Invar Manufacturing

Source: Exec Digital Canada

Date :07/08/2007 14:46:45

Being one of 36 divisions, Invar Manufacturing has learned to balance autonomy with commitment to the larger family of companies

Written and produced by James Buchanan & Jason Wright

It’s one thing when you are the parent of just a couple of siblings. You are able to spread your attention evenly among the offspring and monitor their actions in order to make sure they are pulling their weight and moving the family of companies forward.

However, when a parent company adopts many more siblings through acquisition, managing all of these separate entities becomes a challenge. Further, each company within the family is required to stand on its own and operate with quite a bit of autonomy in order for the organization to work.

With more than 36 manufacturing divisions and 11,000 employees worldwide, Linamar Corporation is challenged to make sure each of its cogs is meshing with the rest of the machine. To do this, the company operates under a decentralized structure with independent profit centers and clustered facilities to maximize efficiencies and economies of scale.

“Linamar is broken down into five groups, which are engine, transmission/driveline, Europe, Asia/Pacific, and industrial groups”

says Kim Johnston, a customer service representative for Invar Manufacturing, a division of Linamar. “And each group is broken down into the different companies that fall under one of these headings. We fall under the Engine Group umbrella.”

Almost like a Russian Matryoshka doll, where one doll fits inside of another of the same shape until one reaches the center, Linamar can be unpacked down to its base components.

“Each facility will have its own plant manager, general manager, and then it’s broken down to each production cell, which will have its own business manager and team leader - a whole management structure for each cell,” says Johnston. “The general manager is, in turn, accountable to the group vice president.”

The bulk of these divisions are dedicated to manufacturing parts and components for the automobile industry with a few exceptions. These would include the McLaren Performance Technology Group, which handles design and prototyping work for engines and engine components; and Invar, which produces parts and components for the atomic energy industry (primarily for CANDU reactors) as well as gear housings, steering columns, and center housings, says Johnston.

Lean manufacturing is also a tool used by Linamar to help manage its various divisions down to the center Matryoshka doll.

“Our lean initiative started a couple of years ago, and we are following the Toyota model,” says Johnston of the lean efforts at Invar. “What we are doing is going into each of our production cells. We sit everyone down and we have a meeting to discuss the flow of the cell and how things can be streamlined to be made more efficient.”

She adds that the company is taking its time with this process to ensure that each cell’s efficiency and Lean capacity is maximized. As of August, Invar has completed blitzes for two of its cells.

“The process for the individual cell lean events is fairly intensive,” says Johnston. “It’s a lot more planning and moving the machines and getting down to the point where you are looking at how your production cell works and what would happen if you move one machine closer to another. Will the process be more efficient because [an operator] can do one and a half jobs as opposed to one?”

Continuous improvement is also a top- down event, as the founder and chairman of the board of Linamar, Frank Hasenfratz, will visit each division with what the company calls a “coast attack team.” The cost attack team will meet with the division’s management team, and seek out opportunities for it to become more efficient.

“They will look over the structure of our business, each product line, and what we are spending on tooling and different consum-ables, and look to see if we can get any cost savings on those products,” says Johnston.

“This is done to ensure that we are competitive when we do our pricing for our customers.”

This attention to detail also reflects the involvement the company’s founder has had with his company since its beginnings.

According to Linamar’s website, Hasenfratz was born in Hungary in 1935 where he attended trade and engineering technical schools while working as a toolmaker and machinist. In 1957, he immigrated to Canada, where he found work within his trade until he was able to begin work as a one man machine shop in the basement of his home in 1964.

From this humble beginning, Hasenfratz was able to build Linamar into a $2.26 billion manufacturer with facilities in Canada, the U.S., Mexico, Germany, Hungary, South Korea, and China.

It is also worth noting how Invar manages the disconnect between producing steering columns for vehicles and nuclear reactor components.

“Our atomic energy work is done in one large cell that is run very much like a job-shop, as opposed to the rest of our cells, which run like [a production line] – where you are pumping out a large number of parts every few minutes,” says Johnston. “The atomic energy cell is not a high production, high volume shop, where parts are made very quickly. It is labor intensive and we need machinists and journeymen with very specific [skill sets] working on these jobs because of the amount of setup and the intricacy of the parts.”

There is also a mix of equipment within this cell, which includes CNC driven machinery and manually operated lathes that are used for some of the more intricate work.

“Right now we are doing a lot of atomic energy work because of the new builds and the refurbishments, which has grown in leaps and bounds over the last two years,” says Johnston. “Right now we are producing components for refurbishing the Bruce Power reactor and the Point Lepreau reactor. The older reactors are reaching the end of their lifespan so they either need to be refurbished or replaced, but refurbishment is more cost effective.”

Asked if concerns regarding global warming and fossil fuels are driving a move toward building new reactors, Johnston says there is some discussion, but no firm plans to build anything.

“There is a lot of talk of new power plants in the wind, but there is nothing set in stone yet where anyone is actually going to start building,” she says. “Everyone is doing feasibility studies, which is part of the years of work required to build one of these, but there is nothing at a bidding stage yet.”

She goes on to add, “As long as we stay in the loop and are competitive when the new contract bids come out, hopefully we can keep the work in Canada.”