Sulzer Metco/Sulzer Eldim Division Sulzer Eldim is a division of Sulzer Metco, a company under the Sulzer Metaplas umbrella. The company is a leader in the aerospace and industrial gas turbine industries, having developed long-term relationships with OEM manufacturers. Their technological, financial, and human resources have facilitated a long history of success. Recently, they have implemented a cellular manufacturing strategy, with a Zero Defects policy, which has greatly increased efficiency. They are now looking to implement a similar strategy across other departments. Their concerns regarding reduced efficiencies for low-volume orders are invalid. In addition, the concerns regarding reduced autonomy within divisions, will simply be transferred autonomy to core groups, as the semiautonomous manufacturing cells currently experience. A timeline for implementation of this strategy is provided.

Introduction

For several decades, Sulzer Metaplas GmbH has been a leader in the coating services and thin film equipment industry. Sulzer Metaplas was founded under the corporate umbrella of the Sulzer group, which begain in 1834, in Winterhur, Switzerland. Today, this global leader has multiple divisions that pave the way for groundbreaking technologies in each of their respective markets. The Sulzer Metco division specifically focuses on the surface coating and refining market. ("About us," 2010). Within Sulzer Metco, Sulzer Eldim specializes in the non-traditional manufacturing and machining of gas turbine parts, including -- turbine seals, blades, turbine compressor stators and stator assemblies, vanes, fuel nozzle guides, and inserts ("Sulzer," n.d.). Recently, Sulzer Eldim has implemented a cellular manufacturing strategy and intend on deploying it throughout all departments, to benefit the entire division. With this new strategy, Sulzer Eldim must determine how best to deal with the increased costs of low volume individual orders, which cannot be calculated with a business case/cell concept, while also determining and preparing for the challenges they are likely to experience as they further implement the cellular strategy across other departments.

Sulzer Eldim Operations Overview

In 1909, Max Ulrich Schoop invented the process of "spraying lead and zinc metals for protective coatings. His second patent incorporated an electric arc as a heat source" ("History," 2010) and with it invented the process of Thermal Spraying. In 1933, Rea Axline founded Metco in 1933, in New Jersey. With five employees, Metco developed innovative spray guns for the Thermal Spraying process, along with material improvements. This early success led to expansion into Europe, and in the 1970s, the company would develop a joint venture with Plasma Technik AG, of Switzerland. In 1985, Sulzer acquired Plasma Technik, and nine years later, Sulzer Metco was formed. Today, Sulzer Metco provides surface solutions to their customers to "improve the value and service performance of the components (their customers) produce or require for their own operations" ("History," 2010). One division within Sulzer Metco is Sulzer Eldim.

Sulzer Eldim's comprehensive portfolio of manufacturing processes allows Sulzer Eldim to develop and manufacture critical engine components as a "one stop shop." Thus, we can easily adopt manufacturing processes to meet changing customer requirements, including challenges that call for modification to the original component design The various components are processed in a state-of-the-art, cellular manufacturing environment with a focus on customer requirements and supported by lean manufacturing methods. This has translated itself into our company achieving high on-time delivery and quality performance

("Products and services," 2011).

In addition, Sulzer Eldim has added selective in-house production processes, as a means of providing a select number of specialized components, for their customers.

Much of Sulzer Eldim success has hinged on their successful supply chain management, and their business process integration that has involved collaboration between the company and their customers. The various business processes embedded in Sulzer Eldim's supply chain process include: procurement, product development, manufacturing management, distribution, performance measurement, distribution management, and customer service management (Lambert, 2008). Customers rely on Sulzer Eldim to provide non-traditional manufacturing and machining of gas turbine parts, including -- turbine seals, blades, turbine compressor stators and stator assemblies, vanes, fuel nozzle guides, and inserts

Current Resources and Competencies at Sulzer Metco

Sulzer Eldim has a variety of resources and competencies at their disposal to continue their history of strong growth. In an era of troubling economic times globally, the parent company of Sulzer Eldim, Sulzer Metco, realized strong growth in 2010. Order intake increased 17.9%. Sales grew 12.1% from 2009 figures, in 2010. Additionally, operating income climbed 178.5% in 2010 ("Key figures," 2011). Some of this growth is due to strong gains in the machinery consumption market, and 2011 looks to be another year of growth. In the United States alone, "manufacturing technology consumption rose nearly 100% in March 2011 compared...

