Metal Service Centers
September 5, 2015 / agility, best practices, continuous improvement, Cost Management, customer delivery, industry news, lean manufacturing, LIT, preventative maintenance, resource allocation, strategic planning, value-added services
Staying ahead of the competition can often seem like an impossible task, especially in today’s marketplace. Continuous improvement is now the expectation, lean manufacturing is fairly commonplace, and uncertainty about market conditions makes it hard to gauge investments and risk.
So how do you get ahead in the current landscape? While it would be near impossible to truly answer that question, the LENOX Institute of Technology (LIT) gathered a few examples of high-performing service centers and outlined some of their key traits below. How does your service center stack up against these leaders?
Reliance Steel & Aluminum
Los Angeles, CA-based Reliance was ranked number one in Metal Center News’ (MCN) annual survey, “Top 50 Service Center Industry Giants.” The industry leader, which operates more than 290 locations in 29 states and 11 countries, continues to expand its reach. According to Reliance’s profile in MCN, the service center shines in three key areas:
- Value-added processing. Reliance’s services range from cut-to-length/blanking and laser cutting, to sawing and water-jet cutting. The company has made 58 acquisitions since 1994 and continues to acquire businesses that add to its capabilities.
- Quick delivery of small orders. According to the company web site, it isn’t uncommon for Reliance to fill and deliver orders within 24 hours of receipt. Perhaps that’s why more than 90 percent of customers return to do business.
- Strategic supplier relationships. According the MCN, Reliance “continues to cherry-pick the best players in metals distribution, along with strategic downstream processors.”
A.M. Castle & Co.
In addition to distributing a wide range of metal and plastic materials, the leading metal service center also performs simple sawing operations at several of its locations, including its main distribution center in Franklin Park, IL. A case study, published here by LIT, describes the company’s three areas of focus:
- Lean improvements. Glen Sliwa, who is responsible for keeping saw operations up and running, says the company is focused on continuous improvement and is “always doing something to upgrade.” About 7 years ago, the operation underwent a lean transformation, which included major changes in workflow and equipment placement as well as simple improvements like color-coding material. The facility also uses the lean tool known as 5S, which eliminates waste by keeping work areas clean and organized.
- Preventative maintenance. According to Sliwa, preventative maintenance is critical to keeping production moving. Operators perform daily maintenance on machines by following a checklist that they have to verify and sign at the end of every job. Sliwa and his team also perform more in-depth PM checks on a quarterly basis.
- Close supplier relationships. Sliwa works closely with his suppliers and relies on their expertise any time his team has a cutting issue or is looking to improve performance. In one instance, operators were having a hard time reaching productivity goals when cutting several grades of stainless steel. A technical representative from Sliwa’s blade supplier came out to evaluate the problem and suggested a new blade type. Not only did the new blade cut Sliwa’s cutting time in half and double the blade life, the supplier also trained his team and tuned up his saws.
Klein Steel Service Inc.
In May 2015, American Metal Market (AMM) magazine named Klein Steel one of its service centers of the year. According to the magazine, the Rochester, NY-based company experienced its largest year ever in 2014 in terms of weight shipped and revenue generated. The following are just a few notable attributes of the service center:
- Technological investments. Klein launched a newly designed web site last year that increased its web site visitors by 50 percent and earned it three awards, according to AMM. The company also invested in technology that uses data and information flow to streamline and improve operations.
- Customer service. After earning an almost-perfect customer retention rate and millions of dollars in new customers last year, it’s clear that customer service is important to Klein. In fact, a 2014 survey revealed that customers do business with Klein because of great customer service, on-time delivery, and rapid quote response time, reports AMM.
- Strategic planning. In addition to the AMM’s honor, Klein was also named Metals Distributor of the Year at the 2015 Platts Global Metals Awards. As detailed in Platts Insight magazine, the service center scored high marks for its ability to strategically plan for growth while keeping an eye on the economy and remaining flexible. According to the Insight, Klein “maintains steady inventory, buying according to customers’ forecasted needs and minimizing speculative purchases that increase risk.”
