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Reorganization gives Marlite a successful display.


It was not an unusual scenario in the 1980s. A large manufacturing conglomerate becomes the target of a hostile takeover. Often, in the process, the corporation is restructured, refinanced and assets sold. This sometimes ends in disaster for manufacturers and employees.

But there were exceptions.

Founded in 1930 by Alvin and Victor Marsh, Marsh Wall Products Co. was noted for its decorative, functional and durable "Marsh Tile" for bathrooms and kitchens. The product, with grooves resembling tile, was made of hardboard and finished in a topcoat of tough scratch- and moisture-resistant melamine that sold well because of its surface quality.

Later known as Marlite, in 1948 it became a subsidiary of Masonite Corp., the supplier of hardboard substrate. Both became a part of USG in 1985. However, on May 3, 1988, USG underwent restructuring to avoid a hostile takeover by Desert Partners, a partnership led by Cyril Wagner Jr. and Jack E. Brown, of Midland, Texas. On Jan. 27, 1989, USG closed all Marlite operations and dismissed all employees.

Assets were acquired by Commercial and Architectural Products Inc., an Illinois corporation owned by equal partners: Rodney S. Campbell, president/chief executive officer; Tony DeCrescenzo, executive vice president/chief operating officer; Larry D. Murphy, vice president, sales and marketing; and David Johnson, vice president, manufacturing.

Facing the recession

Steps were taken to make the plant profitable. By Jan. 30, 1989, the facility had reopened. "There were to be no gaps in the company's leadership in the commercial interior wall products market," DeCrescenzo said.

Salaried employees were first hired to solidify business and marketing functions. Marlite's 23 outside sales people were reaffirmed. "We instituted a rigorous employment interview process for our manufacturing workforce using an outside human resource consultant," said Johnson.

Marlite retained Gunter Geiger Systems Ltd., based in King of Prussia, Pa., to evaluate the manufacturing facilities and processes. The firm specializes in designing new plants and revising older ones, with an emphasis on employing state-of-the-art technology. "At Marlite we focused on a new bottom-up factory management and new technologies, applications, techniques, improved processes and strategic planning," said Gunter Geiger, president. "Specifically, we analyzed and made recommendations for: the key products, the processes being used, the plant areas and services, including layout and handling, production control and inventory management, and flexible systems for producing custom colors for Marlite products."

"It is important for any turnaround to succeed, that all members of the team, including management and factory workers, |buy in' on the strategic plan and want to make better products, apply just-in-time procedures, and use new technologies and systems to benefit themselves and their customers," Geiger said. "Our recommendations included critical changes in the areas of production, processing, plant and systems, in order to deliver Marlite products the fastest way possible."

"We established a high-quality work environment," said DeCrescenzo. "New employees were encouraged to grow in ways allowing them to realize their potential and contribute to the organization."

Making the changes

At the time of the acquisition by the new owners, Marlite had a new plant in Fort Worth, Texas. "It basically duplicated our operations in Dover," said Johnson. "Both plants were under-utilized from a capacity standpoint. In many cases we ended up with capabilities that were needed here to meet a service demand, that were only available in Forth Worth and vice versa."

"A business analysis was made regarding the Forth Worth facility by Geiger to determine whether or not it was reasonable to consider consolidation and whether or not it made good sense from the standpoint of economic customer service to do that," Campbell said. Based on Geiger's recommendation, Marlite sold the Fort Worth facility before the economic downturn. "In a very detailed scale, Geiger laid out options on how we might approach it. He had a whole lot of interaction with production people. His team got them working in unison to pull all of the operation data together," Campbell said.

"Our success is related to new product development and/or product line enhancement," said Murphy. "We create the market and work hard to extend and broaden it. Our Displawall line is the perfect example. The profile groove is our design. We were one of the first to have plastic PVC and formed steel inserts. We not only put the groove in the panel and apply a solid color or printed design on the surface, but also carry that into the groove," he added.

"A recent introduction was ColorSnaps, a PVC extrusion that snaps into the groove after the panel is up on the wall. Many of the leading retail chains make extensive use of our display products," Murphy added.

Impact of change on manufacturing

In the 1950s and 1960s, Marlite's durable surface panel products, used in residential kitchens and bathrooms, allowed for long production runs. "We would set up in the morning and run the same product all day long," said Johnson.

Today, Marlite is going more and more from standard stock panels to custom products and modules, some of which are under development. "Our business has transformed to meet today's commercial market. Retail stores require a different look. Many sell similar merchandise, but the way they display the product sets them apart from everybody else," Johnson added.

"True, we have a standard product line that we produce and inventory. But much of our business today is to meet that custom look. As a result, production runs are shorter and set-up time is reduced. We must selectively schedule the plant ahead of the production day and maximize controls on our inventory investment and turn inventories faster.

