Parker Hannifin Hydraulic Filter Division Metamora Ohio AME

Parker Hannifin Hydraulic Filter Division Metamora, Ohio AME Presentation 11 -18 -2010

Hydraulic Filter Division • Metamora, Ohio • Division of Parker • Hannifin’s Filtration Group • Since early 1970’s • 107, 500 sq. ft. • ISO 9001 Certified 2

Product Range • Pressure Filters • 3000 -6000 psi 18/28/38 P • Medium Pressure 15/30 P CN Series • 1000 -3000 psi 50 P IL 8 Series • Low Pressure • 100 -500 psi 3 Spin-ons Moduflow KLS/KLT

HFD Main Asset – The employees Monthly Plant Meetings 4 Division Staff

Focus of Presentation A. Two Best Practices (Things the Parker Hydraulic Filter Division has done well) B. Two Lessons Learned / Opportunities C. The Value of applying for the AME Award 5

A. Two Things We Now Do Well 1. Converted a no-flow, no-visual management, massive warehouse, all 7 forms of waste facility into a Lean continuous improvement facility with a Supermarket in an open visual plant with uninterrupted flow. 2. Instilled a Lean culture of ☺ employee empowerment. 6

HFD Lean Journey History • Started with Parker Filtration Group Lean kickoff February 2002 in Ypsilanti Michigan • Had to overcome the ‘We’re Different’ (high-mix) mind set • 1+ Kaizen events per month for first 3 years • 50+ events • Gradually changed culture • Work with Lean Sensei’s in beginning • Three Major Site Plan Phases (now phase 4) • Continuous Improvement 7

Warehouse Before: Vast Massive Storage Hid Problems 8

Before: Central Wall & Mezzanine Impeded Flow & Hid Material 9

Assembly Before: 10

Mezzanine & Central Wall Coming Down: 11

Supermarket Instead of Warehouse 12

Receiving After 13

THE AFTER: 14

PFEP & Making Material Flow @ HFD • • • 15 BEFORE Massive random storage W/H Central mezzanine/wall blocked flow Inventory Turns < 3 150 tall racks Lost parts regularly 1200 ft travel & handle 20 times 12 recorded accidents All 7 forms of Waste No Supplier Kanbans Annual Inventory took 3+ days No 5 S’s • • • AFTER Supermarket, PFEP, Supplier Kanbans, Water-spider Inventory Turns 11 Open visual management Travel & Handling reduced 85% Eliminated 150 tall racks Freed up 5000 sq ft Safety recorded accidents reduced 83% Surplus two fork lifts Annual Inventory now 1 day 5 S Everywhere

Instilling Employee Empowerment • Training • Teams • • • 16 Kaizen VS 5 S HPWT 10 X 10 All Hands On Deck Commitment Communication Celebrations

A Few HFD Initiatives • 5 S Golden Broom & Golden Duster • 10 X 10 teams • Lean Training Ø All Employees trained on Basic Problem Solving Ø Lean Boot Camps rolled out • • 17 Lean Work Shop Monthly Plant Meetings Quarterly News Letter Forklift Free Production Areas Safety Cook Outs Safety Suggestion Program On Site Physicians Assistant

18

Parker’s Lean Tracking System The Boards Tell HFD’s Story 19

A Few of the Results • • • 20 Lost Time Accidents at 0 72% Reduction in Scrap WIP Reduction of 75% Inventory Returns Improved by 270% Productivity Improved by 115%

Celebrate 21

Lean Celebration 22

Lessons Learned • Lean must be treated as a complete continuous improvement process and not just pick and choose a few Lean tools. • The Lean journey must lead to true culture change with employee empowerment if you want it to stick. • Lean can work for high mix operations too—it takes that extra effort. • Positive peer pressure can be an effective tool. Opportunities • Inventory Turns can improve more to high double digits • Careful not to become complacent 23

Value of Applying for AME Award • Benchmark to peers • Challenge: Writing a summary of your Lean Journey gives you a great perspective as to how far your company has come and what is still left to be done. • Very professional volunteer examiners will give you honest feedback, including suggested opportunities for improvements. • A good indicator of Lean progress • No Fees • Good Company / Division PR 24

THANK YOU QUESTIONS ? ? ? 25