Metal Service Centers
August 5, 2015 / best practices, blade failure, blade life, blade selection, cost per cut, industry news, material costs, preventative maintenance, productivity, quality
Over the next few years, experts anticipate growth in the use of high performance alloys or “superalloy” materials such as Inconel and Hastelloy. The high-performance metals, which are known for their outstanding corrosion and high temperature resistance, continue to find uses in aerospace and aircraft applications, and more recently, are expanding into the oil and gas industries.
“Growing corrosion as a cost concern in exploration and production in offshore drilling rigs is expected to propel use of high performance alloys such as superalloys in oil and gas applications,” states one study from Grand View Research, Inc. “Non-ferrous alloys such as nickel and titanium are also expected to witness above average growth due to their high mechanical strength coupled with increased use in aerospace, oil & gas and gas turbine applications,” the study continues. Specifically, Grand View Research forecasts that superalloy demand will experience an annual compound growth rate of more than 3.0 percent from 2014 to 2020.
While there is certainly a science to cutting any metal material, tackling tough-to-cut materials like superalloys can be even more challenging as managers try to balance cutting speed, finish quality, and blade life. However, with the right tools and know-how, service centers can efficiently and cost-effectively handle tough-to-cut materials without compromising quality.
The following are three key tips for service centers that want to cut superalloy materials:
- Use the right blade. Although it is possible to use bi-metal band saw blades to cut superalloys, carbide-tipped blades are typically better suited for the task and offer longer life, faster cutting, and better part finish. As with bi-metal blades, carbide-tipped blades are designed with multi-metal tooth constructions to provide high performance and prolonged blade life. In a carbide blade, the more durable tooth tips are welded to a high-strength alloy backing, enabling it to cut even the toughest metal. While carbide blades are more expensive, they are designed to take more bite and more chip load, which allows for faster cutting and can improve productivity and cost per cut. Aeordyne Alloys, a service center featured here in a LENOX case study, found this to be the case. Working with hard-to-cut metals like Inconel 718 and Hastelloy X, the service center decided to upgrade from bi-metal blades to carbide-tipped blades to get higher performance out of its band saws. By using a carbide blade, Aerodyne was able to tackle the hard, nickel-based alloys, while also improving cutting time on easier to cut materials like stainless steel.
- Coolant is key. There is no question that tougher metals take a toll on blade life, but this issue is even more compounded if operators fail to use coolants. As explained in an article from Canadian Industrial Machinery (CIM), choosing the right coolant, as well as getting the coolant into the cut, will extend blade life and improve cut quality. While some experts suggest highly compounded straight oil coolants for the more difficult tocut metals like superalloys and certain stainless steels, Matt Lacroix, director of marketing, LENOX Industrial Products & Services, says the choice isn’t always that simple. “There’s an inverse relationship between the lubrication and cooling effect of the fluid,” Lacroix tells CIM. “A water-soluble oil or straight oil is good for lubrication, but not as good for cooling. The synthetics and semisynthetics are better for cooling, but offer less lubricity than fluids with a higher oil content.” In the end, Lacroix says selecting the right coolant depends on the application.
- Break in blades. As discussed in a previous blog post, when it comes to band sawing, it always pays to break in blades. This is especially true when getting ready to cut harder materials that quickly wear down band saw blades. A new blade has razor sharp tooth tips, and in order to withstand the cutting pressures used in band sawing, tooth tips should be honed to form a micro-fine radius. Failure to perform this honing will cause microscopic damage to the tips of the teeth, resulting in reduced blade life and poor-quality cuts. When done correctly, performing this simple task can extend blade life by up to 30 percent.
Metal Service Centers
July 5, 2015 / best practices, continuous improvement, Cost Management, industry news, LIT, operations metrics, performance metrics, preventative maintenance
As we reported in our Metal Service Center Outlook for 2015, metal service centers went into the new year optimistic. Unfortunately, shipment data has failed to meet expectations. According to monthly data from the Metal Service Center Institute (MSCI), U.S. service center steel shipments have been down all year compared to the same months in 2014. In May, MSCI reported that steel shipments decreased by a whopping 12.6% compared to May 2014, and shipments of aluminum products also registered the first decrease of the year, down 3.3% compared to May 2014.
In light of current conditions, it’s hard to fathom that any service center would turn down work. One would imagine that sales teams are working hard to ensure a steady stream of contracts, all the while hoping to land that huge, game-changing order. After all, growth is always the goal.
