2004 Sales: ~$600 Million
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1 Measuring Environmental Performance: A Genie Industries Case Study Sustainability Indicators Workshop February 26, 2004 Michael Johnson, PE Genie Industries Christa Colouzis, PE WasteMinCo
2 Genie Industries History Ladders & Scaffolding And then Genie Industries: Light Aerial Products Articulating Booms Stick Booms Slab Scissors Trailer Mounted Z-Lift Superbooms RT Scissors Telehandlers 2004 Sales: ~$600 Million
3 Light Aerial Products and Z45
4 Stick Boom and Slab Scissors
5 TMZ and RT Scissors
6 Z-80 and Telehandler
7 Manufacturing Processes Purchased Parts (Engines, Tires, Hydraulics) Fabricated Steel Parts (Heavy Plate, Counterweights) Sheet and Tube Stock Fabrication Welding and Machining Pin Fabrication and Nitrocarburization Blasting and Multistage Washers Wet Paint, Powder Coat and E-Coat Assembly Transportation
8 Introduction to Lean Manufacturing 5 Rules of the Toyota Production System Lean Concepts: JIT, Pull System, Kanban, Poka Yoke and Visual Management Transportation, WIP and Working Capital Supply Chain Management Financial Impact of Lean Manufacturing Environmental Implications of Lean
9 Lean Manufacturing Based on the Toyota Production System (TPS) Developed by Taichii Ohno Phenomenal Toyota Productivity & Quality Ford + TQM + SPC + Toyota Techniques 1990 Book The Machine that Changed the World recognized impact to productivity and quality (MIT) The modern vocabulary of industry Lean manufacturing and the environment
10 Five Rules of Lean Manufacturing 1. Specifications document ALL work processes 2. Connections with clear YES / NO signals directly link every customer with every supplier 3. Every product and service travels in a single simple and direct flow path (JIT) 4. Workers improve their own processes 5. Integrated failure tests automatically at signal deviations for every activity (autonomation)
11 Lean Concepts TAKT Time The rate that customers consume product Just-in in-time (JIT) A system that makes and delivers just what it needs when it needs it Pull-System Production is initiated by consumption, often using visual signals (Kanban) One Piece Flow Producing and moving one item at a time, only when needed according to TAKT Time (or smallest possible batch)
12 Lean Concepts (2) All Transportation is Waste Moving products or materials creates no value for the customer Jikoda The ability to determine an abnormal condition and immediately stop work Kanban A visual signal to produce or deliver products Poka Yoke Technique for mistake-proofing processes Chaku chaku Building right-sized equipment to do simple tasks in sequence within a work cell
13 Lean Concept (3) WASTE Any activity that consumes resources but creates no value for the customer (The goal of Lean Manufacturing is to eliminate waste)
14 Lean (TPS) and the Environment Any asset, object, or commodity that s been produced and is not being used is waste Biggest waste is OVER-PRODUCTION Industry does not have a monopoly on waste Assume US businesses maintain 60 days inventory US GDP ~ $10 Trillion Cost of US Inventory (Waste) ~ $1.7 Trillion Annual Cost-of-Capital ~ $150 Billion Note the temporal component of waste
15 Genie Sustainability Goals Striving for Perfection Ultimate Goal of TPS Eliminate i all forms of waste Incremental Goal Increase Inventory Turns Above 6.1 Per Year Incremental Goal Incremental Goal 5% Increase in Material Efficiency in 2004 Reduce Lost-Time Injuries And OSHA Recordables (People are our greatest asset) Incremental Goal $800 MM in 06 w/ Same WC Incremental Goal < 500 Chemicals Company-wide
16 What is Genie s Biggest Environmental Impact?
17
18 GEMS Genie Environmental Management System Combines Measurement, Efficiency i Goals and Compliance Systems Source Reduction and Media Programs: Process Selection Water Conservation Chemical Consolidation Hazardous Waste Energy Conservation Commute Trip Reduction Recycling Programs Measurement is key: MassBalance.xls Waste
19 Four Criteria for Successful Change Increased Profit The business of business is to stay in business (Deming) Improved product or process quality Any change must increase value to the customer Simplified operations Operator s life must get easier due to the change Improved environment Convert resources into customer value more effectively
20 Process Selection Example Wet Paint 45% solids w/ 50% transfer efficiency 22.5% of purchased material goes to product 77.5% is air pollution Material Cost ~ $10.95 per 100 square feet painted Powder Coating 100% solids > 90% Transfer Efficiency (Electrostatic + Recycle) < 2% of purchased material is air pollution Material Cost ~ $2.65 per 100 square feet painted Capital cost and thermal mass limit powder applications Cost of materials is a small part of total cost of painting
21 Water Conservation Cleanliness specification key to success Reduce flow when process specs exceeded Re-use or recycle when a waste stream is cleaner than neighboring process spec Other Techniques Measure flow and loading continuously Use visual techniques (i.e. V-notch weir) Counter-flow wherever possible Drag-out reduction techniques broadly applicable Reduced flow by more than 55% company-wide
22 Chemical Consolidation 2,130 Chemicals January 2003 Track every component? Purchasing complexity Compliance complexity 700 Chemicals January 2004 Consolidating to best performance Leverage volumes to reduce costs Simplify compliance while reducing exposures Goal: 500 Chemicals January 2005
23 Future P2 Opportunities Single-Coat E-Coat Encroachment by high density residential development Eliminating epoxy cuts butyl cellosolve by 80% Cost savings ~ $350,000 Acid Self-Formulation Use multi-step process Counter-flow acid system Increased capacity Cost savings ~ $250,000
24 Mass Balance.xls ENVIRONMENTAL PERFORMANCE METRIC 2002 Year-to-Date Combustion Air Water 615,424 Lbs 9,287,457 Gallons Electricity Exhaust 10,483,928 kwh 669,409 Lbs Natural Gas Emissions 53,985 Lbs 142,560 Lbs Inputs and outputs BOM MRO Chemicals Products Wastewater Other 8,207,035 Gallons 0 Lbs Used Oil Scrap Metal 1500 Gallons 7,685,230 Lbs Trash Non-Haz Industrial 514,740 Lbs 1,702,122 Lbs Wood Paper 1,080,000 Lbs Lbs Haz Waste 6 51,110 Lbs Measures mass and cost
25 OSHA Recordable Injuries OSHA Out-of-pocket >$1,000,000 Recordable Injuries Lost Light Medical Other Total Location Time Duty Only Injuries Injuries Building # Building # Building # Main Campus Moses Lake Administration Totals
26 Sustainability Measures Safety Working Capital GEMS Programs MassBalance.xls Resource Value vs. Cost of Exploitation Work in Process (WIP) Return on Invested Capital (ROIC) Productivity (Return on Human Capital)
27 Key Lessons Value-Based Definition of Waste (Waste = Consumption of Resources without Adding Value) Four Criteria for Success (Profit / Quality / Simplicity / Environment) Unused or under-utilized utilized production is waste All transportation is waste Complexity is the enemy If you can t measure it, it didn t happen
28 Stewardship Nobody can tell you what is sustainable, because it s a dynamic system. Our relationship should be a restorative one. You re either restoring or degrading. There is no middle grey area. Paul Hawken
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