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CMTC Helps Clients Streamline While Increasing Manufacturer Profitability

August 09, 2000|STEPHEN GREGORY | SPECIAL TO THE TIMES

The California Manufacturing Technology Center helps small manufacturers trouble-shoot problems, cut costs and increase profits. The private, not-for-profit organization, funded in part by the state and federal governments, gives expert advice at seven offices across the state, starting at $100 an hour. Fabio Gomez, managing director of the Los Angeles office, recently spoke about his center's efforts to raise the bottom line of its clients.

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Q How does the California Manufacturing Technology Center help manufacturers become more profitable?

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A One of the biggest challenges companies face is how to grow in a time of rapid change. So we help companies develop strategies and implement solutions to their problems from the front office to the shipping dock.

We provide solutions in four areas: quality systems, management and business, operations and work force development. For example, we help companies implement International Standards Organization standards for quality. A lot of companies are required to be ISO-certified to do business internationally and nationally. There are certain specifications and procedures that companies need to comply with, and we help them do that.

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Q How can CMTC help businesses become more competitive?

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A We help companies eliminate waste from their processes. We help them develop and implement business plans, marketing plans, and do strategic planning. We do some company assessments and try to figure out where they stand compared to the rest of the industry.

We also help companies get started. Somebody comes to us with an idea, and we help them get it off the ground. We also help them to get financing.

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Q How do you help companies trouble-shoot their problems?

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A A company will contact us, and they might not even know what their problem is. So we go visit with them and try to determine what the problem is and what the potential solutions are.

The most common problem we hear from companies is that they are not profitable. They want to grow, but they don't seem to have the solution for how to do it. First we go and look for any waste that there is in the production system.

The way companies used to calculate profit has changed. Before, when a company manufactured a widget, they would figure out how much it cost them to manufacture it, and on top of that they added their profit to get their selling price.

Now because the competition is keen, the customers are setting the price. So the company has to take what it can get in profit by subtracting the production cost from the selling price. The only thing a company can do to increase the profit is to eliminate costs. So that's what we do. We go to a company and we figure out where in the whole process is the waste. And based on that, we'll develop leaner processes that help the companies eliminate the waste.

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Q Where are some of the most common areas you find waste?

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A All over the place. Sometimes it's on the operations side of the house. Very often a company has a crazy work flow. Parts are moving from one end of the shop to the other in no particular order. We help to streamline that operation, so the processes are in sequence. Sometimes, they have too much inventory or excessive travel times. Sometimes we help them design products that are easier to manufacture. Sometimes they have a problem in the front office or they don't have a good marketing strategy.

We basically concentrate our attention in five different areas. No. 1 is the quality. Do they have good quality products that they don't have to rework?

The next thing we want to do is make sure they deliver it on time.

Then we want to make sure they have good pricing policies. We want to make sure people will be willing to pay what they're asking for the product.

No. 4, we want to make sure they are innovative. If you're innovative, you can develop a more sophisticated product and you can tap into different markets.

Next we help them adapt quickly to change. The market is changing so rapidly that for these companies to stay on top of the competition, they have to know how to change quickly. To be innovative, you have to have the proper team in place that can move rapidly. And we eliminate all the waste in the processes so that they can react faster.

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Q How does CMTC help streamline operations?

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A Sometimes we help people design products. Somebody comes to us with an idea, and they need somebody with an engineering background to help design this product. Sometimes we go and help them with the automation. They might rely on manually operated processes, and we help them automate them. We'll even exchange our engineers. If there is a particular problem, say, in Fresno or Sacramento that requires a consultant that is located in Los Angeles, we'll not hesitate to send the consultant over there.

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Q How can CMTC help improve a company's work force?

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A We have seen a lot of need out there for work force development. The job market is so tight that it has been difficult to find the right people. Companies are realizing more and more that employees need to be trained and that employees have to work as a team. A couple of years ago, companies were focusing on quality, delivery and price. Faster, better and cheaper, that was the whole scenario. But now everybody has caught up with that, and now you've got to be innovative. You've got to be in front of the market. In order to be innovative, you have to work as a team. In order to adapt quickly to change, you have to work as a team.

We put programs together that help companies achieve that.

The California Manufacturing Technology Center can be reached at (800) 300-CMTC, or visit the Web site at http://www.cmtc.com.

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