But what happens when that big order finally comes in, and it is clear that taking it on will require capital investment in either equipment or labor? What if you are running at capacity and the money just isn’t there, yet the growth opportunity a new customer represents is undeniable? What then?
As this article from Canadian Metalworking explains, most companies are left with three possible options:
- Delay fulfillment of the order, if at all possible.
- Beg the customer for a 50% down payment, hoping he has the financial wherewithal.
- Turn the customer away—or worse—send him to the competition
Obviously, none of these options are ideal, but this scenario is all too often the case for a large number of service centers that cut and process metal. However, not all hope is lost.
While there will always be instances when a company has to decide whether or not the business risk is worth it, there are ways to proactively prepare for potential growth. Below are three strategies that can help service centers be in a better position to accept new growth opportunities.
Focus on Reducing Operating Costs
In the midst of the day-to-day grind, it’s easy to put the most focus on getting the job done. However, keeping operational costs under control should always be a top priority for managers. According to consultant Lisa Anderson, businesses looking to find ways to grow profitably need to stay focused on maintaining low operational costs. Doing so not only saves money, it “provides pricing flexibility as you are able to reduce your breakeven point for covering costs.” Anderson explains.
In most cases, lowering operating costs won’t require any capital investment, but rather is a matter of taking better care of the investments you’ve already made. For instance, according to the white paper, The Top 5 Operating Challenges for Metal Service Centers, proper management and proactive maintenance of metal-cutting equipment and tools can save companies a lot of money. On a band saw, for example, low coolant levels can lead to premature and uneven wear of band wheels, which typically cost about $1,000 each. By instituting regular coolant checks as part of a PM program or daily operator checks, managers can eliminate this unnecessary maintenance cost, as well as the time needed to replace the band wheel.
Anderson agrees that PM is a key strategy and goes on to list several other strategies here. In the end, reducing operating costs is a good practice for any company, but it is essential for companies looking to expand.
Evaluate Your Position
In addition to cost readiness, managers need to be able to gauge whether or not their operation could logistically handle any growth. This requires measurement. An article from IndustryWeek describes several metrics that can help managers determine factory readiness.
Below are two key metrics that should be evaluated quarterly, according to IW:
- Utilization versus capacity. Chances are you’re already running this test at least weekly. Managers who don’t have a clear sense of the mix are bound to have a tough time winning new business while keeping existing clients happy. This metric can also be used in context. Do complaints rise along with utilization? If so, your factory may need training and support to handle new business and cut down on churn.
- Per-project profitability. How will you know whether your factory has the right mix of projects if you don’t measure per-project profitability? Calculate materials, hours worked, and other incidentals for completing projects and generate a figure. Estimates are fine; the key here is to have an apples-to-apples way to measure projects against each other. Then, dig deeper to look for patterns. Do certain clients always cost more to serve? Are certain industries more profitable?
Get Finances in Order
If that big order does come in, companies should be sure their finances are in order just in case financing is required. According to the Canadian Manufacturing article, the following best practices can help companies of any size can be in a better position to get financing:
- Make sure that your financial statements are up to date. A good accountant should take less than six months after the fiscal year end to prepare financial statements.
- Have financial projections outlining assumptions for every variable ready at all times, even if you have to hire a part-time CFO to get them done.
- Anticipate future orders by staying close to your customers.
- Determine from your banker what ideal financial ratios look like and stick to them whenever possible. While most businesses show the lowest reasonable bottom line to minimize their taxes, it is not the best strategy when seeking bank or equity financing.
Metal Service Centers
June 5, 2015 / bottlenecks, customer delivery, customer service, industry news, lean manufacturing, LIT, value-added services, workflow process
According to data from the Institute for Supply Management, the May PMI increased 1.3 percent to 52.8, indicating growth and economic expansion in the manufacturing sector for the 29th consecutive month. Of course, this is good news for the manufacturing supply chain, and many service centers are taking steps to position themselves as preferred suppliers. These steps include everything from holding inventory and working directly with mills, to preparing material to custom specifications and upgrading to electronic databases.
