Operations & Management
Right at home: Instead of bending to pressure to move overseas, one manufacturer found a cost-effective way to boost productivity and improve safety, while still keeping jobs in Canada
November 17, 2011 by Alison Dunn
Oakville Stamping & Bending isn’t moving to China.
When Kevin Ernst, the general manager of Oakville Stamping & Bending (OS&B), and his team faced the tough decision of whether to upgrade processes or move production overseas almost four years ago, they knew China wasn’t the answer.
OS&B, located in Oakville, Ont., manufactures plumbing fittings for the wholesale and retail market. They make the fittings that connect your bathtub, sink and faucet to the plumbing in your house. But by 2008, most of OS&B’s competitors had outsourced the manufacturing of these parts overseas to China. Faced with aging equipment and ever-tightening safety requirements, it looked as though the company might have to follow suit.
“We were at the point where we had to do something,” says Ernst.
The truth was that the machines that the company used for cutting tubes, as well as flanging, threading and punching, were getting old. Not only that, but newer, stricter safety requirements meant the machines had to be upgraded with more guarding.
“We are required to guard the people who are in the area around the machine, not just the operator,” Ernst says. “We realized that just by having the machinery meet those requirements, it would significantly reduce productivity.”
And that meant OS&B simply wouldn’t be able to compete with its competitors who moved their operations offshore. Automation seemed like a perfect solution – but it was one the small manufacturer, with just 27 employees, couldn’t afford.
“We looked at automation,” Ernst says. “But every time we tried to run the numbers, it didn’t look good. It was too costly. It didn’t make sense to automate and we were faced with a decision. What do we do?”
SHOW ME THE MONEY
Ernst and the team at OS&B knew there had to be an answer. They started investigating various government programs and grants designed to help Canadian manufacturers. They discovered and subsequently applied to the Canadian Manufacturers and Exporters’ SMART Program.
Funded by the Government of Ontario and the Southern Ontario Development Program (FedDev Ontario), CME’s SMART Program was specifically designed to help small and medium-sized manufacturers in Ontario improve productivity and compete more effectively in the global economy. The program offered grants – not loans – to help companies fund productivity improvement projects with as much as 50 percent of the funding, up to $50,000.
With nothing to lose and everything to gain, OS&B applied for a SMART Program grant. While the team waited to hear back on funding approval, they started interviewing integrators to help them build an all-new, custom machine that would be able to process the tubes.
They chose an integrator to help build the machine, and looked for some additional investors to help fund the balance of the project. In 2009, they finally received the good news: they had been approved for funding through the CME. It was time to call the integrator they’d chosen and move forward with the project.
That’s when the bottom fell out.
“Just when we got our funding, and we were telling the company selected we were going to go ahead, they went bankrupt,” Ernst says.
Suddenly, OS&B was back to square one.
ROBOTICS TO THE RESCUE
OS&B then turned to Waterloo, Ont.-based AEMK Systems, an integrator that specializes in high speed, vision-based robotics systems. Ernst says they had originally approached AEMK before choosing the other integrator, but the timing of the project didn’t work out. This time, however, AEMK was just finishing up with another project and was able to take on OS&B’s new challenge.
Instead of a dedicated machine, AEMK proposed using its flexible Deltabot robot as the core of the work cell. The tubes are fed into the machine, and then the robot picks up the tube, places it down for cutting and then places it back into a line where it comes out of the other end and is dropped into a bin.
“The design philosophy is that there’s a key programmable machine – a robot – and whatever process you do downstream or upstream, you change it as you go,” says AEMK’s Edmon Chan, one of the project’s leaders. “We used a simple, open design.”
That simple design is what helped keep the cost of the project under control – a key consideration for the team at OS&B.
Another way they kept costs down was by re-using much of OS&B’s old production line. They mounted the robot to the surface of an old cabinet from the 1950s that spins the tubes.
“All we did was refurbish it and get the bearings straightened out,” Ernst says. “They don’t make them like that anymore – with that kind of frame and that motor on it.”
The project was also completed quickly. Ernst says he initially contacted AEMK to move forward with the robot in the fall of 2009; by March 2010, the project was completed.
REALIZING THE BENEFITS OF AUTOMATION
Automating the process has allowed OS&B to remain competitive in a very tough market. The company has reduced its order fulfillment time to as little as two days – all without carrying much overhead inventory.
“A lot of our competitors carry more inventory,” Ernst admits. “They say they’ll ship it in the same day in some instances. We’re competing against that model. We don’t always have it in stock because we make it ourselves. We had to shorten our manufacturing cycle down. We did that with the work cell.”
OS&B was also able to keep all of its employees, something that wouldn’t have been possible if it moved manufacturing overseas.
“We didn’t lose anybody,” Ernst says. “We just redeployed them in other areas. The automation allowed us to compete in Canada as a manufacturer.”
The new solution also improves safety. It not only works faster than the old machine, helping to boost productivity, but it also has safety built right into the design.
The machine is guarded on all sides with fencing, and no longer needs an operator to feed the tubes into the machine, meeting the most stringent safety requirements. It is also guarded on all four sides by fencing that is programmed to ensure no one can enter while the machine is running.
“It’s all fenced,” Ernst says. “As soon as someone goes into the gating, the machine dies. You can’t go in.”
But perhaps the best part, from OS&B’s perspective, is the flexibility of the design.
“If we went with a customized machine and, down the road, the business changes or our needs change, that machine would become obsolete,” Ernst says.
“Whereas with the robot, we’ve got a core piece of technology handling material feeds and a controller, and we can change whatever it’s handling and doing. Today we handle tube that’s 1 1/2 inches to 1 1/4 inches. But if we do other processes down the road, we’ve protected our investment and allowed the machine to be redeployed in other ways.”
WHAT THE FUTURE HOLDS
Since deploying the new solution, Ernst says the future looks much brighter for OS&B. There’s a possibility for the business to grow by cutting aluminum parts, simply because the robot is flexible enough to adapt.
The company is also looking to further automate its processes. It’s working with AEMK on another robotic project, this time in packaging.
“We have a bagging machine with two operators. One keeps the parts fed into the back of the machine, and the other holds the bag,” Ernst says. “That person just holds the bag open and grabs the parts. We’re going to get the robot to do the grabbing and moving into the bag.”
In addition, OS&B has implemented a paperless job processing system that moves each job from sales order straight through the manufacturing process and on to shipping. The program is web browser-based, and also allowed the company to reduce its time for order fulfillment. Similarly, parts pickers are using iTouches on the warehouse floor to pick the parts for each order, eliminating the need for paper-based picking.
What advice does Ernst have for other Canadian manufacturers looking to automate?
“Do a lot of research on the available technology,” he advises. “Rather than going a custom-machine route – where it’s dedicated and built specifically for one function – investigate robotics instead.
“Our original solution was going to be more of a dedicated machine,” he adds. “I’m thankful that fell through, because we didn’t get something that could have been obsolete. Make sure whatever system you choose is flexible, so you’re not stuck with technology that only has a lifespan of so many years.”
Chan agrees. “Treat the robot as one module,” he says. “If your product changes, you can still keep the robot as long as possible and change your processes.”
Click here to see the Deltabot in action at OS&B.
Alison Dunn is a freelance writer based in Burlington, Ont.
This article originally appeared in the November/December 2011 issue of Manufacturing AUTOMATION.