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CM: manufacturing or service industry?

CM: Manufacturing of service industry?

The objective of this article is to explain how one rubber custom mixer, Colonial Rubber Works (headquartered in Dyersburg, TN), has refocused its traditional customer service role. The concept of industrial partnerships is by no means new to manufacturing. In times past, these partnerships were dictated by the strict terms of a written contract. As industry prepares to face a new decade, the industrial partnership is taking on a new composition - the terms of which are seemingly renegotiated every time the phone rings. Instead of loosely defined relationships between vendor and customer, this decade will require suppliers to serve to an even greater extent as an extension of their customer's manufacturing arm. Business decisions in the future (and in reality, in the present) will not be based on which company has the best equipment or the most impressive name or balance sheet. They will be based on who provides the best total service from the time the order is placed to the time a customer delivers the finished part to his customer.

We have developed an approach to customer service that we realize is not the only "correct" method of serving customers, but we do believe it works best for our business, and it has naturally evolved over our 35 years of experience in the rubber mixing business. Our approach consists of dividing our customer service group into teams serving specific geographic regions, while splitting the type service needed into each team member's area of expertise. Each team consists of a:

* regional accounts manager (the sales component of the team),

* a technical service specialist (technical service component), and

* a process control engineer (process control component).

Since the majority of manufacturers in the different types of rubber processing businesses tend to be centralized in a specific geographic region, we feel we have essentially divided our teams into product lines. For example, the Ohio-Indiana-Michigan area is very heavy in automotive suppliers and we have one team specifically serving that region and consequently that business. Other examples of this centralization include the wire and cable manufacturers in the northeast and the oil patch concentration of Texas, Oklahoma and Louisiana. Obviously, these specialized teams share expertise internally across geographic lines to provide the very best service to all customers.

The regional accounts manager

The division of teams into areas of expertise is important because we feel that through this division (and its inherent overlap) we have covered all aspects of customer needs thoroughly. The regional accounts managers are responsible for sales, pricing, locating new customers and complaints. All of these areas overlap the function of the technical service specialist who has the additional responsibilities of new product development, quick pricing estimates, consulting and process improvement (both in-house and customers). These areas overlap the process control engineer's functions of streamlining the mixing process for optimum quality and efficiency, and ensuring a quality product is packaged and delivered. (While these are brief descriptions of each component's role, they will be expanded upon later). It is the overall goal of this team program that any existing customer or new customer experiencing a problem or faced with a new opportunity can just pick up the telephone and get an answer on the first call. While this cannot be the case every time, each team member is cognizant of the role he plays in adding value to every pound of rubber mixed.

Each of the regional accounts managers is a veteran of the rubber industry. We have blended a group with experience in different areas of rubber processing at companies other than ours with another group who have spent all or most of their careers with us and have "grown-up" in our production facilities. This group constitutes our sales force. They perform the usual sales functions of conducting routine sales/service calls on existing customers, and of locating new customers who may need to utilize the services of a custom mixer. They are ultimately responsible for addressing complaints, while serving as the customer's primary communication vehicle. They determine how best we may aid the customer in being competitive in their business, and they are obviously responsible for pricing issues, ensuring that the customer is able to get the highest quality product possible at a price he can afford. With all of these responsibilities, it is natural that we refer to the members of this group as the account managers. Their primary responsibility is to keep the customer happy and competitive, and since the processing industries tend to be centralized, these managers have consequently become very knowledgeable of not only how we can serve our customers, but also of the different industries in the area he serves. This adds an enormous amount of value to each pound of rubber delivered.

It is important to point out here that we are extremely protective of the customer's proprietary formulations and methods of manufacturing. Proprietary information is more closely guarded than if it were our own.

The process of arriving at a price for a custom mixed compound is more complicated than simply adding the calculated dry cost of the materials in the formula to the manufacturing costs associated with mixing that type compound. Today's pricing strategies dictate that at least evaluating lower cost equivalent ingredients, where possible, is a must. As stated before, it is the objective of the regional accounts manager to give the customer the highest quality mixed compound possible at a price he can afford. For this reason, the accounts manager, in concert with his technical and processing departments, is constantly suggesting and searching for substitutable ingredients to save customers money. This is, however, never done at the expense of quality. Since the quality of the mixed compound is of paramount concern, these changes are only suggested where the process or application will bear it.

