Managing Automation - September 2007 - (Page 32)

ESSIVE MANUF PROGR IGH ACHIEVERACTURING H 2007 LIVINGSTON & HAVEN PROGRESSIVE MANUFACTURER OF THE YEAR Facing heavy offshore competition, the hydraulic systems manufacturer uses lean principles to transform its own business and then shares its expertise to help bolster customers. BY JEFF MOAD company facts ust over three years ago, Clifton Vann III came to a sobering conclusion: Unless his company did something to stop it, many of its customers would soon go out of business or move offshore, taking their business with them. That was at the tail end of an economic slowdown that saw sales growth come to a screeching halt at CEO Vann’s company, Livingston & Haven, a $70 million manufacturer and distributor of hydraulic, pneumatic, lubrication, and automation systems used by other manufacturers in metal fabrication, automotive, and other industries. Many of L&H’s manufacturing customers were facing intense competition from of fshore rivals and were beginning to move proLIVINGSTON & HAVEN duction to lower-cost locations in order to stay afloat. TOTAL REVENUE/EMPLOYEES: So Vann and his manage$70 million/180 employees ment team came up with a LOCATION: Charlotte, NC plan: L&H would use lean INDUSTRY: Industrial hydraulic, pneumatic, lubricaprinciples to transform itself tion, connector systems into a more ef ficient and CEO: Clifton B. Vann III market-focused organization. PROJECT LEADER: Bruce McKay In so doing, the company PROJECT NAME: Driving Efficiency would serve as an example CORE TECHNOLOGIES USED IN PROJECT: to its manufacturing cusApoge homegrown enterprise software system tomers and gain valuable exROI/BUSINESS BENEFIT: Increased sales by 60% perience it could share with between 2003 and 2006; increased return on assets them, improving the odds from 0.3% in 2003 to 13.4% in 2005 that they would survive and continue to manufacture in the United States. “We decided that we would win only if our customers win,” says Clifton Vann IV, the company’s president. “If they don’t, not only will we miss the opportunity to sell them technology today, but tomorrow they will be gone.” L&H’s initiative has been remarkably successful. Over the past three years, the company has increased sales by 60% and net profit from $37,000 in 2003 to $2 million in 2006. Between 2003 and 2005, the company increased its return on assets from 0.3% to 13.4% and its return on investment from 0.7% to 46.8%. Those results not only improved L&H’s own chances for survival, but they also persuaded a panel of manufacturing experts and judges to name L&H the Progressive Manufacturer of the Year in Managing Automation’s 2007 Progressive Manufacturing awards competition. L&H’s transformation began in Januar y 2003, when CEO Vann issued a challenge to employees to do “whatever it takes to ensure the long-term health of U.S. manufacturing.” Vann formed a Leadership Council, made up of top executives from all of the company’s operations, and instructed the group to develop a new vision for the business and focus on driving efficiency throughout the organization. L&H’s resulting forays into lean techniques delivered mixed results at first. Its initial attempts to map processes, in fact, foundered because many were excessively complex. “That brought us to our knees on day one because we were just learning how confusing our own processes were,” says Bruce ma September 32 2007

Table of Contents Feed for the Digital Edition of Managing Automation - September 2007

Contents Take 1 Europe’s Automation Chiefs Upbeat on ’08 Business Prospects Vendor Coalition Pushes Human Element of SOA Wireless: Users Still Approaching with Caution One Year Later, IBM Shows Plan for MRO’s Maximo Study: More Work Needed to Lure Next-Gen Talent Executive Q&A Notes Cover Story: 2008 Companies to Watch Special Report: The 2007 Progressive Manufacturing High Achievers Progressive Manufacturer of the Year Business Model Mastery Innovation Mastery Customer Mastery Supply Network Mastery Data & Integration Mastery Education & Training Mastery Operational Excellence Mastery Leadership Mastery Transformation: Orchestrating the Multi-Tier Supply Network Integration: The Timeless Quest for Accurate Data Industries: Maintenance No Longer on Schedule Product Scan Advertiser Index Next

Managing Automation - September 2007

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