Service centers are also continuing to work hard to address the increasing demands for faster turnaround. Although efficiency improvements have been the focus of almost every manufacturer the last several years, data shows that it is still a major challenge for most industrial metal-cutting companies. For example, according to an industry benchmark study from the LENOX Institute of Technology, machine downtime, blade failure, and operator error remain the top-three sources of frustration for industrial metal-cutting operations on the shop floor. In other words, there is still room for improvement.
Mapping it Out
To improve efficiency, many leading companies are using a lean manufacturing tool known as value stream mapping. In fact, one company, featured here in IndustryWeek cut its lead time in half—from 10.5 days down to 5 days—by creating a value stream map.
Value stream mapping, as described by iSixSigma, is a paper and pencil tool that helps managers see and understand the flow of material and information as a product or service makes its way through the value stream. The “map” takes into account not only the activity of the product, but the management and information systems that support the basic process as well. This can be especially helpful when working to reduce cycle time because managers gain insight into both the decision making flow in addition to the process flow.
Although it is easy to become overwhelmed by the terminology, an article from Ryder does a good job of outlining the process in five simple steps:
- Identify product. Determine what product or product groups you will follow. Focus on one product at a time and start with the highest volumes.
- Identify Current Flow. Once you’ve defined the scope, the next step is to create a “current state map,” or a visual representation of how the process (or processes) in the warehouse is operating at the present moment. Key data points such as units per month, shipping frequency/schedules, hours of operations (available time), number of shifts worked, or any pertinent information around customer demand should be gathered before beginning the current state.
- Observe. Get on the floor and walk the entire process through step-by-step. Take notes and compile data such as inventory, cycle times, and number of operators.
- Make the map. Literally map out the process you just witnessed by drawing it out on a board. Include the data you collected and place inventory numbers under each step in the process. This will identify your bottlenecks.
- Create (and implement) a plan. Now that you know what and where your process improvements are, choose one or two to focus and improve on in a set amount of time. Once those are complete, you can prioritize the other bottlenecks to improve lead times.
Taking the Time
In an industry driven on speed, taking two days to participate in a class or complete a value steam mapping exercise may seem like a lot. However, managers need to consider the price of not taking the time. Investing in tools like value stream mapping can help your metal service center operate more efficiently, reduce lead time, and, most importantly, allow you to better serve your customers.
Metal Service Centers
May 5, 2015 / best practices, human capital, industry news, KPIs, LIT, maintaining talent, operations metrics, operator training, productivity, quality
According to data from the Metal Service Center Institute, service center shipments of steel were essentially flat in March 2015 compared to the prior-year period while aluminum increased slightly by 4.6 percent from the same month in 2014. With less than stellar shipments, metal service centers are focusing on business conditions they can control.
As this white paper from the LENOX Institute of Technology points out, one area that many companies are focusing their time and efforts on is training and maintaining talent. According to a recent article from Forward, Chicago-based service center Ryerson Inc., for example, has created a formal training initiative called The Ryerson Academy, which is a six-month program that trains up to 40 employees per year with a dedicated curriculum covering operations, supply chain, and more. Attendees also visit one of the company’s facilities to receive hands-on training with products and equipment.
Smaller service centers are also taking note. Westfield Steel, a service center also featured in the Forward article, has created on-the-job training to improve retention and skill rates. Based on each person’s existing knowledge, the training program lasts from four weeks up to four months. Workers observe best practices and also learn with hands-on work under the observation of their trainers.
With many skilled workers preparing for retirement, it’s no surprise that companies like Ryerson and Westfield are investing in training to improve operator capabilities and ensure their technology and equipment investments are used properly. In fact, the trend seems to be stretching across every industry. Citing data from Deloitte’s 2014 Corporate Learning Factbook, Forbes reports that U.S. spending on corporate training grew 15 percent in 2013—the highest growth rate in seven years.
How does your training program stack up? Is it time for some investment in this critical area? Using experiences from Ryerson, Westfield, and others, Forward offers four best practices service centers should use when implementing or enhancing their training programs:
- Test Before Implementing. Pilot the program with leadership or a pilot group of employees. This allows time to solicit feedback, make incorporate changes and fine-tune subject matters.
- Link Training to Business Goals. Training is an ideal way to ensure every employee knows and understands the company’s goals. This helps expose workers to areas outside of their expertise and helps retain new hires.