Sulzer Eldim has established long-term, high quality relationships that have resulted in continuous improvement in their products and added value for their customers. The company offers their partners -- high-tech manufacturing, continuous innovation, state-of-the-art facilities, and technical expertise. This allows Sulzer Eldim to take projects from the concept stage through successful production ("Successful Long-Term," 2011).
Since the division was established, Sulzer Eldim has built a business that is customer centric. They are proactive in their involvement of product production, from the earliest phases of concept development that allows for improved manufacturability of key engine components. Sulzer Eldim's expertise allows them to meet their OEM customer's challenging goals, often exceeding their customer's expectations. They use their production and engineering experience to continuously improve their internal processes. This benefits their clients through reduced manufacturing costs and improved repeatability of parts. These resources, combined with Sulzer Eldim's production capacity to produce not only their customer's required volumes, but also quality, is why the company has become a trusted partner of the OEMs ("Successful Long-Term," 2011).

Sulzer Eldim has the financial resources available to them to fully take advantage of the opportunities globally. Their parent company's overall return on sales in 2010 for the division was 9.2%. ("Sulzer annual," 2010). Additionally, Sulzer Eldim has the human resources to continue their history of growth. Their parent company's executive team is lead by Cesar Montenegro, who has a "proven track record in leading and growing complex businesses, energizing people and increasing performance" ("Cesar Montenegro," 2011). Additionally, Sulzer Eldim's technological resources are a significant asset at the company's disposal.

Sulzer Eldim offers non-conventional machining and manufacture of gas turbine components - in particular

blades, vanes, turbine seals, turbine compressor stator vanes & stator vane assemblies, inserts and fuel nozzle guides. Founded in 1970, Eldim was the first Dutch company, and one of the first in Europe, to apply advanced machining technologies in the gas turbine field. One of Eldim's core activities is the machining of cooling holes in turbine

components, by means of spark erosion (EDM), elecro-chemical drilling (ECD) and laser drilling. These methods of machining allow Eldim to meet the critical tolerances and the high standards required by the gas turbine industry ("Sulzer," n.d.).

Continuous technological improvements, through a well-supported research and development division and customer collaboration, has kept Sulzer Eldim and it's parent company, Sulzer Metco, an industry leader for decades. According to the Sulzer Annual Report 2010,

We have kept our investment level in research and development high, which allows us to continually seize new business opportunities. A systematic process is used to identify and expedite those projects with the greatest market potential. As a result, the number of new products launched in 2010 increased and the number of solutions in the prelaunch phase is higher than in the last ten years (p. 5).

Research expenses are approximately 2% of annual sales ("Sulzer annual," 2010).

The organization's competencies lie in their lean manufacturing processes and their commitment to improving their quality of their process outputs, with their Six Sigma projects. Through minimizing the variability in their manufacturing processes, Sulzer Eldim has not only increased their turbine products quality, but also reduced costs and increased profits. The company relies on the DMADV methodology of Six Sigma. Improvement projects involve first defining goals that not only meet customer demands, but also the mission of Sulzer Eldim. The company's vision "is to be "The Leading Global Surface Solution Company" by providing innovative and high quality products and services to our customers" ("Vision," 2011). Once goals are defined, Sulzer Eldim measures the Critical to Quality characteristics, as well as their capabilities for their production processes. They then analyze these results to improve their design processes. Running tests, Sulzer Eldim then works out the design details. They then verify the design and perform pilot runs of the new processes, before fully implementing the newly improved process.

Through cellular manufacturing, Sulzer Eldim uses common processing and standardization.

As an example, (Sulzer Eldim) process families of components using semiautonomous teams. The focus of these teams is to operate as efficiently and effectively as possible to provide a competitive offering. Each team is supported by in-cell manufacturing engineers driving continuous process improvement. In-cell key performance…