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May 17, 1999
6 Min Read
From the beginning, True Precision Plastics (Leola, PA) has had one main goal: always to serve its customers to the best of its ability. The company’s drive to meet this and other goals, in the face of widely varying customer demands, has helped True Precision become a master at customized JIT delivery systems.
For more than 10 years, True Precision has been serving big customers like Hewlett-Packard and Harley Davidson, responding to annual forecasts on a daily basis. To enable this, it has created a new culture in molding operations—changing attitudes, investing in people and procedures, and building partnerships rooted in trust.
All of these factors have helped True Precision grow from its inauspicious beginnings in a barn in New Holland, PA. Vice president James Hirsch, who joined the company in 1985, and two other partners have built the company into a $12 million/year enterprise with 110 employees and moved it into a 33,000-sq-ft building.
Here it houses 20 presses ranging from 28 to 440 tons (Cincinnati Milacron, Van Dorn, Engel, and Sandretto with some smaller presses from Boy and Arburg) and makes eight to 10 mold changes a day—a combination that some may say makes it hard to make money. Yet it’s more than possible when you have the right system in place and your people have the right tools and attitude to make it work, says Hirsch.
Whatever It Takes
True Precision’s recipe for success involves reaching goals set both internally and by the customer, such as having parts arrive at the customer’s door exactly when they are needed. Hirsch and his partners realized that it would be True Precision’s responsibility to adapt to each customer’s accounting, inventory control, and MRP systems, which can vary dramatically from customer to customer.
“It wasn’t really breakthrough thinking,” says Hirsch. “We had two major customers [H-P and Harley Davidson] that had different systems, and it was clear that one was not applicable to the other.”
H-P, as you might imagine, has a very sophisticated computerized system with precise upper and lower limits set on both inventory and production, Hirsch explains. That information gets downloaded to True Precision every night. Armed with a daily snapshot of H-P’s production and an annual order, True Precision does whatever it takes to make sure H-P doesn’t run out of parts.
Harley Davidson began by sending a truck weekly to pick up parts. Then it moved to receiving daily deliveries. These days, True Precision is the motorcycle company’s major plastics supplier, and the relationship is almost completely electronic. Production requests come in electronic format. True Precision sends shipping notices in advance, and Harley pays right from that electronic data rather than an invoice.
With knowledge gained from working with larger companies, Hirsch says his company has helped some smaller customers develop systems that work in tune with True Precision as well. However, he does admit to trepidation in the beginning.
“The business side of me said that what [the customers] really wanted to do was to eliminate inventory, to shift those inventory burdens to us.” As a small company, True Precision had limited space, but it also had faith that in working with customers it could create a best-case production scenario as opposed to letting customer orders dictate how production was run.
“We had to sit down with people and say, ‘This is what we can do. What information can you provide us, and what are your expectations?’ Then we produce for our customers against annual forecasts, and we pick and choose how we are going to run, what inventories we are going to maintain or not maintain, and how close we can cut their requirements and still get the job done.”
There have been some growing pains. Not only did Hirsch and his partners have to teach their employees to leave behind conventional attitudes geared toward longer runs and an ultimate goal of lights-out production, they had to get their customers to buy into the absolute need for both long and midrange planning. Hirsch says some current customers, for example, did a terrible job of forecasting their needs and providing True Precision with the information that would allow the company to do the kind of position planning that makes the whole thing work.
If a company assesses its own needs inaccurately, True Precision can’t respond just-in-time. “We found ourselves back in the old situation of taking a phone call from someone saying they were about to run out of parts or saying they thought they needed 10,000, but really they didn’t need any.”
An early challenge was not only getting people to develop forecasts accurately but to share the information. “Back in the late ‘80s, before partnering became a popular buzzword,” says Hirsch, “companies were reticent to share that kind of information with a supplier. They wanted to continue to use the old purchase order system—‘Make us 3000 by March 3’—and that attitude defeats the JIT system.”
The current system works because Hirsch and his partners have challenged the organization from top to bottom, themselves included. The training and tools are important, as are good customer relationships. “It’s a tremendous commitment to quality, and the JIT systems are really just an end result,” says Hirsch. “In order to have a viable JIT system, you have to make quality parts.”
True Precision has been doing business with Harley Davidson for 16 years, and each trusts the other to do what they say they are going to do. Harley has never had to shut down its line for lack of parts. Because of this partnership, Harley has saved money by eliminating its incoming inspection department. The parts shipped from True Precision are often going on motorcycles that same day. The incoming inspection has been replaced by a trust warranted by experience between the two companies.
The two also worked together to form a joint continuous improvement team, which used video to identify wasted motion on both companies’ production lines. Hirsch says that when you fully understand how all elements of a job work together and how long they take, you can continue to challenge people to shorten those times.
A Continuous Process
In general, things keep getting better and better, according to Hirsch. New techniques and new technology, such as computerized machine monitoring systems, have allowed True Precision to better understand what is happening with every machine at every moment of the day and, as a result, better prioritize the attention of everyone from management to floor personnel.
Hirsch says True Precision is selling personal, efficient service: the JIT delivery as well as a range of secondary operations such as boring, reaming, buffing, sonic welding, heat staking, vibration welding, hot stamping, packaging, and polishing.
Success has resulted from investment in people and in procedures. It also stems from creating and reaching goals. Hirsch’s advice: “Pay close attention to meeting your goals and keep moving the bar up. If you’ve got good people and you provide them with knowledge and positive feedback, they will keep reaching higher. It’s a wonderful thing to see.”
The year 2000 will bring more growth for True Precision, including a planned move into a new 40,000-sq-ft facility in Columbia, PA. “Going back 10 years, I would’ve said we couldn’t be where we are today,” says Hirsch. “If I’m lucky enough to be looking back 10 years from today, I hope to be able to say the same thing.”
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