From the Gateway:

“In the March 2019 issue of The Gateway, we ran a reprint article on Hobson & Motzer originally published 2007. It was a look back on this great Connecticut manufacturing company who has been a fixture in the state since opening in 1912. In this issue, we check-in on what Hobson & Motzer has been up to over the past decade or so. A lot has happened since 2007, but in the most simplest of terms – Growth!”

Download the PDF of this issue of The Gateway here.

Hobson Motzer, Inc. established in 1912 and now based in Durham, Connecticut, frequently tackles projects that other companies can’t handle. Hobson develops sophisticated manufacturing processes and designs tooling to produce precision metal stampings for companies worldwide.

After the September 11 terrorist attacks, Becton, Dickinson and Co. (BD), of Franklin Lakes, New Jersey, the world’s largest manufacturer of hypodermic needles, asking Hobson to quickly produce millions of delicate needles for the smallpox vaccine. Smallpox was finally eradicated in 1979, and the smallpox needle – three inches long with at tip that flattens into two tiny pitchfork-like prongs – ceased production. But with new worries over global terrorism, these needles were once again urgently needed, as well as a cheap, efficient way for the vaccine to be administered by minimally trained workers. BD dispatched a team armed with photos of smallpox victims, detailed drawings of needles and design specifications to brief a dozen Hobson professionals.

Figuring out how to produce millions of these delicate needles on short notice was the challenge of a lifetime for Hobson, while had to transform its metrology inspection process to meet the huge demand. Hobson had always used optical comparators or toolmaker’s microscopes for manual noncontact inspections.

The Hobson team began working 12-hours shifts around the clock. It designed a system that quickly turned out perfect needles by the millions. Hobson’s sophisticated manufacturing techniques require micron precision and the ability to measure increasingly complex characteristics of objects. The inspection metrology had to be noncontact because of the product’s delicacy and was required over high volumes. Hobson ran three manufacturing machines 24 hours a day. It became increasingly difficult to keep up with production volumes using normal toolmaker’s microscopes because of the huge number of parts requiring inspection.

To solve this problem, Hobson selected Nikon Instruments’ Nexiv VMR CNC video measuring system, which reduced a 15-minute manual inspection down to four minutes, freeing the inspector to perform visual inspections in parallel with the automated inspection. “The system was a huge first for us,” says Frank Dworak, president of Hobson Motzer. “Previously, we had used either optical comparators or toolmaker’s measuring microscopes to inspect products.” Nikon’s laser inspection system represents the ultimate in high-precision vision-based measuring.

The system features a 15:1 zoom ration yielding a wider field of view and higher resolution, a programmable LED illuminator and patented probes for easier edge detection. The system’s advanced progressive scan camera provides rapid image acquisition and increased system speed. With enhanced X-Y measurement capabilities, the U2-compliant system delivers precise and reliable readings. Finally, Nikon software offers offline programming and easy-to-use programming wizards. The Nexiv system ensures faster first-piece inspections and faster in-process inspections.

“Nothing here is ordinary,” says Jim O’Brien, vice president of operations for Hobson Motzer. “Our customers demand extremely high quality. We can only work as close as we can measure.”

Conducting gage repeatability and reproducibility (GR&R) testing with the noncontact laser inspection system delivers more consistent measurements on the machine vs. measurements recorded by numerous operators using toolmaker’s microscopes. The result was a huge improvement in GR&R quality values for Hobson.

“As Hobson grew their medical stampings business, the quality requirements demanded by their customers also grew,” said Mike Metzger, general manager, Nikon Instruments. “The system provided Hobson faster, more consistent quality data, and enabled them to meet the incredible manufacturing challenges posed by Becton, Dickinson.”

Hobson uses the same automated inspection technology for a variety of precision metal components, conducting edge and flatness checks and developing statistical capability studies so the company can inspect larger volumes of product. By implementing state-of-the-art laser inspection technology, Hobson has achieved consistent quality, streamlined the shop floor and attained new levels of innovation, making it possible to purse new mission-critical manufacturing opportunities well into the future.

LEAN MANUFACTURING SLOWLY ADOPTED BY INCREASINGLY COST-CONSCIOUS COMPANIES

Manufacturers everywhere have long looked to lean manufacturing tools to help them build higher-quality products more quickly at lower costs. Reducing inventory and lead times are just some of the benefits that comes from lean initiatives. But even sectors such as automotive and industrial have widely embraced lean, the orthopedic industry has made some but not significant inroads into the lean world, according to companies interviewed by Orthopedic Design & Technology.