- Find the Right Method. Once you determine the training subject matter, decide how to implement and deliver the training. Some companies prefer e-learning courses to minimize travel expenses while others prefer in-person workshops or classroom training to help build team relationships. Determine what works best for you whether it is a webinar, video recording, or in-person sessions.
- Measure Impact. Treat training as any investment and measure results. While the impact of training may not be immediately evident, ask for feedback on the overall effectiveness of the training courses and presenter performance. Then after a few months, compare quantitative metrics such as quality, production rates, and efficiency to gain insights.
As the industry adopts advanced technologies and sees a shift in its talent pool, the need for skilled operators is increasingly important. Have you invested in your people lately? Doing so may just have big pay offs.
Metal Service Centers
April 5, 2015 / agility, customer delivery, industry news, material costs, strategic planning
Like most sectors of the metal-cutting industry, metal service centers are hoping that experts are right about the growth prospects for 2015. After 2014 fell short of expectations and with recent data showing less than favorable numbers, most companies are trying to stay optimistic about the months ahead.
The latest figures from the American Iron and Steel Institute show that February steel shipments from U.S. steel mills were down 10.8 percent compared to January 2015 and decreased by 9.1 percent compared to February 2014. Shipments year-to-date were down 5.3 percent compared to 2014 shipments.
According to data from the Metal Service Center Institute (MSCI), U.S. service center steel shipments declined in the first three months of 2015 compared to the same months in 2014, although March shipments were only down by a tenth of a percent. Shipments of aluminum products, on the other hand, increased in both February and March after being down in January. Meanwhile, steel and aluminum inventories grew in the first three months of 2015, MSCI reports.
Even with a rough start to the year, analysts remain optimistic that there will be growth in 2015. As we reported in our 2015 Industrial Metal Cutting Outlook, forecasts for steel demand are positive, but growth rates will not be as strong as they were in 2014. According to the Short Range Outlook 2014-2015 from the World Steel Association (worldsteel), U.S. steel demand is expected to increase by 1.9% in 2015—much lower than the 6% growth the U.S. experienced in 2014. Globally, worldsteel forecasts that global apparent steel use will increase by 2.0% this year.
Many industry leaders are also fairly optimistic about this year. In a mid-February statement announcing its 2014 financial results, Reliance Steel & Aluminum Co. said that it expects the U.S. economy to continue to improve throughout 2015. The Los Angeles, CA-based service center believes high levels of metal being imported into the U.S. will continue given the strong U.S. dollar and weaker economies in other parts of the world, which will continue to put downward pressure on steel prices. In addition, due to normal seasonal trends and an improving demand environment, Reliance expects higher tons sold in the first quarter of 2015 versus the fourth quarter of 2014, but lower average selling prices and margins.
Of course, no one really knows how this year is going to shake out. Perhaps the greatest gauge for how metal service centers might fare in 2015 is to look at segment forecasts. Below are outlooks for three OEM categories that will likely play a large role in determining demand in 2015:
- Automotive. In 2014, the automotive industry registered gains it hasn’t seen since 2006, and growth is expected to continue in 2015. According to an April 1 from manufacturing.net, auto sales are on track to reach 17 million this year, their best performance since 2005. Low interest rates, low gas prices, the improving economy, and new models will all drive growth, the report says. In addition, the material war between steel and aluminum will likely continue in 2015 as automotive companies seek ways to meet federal emission standards.
- Non-residential construction. Metal Center News recently reported that non-residential construction—one of the steel industry’s biggest markets—is expected to finally register some growth in 2015. While this market has been slow to respond to the improving economy, the report states that the American Institute of Architects predicts an 8.1% increase in non-residential construction this year, driven by double-digit increases in commercial construction. Healthy gains are also expected in institutional projects such as schools and health care facilities. You can download the full Metal Center News forecast report here.
- Energy. The energy sector will likely receive the most attention in 2015. While steel demand from energy companies has been growing at a fast pace, some experts believe the sector’s steel demand could be subdued in 2015. “Globally, higher crude oil prices drove a lot of energy companies to invest in shale formations,” states one analysis from Market Realist. “However, lower crude oil prices dampened the mood among energy exploration companies.” Low oil prices may also have larger effects on the industry, including decreased steel prices and increased U.S. steel imports. To read more about the impact crude oil pricing may have on the steel industry, check out Modern Metals February cover story, “Brooding Over Crude.”
