The key to packaging company Standfast’s increased efficiency has been its conversion to lean manufacturing.

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Some companies look at the decision to go lean as a necessary process to stay competitive.

For Addison, Ill.-based Standfast Packaging Products Inc. President Jay Carman, the choice marked a significant step in the company’s reinvention.    

Carman introduced lean processes to the company when he replaced his father as president five years ago.   

“There were a lot of naysayers within the company,” Carman says. “What I tried to make them understand was that our integrity and our old-fashioned business values won’t change. I’m conservative, but from a business standpoint, the old ‘my way or the highway’ viewpoint is not going to help us.”

In 2000, the company lost its two biggest accounts, each nearly worth a million dollars. “Our customer base had to consolidate to reduce their costs to compete globally,” Carman says. As industry consolidation became more frequent, Standfast, which manufactures corrugated boxes and assorted packaging, became vulnerable. Carman decided that to compete with its larger competitors, it needed to reintroduce itself to the marketplace.

“With all the [industry] consolidation, [I thought] there may be some opportunities for companies like us to take advantage of what bigger companies can’t,” Carman says.

The company’s customer base used to consist largely of industrial accounts, but Standfast shifted its attention to consumer packaging, such as specialty food packaging. While bigger companies continued to go after larger accounts, Standfast found its niche as a provider for smaller companies with special needs.
 
Internal Changes
The next step in the company’s reinvention was an increased investment in equipment. This includes its four-color vacuum transfer dye cutter, which it purchased in 2003. “We can run various board grades through it, with good registration and good print quality,” Carman says.

Only about 10 percent of its competition has that four-color capability – most have two, Carman notes. It also added a specialty gluer in 2004 for its specialty cartons, which helped it earn business in new markets, such as direct print, graphics and consumer-based packaging.   

The company’s internal investments and exploration into new markets occurred in tandem with its increased efficiency. The company changed the way it handled pricing and customer service by delegating pricing duties solely to one member of its staff, instead of having its customer service representatives handle the job. “We were able to get back to customers more quickly, and we immediately noticed we were getting more business,” Carman says.

Employee Pride
“We try to solve a problem holistically – we like to empower people to solve problems,” Carman says. The company’s employees are split up into department teams and are encouraged to come up with their own solutions to internal problems before seeking executive input. Carman explains the company works diligently to “resolve issues at the core.”

To encourage communication among staff, employees are given Nextel phones, which can be used similarly to two-way radios for enhanced communication, and they meet one hour each week with their teams. “We try to communicate so everyone understands what going on,” Carman says. “We also try to standardize our operations for that same reason. There is always so much opportunity for misinterpretation, and we try to prevent that with increased communication.”
    
The Lean Advantage
While increased communication and new equipment helped, the biggest factor in Standfast’s increased efficiency was its conversion to lean manufacturing.    

“We’re keeping our inventory down; we don’t load up our warehouse,” Carman says. “Instead of keeping five shipments on our floor or a 120 day supply, we’ll keep only two weeks’ worth.

“We reinvented ourselves,” he says. “You’ve got to be lean if you want to survive.”