A driver represents a key activity that drives the operations and financial results of a company.
In Thread Roll, we chose three drivers this year that we really wanted to focus on: Parts Produced, Machine Efficiency, and Training Hours. We also have a year-long mini game called “Make the Boss Pay” which is aimed at tackling Cost of Poor Quality (CoPQ). We were able to win that mini game in Q1, and the team leader treated his team to a fun lunch.
Parts Produced
We track and record parts produced daily on our department scoreboard. This allows us to see where we are as far as how many parts we’ve rolled in relation to our absorbed costs forecast. And everyone knows, the more quality parts produced, the more profitable Fastco will be.
Efficiency
We track this measurable weekly in our team huddles. This allows our team to see on average how efficiently the machines are running in relation to their standard run rates in PLEX, our ERP system.
Training Hours
We track training hours weekly in our team huddles. We track the total number of hours team members are logged into machines under “Training.”
Behind the Drivers: Our Challenges
Cost of Poor Quality and Training seem to be the two biggest challenges facing Thread Roll right now. Luckily, with help from our department scoreboard and mini game, we are able to track and review these numbers regularly. I feel these challenges go hand-in-hand. Once we’ve established more training in our department, the CoPQ numbers should drop considerably.
Training Days
This leads directly into what I am most excited about for Thread Roll in 2024, which is training, training, training! The “Training Days” we’ve started have helped up and coming setup personnel to be able to focus more on setups without the need to stop what they are doing to dump production pans. We will continue to implement more of these “Training Days” when opportunities present themselves.
If you have been paying attention to the news lately, you have probably come across stories of increasing tension between China and the island state of Taiwan. In fact, in recent years the Chinese government and military has become increasingly aggressive with respect to violating Taiwanese airspace, harassing Taiwanese shipping, and putting pressure on other nations not to allow Taiwan to join such international organization as the World Trade Organization (WTO), the World Health Organization (WHO), and the United Nations (UN). What’s the nature of this conflict and how serious are the ramifications for the rest of the world?
China and Taiwan: Roots of the conflict
The conflict between China and Taiwan has its roots in the 16th century. Chinese settlers from the Guangdong and Fujian provinces sailed across the straits of Taiwan. Eventually, they settled the south west portion of the island in the vicinity of modern day Tainan. Although nominally under Chinse control, the Chinese who settled Taiwan did not pay much attention to the central government in Beijing. When the Qin dynasty, from time to time, did try to exert more administrative control, the settlers on Taiwan proved unusually rebellious. In the 18th and 19th century, there were numerous rebellions on the part of the Chinese residents of Taiwan against the Qin dynasty.
The problem of Taiwan for China became a moot point in the early 1890s, after the Chinese lost a war against the rapidly rising empire of Japan. According to the terms of the treaty of Shimonoseki of 1895, China formally ceded Taiwan to Japan. The Japanese would rule Taiwan for the next 50 years, until their defeat in World War II would force the return of the island to China.
A map of China and Taiwan
China and Taiwan Post WWII
The end of war in 1945 led the resumption of Civil War in China between the Nationalists forces under Chiang K’ai-shek and Communists forces under Mao Zedong. When the Communist triumphed in October 1949, the Nationalists forced retreated to the island of Taiwan, where they established the Republic of China which now competed with the Communist mainland named the People’s Republic of China.
During the 1950s and 1960s, both entities claimed to be the “real” China. Communist China planned to invade Taiwan and complete the “revolution. However, the military support and economic aid provided to the government of Taiwan by the United States made this invasion problematic. When the United States officially recognized the People’s Republic of China in December 1978, it no longer officially recognized the Republic of China on Taiwan. At the same time, the United States pledged its support for Taiwan by providing defensive weapons to the island state in case of an invasion by the People’s Republic of China.
For forty years, the two parties have uneasily co-existed. The Communists in China have become more impatient for unification. Meanwhile, on the island of Taiwan, many of the residents simply want to be independent of China. They argue that Taiwan is not really China, but another sovereign country. The United States believes there is one China; however, it has also said that force may not be used by the Communist Chinese Part (CCP) to bring about re-unification. If re-unification take place, it can only be the result of an agreement between the two sides.
Xi Jinping
Since Xi Jinping became the leader of China in 2013, the CCP has doubled-down on its determination to re-unite with Taiwan. Viewing Taiwan as a renegade, break-away province, President Xi, some say, is determined to force reunification, even by violent means. Most Taiwanese reject forced re-unification. My contacts on the island claim nearly 75% of the Taiwanese population view their country as sovereign. With the recent example of China’s governance of Hong Kong, few Taiwanese want to see their right to self-government diminished.
