I was saddened to read about the loss of another cabinet and millwork shop from our family of domestic manufacturers recently. Janov Millwork and Manufacturing, LLC of Austin, Texas has closed its doors after 17 years of business. Like many other companies in the industry, Janov’s website boasted of their “green” compliance, “state of the art” technology, full-service capability, dedicated craftsmen, and quality service and product. The auction company listed a wide array of equipment for sale that would be the envy of many of the businesses I have worked with.
 
It was disappointing to not find any reference to lean thinking as an element in Janov’s story of their success. This may seem like a pretty strong statement since I don’t know the circumstances behind Janov’s decision to close, but maybe the absence of lean thinking contributed to their failure. A further explanation of that reasoning follows.
 

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Embracing lean

 
Steve Hallagan, the CEO of Hallagan Manufacturing in Newark, New York, has told me on several occasions that his 115-year-old company probably wouldn’t be in business today if it weren’t for embracing lean thinking as a model for their business in 2005. He believes that the economic failure that started in 2008 would have meant the end of their family-owned business. But the company’s application of lean thinking by an actively engaged workforce created flexible processes that could readily adapt to changing demand and product mix.
 
Hallagan had to broaden its product offering to maximize resources and it was lean thinking that enabled them to do so. Steve is not content with where the company is financially, but he knows that a culture is in place and the stage has been set for Hallagan to capitalize on a more robust economy in the future.
 

Getting out of the red

 
Brad Cairns, who you will have a chance to meet at the Wood Pro Expo in Baltimore in October, is of the same mind as Steve Hallagan. Before transforming Signature Wood Systems to the lean business model, Brad was frustrated by an unprofitable operation that couldn’t meet customer demand. He was considering closing the business rather than continuing to run in the red with no relief in sight. Fortunately he chose to apply lean thinking instead and achieved incredible results in the process. He, too, isn’t satisfied with the current state of the business, but he knows the future is going to be much brighter.
 
Joe’s cabinet shop wasn’t on the verge of closing the doors before they started their lean journey in 2013, but productivity and profitability were less than Joe deemed necessary to position the company for future growth and market expansion. Lean thinking has revealed opportunities and avenues for exploiting those opportunities that were buried in the mire of the daily chaos and confusion.
 
Exploiting opportunities to their full extent is still a little scary and uncertain for some of Joe’s leaders, but they now have new tools and techniques that weren’t available to them before May 2013. Leaders have also been empowered to explore and implement solutions, which wasn’t part of the culture before lean.
 

Uncovering the real problem

 
As I prepare this article, Joe’s factory manager is wrestling with a perplexing situation that is negatively impacting revenue and productivity goals. The old protocol for developing solutions would have included a meeting of all of the managers to discuss a situation that most of them wouldn’t be familiar with, in a closed meeting room away from the problem itself to come up with a Band-Aid fix for a symptom of the problem without ever drilling down to discover the “real” problem.
 
The approach now is for the area supervisor to spend time in gemba (the shop floor) gathering data to define the problem rather than just tackling symptoms of it. Once he understands the problem he will organize a Kaizen Team to develop and implement a long-term solution, standardize and document the process, and train all of the affected people in the new process. The Kaizen Team will successfully accomplish more than the old process would have accomplished and in less time through lean thinking.
 

Technology’s role

 
I contacted Dustin Hunter, the CEO of Hunter Trim and Cabinet (HTC) in Fort Worth, Texas, after reading about the auction at Janov to see if he was aware of the company and to find out more about the business climate in Texas. Dustin wasn’t familiar with Janov, but he reinforced my long-held assertion that technology and automation are not necessarily key ingredients for success.
 
“If there is one thing I have learned since we started our Lean journey,” he said, “it is that automation and technology have to go together with lean thinking as part of an overall continuous improvement strategy to be successful.” 
 
He also stated that the economy in Texas is booming. In fact, his business is on track to meet the total revenue of 2013 by the third quarter of 2014. As I mentioned in an article earlier in 2014, HTC had record revenue and profit in 2013, which Dustin didn’t think would be sustainable into 2014. Well, his assumption was incorrect from two perspectives. First, revenue is already exceeding 2013, and Second, HTC is delivering orders complete and on-time with only minor changes in resources.
 
Dustin installed a CNC Router early in 2014, but he moved to automation only when it was necessary to meet increased customer demand. Some company leaders jump to automation and technology solutions immediately and wind up with very expensive, underutilized resources that drain limited cash flow that then can’t be used to keep the business afloat when the economy or demand are in a slump. On the other hand, lean thinking creates an environment where flexibility, innovation, and creativity thrive so that changes in demand or a downturn of the economy have less effect on the company’s sustainability.
 
Is your company in an unsustainable situation like Janov? Do you think you have exhausted all available options for staying the course through these difficult times? If you are not applying lean thinking in your business then you haven’t begun to experience its benefits. You can learn more about lean thinking and how “Joe,” Brad, and Dustin are benefiting from it at Wood Pro Expo in Baltimore in October. I hope to see you there.

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