Metal Service Centers
March 5, 2015 / blade selection, bottlenecks, circular sawing, Cost Management, cost per cut, LIT, operator training, preventative maintenance, productivity, quality
In today’s fast-paced paced and competitive market, the main objective for most service centers is optimization. While getting orders out the door is always a priority, leading companies know that speed isn’t everything. In fact, running a circular saw too fast can lead to shorter blade life, unexpected downtime, and even poor quality and rework, all of which decrease a cutting operation’s overall productivity.
Optimization requires managers to weigh short-term factors such as cutting speed against longer-term factors such as blade life, maintenance, and cost. Of course, this challenge is easier said than done. As this article from Canadian Metalworking points out, the overall performance of your cutting tool depends on a variety of factors, including speed, feed, depth of cut, and the material being cut.
To help service centers optimize their precision circular sawing operations, the LENOX Institute of Technology (LIT) compiled a series of charts that describe some of the common cutting challenges operators face and possible solutions.
The following are LIT’s tips and tricks for keeping your circular sawing operation running at peak efficiency:
For more information on optimizing your precision circular sawing operation, including best practices, white papers, and case studies, check out LIT’s resource center here.
Metal Service Centers
February 5, 2015 / benchmarking, industry news, LIT, operator training, quality, Safety, skills gap, strategic planning
Based on recent data, the metal service center industry entered 2015 on the right foot. According the latest Metals Activity Report from the Metals Service Center Institute (MSCI), U.S. service center shipments of both steel and aluminum were higher in December 2014 than in the prior year. In addition, year-to-date U.S. steel shipments were higher than 2013 by 4.2% while year-to-date U.S. aluminum shipments were up 8.1% year over year. Canadian results for December 2014 and for the year were similar.
All of that good news falls in line with most industry forecasts. As we reported here, industry trade publication Modern Metals says the outlook for 2015 is mostly positive. However, the magazine also warns that “competition, domestic and foreign, is always the overriding force that determines whether volume, price and demand forecasts are in balance.”
Indeed, even with positive expectations, service centers need to be aware of some of the potential challenges they will face and, even more so, start finding ways to be prepared. Earlier this month, MSCI President and CEO M. Robert Weidner III discussed the top trends challenging the metals industry in his State of the Industry address. Below are the three of the five challenges that he outlined, as reported by thefabricator.com (you can read the full coverage here.):
- Market Intelligence – Volatile markets and increasing competition have heightened the need for trustworthy data and analysis tools, as well as the need for cybersecurity resources and training to secure market intelligence.
- Business Disruption – World events have an even bigger impact on local economies than before, creating a need for topic- and area-specific experts and information and enhanced vehicles and technology to provide information.
- Congressional Gridlock – U.S. partisan politics have stalled action in the legislative branch, often resulting in extreme actions through regulators that have impeded manufacturing growth. It’s imperative to continue to advocate on behalf of the metals industry in the U.S. and Canada for pro-business agenda.
In his last two points, Weidner stressed the importance of employee safety and ongoing training as a means of attracting and maintaining workers. Investing in areas like safety and education shows employees that you value them, which only encourages them to invest right back into the company. In addition, LENOX Institute of Technology’s benchmark survey of industrial metal-cutting companies provides evidence that investing in areas like training can provide additional benefits, including better quality, faster on-time customer delivery, higher revenue per operator, and lower rework costs. In other words, it’s a win-win for everyone.
Only time will tell if industry performance plays out the way everyone expects. After all, forecasts are really only educated guesses. However, managers need to be sure they remain aware of trends like those outlined by Weidner so they can make informed decisions and be as prepared as possible for whatever 2015 brings.
Metal Service Centers
January 5, 2015 / best practices, blade failure, Cost Management, cost per cut, Employee Morale, LIT, productivity, quality, resource allocation, ROI, Safety, strategic planning
If your metal service center is doing its part to ensure proper coolant management, then you are fully aware that it is not as simple as it seems. From choosing the right coolant to proper fluid prep and monitoring, getting the most out of your metal-cutting fluids takes time and effort, but it is well worth the investment.