China’s determination to force this issue has led to increased harassment of Taiwanese shipping, regular violations of Taiwanese airspace, constant pressure on international organization to limit or exclude Taiwanese participation, and aggressive and threatening rhetoric. If the new president of Taiwan, William Lai, were to make a formal declaration of independence, the result would undoubtedly be a declaration of war and invasion of Taiwan, something the People’s Liberation Army (PLA) has been planning for a number of years.
The Threat to Global Supply Chains
There are several threats to international commerce that will undoubtedly happen if China invades Taiwan. First, international shipping will be cut off from the straits of Taiwan, the area between south China and Taiwan. Shipping companies will have to find alternative routes, creating delays and extra costs. Second, critical supplies from Taiwan will be cut off from Europe, Japan, and the United States. These include steel, fasteners, various types of industrial equipment, and, perhaps most importantly, semi-conductors (microchips). Third, other economic shortages will probably result from sanctions imposed on China by the United States, the EU, and other important international players, including Japan, South Korea, and Australia. In other words, there will be hardships felt around the globe by many countries, people, and businesses. Given the highly developed nature of Taiwan’s economy, there are many valuable industries and assets at stake.
Are we prepared?
While a very small island in terms of area, Taiwan is one of most sophisticated economies on the globe. It has 23 million people, but it ranks 21st internationally in terms of Gross Domestic Product. Even with rigorous U. S. assistance, it would be no easy task to repel a Chinese invasion. The results on international trade would be significant. Many U. S. fastener distributors still import a significant portion of their product from Taiwan. In addition, Taiwanese equipment in the fasteners industry still plays a significant role. For instance, they are a major manufacturer of cold headers, thread rollers, CNC grinders, and sorting equipment. Microchips and other sophisticated technologies would potentially be difficult to come by.
In order to prepare for conflict, what should companies that are dependent on Taiwanese products do? Number one, develop alternative suppliers for products made exclusively in Taiwan. Second, increase inventory of key components that are made in Taiwan—replacement parts for instance. Third, carefully consider the risks of further sourcing to Southeast Asia until the geopolitical situation is more stable.
Ironically, the tension between China and Taiwan could be good for the domestic fastener industry as well as other industries. However, the cost could be high in terms of human lives and disruptions to the economies of many Southeastern Asian nations.
What do we mean by an “engaged workforce?” You might not know the definition, but you can probably picture someone on your team that embodies the company’s values and purpose in everything they do. An engaged employee is one who is committed to their organization’s culture and mission as well as to their team. They work with enthusiasm, always looking to improve on the status quo.
At Fastco, we are always striving to meet customer expectations through continuous innovation.
Benefits of an Engaged Workforce
Truly engaged employees can deliver many benefits to the company itself as well as the customers they serve, including:
Increased productivity and efficiency
Improved quality of products
Better customer service
Reduced waste and fewer errors
Increased innovation
Leaders within companies want an engaged workforce. Customers want to work with companies that have an engaged employees, as this improves the customer service and quality experience. So how do you foster engagement?
A collage of photos from Fastco’s Great Game of Business Launch
The Great Game of Business as an Engagement Tool
At Fastco, we follow the Great Game of Business strategy for developing an engaged workforce via five key points:
Transparency: This includes open-book management, but also involves giving employees a clear line of sight as to how they can affect the bottom line.
Future Focus: We forecast every month where we think we will be as a means of affecting changes and improving outcomes.
Financial Literacy: Our employees are taught basic financial literacy so that they can understand how the company is doing. This knowledge helps break down barriers between managers and staff and between departments.
Open Communication: We openly discuss obstacles, innovations, successes, and struggles within our company to create an atmosphere of collaboration and teamwork.
Recognition: We applaud the efforts and achievements of individuals and teams. This goes a long way in creating a workforce that feels valued and important.
Fastco’s quality policy is striving to meet customer expectations through continuous innovation. We believe that the only way to continuously innovate and meet our customer expectations is through an engaged and productive workforce.
At Fastco, our Quality Policy is “Striving to Meet Customer Expectations Through Continuous Innovation.” This may sound like vapid wordiness or mumbo jumbo, but the truth is that continuous innovation takes work. Behind that work, we need concrete data to prove out what we are doing right and how we can improve. That is where metrics come in. This week, we are talking about Cold Heading Metrics.
In all departments, metrics are one way that we can measure our progress. The Cold Heading Department’s metrics include the following:
Production Output
This is a measure of our output, or how many pieces we make per month. This impacts our absorbed costs. The more pieces we make, the more favorable the absorption will be.