"At one time a national retail chain had a pretty consistent look for each of its stores. Now that has changed. They want varied decor packages. Of course, that puts a great deal more pressure on manufacturing. It also reinforces our uniqueness to meet the requirements of varied decor packages," Johnson added.

"Another change that has impacted Marlite's capability: Our customers want to minimize the store construction cycle. So, they apply pressure, not only on the budget and total investment in the store, but they also want to build the store quicker. That puts more demand on us as a supplier of custom products. We must more effectively manage this complex production cycle, including scheduling, manufacturing, quality control - from order entry through shipping," he continued.

Most inventory orders have a two- to four-day turnaround time. Custom orders are shipped in three weeks.

Manufacturing: Two plants in one

In one section of the plant, Marlite processes a high volume of stock panel products including decorative, sanitary and merchandising walls. Machinery and processes for these products are dedicated to long runs.

One such machine, said Dwight Rennicker, production manager, will cut a beaded groove into quarter-inch thick hardboard. This will end up in 16-inch tongue and grooved panels, coated into a wood grain. Special stationary carbide-tipped knives cut the profile; there are no moving cutters on this customized machine. Another dedicated operation employs a Black Bros. coater which puts a very thin coat of water-based paint on the top. "This fills up any low spots in the board," said Rennicker, "so we can get a nice, smooth finish when we apply our final coat of paint. It is baked in an infrared oven, and in five minutes is ready for final coating."

Paints are color-matched to specifications by weight. Marlite meters color coating formulas on a computerized Spectro Sensor II, supplied by Applied Color Systems. A color sample is put in the machine and the computer calculates the color mix required.

Displawall 4- by 8-foot panels are produced on a dedicated machine running from 800 to 1,000 sheets of 3/4-inch MDF in eight hours. Custom sizes and colors of Displawall are run on a CNC machine which is programmed to automatically process to tolerances between two- and three-thousandths of an inch, at about one board per minute, according to Rennicker.

"Displawall machines now use diamond cutters," Rennicker said. "Previously, we got fewer than 100 boards from carbide cutters. Today, we get as high as 10,000 boards without changing," he added.

Another custom CNC machine scores fiberglass reinforced polyester (FRP) panels vertically and horizontally to simulate ceramic tile. These panels go into applications, such as food preparation facilities, and have a more decorative look than plain FRP panels.

Another dimension to the Marlite facility is its fast-growing special products manufacturing capabilities. Here, automated, conveyorized systems make it a different processing concept than the stock goods manufacturing area.

"The entire production process is all on conveyors, so we do not have fork lifts running back and forth," said Ray Kendall, manager of manufacturing planning and administration. "At one time we had 31 fork lifts that had to be maintained, with expensive people driving them."

Included in special products are doors and frames. Before cartoning, the door will be mated with the frame and hinges applied. The doors may be cut out for installation of glass or louvers.

"We have three pieces of CNC equipment for boring, shaping, profiling and routing," Kendall said. "They are three years old, but very good machines. We use them as flexible machining centers. All we have to do is call up the program and the machine knows what product it is supposed to machine, with repeatable accuracy and the same quality control standards."

For the Perimeters product line, one machining center does all of the drilling and mortising for components, including drilling the end for levelers. Normally, these custom panels would require four or five separate manual operations.

Looking to the future

Marlite's broadening market has changed its marketing strategies and procedures as well.

"Marlite salespersons meet with the architectural principal, the person in charge of construction or in charge of merchandising the store. They also spend time with the general contractor or the applicator or installer of our products," Campbell said.

With 370,000 square feet devoted to manufacturing, Marlite is looking to markets outside the United States. Business is also growing in Canada, where Marlite retains a warehouse distribution center.

"We have set up distribution in several countries in Europe for our standard core products," Campbell said. With regards to Eastern Europe, he added, "I talked to a fellow in Budapest last week. We may set up distribution in that country."

PHOTO : Displawall panels emerge from a special coating machine, designed and built by Marlite.

PHOTO : A CNC machine, also built by the company, automatically grooves panels for the Displawall line. The machine reportedly holds tolerances between 0.002 and 0.003 inch. The grooves are 3 inches apart.

PHOTO : A laminating station in Marlite's special products facility houses coating equipment from Black Bros.

PHOTO : In-line curtain coating is one of several finishing systems used by Marlite.

PHOTO : A Therm-O-Web web machine applicator uses dry sheet adhesive for laminating high-pressure laminates to MDF.

PHOTO : Automated edging and banding, part of the special products production line, are performed by an IMA CNC edgebanding machine.

PHOTO : A coordinated network conveyor system begins here with an order for commercial doors.
COPYRIGHT 1991 Vance Publishing Corp.
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.

Article Details
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Title Annotation:includes related article
Publication:Wood & Wood Products
Article Type:Company Profile
Date:Nov 1, 1991
Previous Article:1991 innovator/educator of the year awards.
Next Article:Strata Designs' three steps to success.

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