For die-hard muscle car and racing enthusiasts, factory-installed exhausts just won’t cut it. Many are turning to custom-built aftermarket parts for that extra performance, special look, feel, and sound.
One-off manufacturing is time consuming and costly; and while other suppliers were sacrificing quality and inflating prices, Martin & Ginger Barkey (MBRP) continued to provide the industry with high-performance - yet affordable exhaust systems. From its humble beginnings, MBRP has grown into a brand synonymous with quality, selection, and value. And today, the company has its sights set on becoming North America’s leading supplier of aftermarket exhaust systems.
MBRP’s rising popularity exposed production inefficiencies as supply was unable to keep pace with demand. To further complicate matters, the company’s remote location presented a labor shortage that forced pipe cutting operations to be outsourced. Extending the supply chain added time and shipping costs while threatening the responsiveness and pricing needed to achieve financial goals.
With growth comes growing pains and the need to become lean and efficient. While MBRP founders were well versed in the industry, taking the company to the next level required the expertise of seasoned business professionals. And so, when the company hired Edward Henderson, CPA as CFO to help improve the bottom line, steps were taken to become more productive and more profitable.
While MBRP had been pursuing improvement goals in such areas as safety, quality, leadership, management, and engagement, Henderson, knew that hitting these and aggressive fiscal targets would hinge on the ability to make significant improvements to the manufacturing process. Any solution would begin with acquiring reliable and timely performance data from the shop floor, information which was not easily available.
“The company was understaffed, equipment underutilized, and production simply wasn’t keeping pace with sales,” Henderson explained. “Consequently, we were experiencing a growing backlog of past-due orders. When I learned of plans to invest $3 million in new equipment and probably a second production site, I asked: Where are we going to put it and who’s going to run it? We needed production data to show where we were in terms of throughput and getting volume out of the factory - and we needed it quickly.”
Almost immediately Henderson recognized the absence of quantifiable metrics needed to measure productivity against key performance indicators. Without actionable data achieving the company’s goals (such as increasing productivity and labor efficiency by 10%) would be nearly impossible to measure and validate.
The company’s Director of Manufacturing, Dave Hicks agreed that business as usual was no longer an option. “It’s safe to say that when it came to automation, we were old school,” admitted Hicks. “In the past production goals were hand-written and communicated down the line. From a productivity standpoint, we literally had no visibility into what was happening or reliable way to accurately measure performance or equipment downtime. Consequently, we were manually counting, recording, and drawing conclusions from data that was often subject to interpretation or incomplete.”
We consider Worximity to be an investment rather than an expense. The software is quick to deploy and easily integrates with our legacy equipment. This all adds up to a quantifiable and continuous return on investment.
Henderson had previous experience with Worximity's OEE tracking software and had seen how it removes subjectivity by providing data-driven insights to support key production decisions. And so, the software was put to work benchmarking current levels of manufacturing productivity. Henderson was confident that in less than three months he would have his payback and the data to justify wider implementation as well as cancel planned equipment purchases. In the end, it took only a single month to validate this belief.
Five pieces of equipment were identified as responsible for bottlenecks. Within a week Worximity software was installed on the machines to collect and analyze operating data. Less than ten days later MBRP was validating data and real-time production performance was being observed by supervisors and team leaders. In this way, operators could access data on the shop floor via tablets and knew exactly where they stood in relation to production goals at any given moment. With the ability to definitively track operator-level performance, Henderson also introduced an incentive-based compensation program to reward top performers.
“The system lets us know if we’re falling behind production targets,” explained Hicks. “This allows us to respond more quickly and decisively to changing conditions on the floor. Now our team leaders can recognize when somebody might be struggling, or a piece of equipment isn’t functioning properly, and can correct the issue. This visibility allows us to identify when there's a concern and ask: What’s going on? How can I help you? Is maintenance needed? Do we have a quality issue?”
To guarantee company-wide adoption and smooth implementation, Henderson started with an all-hands meeting aimed at addressing employee concerns. From there, improvements were made to the layout of the shop floor by Kaizen involving employees which immediately gained efficiencies and opened the door to more change.
Maximizing equipment and labor productivity has allowed MBRP to bring pipe cutting back inhouse eliminating $600,000 of additional expenses. With improved manufacturing productivity MBRP is keeping pace with higher sales volume without additional headcount. The results are cost savings, accelerated production, and even greater profitability.
Thanks to Worximity, shop floor operators are more responsive and better equipped to achieve the company’s higher productivity standards. In less than a year, significant improvements were documented in efficiency and machine availability. These gains raised the company’s overall equipment effectiveness (OEE) from 55% to 80% on critical production bottleneck equipment.
One short year after implementation sales have doubled and market share has grown while capital equipment investments have been minimized, driving the EBITDA noticeably higher as a percentage of total revenues. What’s more, MBRP has used historical data to set targets which are being displayed on monitors strategically placed throughout the production floor.
“MBRP is really a model client when it comes to employing our software. The success they were able to achieve is extraordinary,” explained Guillaume Ducharme, Operational Excellence Director at Worximity. “But it’s important to recognize that their success isn’t just attributable to our solution. Edward didn’t cut corners when it came to ensuring his staff was well trained and that the opportunities the software presented were employed through regular check-ins with us and the team. At the end of the day, it’s all about how a client ensures adoption throughout the company, and MBRP did it impeccably.”
By listening to the frustrations of the workforce, aligning goals and objectives across the organization, and tying compensation to performance, Henderson was successful in ensuring everyone from operators, supervisors, and team leads were maximizing the potential of Worximity’s solution.
“We consider Worximity to be an investment rather than an expense,” added Henderson. “The software is quick to deploy and easily integrates with our legacy equipment. This all adds up to a quantifiable and continuous return on investment.”
With the purpose of further increasing throughput, the software has been expanded to six welding lines. And heightened operational efficiency is opening new markets such as high-performance exhaust systems for ATVs and compact sports cars for Ford, Volkswagen and higher-end vehicles like Audis, BMWs, and Infinitis. Needless to say, Worximity will continue to play a supporting role in the company’s continuous improvement and growth initiatives as MBRP develops and produces for new market opportunities.