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Manufacturer of Precision Machined Components
Background
The firm is a manufacturer of precision machined components used in the
automotive, office equipment, and computer industries. At certification,
the firm had 25 employees and annual sales of approximately
$2 million.
During the early '90s, many of the firm's Fortune 500 customers embarked on a
campaign designed to shrink their supplier base from thousands of vendors to a
few hundred closely linked partners. The firm lost several contracts during
this process, when imports were commanding a larger
share of the market as the large OEMs formed strategic partnerships off shore. By
the time of certification revenues were at a point that could no longer ensure
the future operation of the business.
With the NYS TAAC’s help, management identified areas that if improved would
ensure the long-term viability of the business. These areas included a product
line that was mature and, at best, stagnant; weak sales representation; and
inefficient manufacturing processes.
Assistance Provided
The recovery strategy recommended that the firm attain QS certification of its
quality system to attract and retain customers and increase sales. To achieve
this, the following assistance was provided as part of the project:
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Evaluate current quality systems for compliance with QS-9000
requirements
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Educate and train the firm’s staff to facilitate improvements
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Identify required documentation and prepare plan to address needs
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Prepare required documentation and appropriate chart required for
QS-9000
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Train internal auditors for continuous support of the firm's QS-9000
program
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Assist with implementing a quality system compliant to the latest
edition of QS-9000 requirements
Project Results
Even before final certification, a local automobile manufacturer
had approached the firm for a possible partnering opportunity. The magnitude of
this opportunity included a multi-year contract beginning with an order of
250,000 parts the first year, increasing yearly until output reached 1 million
parts per year. Employment would increase 5-10 people the first two years with
the potential of more in the future.
Within one year of achieving QS certification, net sales increased 60 percent
and employment increased over 20 percent. New bids for additional automotive work
are expected to grow sales by an additional 15 percent. The firm is now the largest supplier of
precision-machined components for two of its OEM customers.
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