A clear understanding of clients' design and manufacturing needs opens the door to innovative approaches in stamping, roll forming, and assembly.

For a while, it seemed that Elrae Industries, Inc., had too much of a good thing. The Alden, New York-based producer of stamped and roll-formed metal components and custom assemblies had done well since its founding in the 1940s. During the '90s, however, the company experienced growth that, in the end, proved painful.

By the late '90s, expansion had outrun practicality. Consequently, Elrae was struggling to meet customer demands in a fast-paced, ultra-competitive environment, according to Michele Mancuso-Krollman, marketing and information technology vice president.

"We were having difficulties with meeting shipping deliveries and shipping deadlines," says Mancuso-Krollman. "Basically, we didn't feel that the system that we had could handle what we needed to remain successful."

After an extensive search, Elrae opted for a Made2Manage Enterprise Business System for its unified front-office, back-office, and production operations. "In the contract manufacturing/metal-forming industry, accurately tracking job costs is vital," Mancuso-Krollman says. "Our system lets us see every job we're running in real time. Because information is always real-time, we know exactly where we are regarding costand we know where the problems are."

Punch Three Times

Once it had the wherewithal to handle many customer projects simultaneously, Elrae turned its focus toward effectively responding to its demanding customers. The company introduced a program that it calls "Innovations," through which it leverages its technological capabilities which had been the reason for its great success in the 90swith solution-seeking customers.

One of Elrae's customers wanted to accurately punch three holes on one side of a plastic channel extrusion for a leading office product manufacturer. The bad news: the flexibility of the part made it difficult to maintain the locations of the holes while achieving repeatability. Moreover, the parts had to remain clean and burr-free after the holes were punched, so material handling also was an issue. If parts had slugs left in the holes after punching, the functionality of the end product would be compromised. Elrae was told that a former supplier had attempted to punch holes with conventional press brake tooling. The consequence: excessive scrap, poor quality, and late shipments.

Elrae's "innovative" solution was to punch the holes with a conventional stamping press. The company designed and built a low-cost tool that allowed the extrusion to be held in place on three axes (XYZ), enabling holes to be punched cleanly while slugs could be removed safely. By using the stamping press, Elrae increased production significantly over the prior vendor's hole-punching process. The process met the customer's tolerance and repeatability requirements, reduced unit costs, eliminated scrap, and increased efficiency. It may well be, however, that the customer was happier over another result turnaround time for the subcontracted stamping operation was cut by more than two-thirds.

Raising the Bar

Another customer, a plastics injection molding job shop that was a top supplier to automotive and recreational customers, developed a tension bar for use in a car door. The automaker's initial design called for a die-casting with close tolerances; parts would be injection molded to form the final plastic assembly. The die incorporated an extrusion-like shape made from a high strength/low alloy material. Hole tolerances and thickness of the wall of the extruded neck were critical to ensure that the bearing fit properly in the final door assembly.

"The customer's need was quite clear to us," Mancuso-Krollman says. "They wanted an alternative to the high cost of procuring the die-cast part. Given volume requirements, they also wanted something that enabled faster production."

Elrae assembled a group of its most seasoned staff members in what it called an "Early Supplier Involvement (ESI) team." They concluded that the part could be extruded and sized using progressive die stamping technology. After testing the idea with prototypes, Elrae presented it to the customer, who accepted. In the end, progressive die technology increased production efficiencies, enhancing the customer's ability to meet rigorous JIT delivery schedules. Quality and repeatability improved across all components in comparison to multi-cavity die-cast operations, which, Mancuso-Krollman says, could cause variations in the component. Unit prices dropped, and the customer ultimately used the same technology on four additional parts, enabling expansion into new markets.

Ratcheting Up Hand Tool Sales

Manucuso-Krollman tells of a case in which a major retailer told a leading hand tool manufacturer that it wanted an aggressive expansion of its product line. The manufacturer brought a development sample of one proposed product to Elrae for help in design, development, and manufacturing. As it turned out, the major challenge was the retailer's brick-wall deadline.

