Harloff Mfg Co - Colorado Springs, CO

Harloff Manufacturing Company, Inc. manufactures medical carts in Colorado Springs. Started in 1954 as a hospitality cart manufacturer, the company began producing medical carts in the late 1980’s, and by 2001 decided to focus solely on medical carts. Approximately half of Harloff’s revenue had previously stemmed from the hospitality carts division of the business, and this new strategic decision posed great challenges ahead.

After shifting to only medical carts, Harloff immediately experienced steady growth in their sales of medical carts-- an average annual growth of 19%. Despite their growing success, Harloff was struggling with long lead times, low on-time delivery rates, and consequently, some customer dissatisfaction. In 2004 & 2005, Joe Pentlicki, Vice President of Operations, became familiar with CAMT through its public offerings, such as a “Principles of Lean” public seminar and an organized “Manufacturing Crawl” – a tour of Denver manufacturing companies. Soon Joe approached CAMT about conducting on-site trainings at Harloff.

In 2005, Harloff embarked on a lean journey including staff trainings in Set Up Reduction, Total Production Maintenance and mini Kaizen events in multiple departments. Additionally, a Lean Performance Measure evaluation was conducted that assisted the executive management in their strategic planning process. These trainings facilitated a complete reorganization of departments that allowed the work to flow naturally and efficiently, cut set-up times in half, and reduced unnecessary motion. The results were impressive: Harloff saw an increase in productivity of approximately 40% in just a few short months; between first quarter and fourth quarter of 2006 throughput was increased by 35%; and, average lead times were reduced from five to six weeks to three weeks—a reduction of approximately 25%.

In order to sustain the lean goals that management has set, Joe believes it is imperative to maintain a culture of continuous improvement. Harloff has since identified “change agents” on the shop floor to assist in a culture shift from “the bottom up.” In addition to both managers and change agents creating excitement among the employees about current and future progress, management has also created a reward program for improved performance. Sustaining and expanding the great lean gains accomplished is critical to continuing Harloff’s success.

“Soon after implementing the tools CAMT shared with us, Harloff set an all-time record in sales. The return on investment was enormous.” -- Joe Pentlicki, VP of Operations

Results:
- 35% throughput improvement from Quarter 1 2006 to Quarter 4 2006
- 25% reduction in lead time
- 20% reduction in inventory
- 24% sales increase from 2005 to 2006