In addition to the ingredients of the ultimate recipe, another important consideration in supplying customers a satisfactory compound is the form in which the mixed compound will be supplied. Whether it be pellets, slabs or strips, the form is restricted only by the method the customer will use to process it. Since the accounts manager tends to serve a specific market, he is well aware of the methods that work best for the individual business. Clearly, some methods of processing require a specific form. An extrusion house or injection molding shop will require compound supplied in strips of a constant width and thickness. Some processors with long inventory turnover periods require compounds with nearly "eternal" shelf lives. In these cases, it is best to purchase a masterbatch in a wide, slab form that can have curatives added to it later on a mill. Regardless of the final decision, it is the responsibility of the account manager to assist the customer in choosing the most cost effective method of supply possible.

The final service function of the regional accounts manager to be discussed here is that of the ordinary sales call. The reasons for a routine call are numerous, but the primary reasons are for gathering information and promoting communications between the customer and the custom mixer. The more information the manager can collect about his customer's needs, the better the customer can be served. What better way to evaluate how the customer can best be served than by actually watching him process mixed compound on his equipment. Because of the proprietary nature of some processes, this is not always feasible. When it has been possible this has led to great strides in making us a better supplier. Something as simple as talking to an operator and getting his impressions of problems or improvements needed has led to the development of a stronger partnership between customer and supplier. Making sales calls has been the historic role of our regional accounts manager, but in today's world, these managers are attempting to make every "sales" visit a service call.

Technical service manager

While we believe we operate in a true service industry, we are also well aware that rubber mixing is a very technical business. This cannot be understated in this age of increasing under-hood temperatures, hostile chemical environments, hazardous material disposal concerns and complex polymer alloys. To answer the challenge of competing on a technical level, perhaps the most valuable service that a custom mixer can provide is that of technical service. Many small rubber processors cannot afford a development lab or a research chemist to develop and streamline their compounds. Even some of the larger processors have relied on the custom mixer for their technical expertise in order to reduce their overhead costs. Whatever the reason, the utilization of the technical service department by a customer can add even more value to the mixed stock.

Each member of the technical service team is a degreed chemist or chemical engineer with several years experience in the rubber industry. Each member (titled technical service specialist) is our resident "expert" on the geographic region, and therefore the business he serves. The advantage of this concept to the customer should be obvious. Instead of having to rely on a chemist with a familiarity of all the various rubber processing methods to understand the nuances of his individual process, he is able to work directly with a specialist who deals with his specific industry every day.

Because of the wide range of technical expertise each customer utilizes, compound development can be quite challenging for a custom mixer. For example, in the oil patch region some of the large oil companies employ Ph.D. research chemists to develop sophisticated compounds to function in the severe heat and high concentrations of [H.sub.2]S found in some oil wells. This customer may rely on the custom mixer for some technical advice as how to best process the material in their mixer, but beyond that the customer is usually self-sufficient. By contrast, another much smaller customer in the same city may be supplying parts for the same oil well, albeit probably for a much less demanding application - and may have no technically trained personnel at all.

The development of compounds to meet the needs of the smaller rubber manufacturers is one of the most important functions of the technical specialists. These fabricators usually do not have a chemist and are not schooled in the science of compound development. The initial step in the development process is elastomer selection. Each elastomer has inherent properties that make it suitable for a given application, but usually the choice of elastomer is taken out of the hands of the processor and is determined by the end user.

Our strength in technical service is based to a large extent on the knowledge of materials we have acquired over the past 35 years. During that time, we have have experience mixing (and this is a conservative estimate) over 10,000 different raw materials into finished compounds. Even the largest rubber companies would find this a staggering figure. The business of custom mixing by its very nature dictates that the company build up a history such as this. The existence of this knowledge of materials is as important to the small customer as it is to the largest of fabricators.

Coupling material knowledge with the experience level of our technical staff, the next logical area for discussion is troubleshooting. In a perfect world there is no need for such a function, but we do not yet do business in a perfect world. Our tech service specialists are well-versed in problem solving. Sometimes solutions are as simple as suggesting extruder zone temperatures be changed, or revising a compound for a reduced viscosity to improve compound flow. For severe problems, the specialist may have to visit his customer's plant to assist in process or compound modifications to solve a particular problem. The bottom line here is that until the customer is satisfied with his compound and its characteristics, the job is not finished.

Because of the many areas the specialist must be proficient in to be of assistance to his customer, he often finds himself serving in a consulting role for his "client." This function largely overlaps those previously discussed. Compound selection/modification and processing techniques often fall into this category, as do interpreting specifications, obtaining cost reductions, supplying certifications and even talking to end-users (on behalf of the customer only). This area is essentially wide open, restricted only by liability concerns and ethical business practices.

