April 3, 2020

Hansen Plastics Turns to Sticky Notes to Get More Efficient


“After several years of increased sales, Hansen Plastics Corp. in Elgin, Ill., decided they weren’t getting enough profit out of the new sales. So the company decided to do a deep dive into lean manufacturing. We go inside the injection molder to find out how it completely changed its company culture.”

Listen to the Plastic News Radio podcast here: https://www.plasticsnews.com/article/20170925/MULTIMEDIA03/170929936/hansen-plastics-turns-to-sticky-notes-to-get-more-efficient

Or read the full transcription below.

Jeremy Carroll (Presenter):
Ken Knight has seen a lot in his 31 years at Hansen Plastics Corporation. The process engineer has seen customers come and go, bosses come and go, whole plants come and go. He even became an owner of the company along the way. Hansen became 100% employee owned in the 1990s. But none of those changes, not the plant, not the bosses, not the customers compare to the last couple of years.

Ken Knight:
In the last couple of years things have changed unbelievably. That would be the best way to describe it.

Jeremy Carroll:
Business had been good at Hansen. Sales went from about 11 million dollars a year in 2007 to about 30 million a year five years later. But leadership at the company thought they weren’t getting enough profit out of that revenue. That’s when CEO Roy Lilly saw Lean Manufacturing expert Paul Acres speak.

Roy Lilly:
The guy just floored me, you know? The common sense simple approach that he takes to Lean is just like, I mean it’s just so simple that anyone can do it. Anyone can achieve it and after his presentation we got the books and we read the books. The books are easy to read, they really are. And it was man, why in the heck aren’t we doing this? So we started in the bathrooms just like Paul said we should do.

Transition Music

Jeremy Carroll:
The bathrooms, we’ll get to those bathrooms in a bit. Welcome to Plastics News Radio, I’m Jeremy Carroll. Today on the show, how a 46-year-old injection molder completely changed its culture one sticky note at a time.

Commercial begins with music

Commercial Presenter:
This episode of Plastics News Radio is brought to you by the 2018 Best Places to Work in the Plastics Industry. Nominations are now open for the award program that honors the best employers in the plastics industry. The deadline to submit your company for consideration is October 20th. For more information or to register, visit bestplacestoworkplastics.com. That’s bestplacestoworkplastics.com.

Cut Scene begins (metal sounds and muffled speaking)

Jeremy Carroll:
Morning!

Woman:
Morning!

Jeremy Carroll:
I’m Jeremy

Woman:
Oh, hi!

Jeremy Carroll:
I visited Hansen back in May during an event with the manufacturer’s association for plastics processors. The company’s in Elgin, Illinois a western suburb of Chicago. Hansen’s plant is nestled in an industrial park with several new buildings, it’s gorgeous. Everything looks brand new. About 60 executives from across the country came to tour the plant and learned how they went from a normal plastics company processor to one that uses Lean Manufacturing.

Tim Bayer:
And we truly started in the bathroom.

Jeremy Carroll:
Ah, yes, the bathroom. I told you we’d get back to that. That’s Tim Bayer, Hansen’s president. Job one of becoming more efficient is getting rid of the janitorial staff for the bathrooms. Instead, each and every employee takes turns cleaning them.

Tim Bayer:
In Paul’s book it starts in the bathroom. In the bathroom one thing is that you’re going to make it lean because you don’t want to clean the bathroom. You don’t want to spend hours in there so you’re going to make sure it’s clean and ready to go. Also, that helps with our core values. Humility’s one of our core values, so I don’t ask anybody on the floor to do something I’m not willing to do. I clean the bathrooms, Roy cleans the bathrooms, everybody takes a turn cleaning the bathrooms. Client, office all of them.

Jeremy Carroll:
The whole idea behind the Two Second Lean Concept is finding little things, tiny things really that makes the job easier and faster. Like, two seconds faster. Here’s an example of an early easy one from Robert Sandeen, a process engineer.

