How manufacturers can stay competitive

There aren’t many products that are more symbolic of America than the cowboy boot, but look inside one today and there’s a chance you’ll find a “Made in China” tag.

The outsourcing trend began more than a decade ago, but El Paso-based Lucchese Boot Company has seen its competitive advantage in the U.S. erode further in recent years, as the threat of overseas competition has spurred other domestic boot makers to modernize their manufacturing processes.

So the 132-year-old company is following suit.

Lucchese has enlisted the help of the Texas Manufacturing Assistance Center at the University of Texas at El Paso and engineering students to increase the efficiency of its plant, located on the Eastside at 40 Walter Jones.

“If we can keep jobs and production in El Paso, that should ultimately be our goal. These people are who we are, and we should be doing all we can to keep them,” said Michael Lawlor, Lucchese vice president of operations.

Standing on the production floor last Wednesday, Lawlor looked genuinely ebullient while talking about how the company is using “lean” manufacturing methods to reduce waste and inefficiency for the first time.

“You must think I’m drinking the Kool-Aid,” Lawlor said, after he realized how excited he had gotten talking about processes, efficiencies and optimization potential.

“Lean manufacturing does exactly what we were looking for,” he said. “It identifies waste in our processes and helps us to get our product from the beginning of the manufacturing line to the customer in the shortest amount of time possible.”

The company employs about 400 people in El Paso, and its luxury boots have been worn by everyone from American icon John Wayne to former British Prime Minister Tony Blair.

The man most responsible for the redesign of portions of the plant’s operations and the cork boards that have gone up across the production floor, which are covered in colorful graphs that track performance, is engineer Jesus Reverol.

Reverol was one of six manufacturing specialists who worked at the Texas Manufacturing Assistance Center, or TMAC, until a few months ago. That’s when he was recruited away by Lucchese to work full-time at the company as director of process improvement.

“We started just playing with the plant, basically, making small changes here and small changes there,” Reverol said.

The production floor used to be organized like a “spider web,” Lawlor said. Now it’s organized so that each step in the boot-making process flows to another, so that a person walking from one end of the plant to the other sees the boots slowly take shape.

Beyond the jargon, the changes mean that the company can make more boots in a shorter amount of time and keep more of its production here.

TMAC’s regional office in El Paso was founded nearly 20 years ago. Its aim is to increase the El Paso region’s global competitiveness by working with small- and medium-sized manufacturers to implement new technologies and best business practices.

The center, which is housed by UTEP, also provides engineering students the opportunity to work on real-world problems, said TMAC regional director Hilario Gamez. Engineering students, who might be working on their senior projects or looking for work experience to improve their résumés, can apply to work beside the center’s manufacturing experts.

The El Paso center is one of 60 across the United States that is part of the U.S. Department of Commerce’s Manufacturing Extension Partnership.

The partnership was created in the 1980s when U.S. manufacturing began to lose ground to Japan, where Toyota became famous for its production system.

The centers are public-private partnerships that are funded in part by the federal government, state governments and client fees. The El Paso office operates on a $1.5-million budget and works with roughly five clients a month, according to Gamez.

TMAC’s services tend to be less expensive than hiring a consultant, as it leans on the resources of the university and federal government.

“You can go out and spend a substantial amount of money on a plant optimization consultant to come in,” Lawlor said.

Across the state, the manufacturing assistance center has helped more than 5,000 Texas companies that have reported $682 million in cost savings. They have also reported creating or retaining 20,000 jobs as a result of TMAC’s services, according to Gamez.

After reaching capacity in its El Paso facility four years ago, Lucchese outsourced some of its production to Leon, Mexico, according to Lawlor. That was before the company had hired TMAC and Lawlor had seriously considered increasing production at the El Paso facility by implementing lean manufacturing strategies.

“In hindsight, we should have spent more time looking at the capacities here and improving our processes,” Lawlor said.

He added, “We will be able to produce more in this facility, because we are identifying where we are failing.”

The company is now preparing to launch a new boot collection, Lawlor said. He didn’t reveal many details, except to say he hopes that the new products will attract new customers to the brand while appealing to loyal Lucchese customers who are buying other types of footwear they could buy from Lucchese if the company produced them.

“He might wear an oxford shoe to church on Sunday and wear cowboy boots all week long, but he’s got to buy an oxford somewhere,” Lawlor said. “And if he is already familiar with Lucchese, why shouldn’t it be a Lucchese Oxford?”

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23 Feb 2015

By Robert Gray