Original Date: 08/30/2004
Revision Date: 01/18/2007
Best Practice : Sharing Work
RB Tool & Manufacturing Company and sister company, TOMAK Precision, are two independently operated companies with very different capabilities, but share and receive work from each other. Sharing Work enables each company to level its workload and also perform the work that best utilizes each company’s capabilities and expertise.
RB Tool & Manufacturing Company (RB Tool) and TOMAK Precision are two independently operated companies with very different capabilities, but cooperate successfully in Sharing Work. What may be one company's deficiency for supporting a particular job may be the other company's strength. As a result, RB Tool benefits by avoiding outsourcing because of a lack of certain capabilities or shortage in manpower resources. In turn, customers benefit from the expertise and capabilities of both companies.
Prior to Sharing Work, each company bid on jobs and accepted orders independently, with little regard for the contributions of the other company. They independently sought external sources to perform a process where they lacked capabilities and resources, or they resorted to costly and time-consuming manual operations. External sourcing required close attention and monitoring to ensure deliverables and pricing were held within defined requirements to satisfy the customer. In some cases, jobs were turned down because of too many uncertainties something neither company wanted to pass on to its customers.
RB Tool and TOMAK Precision realized that a unique arrangement existed between them both companies share the same ownership yet they had not taken advantage of this opportunity. The companies have an established relationship and operate under an almost identical business structure. RB Tool’s capabilities and expertise in angled milling and assembly and TOMAK Precision’s capabilities and expertise in grinding and honing are different, but a good fit. The differences complemented each other in developing and expanding their total customer base, an excellent match from a business standpoint. Each company’s marketing strategy is included with the other company’s capabilities and resources. Requests for quotes, work orders, and inquiries from customers are still processed by the primary company performing most of the work, and each job is reviewed to determine the type and amount of work that can be shared. When dips in the workload occur at one company, the other company can shift its work to fill the daily shortfall, and move the work to the other facility rather than move employees.
In the past, TOMAK Precision manually performed machining (mill work for cylinder blocks). By Sharing Work, RB Tool supplies the mill work, thus reducing cost by 38% and lead time from eight to 10 weeks to five to six weeks. Sharing Work enables greater penetration of customers, and the work is performed at the facility that can most efficiently complete the job providing more value to the customer. Since implementing the Sharing Work process, the companies have realized a 60% increase in sales per customer. An average of 7% of RB Tool’s sales is generated by TOMAK Precision, and 5% of TOMAK Precision’s sales are generated by RB Tool.
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