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Plastic Components, Inc.: Making the Customer Part of the Equation
   by Dianna Brodine
   Profile   Summer  2006
  
Some companies talk about customer service. Plastic Components, Inc. has taken steps to move beyond the words, connecting with its customers in a way that is rewarding for both the company and the people it serves. Using non-traditional marketing techniques, hands-free production processes, and an innovative customer advisory council, Plastics Components is thriving in the globally-competitive molding industry.

Competing on a Global Level
Tom Duffey was a manufacturers’ representative in the early 80s. He represented a number of companies, two of which were in the plastics industry. “Even in the 1980s, you could see trends developing in the world of manufacturing. Some of the manufacturing industries, like foundry, were very mature and there wasn’t a lot of growth potential,” explained Duffey. He returned to school for his MBA, with the goal of starting a manufacturing company after obtaining his degree. “After all the research was done, I felt plastics had the most upside potential,” said Duffey.

The potential was transformed into solid success when Plastic Components, Inc. was formed in April of 1989 in Germantown, Wis. As a new player in the plastics industry, Plastic Components needed an immediate ‘in’ with the purchasing crowd. Luring customers away from established producers would be difficult, but Duffey had thought this through. He had an idea that would produce the needed parts in a unique and accurate way, while at the same time reducing the costs to manufacture the molded piece.

“We knew we were going to have to compete in a global marketplace… We had to do something different right from the beginning,” stated Duffey. That ‘something different’ was complete process automation. For seventeen years, since Plastic Components molded its first part, the plant has been fully automated. “We’ve never had an operator in the direct molding process… ever,” emphasized Duffey.

With 55 employees, 40 production cells, and 40,000 square feet of space, Plastic Components is hardly hands-free but automation is the key to the company’s productivity. “Each production cell is a self-contained work-cell, with the molding press as the cornerstone of an entire array of support equipment,” explained Teresa Schell, Marketing Manager. “The strategy requires an aggressive investment in molding presses, as well as all of the necessary support equipment (material handling systems, robots, parts conveyors, and automated packaging systems) to run the cells effectively on a fully automated basis.”

While this production environment requires a significant capital investment, it also allows for the elimination of all non-value added labor in the manufacturing process. The plant is staffed solely with molding technicians, who are responsible for mold changeovers and process adjustments; quality technicians, who monitor the quality of the parts molded; and material handlers, who bring the raw material to the press and the molded parts to the warehouse.

The manufacturing process itself, however, is monitored through the IQMS Enterprise Resource Planning System, a software system used throughout the organization to provide real-time feedback on each aspect of the production process for every production cell. In addition to its monitoring capabilities, IQMS provides full scheduling capability to the plant manager.

Another factor that adds to the success of the complete process automation system at Plastic Components is the elaborate design process at the front-end. The company has plastic part design experts in-house to help customers create the parts they require, with the design considerations needed for the lowest possible cost. These experts ensure that all aspects of the plastic component are considered before the mold creation begins. An investment in engineering software - Moldflow Part Adviser 7.3 and Mold Adviser 7.3 - has assisted customers with those design considerations.

Seventeen years later, it’s obvious that Duffey’s hands-free manufacturing concept is working. The company is providing custom injection molded plastic parts for long-term customers located throughout North America, including Briggs & Stratton, Pentair, and a number of automotive customers, including Delphi, Eaton, and Siemens. Plastic Components continues to find new customers, many of them companies who would previously have gone overseas for molded parts. In fact, one company has asked Plastic Components to mold the parts needed, which will then be shipped to China for assembly. Plastic Components’ reputation for excellence is forcing its customers to rethink the traditional methods of parts manufacturing and assembly.

Communicating Success
The challenge, as with any company, is choosing a methodology to communicate the success of the business to its customers and prospects. The traditional method of communication is often a phone call or visit by the regional sales person. Using this method, the information can be passed on only if the sales person is successful in obtaining a visit, and has the ability to convey a large number of facts in the short amount of time allotted for his/her visit.

“We asked our customers how they preferred that we communicate with them and how they thought we could communicate most effectively with our prospects. We heard that they have no time to talk to new suppliers and barely time to talk to their existing suppliers. We needed to give people a sense of the success we’re having without leaving them fifteen voice mails,” said Duffey.