Aerial View of the Cold Heading West Bay
Downtime
When a machine is down, we aren’t making money. With this metric, we are measuring downtime as a percentage of the total hours for each job. We chose to only record the forms of downtime that we have the most control over which include: Unavailable Setup/Operator, Troubleshooting, and Weld/String Wire. This metric would impact the absorption and profitability because, in theory, the less downtime we have, the more parts we can run.
An aerial view of Cold Heading Bay 2
Setup + Run Times vs Standard
We have standards established that tell us how long it should take to set up a machine, and how long it should take to run a job. This metric compares our actual times to the standard times as a percentage with 100% meaning the actual times and standard times are equal, and anything under 100% means we set up and ran the job out quicker than our standards, meaning we saved labor dollars on the setup. This metric would also impact the department’s absorbed costs. If we take longer to run a job out, then we are using more resources making each part more expensive, hurting our absorption number and our overall profitability.
A scrap bin
Scrap
This is the dollar value of all the setup scrap we make per month. Keeping track of this will make us more aware of how much money we throw away every month in scrap, this is money taken directly from our bottom line. This metric impacts the scrap number for the company.
On Monday, May 13, the Federal Energy Regulatory Commission approved comprehensive changes to America’s electric grids. The changes will impact the planning and funding of grids. The new rule represents the most substantial attempt in over a decade to upgrade and expand the electric grid. In the face of extreme weather from climate change and the push to the electrification of vehicles, our power grid urgently needs these changes.
Without action, the aging power grid will be more and more susceptible to blackouts, experts have warned. In addition, many renewable energy proposals have stalled throughout the country due to a lack of capacity in the grid.
With the new rule, grid operators will take a 20-year outlook at the country’s needs, rather than the reactionary, short-term viewpoint they’ve historically taken. Investment in and overhaul of the grid will be essential to combatting climate change and implementing such renewable energy sources as wind and solar.
Here at Fastco, we’ve seen a jump in our solar industry fasteners. From taking up less than .01% of our market share in 2022 to 3.5% in 2023, and climbing over 5% in 2024, solar industry fasteners have becoming a significant part of Fastco’s product mix. Therefore, we are excited for the continued growth of this industry.
It’s time for a Purchasing Update from the team that works seamlessly with Fastco’s tool rooms and other departments to handle inventory and purchasing.
In Purchasing, one of our recent points of focus has been tooling inventory accuracy and management. On the inventory control side, we have been working tirelessly to ensure the Plex Toolset BOM’s are accurate and fully loaded, giving us greater visibility on cost, inventory value, and projected tooling needs. Optimizing our storage solutions for tooling has freed up space in the shuttles for new work.
Meanwhile, our purchasing assistant has sorted and labeled obsolete tooling provides a significant savings on tooling material as we’re able to repurpose this old tooling for current jobs.
Purchasing Update on Department Goals
Our number one goal this year is Point of Use Storage for tooling. It’s been on our list for quite a while. This year is the year we can get it done.
The Purchasing team, clockwise from top left: Aaron Headrick, Julie Boyce, Tracy Eno, and Ginny Beld.
Open-Book Management and Purchasing
The open-book style of management has generated some great discussions and questions from our team. We’ve incorporated some of these into our processes. We are working on implementing additional ideas that will ultimately improve profitability in the future.
The inventory control team had already been communicating potential (or actual) stock outs to the Tool Room and Purchasing functions. The addition of our scoreboard drivers will generate long-term solutions to some of the common issues we’ve been seeing. With the improved transparency, score boarding, and utilizing the Great Game of Business framework to conduct business, I am incredibly excited to see what cross-functional collaboration we achieve. In addition, I am eager to see how much better Fastco will be performing in the coming years!
Sometimes, there can be a relatively cheap and simple solution to what seems like an expensive and difficult problem.
One of Fastco’s cold heading machines was having ongoing issue with the transfer block. A maintenance request was put in and it wasn’t immediately clear that there were large problems with the block itself. Replacing it would have cost about $20,000. Process Engineer Nick Steimel came up with a test to validate the problem with data. He used a torque wrench on one of the bolts that swings the transfer fingers open. There was a significant drop in the pressure of one machine vs. others. Lack of holding pressure when transferring can lead to dropped progressions, forming and quality issues, and downtime for tool repair.
Nick worked with Brandon Schell (Machine Repair) and determined the root cause. Air assist pistons on the transfer block increase the finger pressure. However, there are sleeves inside the pistons that had fallen out due to wear. The air assist pistons had stopped working and all the pressure was coming from the springs only.
