Raymond Corp. Takes a Lean Approach to Keep Its Customers Satisfied
Founded in 1922, The Raymond Corporation has been manufacturing material handling equipment for nearly a century, with its headquarters based in the small town of Greene, N.Y. More recently, in 2000 the company was acquired by Japanese vehicle manufacturer Toyota. Not only did Toyota have a complementary line of lift trucks to Raymond’s, but the two companies already shared a common customer-first focus.
Michael Field joined Raymond in 2004, shortly after the Toyota acquisition, as vice president of engineering, moving up the ranks to president of operations and engineering, and last year, to CEO. So he was very much involved with the implementation of the Toyota Production System, the parent company’s well-known lean methodology, which began in 2007. Raymond’s continuous improvement journey reached a noteworthy peak in 2015, when the company’s Greene plant was named an IndustryWeek Best Plant. Some noteworthy accomplishments at the time included reducing the in-plant defect rate by 75% over the previous three years; achieving an on-time delivery rate of 99%; and increasing labor productivity by more than 13% over the previous three years.
IndustryWeek sat down with Michael Field at the recent MODEX 2016 show in Atlanta to learn more about his philosophy of running a company whose products are instrumental in making the supply chain of other companies move rapidly and efficiently.
IndustryWeek: After the Toyota acquisition, what happened internally? Did Toyota come forward and say, “We’d like you to adopt TPS and institute a basic lean culture at Raymond?”
Field: There was no mandate from Toyota to adopt what they do because Raymond for a very long time has been a very well-run, profitable company. Also, Raymond had always been lean and focused on continuous improvement and always getting better.
I came to Raymond in January 2004, so shortly after the acquisition, there were changes as people retired, the organization changed and evolved as all do, but always the key piece behind it was a customer-first focus. If you keep your eye on the customer, you can do a lot of things well because then you’re focused on meeting the end goals of what it is you’re selling, and what you’re providing to your customers.
IW: Just to be clear, when you say “customer,” are you talking about distributors or are you talking about the end user, or both?
Field: Our distributors are an extension of the Raymond Corp. and in many cases we actually own many of our dealers. So when we’re talking about customers we’re talking about the end customer—we’re always trying to figure out how to help them be more productive moving materials through their warehouse and through the distribution channel so that everybody wins. Because if we sub-optimize to make our dealers really good at what they do but they don’t deliver that same promise to the end customer, nobody’s won. So that’s really where we need to focus—on the end customer and solving the end customer’s problems.
IW: In terms of how you run the operation, what specifically are your employees focused on?
Field: It comes back to being very customer-centric, striving for innovation, striving for quality, and providing service like nobody else. If you do all of those well, everything else just sorts of fits together because you’ve got your real focus on the important things that add value to your customer’s business.
IW: So how do you do that?
Field: You work really hard. You have to do a lot of listening to your customers. Sometimes you have to ask a lot of questions about what they want versus what they need versus what you can really do to help them.
IW: When your Greene plant was named an IW Best Plant, one of the reasons was the impressive work that’s been done there in reducing defects. Can you describe how these programs work?
Field: Weak Point Management and Change Point Management are methodologies in the TPS to help a company improve. So Weak Point Management helps you identify “what is the problem?” What are the problems that a customer or a process or a supplier is actually having? How do you figure out the root cause?
And then what goes with that is Change Point Management, which is identifying what actually changed, whether it’s people, materials, process, any of the different things that can change—how do you know that’s happening, and that it occurs in a proactive way rather than remaining reactive.
For instance, let’s say an employee is sick today, and he works in Station # 4. That means someone else has to do his job today. Is that person who’s going to do that job ready? Has he been well trained? Is the person who’s normally in station # 4 doing something special that no one else knows about? If so, that’s not a good thing because we want everybody to understand what we’re doing and how we’re doing it. So we do a lot of cross-training, so people know how to do more than one job. It creates a lot of teamwork. It’s not in any way, shape or form diminishing to the associate that’s working on the assembly line. It’s more about working together and making sure that we’re focused on building the best possible products we can build for our customers.
IW: What is your personal management philosophy? How would you define your leadership style?
Field: I like leaders who are very hard on the problem and softer on the people to make sure that everybody is focused on the right thing, which is building an atmosphere of teamwork, breaking down the silos of an organization so that, again, we’re focused on doing the right thing for the right reasons for our customer. Everybody is happy working that way. There’s a sense of accomplishment when you’re working together as a team to get something done.
If you’re working at cross purposes and you’re not working as a team, accomplishing something means someone on the team won and someone else lost. It’s always about creating as close to a win-win situation as you can have. Sometimes it requires compromise, and we need to know when we’re compromising. But at the same time we need to make sure that everybody is being stretched to a level that’s a little higher.
IW: What contribution is there from the supply chain in what you do?
Field: Similar to the discussion we’ve had so far in how important the customer is, the supply chain is kind of that upstream customer. You’re a customer of them but there needs to be a balance in that process. And it all has to flow through because our customers have customers, so the supply chain just keeps moving and it’s sort of like what material handling is about. So we need to have the same external focus with our suppliers that we have internally with our organization and to our customers.
