News
Terex constructs quality
In one of a series of interviews with industry leaders in quality management, John Asher talks with Chris Melia, Vice President, Quality and Reliability, Terex Construction, about developments in coating construction equipment to face some of the most demanding applications on earth.
The Terex Group has more than doubled in size since 1998, and manufactures its products around the world. Part of this growth has come from acquisition, including many famous names such as Demag, Atlas, Powerscreen and Tatra. I start by asking what value Terex adds to these companies. "That varies: many of the companies, such as Demag, are technological leaders. Often we've been able to widen distribution, improve financial management or eliminate product or production duplication. In every business we've seen step-changes in quality and efficiency."
As I knew Chris in the past as a "paint man", I was interested to understand how he had started with a heavy engineering company like Terex. "Over the last 6 years I've been helping companies within the group to develop their assembly processes to give us improved quality and improved residual values. I started in cranes in North America. We have a massive market share, but a guy could pay $2-300,000 for a truck crane and he couldn't understand why it looked second-hand when it arrived and certainly didn't look as good as his $15,000 pick-up. The cranes performed mechanically extremely well, but looked undistinguished at the start and pretty ropey after 2-3 years operation."
Chris pointed out that the old argument across the industry was, "These machines are going into a hole in the ground, no-one will see them." If a panel didn't fit, they'd bang it and bash it and grind it to make it fit, because someone was going to put a low gloss finish on it to hide the damage, and it didn't really matter. Everything was, effectively, painted twice, instead of trying to fix the reason for the metal marks.
The businesses were using air-drying alkyds and were building machines, then sanding down and painting. "We got all the consequent poor quality that comes out of that type of operation – and it was very expensive! A lot of our machines were designed by engineers whose only plan for corrosion protection was, "Somebody'll have to paint it". So in the U.S. we introduced over a 2-year period 8 or 9 new cranes, built to new principles and finished with a urethane system – primer and 2-K topcoat. This system gives great flexibility on flash-off between coats. The biggest battle was getting the sub-contractors to see that they could convert from being metal fabricators to producing a fully finished component."
Chris described how the new cranes were designed for pre-paint, and were checked to ensure that all surfaces could be painted rather than leaving voids as sites for corrosion and subsequent rust streaks. "It can be an enormous battle to get people to provide fixings so that you can bolt an option on rather than welding it on. In some factories we used to have people called 'live welders' who would descend on a machine almost immediately it had been painted and start cutting it up and grinding it and hacking away at it. Engineering all these things out takes a surprising amount of time and effort, but it has to be done."
I asked whether the lessons learned in the U.S. crane business were now general practice across the industry, but six years later, Chris finds the same problems and opportunities when businesses are acquired. "Powerscreen, in Northern Ireland, is a case in point. Their products work extremely well, and Powerscreen has a worldwide reputation for developing new products that customers want. But the dealers, particularly in Japan and Germany, were very concerned about the finish. So Powerscreen has invested £2M in moving to pre-paint to deliver a substantial quality improvement to make it the clear quality, as well as technical, leader. Other competitors, including other Terex companies, will catch up, but this investment will give Powerscreen a real lead in the market place."
Staff and subcontractors are hard to convince that it can be done. "So we painted the components for one machine in April, brought back the 12 suppliers and said, 'Right, they're all going to be like this' – then they started to believe us!"
If subcontractors worry about how to fund the new painting plant, and look for guarantees from Terex, they get a robust cold shoulder. Terex has its own business to run, and the subcontractors have theirs. "Six months later the majority are putting in finishing facilities to give us what we need and see it as an opportunity to supply an entire product rather than half a product."
Chris's experiences have clarified for him the benefits of clear responsibilities in the supply chain. "The advantage for us is that we can put the responsibility for the quality of the product directly with that supplier. When someone is supplying a welded fabrication, and someone else is going to clean and paint it, he views his product as half-made and, if it isn't quite right it doesn't matter: it can be fixed later. That's true of primed product. It's only when you say, we want something fully finished to this level of gloss and appearance, we are simply going to bolt it on and it has to fit, that they realise that they are fully responsible for their component."
At the risk of pointing out the obvious, handling very large components without damaging them is a real challenge. But quality is often about doing the obvious, so special transport jigs are a key part of the Terex strategy. These carry product to the assembly line so that it can be lifted off and placed straight onto the machine being built without extra handling or damage. The jig also acts as a dimensional check – if the part does not bolt properly onto the jig, it won't fit the machine either. "The big thing is to get everyone to accept that we are not going to have an automatic repair facility – the product is going to be built and shipped."
So far the conversation had been about, naturally enough, engineering and assembly. I wanted to know what part the paint played in raising the company's quality and image. Pre-treatment is invariably shot blasting or abrasive grit blasting to a surface profile of 40μ ± 10μ. Paint is applied at 120μ dft (2/3 primer, 1/3 topcoat). The primer will be either urethane (in north America) or epoxy (in Europe). A highly reflective topcoat is vital, normally a urethane.
Terex generally installs plant capable of ½ hour cycles – ½ hour to paint, ½ hour to cure at 80°C – but generally start by operating on a 1-hour cure time, leaving capacity to speed up the process. "This gives a product which is nice and hard and handleable, which can be worked on. It's very successful."