Process control engineer

The final component of the customer service team is the process control engineer. The members of this group are experienced in every aspect of our custom mixing production facilities. They are our "shirt sleeve" experts on the mixing process and their hands-on experience has made them extremely knowledgeable of our production capabilities.

The primary function of the process control engineer is to ensure a quality product is mixed and packaged for shipment to the customer. They are ultimately responsible for certifying the mixing procedure of each compound, by monitoring the initial production run of a new compound, and by periodically monitoring subsequent runs to ensure the best procedures are used. A strong working knowledge of statistical process control techniques enables these engineers to head off problems before they happen. For example, if a particular EPDM hose recipe had been running on the lower side of its Mooney viscosity specification, the engineer would automatically review the procedures in place to determine if this might have been caused by the particular mixing procedure being used. If this were not the answer, he would approach the customer for feedback on how the compound has been running in his process. The key here is to recognize potential problems in-house, long before an external failure is experienced.

As a vital member of the customer service team, the process control engineer has ongoing contact with "his" customers. Once again, the geographic division of the team essentially into product lines enables the engineer to be very familiar with each customer's particular industry. Processing problems at the customer's plant can often be alleviated with adjustments in the mixing process or the way the stock is packaged. These concerns are always addressed primarily to the engineer, who is available for site visits in the same way as the regional account manager and the technical services specialist. These visits can be for reasons as routine as gathering information to better serve the customer through process modifications, or as simple as observing how stock is rotated and removed from a package before a customer processes it to suggest alternative methods.

Perhaps the most valuable service the engineer is able to perform is serving as the customer's agent on the production floor. Since the accounts managers are on the road traveling a great deal of the time, and the technical services specialists work mainly in the laboratory, this function gives the customer a set of eyes, ears and hands integrally involved in the production process. Many customers find this an important aid in collecting pertinent data about each production run. While larger customers tend to take advantage of this more often, it is available to every customer, no matter what the size.

Conclusion

The ultimate intent of this new network of customer service is to forge a stronger partnership with our customers. Our role in such a partnership is to be readily available to meet the needs of the customer, regardless of what those needs may be, and to use our technical and processing expertise to the utmost advantage of the customer, even to the extent of making unsolicited recommendations or suggestions that may serve to increase the customer's profitability and market share.

The customer's position in the partnership is to provide as much relevant information to the custom mixer as possible. Needs which are not brought to the attention of the mixer obviously cannot be met, regardless of how simple they are. It is also the responsibility of the customer to ask for help or, yes, to even complain when a situation warrants it. Since some external failures are impossible to detect before a compound is shipped and processed, Colonial depends on its customers to report any situation that causes a problem. It is only through timely communication that corrective action measures can be implemented.

A competitive advantage that we possess (and by its very nature share with other custom mixers) is that while we are involved in manufacturing and therefore must understand how quality concepts are used to achieve the desired finished product, we are in essence a service company that must apply these same concepts. In 1990, Federal Express became the first service company to win the Malcolm Baldridge National Quality Award. This fact suggests that most service industries have not yet fully embraced the teachings of Juran, Deming and their contemporaries. Because these concepts were first applied to manufacturing processes, a company functioning in both the service and manufacturing areas of industry has a head start in applying them to its service arm.

Specifically (and briefly), the techniques we are referring to are amazingly simple. Doing it right the first time. Including quality in everything we do, no matter how seemingly insignificant. Not only correcting problems, but immediately investigating the cause of problems and correcting these. Learning from each mistake, so it is never made again. Simple statements, yet when applied, become invaluable when measured in terms of dollars.

The overall objective of this work has been to illustrate how Colonial Rubber has markedly improved service to our customers by assigning a team of experts to each individual account. The goal of this division of service into areas of expertise has been to enable our customer to be more competitive in their own businesses, and to add significant value to each pound of mixed compound delivered. The success of this customer/supplier partnership can be proven only as our customers continue to capture and expand market share.

Edward N. James, Colonial Rubber Works
COPYRIGHT 1991 Lippincott & Peto, Inc.
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1991, Gale Group. All rights reserved. Gale Group is a Thomson Corporation Company.

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Title Annotation:custom mixer Colonial Rubber Works
Author:James, Edward N.
Publication:Rubber World
Date:Feb 1, 1991
Words:2988
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