October 1st, 2013
The Power of the Tribe
Tribal knowledge—corporate, social, racial, etc. —is a reservoir of both written and unwritten information. It is a living energy center around which kindred minds gather and exchange ideas, traditions, protocols, inspirations, experiences, lessons learned, technology—all magnetized to a core of shared interests. A real tribe understands the inherent value of working together for its own enlightenment, growth and security.
Those of us engaged with the kinds of products that we manufacture at KPI-JCI & Astec Mobile Screens find ourselves working in a relatively small world. As such, it comes as no surprise that I am not aware of any higher education institutions offering any advanced degrees in aggregate system design. We rely on "tribal knowledge" within our industry to pass on our wisdom as well as exchange ideas and information.
I had the privilege of attending our annual National Dealer Conference (NDC) event in Eugene, OR the week of September 16. NDC is a three-day function where we get together with our dealers to unveil new products, discuss business strategies for the upcoming year, present awards to our top-performing dealers, build relationships with new associates, and strengthen relationships with old contacts.
Much of the theme in this year’s NDC centered on recognizing our past legacy as a company. A slideshow during the President’s Reception showed photos of old co-workers and mentors from years past, which really drove home the rich legacy of our company. Some of those faces shown up on the screen I still have pleasure to work with, where a few cherished others have since passed away.
I looked at those faces on the screen and it struck me as to how much knowledge and wisdom so many of us in that room – my peers and our dealers alike - gained from these legends.
It is that kind of tribal knowledge that we all rely on every day but will never find in a textbook. Like knowing at what angle a conveyor can be raised to, how to prevent shale from getting into your product pile, what kind of liners work best for crushing hard round stone in a cone crusher, or what is the best way to handle dirty material in a recycle operation.
At KPI-JCI and Astec Mobile Screens, we practice tribal knowledge by creating events like NDC to share strategic business planning information with our dealers, or PRO Training to pass on technical information to industry newcomers. And while not as glamorous, probably where this mindset pays the biggest dividend is simply through being able to provide a strong response at the answer desk.
However, the more I learn about this industry, the more I realize that I have so much more to learn. Therefore, I am grateful that my employer appreciates the value of having our associates be "out in the trenches." Therefore, in addition to our routine service and sales trips, our engineering, marketing, and product management staff routinely travel and interact with our dealers and our customers.
Even after more than 20 years of working in this industry, I still seek new information from the end-users of our products whenever I get the chance…and I find that I don’t have to look hard to find it. I find that I am far more useful to my employer when I am listening to our customers and not my own thinking!
July 9th, 2013
Don't Just Look at the Price Tag- Consider All Costs When Buying Equipment
Everybody has heard the phrase "you get what you pay for." Whether comparing automobiles, tissue paper, electronic equipment or construction machinery, the perceived value of a product is generally defined by the customer’s perception of the quality relative to the cost that has been invested.
Can someone save money by buying equipment from a smaller fabricator with a lower overhead burden as compared to a world-class manufacturing organization? Sure. But there is an inherent risk if things don’t pan out -- the biggest and costliest risk being poor or non-existent factory support, which must be absorbed by the customer in the form of downtime and costly loss of production.
Let’s do some quick math. Let’s say a customer saved $50,000 by purchasing equipment from a lower-quality manufacturer. The quick math would seem to make a strong case supporting that they made a wise choice, wouldn’t it?
Let’s put some variables to the operation: A 200tph plant produces material worth $12/ton. When the plant is up and running, it produces a revenue stream of $2,400 per hour. For a typical eight-hour shift, the system will generate just north of $19,000 per day in revenues.
Now imagine that the competitive equipment collapsed because it wasn’t properly designed by a certified engineer like that we employ at a higher wage. Now the plant is shut down and the customer’s revenue stream is suddenly at zero.
The customer calls Brand X to explain what has transpired; however, they lack a strong service department. A couple of days pass before a corrective action plan is established. By the time final repairs are implemented and the plant is back running, all of the front-end savings - and then some! - have long since been consumed by a single failure that could have been avoided.
Of course, larger, world-class manufacturers like KPI-JCI and Astec Mobile Screens go to great lengths to ensure that these types of scenarios are prevented. How, you ask? Factories like us use:
- Professional engineering systems to identify "hot spots" on paper long before anything is operated in the field;
- Industrial engineering/CNC programming to guarantee precision assembly;
- A company-wide quality and assurance culture to ensure multiple quality checks and shop-floor accountability;
- State-of-the-art manufacturing facility and tooling to provideconsistent workmanship;
- Parts inventory and service personnel on the ground to offer smooth start-ups;
- Year-round factory training schools to educate the users.
