SPARTAN STEEL COATING LLC: Minimizing Costs to Maximize Returns
Collaboration with The Center enabled Spartan Steel to maximize usage of project management tools, statistical software and the DMAIC process in order to achieve our strategic goals. I would recommend their classes and consultants to any manufacturer.
-- Brock Minton, Area Manager
Worthington Industries (www.worthingtonindustries.com) was founded in 1955 when a young steel salesman saw an opportunity in the custom-processed steel market. The company has grown to become North America’s premier steel processor, providing customers with wide-ranging capabilities, products and services. Spartan Steel Coating LLC, a subsidiary of Worthington Industries, employs more than 70 at their Monroe, Mich., facility.
Challenge
Spartan Steel sought to improve several areas in production to save costs. They identified an opportunity to modify and improve the tension leveler, which is used to elongate and shape coiled steel, as it was costing the company more than $165,000 a year to maintain with no surcharge to customers. Additionally, with the cost of zinc rising, Spartan Steel wanted to find a way to decrease the amount of excess zinc used to lower overall production costs.
Solution
To achieve these goals, Spartan Steel partnered with experts at the Michigan Manufacturing Technology Center (The Center) for Six Sigma Green Belt training. Matthew Powell, Production Coordinator, and Brock Minton, Area Manager, both engaged in The Center’s training to lead project teams in these improvements.
Evaluations showed the company was losing $0.72 for every ton produced in the tension leveler because of failures and damages to the cassettes. Reducing costs by 75% would save the company more than $100,000 a year. Using the DMAIC process, the team created a process map to determine potential causes for failures. One main issue was incoming product widths being smaller than the maximum design. To resolve this, they modified the length of the cassettes to better match the width of the strip going through. This reduced repair and replacement costs by 86%. The team continues to review quality and costs of the tension leveler monthly.
The second project aimed to minimize the amount of excess zinc used when coating coils. The team gathered data to determine the minimum percentage of overcoat achievable without sacrificing process control or process capability. After identifying this amount and decreasing the amount of zinc accordingly, the team achieved cost savings of $30,000. These savings were passed on to company stakeholders.
Results
- Annual Cost Savings: approximately $100,000
- One-time Cost Savings: $30,000
- Reduced repair and replacement costs for tension leveler by 86%, exceeding goal of 75%