Close-up of the tapped-in screw holding down the sleeve for the air assist pistons on the transfer block.
They came up with the idea of drilling & tapping a set screw below the sleeve on the transfer block to retain it. This improved the pressure by more than three times at minimal cost.
As you can see, when teams come together to collaborate, it often yields better results. In this case, engineering and maintenance team members working together solved an ongoing problem quickly, cheaply, and effectively.
2023 was a challenging year for the Administration department, however the team stepped up and worked together to keep things running smoothly. Fastco’s controller position was in a state of flux for most of the year, but since the end of 2023, the entire team has been going strong and working together to keep things running as well as implement changes in the Finance and HR departments to help Fastco improve and remain compliant.
With the addition to our department of a full-time administrative assistant, we plan to utilize our time better. Job duties will be redistributed within the team. There will be more time to focus on preparing for instead of reacting to situations that come our way. We are working towards improving our process so that we are consistent and have a more proactive approach to problems.
The admin team: finance, HR, and IT
Open-Book Management & Administration
One of our department’s tasks is to promote open-book management by bringing financial literacy and updates to the company. Open-book management can show employees how their efforts impact the bigger picture. With open-book management employees can see how their efforts impact Fastco’s finances, which usually inspires greater investment in their work. This helps employees realize the power they have to make a better financial outcome for themselves and their coworkers by working together.
In 2024, we are working with our business coach to implement company-wide huddles. This will improve engagement in open-book management as well as the financial results of the company. I am excited to see what type of impact these huddles will have on our company and employees. For our department, we are looking forward to implementing ideas and projects that will help us move towards more accurate reporting for finances and more consistency in the HR area.
by Jodie Shaver, Corporate Controller & Employee Relations Manager
Also called self-clinching fasteners, or press-fit studs, these fasteners utilize a unique clinch feature below the head. These permanently mounted fixtures reduce costs and assembly time. They eliminate the necessity for loose hardware.
Unlike traditional screws, set screws create compression forces to hold two loose objects firmly together without the use of a nut. They are also called blind screws because they typically sit entirely inside the hole into which they are inserted.
Typically, a set screw is headless and threaded along its entire length, although it may have some kind of narrow head or drive
Ball studs consist of a spherically shaped head and a shank. At Fastco, our machines can produce a limited array of ball studs due to the nature of the cold heading machines. We can go from a small diameter to a large diameter and back down to a small diameter.
The ball stud pictured is an example of a Fastco manufactured part.
It’s one of the simplest types of fasteners that exist. Dowel pins are solid, headless cylindrical-shaped unthreaded pins can be made from are variety of materials, from wood to steel and aluminum.
At Fastco, we work with steel and stainless steel to cold head dowel pins.
Recognizable for its round, domed head and square shoulder or neck, the carriage bolt derives its name from its original purpose: the construction of carriages and carriage wheels in the early 1800s.
A carriage bolt’s smooth, round head adds a finished look to surfaces.
The greatest achievement to come out of engineering last year was the team brainstorm of getting a new, complicated part with an internal hex drive on the end to strip off of the extrude pin. We have lots of talented individuals that were able to combine their knowledge to get the part to work, starting from the design phase, simulations, tooling trials, the mechanical arm mechanism, along with the wiring of the actual stripper mechanism.
The Engineering team at Fastco.
In addition, training on the floor has been a huge success thanks to Sean Higley. The new setup people have been given a better opportunity for growth. They are better equipped to help their co-workers in the bay. It saves bay bosses from the added burden and frustration of training new people. It also ensures setup personnel receive consistent, proper training.
2024 Goals
It is difficult to pick a #1 goal for Engineering. We tend to take the mindset that each thing we work on is the #1 goal to achieve at that time.
It would be cliché to say that our #1 goal is to make sure Fastco succeeds and is as profitable as possible. That should be the overall goal for everyone. Our #1 goal for the year could be to make sure that everyone in the department completes any ongoing training. We also need to make sure all new equipment is properly tooled and all jobs designed. The #1 goal could also be to rapidly design for samples so they move through the facility on or before their due date. Or our #1 could be doing our part to keep production is as efficient as possible. Our #1 goal could be making sure all control plans and prints are accurate. I’m not devaluing having a #1 goal, but our #1 goal can and does change daily.
If I had to pick one #1 goal for the year, it would be having a 0 turnover rate in 2024. I also hope that the Engineering Team continues to enjoy what they do.
