Neocorp
In 2007, like many manufacturing companies, Neocorp was falling victim to the changing external environment brought on by continued globalization. But after starting the Rhode Island Manufacturing Extension Services’ (RIMES) Lean 101 program, the company was reaping the benefits of team building and functional area integration.
Neocorp, an East Providence-based engineering, manufacturing, warehousing and distribution company, manufactures a diverse and growing range of custom and common use cordage, gaskets and stretch cord products. Neocorp serves diverse markets, which range from select sporting goods retailers to commercial fishing dealers to a variety of OEMS in North America and abroad, and produces more than 1,500 stocked and made to order items with many shipping within three days.
Prior to working with RIMES, Neocorp's survival had been based on their ability to go a broader product offering and offering our products to a more diverse marketplace. The costs associated with the approach Neocorp was taking — offering their products and services with competitively superior delivery times, quality and price points — were high and, at times, even self-defeating.
Inventory and cash flow were fast becoming the casualties of maintaining Neocorp’s service oriented market position. The company tried several fixes: they re-visited their standard delivery expectations and were able to favorably modify them to some degree; they cross trained the production personnel; the company trained its leadership team internally on decision making by functional area; and established metrics by functional area and deemed obsolete a fair portion of our inventory. While these efforts yielded better control and some improvement, still more improvement was needed, particularly in the face of a weakening economy.
While these efforts yielded better control and some improvement, still more improvement was needed, particularly in the face of a weakening economy. Neocorp reviewed its situation with members of the Rhode Island Manufacturing Extension Services (RIMES) in early 2008.
RIMES conducted an assessment yielding a score card that showed areas that Neocorp could improve. Based on recommendations from RIMES, Neocorp began with RIMES’ Lean 101 program which gave Neocorp some concepts, definitions and fostered a focused team continuous improvement effort. The Lean 101 program has provided Neocorp with an enhanced formal platform of view points and measurements from which the company has improved efficiencies, value propositions and corporate values.
The Lean 101 training was followed by Value Stream Mapping. After Neocorp experimented with Value Stream Mapping in-house, they applied the tool to a popular Neocorp item, starting at production receipt of order all the way through to shipping.
"With expert instruction from the folks at RIMES and our focus centered on our mission and values, Neocorp has begun its continuous improvement journey,” says Chet Sutphen, President of Neocorp. “The Neocorp team has already seen benefits to our bottom line and our workforce. The highest costs associated with Lean are only those of ego's and old habits."
Through the RIMES programs, Neocorp determined that they did not need to produce and hold as much product as they had before. The ripple effect of this realization on inventory, cash flow and set-ups was clearly and immediately evident. Through the analysis tools provided by RIMES, Neocorp was able to determine where time, effort and energy was being squandered.
Since working with RIMES to uncover potential ways to improve the way they do business, Neocorp has reduced inventory costs by 10 percent and space required by more than 15 percent.