Cut quality, productivity, and cost savings are all major reasons your service center should continue to make coolant management a priority. Case in point: As this white paper explains, low coolant levels on a band saw can lead to premature and uneven wear of band wheels, which can cost $1,000 each. Poor fluid management can have negative effects on circular saws as well, causing blade problems such as excessive edge chipping and tooth damage. (You can read more about that here.)
Really, any informed manager can typically accept the ROI argument for most areas of coolant management, except maybe when it comes to disposal. In today’s environmentally conscious world, coolant waste disposal can get expensive (up to $0.50 a gallon), and if you are a larger service center, this adds up fast.
For this reason alone, more and more manufacturers are investing in in-house coolant recycling. Some experts claim that coolant recycling can cut coolant waste disposal costs by up to 90 percent, and according to an archived article from Manufacturing Engineering magazine, tool life can also be significantly extended—from 25 percent up to 209 percent—with effective coolant recycling equipment.
In a recent article from Canadian Metalworking, Tom Tripepi, technical director for the fluid filtration division of PRAB, discusses some of the advantages of in-house coolant recycling. Below are a few highlights from the article:
- Some coolants are easier to recycle than others. “The tighter the emulsion, the easier it is to filter out the impurities without affecting the coolant,” Tripepi states in the article.
- Consider getting a coolant recycling system with an automatic proportionating system. This feature will tell you when coolant levels drop and if it is the correct concentration. “That process itself can probably save 10 to 20 percent in new coolant purchases, just because it’s giving you control over how you’re mixing your coolant,” Tripepi says.
- Smaller shops can benefit from coolant recycling, too. “We’ve got shops where we’ve sold recycling stations that have as few as four machines,” Tripepi tells Canadian Metalworking. “A typical machine shop that is looking at recycling their coolant will probably have somewhere between 15 and 20 machines, and from there on up to the larger shops with 80 to 100 machines or more.”
- There are benefits to coolant recycling that go beyond cost. These include health benefits such as improved air quality and a common skin condition called dermatitis. “Not all operators wear gloves, and they will be pulling parts in and out of a machine,” Tripepi notes. “By eliminating the bacteria, you can eliminate the dermatitis.”
To read about some metal-cutting companies that have reaped the benefits of coolant recycling, check out these case studies. SME also offers technical papers that discuss more recycling best practices as well as a review of the different types of recycling technologies.
Metal Service Centers
December 5, 2014 / best practices, Employee Morale, human capital, maintaining talent, operator training, resource allocation, skills gap, strategic planning
Metal service centers, just like every other segment of the manufacturing industry, are facing a huge challenge that is only going to intensify in the years to come. That challenge is the skills gap, and if you aren’t facing this issue head on just yet, you will be soon.
As stated in a previous blog post, skilled production workers are one of the largest workforce segments facing retirement in the near future, which will have an impact on the number of experienced workers on the shop floor. Meanwhile, the next generation of workers just isn’t interested in pursuing manufacturing careers. Large corporations like GE are trying to change that, but shifting cultural perception isn’t something that happens overnight. This is leaving manufacturers with a small pool of talent from which to choose.
Many experts believe that actively attacking the skills gap will require managers to adjust the ways they both hire and maintain talent. While larger company goals and expectations should never be compromised, part of the solution will be for your service center to adapt to a new generation of operators. In other words, it will serve you better to embrace—not fight—the generational traits of Millennial workers, which includes taking into account their upbringing, their strengths, and their weaknesses.
What are some of these traits? In a recent article published in Forward magazine, Neil Howe, president of consulting firm LifeCourse Associates, provides a few attitudes and behaviors that define Millennials:
- They feel special and have been sheltered.
- They want to be mentored.
- They are team-oriented.
- They want a “mainstream” job.
- They feel pressured.
- They are achievement-oriented.
According to Howe, companies need to re-brand their operations with these tendencies in mind if they want to attract a new generation of operators. For example, Howe says managers should focus on creating teamwork-oriented activities—a tactic that fits well within the premise of lean manufacturing. “Give Millennials shared responsibilities, the chance to learn from peers, and let them collaborate on design and production work,” Howe suggests.
These types of strategies, combined with community efforts such as plant tours and working with local universities, will not only help your service center close the skills gap, but just as importantly, prepare you for a next-generation of customers as well.