of its many subsidiaries, affiliates, and joint ventures. Weaver took advantage of EZ tax benefits, financial incentives, and regulatory relief to invest in capital equipment and expand MSE. But he never forgot who he was, or where he came from. 

There is a good reason why Weaver calls the Annville site a campus. He gave his fellow mountain people jobs, but he also gave them pride, confidence, and self-respect through training. When the company's new training programs began three years ago, MSI's sales were around $150 million. They are $250 million today. At one site on the MSE campus, production output increased 15 percent while scrap went down 8 percent over the same period. Three years ago employee turnover was 15 percent. The dropout rate now is less than 2 percent. And, in total, 18 percent of its 900 employees received perfect attendance awards last year. Want to see for yourself why these empowered mountain people impressed the President? Sign in and let's tour. 

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A fully equipped and well maintained area at JCRI is dedicated to a moldmaker apprenticeship program it started in August 1999.

Shown here is the shop floor at JCRI, a 23,500-sq-ft training facility on the MSE campus. Among other things, JCRI houses two vintage Van Dorn presses and five training rooms to provide workers with valuable hands-on training.

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Hands-on interactive training also is practiced on MSE's campus. Moldsetters train for two solid weeks right on the Plant #1 shop floor. All MSE molding associates average 40 hours of training annually.

Travis Waggoner (standing), an apprentice moldmaker, is also the chief instructor in JCRI's Paulson Room. Associates can take the courses any time they want to, either on their own time or within a shift. JCRI plans to bring in four more instructors.



Inside JCRI
Our campus tour begins at 25,300-sq-ft JCR Industries Inc. (JCRI). Eddie Fields, plant manager, is our guide. JCRI has two vintage Van Dorn Demag presses it inherited from MSE's main molding plant. They are configured in an L-shape so a single associate can learn to handle two machines. That is because, like everything else at JCRI, these presses are for training. JCR stands for Jackson County Rehabilitation. 

"We saw that the only way we were going to succeed and take full advantage of our EZ capital investments was by training our associates," Fields explains. "I know what mountain people can do, but we often lack a sense of self-worth and need some help. We've been able to push their 'on' button with training. It's been the most enjoyable experience of my entire career." 

JCRI houses five training rooms, but its educational services are not solely reserved for MSE associates. The Christian Appalachian Job Start Project and the Kentucky Department of Adult Education share adjoining classrooms at JCRI. The doors are open for education in everything from the three Rs and computer skills to studying for a GED. The centerpiece of the training program is upstairs on the mezzanine. JCRI calls it the Paulson room. 

Interactive Training at Work
Before they came on board, both Fields and Lex Barnett, MSE's molding manager, were familiar with the value of courses from Paulson Training Programs Inc. (Chester, CT). 

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Integrated contract manufacturing is the cornerstone on which MSE's molding operation was built. Assembly is offered for a variety of products, including circuit boards and cable and wire harnesses.

All of Plant #1's VDD presses, old and new, have been equipped with advanced Pathfinder 5000 controls. Plans call for integrating the Pathfinders into the company's Mattec SPC system.

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Pulled tools go through a thorough PM program before they are shelved. The last shots are attached to the molds when they are green tagged. The shelves can be pulled out to facilitate automated handling with the company's 10-ton crane. MSE has about 75 active molds.

Presses are fed by a centralized quick-change drying and materials handling system and recycling systems, both from Milacron.

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Mattec plantwide monitoring systems, installed in February, sit on handmade stands. Part run calculations are run through the Mattecs, which create weekly machine schedules for JIT deliveries. 



Both Fields and Barnett agree that the speed of learning and level of knowledge retention provided by the interactive approach is a big benefit. They say associates can progress at their own pace in a nonintimidating setting. It took the company only 60 days to achieve the payback necessary to justify the initial investment in these programs. 

"We have mold operators and molding technicians now, rather than machine attendants," Barnett says. "Products today have to be consistently perfect, so you have to have educated people running the equipment. I've seen people let machines degrade simply because of a lack of interest. Paulson training gets people interested in what they do." 