To accomplish this goal, Plastic Components implemented a fresh, multi-functional approach. The first step was to introduce an Internet marketing strategy to create new market opportunities and find customers in non-traditional ways. “We needed to use that medium more effectively,” said Schell, “and not just as a static brochure.” However, Schell has been careful not to rush the process and carefully monitors the way the web site is used. “We still have customers who are old-school and want the personal touch. We learned that a new feature we added to the web site – Quick Quote – was not being used as originally intended. Customers were bailing out when the system asked them to choose a resin. The customers wanted to interface with a member of the management team, someone to help them with the decision – a personal opinion.” The Quick Quote feature will be reevaluated as web site development continues.

To increase communication to customers and prospects, Plastic Components has implemented a system of e-mails, on-line newsletters, and letters from the president. This allows the company to communicate with customers on a regular basis about its growth – everything from new equipment to plant size to technology investments. Duffey is enthusiastic about the company’s efforts: “We need to communicate with our customers in a way that respects their time and is cost effective on our part. It allows us to share information about the addition of new technology and its impact on our operations. For example, we have a brand-new, all-electric 300 ton press. Through these new communication methods, we have told all of our customers about our investment and what it means for them. We can now mold bigger parts and we’re no longer losing opportunities for business because the customer doesn’t know what our capabilities are.”

Listening to the Customers’ Point of View
Another marketing strategy with a personal touch is Plastic Components’ Customer Advisory Council -  a concept developed by the company to gain valuable insights into what its customers truly need. The council benefits both Plastic Components and its customers through organized sit-down sessions with topics that are carefully chosen to provide feedback that is beneficial on both ends of a product sale. Schell explained why the company took such an unusual step: “In today’s highly competitive environment, an organization must create an active dialogue with the customer in order to retain and maintain the customer relationship. Feedback relative to delivery, performance, products, and services is vital to continued success.”

The members of the advisory council were carefully chosen for what they could bring to the table and their ability to provide productive feedback. “We have customers and we have people who buy parts from us. Customers are people who we trust, whose opinions we value, and who can provide insight into making us a better company. We have developed a strategic relationship that allows them to tell us what they need. Other customers – the ones who buy parts – may not make suggestions based on what’s best for us,” said Duffey.

The Customer Advisory Council process was developed to create the most value for everyone in attendance. A survey was sent to the members before the first meeting to gain an understanding from the council members about their customer sourcing thought process. Schell and Duffey knew cost was king in the manufacturing environment… but what were the second tier factors in the buyer’s sourcing decision? To get the conversation flowing, Schell kept the session interactive. One of the council members was invited to lead a brainstorming session, which created a list describing criteria for ‘best’ suppliers. If cost wasn’t a factor, what would convince the purchaser to buy from a particular supplier. To keep the advisory council members thinking outside the box, Schell asked them not to think specifically about the plastics industry or the manufacturing process, but to consider every type of consumer interaction.

The answers? Quality, engineering support, location, and consistency. Plastic Components is committed to excelling in each of those categories, responding to the items its valued customers have said are important.

Another change resulting from the input of the Customer Advisory Council was the need for communication regarding the overall number of parts shipped, part names, etc. – essentially, an inventory list. “The people we interface with may be here in Milwaukee, but their plant locations could be all over the country, so our main contact person may not be in the loop about what we ship to other locations,” explained Duffey. “They have no idea how much business they do with us through other locations - no idea about the magnitude of our relationship with the entire organization.” As a result of this feedback, Schell sent the shipping information for the first six months of the year to every Plastic Components customer. She is looking to add this information on-line in a password-protected area so that shipment history is always available to customers when needed.

“We want to create value for the customer, as well as us,” said Schell. “Not only did we receive critical customer feedback, but we created an environment for our customers to collaborate with their peers.”

Building on a Strong Foundation
In the seventeen years since it was founded, Plastic Components, Inc. has added 30,000 square feet to its manufacturing facility and added 47 employees to its workforce. The company has become a global competitor in the plastics molding industry. And in the first six months of 2006 alone, Plastic Components grew by 21.7 percent.

Tom Duffey is justifiably proud of the success of his company. “We built a manufacturing model that is unique and allows us to compete globally on the basis of cost and performance. Now we are trying to take this foundation and build it, using new and creative marketing concepts that are non-traditional in the plastics industry.”