However, that may change in the future, as some of the industry’s largest manufacturers look to cut costs. With reimbursement steadily declining and margins shrinking, manufacturers are forced to re-examine their cost structure. And to gain efficiencies, lean may be the answer for some.

Lean by Piecemeal

While a number of orthopedic product manufacturers say they have implemented lean tools, some of them lack a formal program or have tried to adopt it in piecemeal fashion. Others readily admit that few customers have demanded they become lean organizations; instead, buyers only want to be assured that quality products are delivered on time and at the right price. Still others point to the fact that unlike the automotive industry, where lean and Six Sigma programs initially began, the orthopedic product industry produces much lower volumes and would see fewer benefits from lean initiatives. Universally, though, medical manufacturers agree the industry is years behind those sectors in the adoption of lean.

“Probably every supplier will tell you the do kanban and JIT (just-in-time manufacturing). In reality, the level of understanding is very minimal,” said Francisco Santiago, the shared services director for Stryker Endoscopy and Instruments in Arroyo, Puerto Rico. Santiago, who helped initiate lean efforts in the plant some four years ago, lamented that one of the difficulties that his operations initially faced was inconsistent compliance by suppliers. Communication problems, inadequate understanding of lean requirements by suppliers and other challenges were encountered along the way. However, he also acknowledged, some of those suppliers are becoming more adept at meeting customers’ lean requirements.

Varying Definition

Ask 50 manufacturing engineers the definition of lean and you might get 50 different answers. Survey 50 companies implementing lean programs and chances are they have all taken different approaches. That’s because while the lean concept is well established, implementation among practitioners varies significantly.

Generally, lean is a systematic approach to identifying and elimination waste trough continuous process improvements. There are many components and tools, and companies don’t embrace all of them uniformly.

Also, different manufacturers have different needs from lean. Some pursue it to improve on-time delivery, others look to it for inventory reduction and still others want quality improvements. Whatever the need, lean is described by many as a change in company culture and not just the adoption of tools.

“Lean is not a tool but a way of thinking,” said Larry Cote, president and CEO of Ottawa, Canada-based Lean Advisors, Inc., a consulting group that has provided services to companies such as Medtronic. He said uninitiated manufacturers often confuse lean as a discrete program or tool when it’s really a way of life for manufacturers.

Making this distinction is critical to the success of any program, he said, because management needs to recognize that lean programs have no end point and final result. Often, companies are required to devote significant resources-in man hours, capital and consulting fees-to effectively implement lean. Furthermore, management must be committed to it once they begin, otherwise their efforts may yield minimal rewards, Cote added.

Worth the Effort?

While adopting lean may seem like a monumental effort, those who have pursued it say the rewards are worth the effort. Measured in lead time, inventory turns or worker productivity, the payoff can be huge for any operation. According to Cote, a well executed lean program should lead to a reduction in inventory, lead time and errors by at least 50%.

“If you’re not getting that kind of result, you should re-examine how you are doing it,” he said. “You may be applying a tool and not a culture.”

Indeed, some orthopedic manufacturers report significant increases in efficiencies shortly after implementing lean. Take Warsaw, IN-based Symmetry Othy, for instance. This surgical instrument division of Symmetry Medical estimates that its five plants in the division are at various stages of lean implementation, with some facilities at less than 40% complete and others as high as 80%. On average, said Alec McPherson, general manager and VP of instruments, the roll out of lean is about 50% complete.

McPherson said the division has invested in a number of tools, including cellular workspace, just-in-time (JIT) manufacturing and Single Minute Exchange of Die (SMED). A trained master black belt in six sigma, McPherson said the division has trained a number of employees in lean techniques. Its most important program, he added, is the adoption of a 5S program.

He said embracing lean was no small task; it required a culture change and the commitment of workers at all levels, from shop technicians to management. He said while customers don’t especially care if Symmetry has adopted lean, they are the beneficiaries.

“I’d say our lead times are one-third to half less. Inventory turns are 10-20% better so inventory dollars are down,” he added. “I’d like to think what we offer our customers are lead time and flexibility. And our costs have come down significantly from what we quoted three years ago.”