All MSE molding associates average 40 hours of training annually. Newcomers must start with the first four modules. It's up to them to go for more. No special financial incentives are offered for them to take the courses. Other associates in different departments also visit the Paulson room, mostly to take the courses in SPC and troubleshooting. 

One-third of the funding for JCRI's training programs came from a former employee, Clyde G. Phillips. JCRI and MSE put up the rest. Phillips is president of a cooperative competitor on the campus called Phillips Diversified Cos. His $8 million manufacturing and shipping company runs mostly PVC on 12 Van Dorn Demag presses. It also does insert molding and employs 130, some of whom Phillips admits he stole from MSE. Judy Smith, another former MSE employee, is putting up her own molding plant on the campus, called JC Tech. 

Inside Plant #1
Injection molding was a stepchild at MSE's 39,000-sq-ft Plant #1. The company backward-integrated into molding to complement its vertically integrated contract manufacturing capabilities, which also include design engineering, metal stamping, printed circuit board assembly, cable and wire harness assembly, electromechanical assembly, powder coating, system testing, and shipping. Plant #2, 53,000 sq ft, is a dedicated electronics facility. 

A $6 million Plant #1 expansion spurred by the company's growth in the large appliance market was recently completed. In this facility, MSE operates 14 manufacturing cells built around VDD hydraulic and toggle presses. A new 1000-ton hydraulic Milacron press is a recent addition to what will be a new machine bay across from the VDDs. Old and new, all of the VDDs are equipped with Pathfinder 5000 control systems. Some of the cells are serviced by traverse-robot-based automation stations from Wittmann. All of the cells are monitored by a Mattec system, and all are equipped with Maguire four-component gravimetric blenders for handling additives, colorants, regrind, and virgin. Barnett says the Maguire blenders have been instrumental in helping the company reduce scrap by 17 percent. 

Milacron provided the beside-the-press granulator recycling systems found in each cell. Milacron also equipped MSE with a centralized materials handling and drying system. All of the pumps, 4000-lb surgebins, dryers, and line-proofed quick-couplings for verifying that the right material goes to the right machine are behind a bulkhead wall in a room at the far end of the floor. A 60,000-lb silo is outside, and another is coming. 

MSE's biggest market is large appliances. It's a leading manufacturer of ice-making machines, producing up to two million/year. The company also manufactures 90 percent of all Lucent telephone handsets. A Continuous Improvement Team consisting of representatives from all key departments is structured around all of its customers to ensure each remains a customer for life. 

The Future at Work
In addition to managing JCRI, Fields also is president and ceo of Stonewall Jackson Mold Inc., a new, ultramodern moldmaking plant on the campus. Previously, MSE was sourcing its tooling from a sister company in the MSI group, Dixie Tool & Die Co., which Weaver started in Gadsden in 1962 and eventually built into the MSI empire. Stonewall will build complete molds. Plans also call for building a new campus plant dedicated to insert molding. Both ventures will require more associate training. 

MSE also is constructing a childcare center on the campus, and next year Fields plans to bring in kids from the local public school to tour the plants and let them see the high-tech opportunities in their home town. In addition, the company plans to obtain ISO certification for its JCRI training center. Fields adds that he intends to use his Paulson programs as a springboard for his associates to win their SPI Molder Certificates. Financial incentives may be offered to stimulate certification pursuits. 

"Mountain people have been afraid of making mistakes, what with all the stereotypes," says Fields. "Now, thanks to our training programs, they know how to learn from any mistakes they make and add value to their lives. Training has truly been a blessing for us all," Fields concludes. President Clinton agrees. 

VITAL STATS

MID-SOUTH ELECTRONICS INC., ANNVILLE, KY 

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Molding machines: MSE Plant #1:

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Contact information
MSE
Annville, KY
Eddie Fields
Phone: (606) 364-4668
Fax: (606) 364-8532
Web: www.midsouthindustries.com;
          www.jcri.org
E-mail: [email protected]

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