Can failures that incur downtime expenses occur? Sure. But the chances of common failures occurring are fewer, and the response time to repair them from a 24/7 global support team is far faster.
All of these activities are the norm at KPI-JCI and Astec Mobile Screens. They do add to the front-end cost of factory products. But they also contribute greatly to the value, and they ultimately will contribute to a lower cost-of-ownership on the part of the customer.
May 30th, 2013
Six Steps to Reducing Waste in Your Aggregate Operation
We've discussed Lean principles before -- essentially, that ‘lean’ is a systematic, top-down approach to identifying and eliminating waste (in other words, activities that don’t add value) in all aspects of business. But how does this apply to your aggregate operation?
As an example of non-value added activities to eliminate waste, let’s envision the process of scraping barnacles off the bottom of a cruise ship. While a critical task, the cost associated with this activity adds no value to the ticketed customer who bought a state room on the cruise ship and is sailing his family to Bora Bora.
Chances are, your aggregate processing facility has pockets of barnacles within it as well. In fact, research indicates that 95 percent of all operating costs/activity are non-value added. Here are just some examples that you may take for granted at your own operation every day:
- The cost of operating loaders and other material handling equipment
- Settling ponds
- Maintaining attachments
- Dust suppression
- Drilling and basting
- Crusher liners and consumables
- Screening media
- Electricity and energy consumption
- Transfer point maintenance
- Conveyor maintenance
- Safety programs
While all of these tasks are extremely critical, they really do not add any value to the end user or the customer of your products and services. They represent a cost which by definition means a waste center which should be targeted for reduction or elimination.
So what can you do about it?
- Appoint a Value Stream Team. Identify employees from various aspects of the organization, including production, management, the office, even accounting, safety, or other non-production-related areas of the company. The idea is to find cross-functional associates who have fresh ideas that are willing to work without bias or pre-disposed ideas. These small teams will address the needs of individual work areas in hands-on proactive workshops focusing on quick and easy ideas as opposed to groundbreaking solutions. The mindset should be "continuous improvement."
- Apply the 5S. Once the team has selected the first work station, it is recommended that they apply a “5S” process to that workstation. This includes 1) Sort; 2) Straighten; 3) Standardize; 4) Shine; and 5) Sustain.
- Identify and Analyze the System. Identify individual components of your system and how they function together. Recognize that each component may work at a different rate, and ensure optimum production is achieved by analyzing the system holistically. For example, what is the role, capacity and performance of the secondary crusher as it applies to the entire circuit? How is it performing? Where are the issues? How much is it costing to operate? Is it a bottleneck? If the 5S process was thoroughly performed in step 2, it should help identify the above.
- Identify a Focus Area. The status of the 5S system and identification of bottlenecks should help provide good indicators of where to find opportunities to rapidly improve a specific area of the system. Some common opportunities include: crusher configurations, screen configurations (throw/speed/media), waste water (what's going to pond), conveyor flashing, transfer chutes/liners, safety/inspection reports, and calibration/controls/connections.
- Count and Reduce the Number of Pieces. During the past 15 years, stationary plants grew to support unprecedented growth in residential and commercial construction. As a result, following the recession, today many plants are underutilized with excess processing equipment needed to fulfill their core material demand. This might create an opportunity to reduce waste by decommissioning unnecessary equipment from the plant. Ask yourself, do you really need that chip screen, coarse material washer and additional material handling equipment that was installed for the runway project back in 2003 and requires 150 GPM of water just to turn on every day?
- Accelerate Flow. Accelerating flow is one of the main objectives in creating a lean operation due to the many benefits flow provides. These benefits range from improved lead time to delivery, better quality, higher production capacity, reduced work in progress inventory, less wasted motion, fewer interruptions, greater space utilization, and much more. Ultimately, what we are really talking about here is identifying and relieving production bottlenecks.
This systematic approach may sound complicated, but all it really takes is a group of people who are dedicated to making small, incremental changes on a daily basis in pursuit of a better workplace.
While we all dream of making the large groundbreaking change that make everything better overnight, we have found that dozens of small, quick and easy ideas tend have a viral effect on an organization and provide even greater rewards over time through a stronger culture, improved safety and increased profits.
Start scraping them barnacles!
May 13th, 2013
Trucks vs. Conveyors: The Smarter Investment For Your Operation
When it comes to selecting a material handling system, a number of factors must be considered, such as costs, safety, labor and environmental impact. As contractors seek to make every dollar work harder for them, it's critical they carefully examine how they are transporting material from place to place.
Material handling systems provide several potential advantages, which include (but are not limited to):
- Safety. Conveyors require fewer personnel to operate, reducing exposure to fewer hazards. Conveyors can include numerous safety devices, including chord switches, zero speed switches, plugged chute switches, etc.