Robert (Sandeen):
Originally we went around and said, well we think we need garbage cans in these areas and we placed them there. Then every day we would come in and they wouldn’t be in the spot that we placed them. We would ask him, “Why don’t you put it back?”. Well, then we found out they were just moving them to where they needed them so we changed the spot from where we thought it should be to the spot that they needed them at. That was when it just really started to click. You’ve got to start thinking about what works for them, not what some strategic plan that seems to make sense. We had them spread out equally through the plant. Well it turns out that three of them were right next to each other but that’s just kind of where they needed them to be.

Jeremy Carroll:
So Hansen completely transformed how it did business. It broke the business up into three different groupings, they call them value streams. One steam consists of jobs that always stay the same. The same machine is pumping out the same part for the same customer, all day every day The second stream has more change over in terms of what’s being molded on what machine but the schedule stays pretty regular. The final stream is all the odds and end jobs. Each one of those segments has a value steam leader who runs a meeting with staff every morning to go over what’s happening for the day and how they’re performing.

Ken Knight:
It took quite a while for the buy in, like I said I’ve been here 31 years already. I’m the type of person who says okay, if we want to try this I’m more than willing to give it a try. One of my first questions to Tim was, “How long is this going to be around?”. Then the way it was presented to me was, it’s not going to be around, it’s a journey that we’re on. Then as I saw that and it kept moving I got the buy in real quick. It took a little while for some of the people out on the floor. The more we had meetings and then once we moved into the new facility and we broke up into value streams and especially once we started the daily huddles for each value stream. Then with the improvements to where we tried to get all the operators, material handlers, everyone engaged. That’s when I think we started to get a really big buy in. That’s when the light bulb went on and they realized that it’s more than a job and their opinions do matter.

Jeremy Carroll:
That’s process engineer Ken Knight. That last point about getting the material handlers and operators engaged, that was absolutely critical to the success of the process. And how they did it, was with sticky notes. Lots and lots of sticky notes. You guys, I’m not kidding. There are sticky notes everywhere.

Jeremy Carroll:
By the way, you guys must spend a ton of money on sticky notes (laugh).

Robert Sandeen:
(laugh) Right? (continues to laugh)
You gotta get the super sticky ones though.

Jeremy Carroll:
(laughs) Yeah.

Jeremy Carroll:
And we’re laughing there but it’s true, there are sticky notes all over Hansen’s and they’re full of ideas. Operators, material handlers, process engineers, the CEO, everyone. You have an idea for a two second improvement you put it on a sticky and you put it on the board. Each value stream has its own big board. Are there obstacles in the way? Put it on a sticky and put it on the board. Has it been implemented? Put it on a sticky and put it on the board. You get the idea. This is a completely different way to operate an injection molding plant and not everyone was on board. How the staff reacted, after the break.

Commercial begins with music

Commercial Presenter:
This episode of Plastics News Radio is brought to you by the 2018 Best Places to Work in the Plastics Industry. Nominations are now open for the award program that honors the best employers in the plastics industry. The deadline to submit your company for consideration is October 20th. For more information or to register, visit bestplacestoworkplastics.com. That’s bestplacestoworkplastics.com.

Jeremy Carroll:
And it sounded like there was probably a little bit of growing pains at first

Roy Lilly:
Absolutely, absolutely.

Jeremy Carroll:
You guys lost a handful of employees that said “You guys, this isn’t for us”.

Roy Lilly:
Yeah, well not a handful. You know Jeremy, I’m going to be honest with you. We lost about 30%. We lost a lot of employees and some of it was mutual and some of it wasn’t. Just speak honestly, you know? Some of it was this is not what I want to do. I don’t want to come to work every day and have to use my brain. This is what I’ve always done. I come to work, I put this here, I put that there and I put it in a box and hand that off. I don’t have to worry about it and I go home. That’s okay, there’s nothing wrong with that you know? But it wasn’t the culture we’re trying to build and it still is not you know. It’s not the culture we’re trying to build. So a lot of those people had a hard time making the change.

Jeremy Carroll:
That’s Roy Lilly again, CEO of the company. That’ right 30% of the 130 people working at Hansen saw these sticky notes, saw the daily meetings, saw that they’re going to have to take turns cleaning the bathroom and said, “Nope, not for me. I’m done here”. In the end Roy and the leadership of Hansen’s said they came out the other side better and stronger and with a more engaged work force.

