Plant Tour: NEW BALANCE
Plant Tour: New Balance December 4, 2018
The New England Lean Consortium was fortunate to take a tour of one of America’s icons, New Balance, on Tuesday, December 4th. The NELC is not so naïve as to think that all of the best practices in Lean reside in the members of the NELC. From time to time we visit companies that are recognized for their outstanding Lean programs and that are well down the road in Lean.
New Balance in Lawrence, MA is one of those companies.
The company website: newbalance.com
From Wikipedia: New Balance - Wikipedia In 1906, William J. Riley, British emigrant, founded the New Balance Arch Support Company in the Boston area, manufacturing arch supports and other accessories designed to improve shoe fit. His first product, a flexible arch support, was designed with three support points to provide greater balance and comfort in the shoe.
It is believed that Riley came up with the name "New Balance" by observing chickens in his yard and demonstrated the way his arch supports worked by keeping a chicken foot on his office desk. He explained to customers that the chicken's three-pronged foot resulted in perfect balance. In 1927, Riley hired Arthur Hall to be a salesman. In 1934, Hall became a business partner and found his niche by marketing to people whose jobs required them to spend a lot of time standing. In 1956, Hall sold the business to his daughter Eleanor and her husband Paul Kidd.
Eleanor and Paul Kidd continued to sell mainly arch supports until 1960, when they designed and manufactured the "Trackster", the world's first running shoe made with a ripple sole. It was also the first running shoe to come in varying widths. The "Trackster" was given a big boost through the YMCA programs in which it became the unofficial shoe. College track teams such as Massachusetts Institute of Technology (MIT), Tufts University and Boston University adopted the New Balance Trackster for their cross-country teams, soon to be followed by other colleges and private high schools around the country.
Marketing was mostly word-of-mouth or local sports fairs. Sales languished until 1972, when current Chairman Jim Davis bought the company on the day of that year's Boston Marathon. At the time, the company consisted of six people making 30 pairs of shoes daily and selling products mostly through mail-order with a few U.S. retailers. Jim committed himself to uphold the company's traditional commitment to individual preferences, customer service and quality products. His future wife Anne, who joined the company in 1978, focused on building a distinct culture for New Balance employees and customers. Their timing was perfect, as the Boston area became a center for the running boom that struck the U.S. in the 1970s.
Their product line expanded and sales grew rapidly once the shoes made its way to Washington, DC in the late 1970s and early 1980s. It was at this time that the shoe became a staple in shoe stores sold around the city for track runners and Moes alike. The company prospered, and the Davises looked to expand New Balance into a global company. The company is now run by Rob DeMartini. DeMartini's background includes Procter & Gamble and Gillette Shave Company. Today, 30 percent of the New Balance shoes sold in the European market are manufactured at the New Balance facility in Flimby, England.
Today, the manufacturing facility in Lawrence is a shining example of a very successful Lean implementation. Manufacturing is separated into three distinct value streams: High Volume, Baseball and Custom shoes. Within each Value Streams are cells. Each cell operates on a TAKT time. Production goals are set for each hour and the full day based on those TAKT times. Andon lights are activated when production falls behind goals. Upon a red andon light, an escalation policy is activated, and group problem solving takes place to solve the immediate problem.
Recognizing that Lean is based on Henry Ford’s assembly line, which, in my opinion is the most efficient way to produce a product or deliver a service, it was most satisfying to see the cells operate on a “make one, move one” basis. In order to keep the cells producing at maximum output, there is a significant amount of work that goes into line balancing. In addition, due to the high mix, low volume nature of the business, there is a significant amount of operator training in jobs within the cells. Worker flexibility is a must in this type of manufacturing.
It is a credit to New Balance to recognize the benefits of Lean to remain competitive, if not, be the leader in a very competitive business.