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Four years ago, the top executives at EFI Electronics in Salt Lake City started thinking about what they needed to do to make the company's manufacturing process leaner and more efficient.
Today, the 80-employee maker of surge protectors to shield sensitive industrial and electronic equipment against harmful spikes in electricity holds a Shingo Prize Silver Medallion, evidence that the journey that began in 2005 succeeded.
"When we started, we had a typical manufacturing line -- components went in one end and finished product came out the other," CEO Todd Dauphinais said Thursday. "But there was a better way."
The Silver Medallion is among the highest of the Shingo prizes, which are international awards administered through the Jon M. Huntsman School of Business at Utah State University. Business Week once described the award as the Nobel Prize of manufacturing.
EFI isn't the only Utah company to receive a Shingo prize this year.
Autoliv, the maker of automobile airbag systems and one of the state's largest manufacturers, was awarded the top Shingo Prize for two of its five Utah locations.
"Every prize represents a remarkable achievement," said Shaun Barker, associate director of The Shingo Prize for Operational Excellence at USU. Companies that believe they have achieved operational excellence through the use of lean manufacturing practices can apply for a Shingo prize.
The prizes are named for
The concept of lean manufacturing embraces such principles as just-in-time inventory management systems, continuous flow work cells and the elimination of waste that inflates costs and reduces quality.
For EFI, the move toward lean manufacturing meant the company had to move its equipment so it could completely reorganize its production into modular work units, Dauphinais said. "And there was also an almost massive overdose of communications to help drive home the point that we wanted our workers to help us achieve a lean culture."
The result was that EFI achieved a 20 percent improvement in its profitability, he said.
Autoliv Americas President Mike Ward attributed the company's success -- it was awarded two of the three top Shingo prizes this year -- to the company's employees who have embraced the lean manufacturing concept.
He said the judges who visited the company this year focused a lot of their attention on Autoliv's work force to determine how they had embraced the philosophy of continuous improvement in the manufacturing process.
"As a supplier to the automotive industry, we have felt the impact of the market downturn," he said. "While some companies have reacted by abandoning lean principles and circling the wagons, our employees have shown they believe in a culture of continuous improvement."
Ward said Autoliv's approximately 2,900 Utah employees last year each offered an average of 63 recommendations on how the company could improve its operations. Those suggestions included ways to improve efficiencies by eliminating excess handling of product and strategies for reducing wasted motion by production workers.
"Individually, the recommendations may each have resulted in small improvements but combined they made a tremendous impact on our operations," he said.