Ken Knight:
So, it’s the little things. It’s amazing how little ideas that I might not think is much, to somebody that is. That to them, that’s the world. That makes them happy to come back to work now.

Jeremy Carroll:
And it also makes everything easier, flow easier, the product better?

Ken Knight:
The product is better because anytime you can improve the quality of their job or anybody’s job in general the product is going to only improve from there because that gives them more time to inspect the parts, to make sure everything is clean, that nothing went wrong. Just, it’s like that snowball effect towards the good.

Jeremy Carroll:
Losing employees is tough. Losing customers is even tougher. But Hansen did something most companies don’t even consider doing. They fired some customers.

Jeremy Carroll:
In to lean there was some talk about you guys firing customers.

Roy Lilly:
Yep.

Jeremy Carroll:

Can you talk about that?

Roy Lilly:
Sure. It was extremely, extremely difficult because these are relationships. You know? We didn’t want to burn any bridges and we didn’t. We didn’t just call them up and go, “Hey guess what? We’re not going to mold for you anymore”. We didn’t do that at all. You know, we gave them a heads up and we told them we have evaluated their jobs and evaluated what the possibility of growth was with their company and that it was just not profitable for us anymore. We asked them to move the work and we would still support them until they found a home. So it took, I mean it was well over a year to get them moved out. Basically like we talked about in the meeting, was there any chance for growth and that was the number one. Number two is how many set ups are we doing a year for that work and what was our profit margins on it.

Recording with laughing and chatter.

Jeremy Carroll:
It wasn’t a normal day when I went to Hansen’s. A bunch of executives from across the country had come to Elgin to learn about Hansen’s process and it was all set up through M.A.P.P. These executives toured the facilities, learned about every aspect of the business and then openly discussed things they liked and areas where they thought the company could improve. It was like a family, a community of plastics processers all looking out for one another. Trying to help one another succeed and that includes competitors. Here’s M.A.P.P, executive director Troy Nicks.

Troy Nicks:
And actually Roy was faced with that and his executive team basically said let him in because if we can’t compete based on what people see. In other words, you can’t copy our guts. You can’t copy the culture. And it’s that, that of which the customer is buying. Yeah they’re buying perfect parts on time at affordable cost right? But you can’t copy what we’re doing here. And I think that they’re very sound in their understanding of that and that’s why they opened up the doors.

Jeremy Carroll:
For Roy, Roy said it was about the greater good.

Roy Lilly:
And we’ve lost enough people in this industry. It’s not good for the industry to lose anymore. You know? We need to help each other. You know, we’ve got a great culture in the United States. We’ve got a great, great core workforce in the United States. We’ve got great managers. We’ve got a brain trust better than anyone’s as far as I’m concerned. You know, so we need to make the industry stronger and I think this is one of the ways to do that.

Jeremy Carroll:
Yeah, and it almost feels like this is the battle lines of fighting off offshore.

Roy Lilly:
Yeah, I agree and I feel that way, I really do. You know, because when we look at everything that’s out here I know you, Jeremy you talk to people all the time. You probably hear the same thing. The material cost the same, it’s no cheaper. You know, rent in Mexico is no cheaper than rent here. The machines cost next to the same so where they’re getting you atis on the labor. We’ve got to lean it up you know, we try to. I don’t do this to get rid of employees. I do it so I don’t have to hire so many more. You know, we try to keep it lean. I’ve never lost an employee, we’ve never let an employee go because we’ve eliminated their job. When we get this area lean, now we can expand our company you know, to where we still need those people. We’re going to continue to still need those people.

Music begins and plays in background:

Jeremy Carroll:
That’s it for this episode of Plastics News Radio. If you have comments or suggestions slap it on a sticky note and send it our way. Or just email, plasticsnewsradio@crane.com. This week’s episode was produced by myself, Jeremy Carroll with help from Steve Toloken and Don Loepp. Special thanks to M.A.P.P. for allowing us to crash the plant tour at Hansen’s. Plastics News Radio is a product of Plastics News, a Crane communications publication.