Naturally, I was interested to find out how Terex selected a coatings supplier to support what is clearly a vital plank of their manufacturing strategy. "Wherever we are, we always look for the same things. First of all, a presence in our industry, with a good understanding of the industry. Secondly, a good development laboratory. And thirdly, a technical service support that understands the business. If people come into any form of production trial who don't know what they're doing, we just forget them."
Chris finds that he can get the same level of quality in different countries from different suppliers, all meeting the specification precisely. " We tried to introduce our American paint supplier to Europe, but this failed. Then Beckers started doing trials on the Terex equipment at Motherwell in Scotland, and what swung it for them was that people knew what to do. Many of their U.K. staff have long experience of the construction industry, and it shows. This is about people. They were prepared to put the effort in. That was in about '98 – they're still doing the same thing now, and I suspect they will continue long-term. Beckers in the U.K. has been able to provide the level of service, the understanding of what's required, the ability to work with suppliers, and to get everyone up to the same quality standards. They've been very successful at that."
"Another thing that Beckers does, and does very well, is to supply us with special colours. We often need them very fast. We're bringing in special colours on components from Poland with just a few days lead-time, and supply through Becker Poland works very well now, after a couple of false starts. In the past year or so, Beckers has resolved these supply issues in central Europe."
It seemed to me that special colours could pose a problem with the pre-paint strategy, but Chris is adamant that pre-paint makes offering special colours easier, not more difficult. In some of the crane companies, 60% are finished in special colours, sometimes as many as five to a machine. This is particularly true of the U.S., where many machines are operated on rental or with owner-drivers. The one time that pre-paint becomes a problem is when bands of colour are specified, crossing different components. Sometimes this can only be achieved after assembly and the process really needs to be considered as a re-paint.
We discussed whether Terex believes in group-wide quality management initiatives. "No. Because we are very decentralised it's up to each general manager at each location. So, when I go into a plant, I go in to help him achieve what he wants to do. I'm not going in with a corporate 'This is how you do it' hat."
Terex is now producing demonstrably better quality at lower cost and in less time on the vast majority of machines that are now assembled pre-painted. It seemed to me that the word must be getting around within the company that pre-paint is a good way to do things. "Sometimes it is, sometimes it isn't. In one location at the moment I was simply asked, could I find ways to increase their output? It was quite obvious to me that you could. What I could see that they couldn't see was that it was quite easy to modify their finishing process to go pre-finish. It just needed a flash-off zone and an oven on the end. Essentially they want to go from 3½ to 5 machines a day, and to do it the old way was just impossible. That management team had no experience of anything else. For 20 years they'd been sanding away. Their spending on consumables, which included masking tape, plastic and body filler, was €30-40,000 a year – but this was the only way they knew. All I went and did was say to this guy, if we do it this way you can eliminate the bottleneck, make economies…if you have a factory on day shift, and the paint shop has to work two shifts, you're at a disadvantage anyway. This factory was looking at a 3-shift paint shop. This would have been just impossible. By January that one will be up and running. But it's not rocket science!"
Managing quality means developing future opportunities to stay ahead of the competition, and I wondered what part coatings might play in Terex' plans for the future. So far as the coatings themselves are concerned, Chris sees no dramatic change. The present standard paint system and pre-treatment is simple, it works, there is very good exposure data and high confidence in the level of durability. "I don't believe the system will change significantly. With the high solids coating we can get now – and that's an area where Beckers is certainly to the fore, as far as I can see – I think we'll continue to be able to meet emissions legislation whenever we are painting, and these coatings can help our suppliers also. Although as a manufacturer we will be much more responsible in the future for emissions, we will expect our suppliers to provide us with a lot of help and support. We're generally compliant through to 2007, and where we're not we're doing something about it."
I wondered how big a part powder might play in the future. "In the heavy end of the business, the technology is likely to stay the same. There is a little involvement in powder for some bought-in components. We have a lot of material 50mm thick, and powder demands too much time, energy and, particularly, floor space. For what advantage?"
It appears that, for Terex, the coatings challenge for the future is to find better ways of application. "I would like to find ways of reducing waste in painting. We need to be better than we are in managing the painting process. The ideal answer for Terex would be not to paint – by buying in everything ready-painted. Some factories, though, will remain much more vertically integrated, where painting is the natural end-point of the fabrication process. We've not had much success in maintaining real savings on electrostatic equipment, for example. We need to get better. At present we use mostly air-assisted airless spray. This is an area in which Beckers could help us more – but is it in their interest?"
Whilst I can't reply for Beckers, I can tell Chris what I've observed from years of working alongside Beckers. That, from the top, Beckers is committed both to environmental improvement – which means continually doing more with less – and to improving the efficiency, competitiveness and profitability of their customers – which means continually helping them to do more with less.
So, how would Chris sum up the last six years? "The benefits to us have been that we've dramatically improved quality and durability, both at the point of delivery to the final customer and, where machines aren't subjected to excessive wear and tear, an improved residual value. We've also been able, most of the time, to demonstrate that we can do it at lower cost than the old way. Lastly but by no means least, we also have been able, most of the time, to remove painting as the bottleneck in production."
Above all, this quality recipe wins business for Terex. "Coal India ordered 160 mining trucks from our plant in Scotland to be built within a year. They said it couldn't be done. Thanks to pre-paint we did it."
Released: August 2005