TransAct

Source: Manufacturing Digital

Date :11/04/2008 04:12:35

The gaming industry is booming. Andy Hoffman, TransAct’s senior vice president of operations, talks to Exec about how the company is hoping to capitalize on this opportunity

Written by Megan Santosus and Produced by Pat Harlow

As a maker of transactional printers - the machines that produce tickets for gaming and lottery applications, and receipts for banking and point-of-sale (POS) activities - TransAct Technologies Inc., doesn’t want consumers to think about its products. After all, transactional printers have become so ubiquitous that they are often taken for granted; the only time consumers notice them is when they don’t work.

For TransAct’s customers - the casinos, banks, restaurants and retailers that buy the printers - the story is different. TransAct strives to be top-of-mind with these people, winning business based on its reputation for reliability, service and customized, built-to-order printers designed to meet each customer’s specific needs.

“For our customers, our printers are really mission-critical,” says Andy Hoffman, TransAct’s senior vice president of operations. “If a slot machine doesn’t produce a ticket, or if a POS system doesn’t produce a restaurant order for the kitchen, it will be bad for our customers’ businesses.”

Differentiating itself

In its markets, TransAct has a lot of competition. To differentiate its products, Hoffman says TransAct borrows a page from computer hardware maker Dell by offering printers that are built-to-order based on customer specifications.“We follow the Dell model of manufacturing,” Hoffman says. “We build one printer at a time.”

At TransAct’s manufacturing and engineering facility in Ithaca, N.Y., there are no finished printers waiting to be shipped to customers. “A customer calls up and can order a printer with multiple customized options.” These options range from whether a printer includes a cutting assembly that cuts a ticket or receipt once its printed, or a validation feature that can produce a check and prints on its reverse, to the color of the printer cabinetry and ink. Customers can also opt for either thermal or ink jet models.

In less than two weeks from receiving an order, TransAct can ship customers their printers that have been specifically built for their needs. According to Hoffman, TransAct can fulfill orders ranging from one to 10,000 printers.

Lean assemblies

TransAct can accommodate customized orders through an adherence to lean manufacturing principles. The company’s high-level assemblies - any component such as the cutting feature that can be tested independently of the finished product - are manufactured by offshore suppliers. When an order for a printer comes in, TransAct can quickly build a product by putting together the various pre-manufactured components and assemblies.

Beginning in 2000, TransAct set out to reduce the number of parts in its products; this bill-of-materials or BOM reduction program has proved critical to TransAct’s ability to turn around customized orders quickly.

Traditionally, TransAct used to manufacture printers with 120-to-140 parts. Today - by relying on external suppliers to produce parts that are higher up the manufacturing chain - TransAct can manufacture a printer using as few as nine parts.

For example, TransAct used to manufacture a cabinet set with ten pieces of plastic; today TransAct buys a complete cabinet set from a supplier. The BOM reduction program has also reduced the number of suppliers TransAct relies on. Hoffman says that ten suppliers manufacture 90 percent of the parts the company uses to build printers.

Streamlining the number of parts is only one aspect of TransAct’s quick turn around time. The other is training of the manufacturing personnel. The company brought in a lean manufacturing consultant to train employees in Kaizen techniques - an approach to manufacturing that emphasizes continuous improvement.

“When we changed the production floor,” Hoffman recalls, “the employees could really see the positive effect continuous improvement would have.” The floor became less cluttered as tools and parts were relegated and organized in specific areas, easing operations for employees.

Hoffman says that the company does not have to set up manufacturing lines for customized products in advance - a process that typically takes about an hour. Instead, employees have been cross-trained for various assembly jobs.

When an order comes in requiring a cutting assembly, for example, that particular area is already set up on the manufacturing floor. TransAct simply shifts personnel to that area to accommodate for that order. In addition, software options for such things as special fonts and command lines are automatically installed on the factory floor at the time of manufacturing. Today, TransAct can assemble a printer that used to take an hour in ten minutes.

Behind the scenes, TransAct uses a single enterprise resource planning system from Oracle Corp. that fully integrates every function of operations including forecasting, manufacturing resource planning, inventories at four locations and services. (TransAct offers repair services as well.)

Growth potential

Currently, the gaming industry is a big area of growth. To reduce labor costs and keep slot machines up and running, casino operators have shifted from using tokens or coins in slot machines to producing tickets when a customer hits a jackpot. (With coins, a slot machine needs to be shut down while an award is verified and then the machine is refilled with coins.) Since every state has different regulations governing gambling, Hoffman says TransAct’s ability to manufacture highly-customized printers is a big edge for the company.

Another area of opportunity is the hospitality industry, particularly quick-service restaurants. POS tickets that contain order information for the kitchen and receipts that have adhesives that adhere to order packages are some of the applications that TransAct can deliver with its printers.

To succeed in any market, TransAct will continue to emphasize speed and customization. While turnaround times eventually have limits - suppliers in Asia can only deliver assemblies so fast - TransAct now handles orders at its production facility in two to three days. “Our whole focus is to improve our agility in manufacturing and run at a high velocity,” Hoffman says.

Click here to view the corporate brochure on TransAct