Again calling on its "Early Supplier Involvement team," Elrae researched whether and how it could produce the entire assembly. Ultimately, the team separated the challenge into distinct components: designing and building equipment, assembly lines, and dedicated product work cells. The trick was to accomplish all these things within less than 90 days. Elrae's customer accepted the company's proposal but carried it further, asking the company to add packaging and point-of-purchase displays to its execution plans. The final tool was ready ahead of schedule and under budget, enabling the retailer to reduce its retail pricing, which improved its competitiveness.

Removing Oily Buildup

In another case, a "Big Three" automaker was redesigning a cooling system and wanted to produce a family of seven components as a metal stamping. The differences among components were two part widths and seven part lengths. "Providing the parts as metal stampings required individual part dies or a complex family of dies with interchangeable inserts," Mancuso-Krollman recounts. The parts also had to be oil-free.

"We told the customer that we were concerned about the numerous tools, different material widths, set-up time and cost, part quality, and consistency, which were all associated with producing the product family as a stamping," Mancuso-Krollman says. "Cleaning the parts after shipping was another issue, since it required an additional step and more handling. It all came down to cost and timing. The existing scenario would have made it difficult for any stamping house to produce the products at the target price while meeting shipment schedules."

The same Early Supplier Involvement team recommended that the parts be roll formed, not stamped. "We designed and built a customer-dedicated roll forming work cell with an in-line automated wash system," Mancuso-Krollman noted. "The work cell could expand as requirements increased, which means that one operator can run two roll forming lines while using the existing in-line wash system."

According to Mancuso-Krollman, one of the advantages of this solution was that roll forming eliminated the need to procure seven different widths of material and the seven different set-ups that would have been required had the parts been produced as a stamping. "Roll forming enables you to perform a timing adjustment to vary part length," she added. "We also recommended oscillated aluminum coils instead of the traditional pancake-type coil. Oscillated coils can hold more material, so we could increase output per hour by reducing the number of coil changes."

The drop in material handling and set-up requirements brought the project in 10% below the customer's target price. At the same time, narrowing the material requirements from seven sizes to two allowed Elrae to realize economies for oscillated material. The roll forming process increased production capacity and improved JIT shipments while providing high quality, tighter tolerance parts consistently.

Surprising Results

In 2001, the firm braced for what was expected to be a down year by improving its ability to focus its resources on customers, and was met with surprising results. Despite projections of a 15%-20% reduction in sales and a net loss, the company enjoyed a profitable year as a result of its preparations. According to the firm, its ratio of sales to direct labor hour increased 28%, while sales to indirect labor decreased by 8%.

An integral part of the company's efforts was its extensive use of the Early Supplier Involvement program, which focuses first on customer needs, then on what needs to be done, and, finally, on determining how Elrae can make it happen. The company derived efficiencies in enterprise resource planning (ERP) from Y2K software upgrades, and monitored jobs in-process to achieve real-time job costing. It also devised a new plant layout that speeds material flow and enhances efficiency. Equally important, Elrae partnered with local utility services to study and reduce its energy usage, and instituted a program that gives employees cash awards and time off for suggesting cost-saving ideas.

But unlike many other companies during the economic downturn, the firm increased its marketing expenditures in the face of potential declines in business demand. It repositioned itself as a company that can help customers by providing numerous services besides metal stamping. Now, sales personnel probe to determine what additional services, such as subassemblies, might be needed. In addition to early involvement in design and prototyping, the company provides tooling, complete secondary operations, and robotic welding services.

A recent building addition has bolstered the company's capacity for both assembly work and jobs involving metal forming or other needs. Similarly, Elrae's innovative approaches to stamping, roll-forming, and assembly challenges have increased the company's overall competitiveness. Today, many of the assembly jobs performed in-house involve few metal formed parts.