The lean discipline also helps some companies lower their labor costs. Bill Loucks, the general manager of the Electrolizing Corp. of OHIO, a metal finishing provider, said he began implementing lean a little more than three years ago. With revenues up 70% during that period, the company was able to maintain the same headcount. At the same time, the Electrolizing Corp. was able to improve quality and lead times.

He partially credits marketing pressures for making the company consider lean.

“We wanted our parts faster. We had our customers pushing us,’ he recalled. “We said we have to figure out how to do it.”
How much a facility can benefit from lean also depends on how dedicated and how long it has engaged in lean. While it is supposed to be a continuous process, some of the improvements are one-time occurrences, said Any Vandermotten, director of operations at orthopedic implant manufacturer Paragon Medical in Pierceton, IN. The company began its lean implementation about two years ago and is using it to take out costs and improve satisfaction for its OE customers.

In the beginning, “you hit low-hanging fruits that have an immediate impact,” he said. “As you move further down the line, it’s more than that instant gratification to more of customer satisfaction.”

While not all OEMs are demanding vendors adopt lean, some are doing so voluntarily because they see the benefits and the impact on customers. For others, it’s a matter of survival. Les Hyatt, director of sales and marketing for Durham, CT-based Hobson Motzer, a precision metal stamping supplier, said one major customer threatened to pull its business if the company could not lower its prices. As a result, Hobson and Motzer implemented lean manufacturing to cut costs to maintain margins.

“Why do we do it? There are two things going on in the marketplace: there are suppliers increasing raw material prices, and we have customers wanting price reduction,” he said.

In some instances, though, vendors are only required to comply with the customer’s kanban procurement scheme and asked to carry inventory on their behalf. Some vendors receive blank orders and fill them accordingly. Some are engaged in vendor-managed inventory as OEMs entrust more of their operations to suppliers. In opening their books and sharing forecasts, some orthopedic product manufacturers adopting lean or just-in-time manufacturing have come to rely on suppliers to make their program work.

Because some vendors lack resources to implement their own lean initiatives-especially smaller companies-a few OEMs have taken on the role of mentor. Stryker’s Santiago said his plant utilized a vendor management team to help its top 10 vendors to understand and meet the company’s expectations. Some of those suppliers were already immersed in a lean culture while others had a tougher time meeting Stryker’s needs.

“It could be as simple as not looking at the kanban,” he pointed out, noting that some vendors failed to realize that each month had a different number of production days.

Indeed, keeping up with customers adopting lean has become a significant challenge for some service providers, but with the industry more widely embracing the discipline-lead by OEMs such as DePuy and Stryker-complying might not be a choice in the near future.

Just as the automotive, telecom and other industries have transitioned into a lean environment, the orthopedic industry may very well be facing the same path. As reimbursement rates fall and raw material costs rise, manufacturers will come under increasing margin pressures. But adopting lean will have its challenges, Symmetry’s McPherson pointed out, because it requires a change of mentality.

“Obviously this whole lean initiatives is where we (the industry) need to be, so why isn’t it a no-brainer?” he questioned. “Because we have always done things the old way.”

COMMON LEAN MANUFACTURING TERMINOLOGY

• SS (of housekeeping): A set of Japanese terms for describing optimal production housekeeping. These include: Seiri (Sort), Seiton (straighten); Seiso (shine); Seiketsu (Standardize); and Shitsuke (sustain). This discipline is aimed at reducing clutter and improving organization.
• Cellular Manufacturing: A system in which manufacturing is focused on work cells that make a specific product or a narrow range of related products. Cellular workflows reduce the distance in which components or products travel throughout the plant.
• JIT Manufacturering: Just-in-time manufacturing. An approach that eliminates inventory and waste.
• Kaizen: A Japanese term for continuous improvement
• Kanban: A Japanese term that describes an inventory scheme in which parts are delivered to the production floor only when needed. The benefits are minimal inventory on the shop floor, eliminating confusion and the need for warehousing unused components.
• Toyota Production System (TPS): This was the model for lean manufacturing schemes, stemming from the factories of Toyota. The company is recognized globally as the originator of lean. 
• Value Stream Mapping: A visual process in which companies identify steps in their manufacturing processes that add value to products. All other time is considered waste. A typical company before adopting lean may add value no more than 3% of the time.