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telwater Quintrex Stacer

Making Boats is Plain Sailing at Telwater


Telwater is a successful Gold Coast boat building company, which manufactures the Quintrex and Stacer brands of aluminium and steel boats. Paul Phelan, the Managing Director of Telwater, had come into contact with, and applied the Theory of Constraints (TOC) methods a few years prior to hearing of TOCCA.

In 2000, Telwater moved into new, state-of-the-art premises, which gave it the potential to expand its operations dramatically. The first step was to optimise capacity as quickly as possible. Although TOC was already used to some extent, Phelan believed it had more potential, so he contacted TOCCA to run a training workshop to “refresh” old employees and bring new employees up to speed with the TOC approach.

So, what did TOCCA do?
Initially, TOCCA ran a training workshop for Telwater to deliver the TOC concepts to key staff in the company. The next step was to help Telwater to radically improve its production processes and thus facilitate its expansion into new markets.

The Problem

Although boat building is an ancient trade, it is constantly evolving. New designs, new materials and new methods are continually being introduced. It is also a highly seasonal business with peaks and troughs in demand closely mapped to the seasons.

The boat-building processes at Telwater were already very refined, with a product set of over 80 different boats, all of which are highly customisable. This meant that it was very difficult to plan and manage workflow in a consistent fashion as well as optimise inventory to meet seasonal demand fluctuations.

Paul Phelan already knew about the constraint in the company’s manufacturing, through his previous exposure to TOC. He said: ”We wanted to work with a company that was going to help communicate the philosophy: ’what is good for the entire company is good for the individual‘. People always respond well to education and training and we wanted the team to feel empowered with the ability to make positive changes that impacted on the overall health of the business.”

TOCCA was thus engaged to run a series of workshops with all of the supervisory personnel from each of the manufacturing cells, as well as sales, marketing and finance – to provide a holistic solution. These workshops, which used Lego exercises as a learning aid, gave Telwater’s staff a clear insight into and understanding of the TOCCA approach and how it applied to Telwater’s processes.

After the workshops, TOCCA was engaged to help improve a specific area of the business – the medium boat manufacturing “cell”.

The TOCCA Solution

The welding shop had been identified as the constraint in the workflow process. Paul Phelan explains: ”We knew we had a bottleneck in the welding shop but the answer was not simply to hire more welders; we needed to look more closely at this area.“

Welding is a highly skilled operation, so it was clear that the use of the welders’ time had to be maximised. Actual welding time was identified as “when the blue flame of the welding torch is burning”, or “blue-light time”.

What TOCCA did was very simple but effective: they carried out a time-and-motion study to see exactly what the welders were doing with their time. As they were the bottleneck in the process, their welding torches, or the blue lights, were expected to be on most of the time, welding boat parts. The time-and-motion study proved that the blue lights were, in fact, only on for a relatively small percentage of the time! Most of the welders’ time was, in fact, spent fetching and carrying components, waiting for parts to arrive, and fitting parts to the boats. This is what was causing the bottleneck in the production process.

Further examination of the non-welding tasks carried out by the welders highlighted the fact that fitting the hulls was a very slow process. TOCCA made the following recommendations:

To invest in hi-tech equipment that would ensure that the hull pieces were more precisely measured so less time was needed to adjust them. This has speeded up the process considerably;
To delegate the fetching and carrying roles of the welders so they could focus on welding;
To manage the supply of components more closely using a simple “buffer-board”, which acted as a physical indicator of where the boat and components were in the process. Workers could look at the board and see if the work-in-progress had reached the point at which they were required, thus synchronising the production effort around the control point of the production process;
To develop a new remuneration system to continue rewarding good individual effort, but only when this was aligned with the requirements of the overall business

The Result

The company had been growing at an annual rate of 20%. Paul Phelan comments, “Growth of that magnitude has to come from somewhere and we realised that there would soon come a time when the local market became saturated. Our overall objective was to continue to improve our manufacturing process. TOCCA’s involvement enabled our staff to significantly increase output and efficiency.”

The Telwater team knew that once the manufacturing had been synchronised, they could plan and manage the run rate over the entire year. In turn this meant they could address the seasonal demand fluctuation issue and look to new markets in Europe and North America.

The company has now appointed distributors in Europe and made inroads into the lucrative North American and Canadian markets.

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