As this year’s venue for the IW Best Plants conference, the state of South Carolina offered a study in contrasts that neatly capsulated a number of manufacturing trends. For one thing, South Carolina is a right-to-work state, and as Governor Nikki Haley stated earlier in the month at the SpeedNews Aerospace Manufacturing Conference, “We don’t have unions in South Carolina and we never will.” For another, the state has developed into a new manufacturing hub, with major automotive (BMW) and aerospace (Boeing) OEMs not only in place there, but attracting suppliers to the state as well.
The Carolinas also used to be synonymous with the U.S. textile industry, back when the United States still had a domestic textile industry. Thanks to the offshoring of jobs to low-cost labor countries in Latin America and China, the number of workers employed at U.S. textile companies is down to around 240,000, a far cry from the 1 million employed in the 1970s.
And yet, some U.S. companies are still alive and well and producing fabrics, such as Valdese Weavers, a privately-held manufacturer based in Valdese, N.C. The company is believed to be one of only three major manufacturers of its kind still operating in the United States. And one of the secrets to Valdese Weavers’ success—so impressive in its application that it’s allowed the company to stay put in its home country where so many other companies have bailed for foreign shores—is lean supply chain management.
According to Eric Lail, vice president of continuous improvement with Transportation Insight, a third-party logistics (3PL) provider who worked with Valdese on its lean initiative, there are two basic approaches to lean. One is the traditional approach, which focuses on getting rid of waste (muda) in such areas as overproduction, waiting, excess inventory, unnecessary motion, defects and transportation. The traditional lean approach, Lail explained at the IW Best Plants show, fits into the various silos typical of manufacturers, but omits the customer from the scenario—a rather glaring omission.
The other approach, though, is extended lean, which goes beyond the plant level to include the customer and other supply chain partners. “Traditional lean works on processes within the plant,” Lail says, “whereas extended lean connects the entire supply chain.”
Renae Ledford, process engineer and continuous improvement leader at Valdese Weavers, told IW Best Plants attendees how the company extended the lean concepts of waste elimination throughout its supply chain for significant performance improvements. For instance, Valdese (along with Transportation Insight, its 3PL) worked with its suppliers to separate out transportation costs from their invoices so Valdese could see exactly how much it was spending on freight transportation. That visibility to its costs opened up the opportunity to shift some freight to less expensive modes (e.g., moving some freight to full truckloads rather than using the more expensive less-than-truckload carriers).
Thanks to similar kaizen efforts that address waste areas in its supply chain, Valdese was able to lower its inbound freight costs by 30%, and outbound by 12%. “And we’re taking the savings gained from leaning the supply chain and investing it into our people, especially in training,” notes Ledford.