- Environmental. Conveyors operate quietly, can operate to enclose dust, and can be elevated or buried to be blended into the landscape to reduce community impact for unscarred, pollution-free operation.
- Reduced labor. Conveyor systems can be monitored and/or automated from a central control system. Typically, the time required for maintenance of belts, idlers, etc. is minimal (eight hours/week is typical for high-capacity systems according to the Conveyor Equipment Manufacturers Association [CEMA]). Conveyor systems are well-suited for preventative maintenance programs including automated lubrication systems, automated warning systems to detect heat/noise signatures, etc.
- Low energy costs. Electric power costs are more constant than liquid fuel. With conveyors, there is no need for idling in line or empty return trips, which is common with mobile hauling equipment. With conveyors, decline grade sections act as a generator and assist in propelling incline/horizontal sections, and in some cases, systems are completely regenerative. As the disparity between electricity and liquid fuel costs increases, the economic advantages becomes very dramatic.
- Reduced maintenance. Material handling systems do not require expensive support systems commonly required with material hauling equipment. Conveyor systems requires only basic maintenance skills as compared to more sophisticated electronics and engines associated with trucks. Conveyor systems only require minimal inventories of spare parts (belt repair kits, rollers, etc.), which represents a minimal financial burden and requires relatively little storage space.
- Improved economics. According to CEMA, overland conveyors are more economical than trucks beyond .6 miles (one KM). Beyond .6 miles the time/mile cost may be as low as 1/10 the cost by haul truck. Estimated operating maintenance cost/year for belt conveyor is 2% of the purchase cost, and +5% of the belt cost. On average, belts must be replaced every five years for hard rock applications and up to 15 years for non-abrasive materials. Well-maintained systems reliably operate at above 90% availability.
It's important to remember that overland conveyors do not require haul road maintenance expenses, which can cost $15-$20K annually for 3,500 feet of road. While trucks and conveyors typically depreciate at 7-10 years, conveyors can operate 25+ years. Conveyors do not require dedicated operators/drivers and can be managed by maintenance staff. And if additional hauling distance is required, conveyors can be lengthened, where trucking distance/cycle time is increased and additional cost is incurred.
It should come as no surprise that every organization in our industry is taking a hard look at their model as it relates to their material handling systems based on the current and forecast realities. As solution providers, we owe it to ourselves and to our business partners to embrace as much knowledge as we can. If you have any questions, please don't hesitate to contact our in-house material handling expert Jodi Heirigs at email@example.com or 605-668-2590.
May 10th, 2013
Using Postcards to Build Relationships, Increase Sales
Connecting with your customers – and potential customers – through postcards is a smart and inexpensive way to remind them of your products and services, but if done incorrectly and without a strategy, direct mail can go from hand to trash in a matter of seconds.
Why does sending a direct mail piece like a postcard matter in this digital age? Postcards are like mini billboards in customers’ mailboxes and on their desktops. Sending postcards to your customer list on a regular basis keeps your name in front of them and reminds them of your current specials and offers. Savvy dealers use postcards to remind customers to call for annual “check-ups” on parts needs, discuss start-up issues, or remind them of new products they might have on the lot for rental. KPI-JCI and Astec Mobile Screens also offers big, easy-to-read customer case study cards, which offer valuable customer testimonial for a variety of applications.
Remember, postcards are an inexpensive way to correct your mailing list. If the address on a postcard is wrong, the postcard will be sent back with an address correction if it is sent first-class. Oversized postcards can be sent bulk rate if there are at least 200 pieces in your mailing, but sending first class gives you better feedback if your address is wrong. Weigh your options before choosing to save money with bulk mailing. It’s safe to assume that half of your customers’ names and addresses are inaccurate within three years unless updated.
Here are some other tips to keep in mind as you plan your direct mail strategy:
- Always include a special offer for your customer when you send a postcard. Encourage the customer to contact you for additional information. If possible, use the most powerful word in the English language – “FREE!” Find a way to give something “free” in your offer- whether that’s a hat, flash drive or even lunch.
- Offer a variety of ways for the customer to contact you. The more response mechanisms you offer (toll-free phone number, website, e-mail, fax), the higher your rate of response.
- Be sure your postcard design complies with postal regulations. Use an experienced company to design and mail your postcards to ensure the mailing process goes smoothly. All KPI-JCI and Astec Mobile Screens direct mail pieces meet this requirement.
- Send postcards out twice a few weeks apart. Sending the same offer to the same list the second time returns 50 percent of the first-time response.
Have questions? Contact the KPI-JCI and Astec Mobile Screens Marketing department at 605-665-9311.