Bay Of Plenty

When ten minutes downtime on the factory floor costs around $1,000, it is easy to see why there is a real need for everyone working at HukaPak to focus on constantly improving productivity and efficiency. 

HukaPak is a key player in the kiwifruit industry.  Twenty years ago, a number of Maori co-operative trusts set up a small packhouse to package the fruit from their orchards.  Today, HukaPak has more diverse shareholders but still maintains a lot of that early co-operative spirit.  Annually, they process over 5.5 million trays of kiwifruit – around 5% of the entire industry in New Zealand.

Gerry Schumacher, General Manager Operations, says a very poor season three years ago forced them to make a lot changes in the way the business operated.  “We had some bad results that year in terms of fruit loss – fruit we have to throw out – and repackaging which happens when we have to handle the same piece of fruit twice.  Our growers have to pay for those losses and inefficiencies.  It directly affected our growers’ bottom line and we simply had to improve,” he says.

The focus last year was improving the processes on the floor.  “Basically, we documented or re-documented all our standard operating procedures.  It had all become a bit ad hoc over time.  This got us up to the industry average which was a real improvement but we knew we needed to do more,” Gerry says.

The ‘more’ turned out to be ‘lean manufacturing’ which Gerry had first encountered when he worked at dairy giant Fonterra.  “I was introduced to their ‘Manufacturing Excellence’ system at Kiwi Dairy in Hawera and saw the results there.  Since then, I have kept an eye on the lean manufacturing literature.  This year, we are bringing it in here,” he says. 

Gerry admits ‘lean manufacturing’ is still in its infancy at HukaPak but even with a softly-softly approach, a small budget and just three pilot projects running, it is already making a difference. 

“Basically, we look to be on track to be at half the industry average on fruit loss and repacking.  That’s a huge turn-around in three years.  We have three pilots running which focus on training, preventative maintenance and our stock ordering system,” Gerry says.

The key, Gerry believes, is that ‘lean manufacturing’ forces companies to clarify their goals.  “You have to identify what adds value to your customer and what does not.  Then you cut out the stuff which does not add value which frees you up to work on the key things that do,” he says.

One of the hardest steps for traditional managers is to empower their staff to do their own assessments of how well they are doing. 

“We give people the tools to run their little part of the business – it’s literally theirs – including small budgets.  In this environment, staff come up with all the ideas for improvements.  The challenge for supervisors on the floor is to stop being autocratic supervisors and become coaches and leaders.  They need to take the time to step back, look at the team and see where they can help rather than looking over people’s shoulders all day.  The new role means we have to either train them better or suggest they do something else in the packhouse,” Gerry says.

“The intent behind doing three small projects was get them up and running.  It is best to not start too big.  Take a couple of quick steps before trying to run.  If people see the results quickly, they know this process is actually something that helps us all and makes all our jobs better,” he says.

Perhaps most unexpected development was that the staff picked up the ‘five S’s of lean manufacturing’ and started doing them – before management even asked them to.  The five s’s are Sort, Set in order, Sweep and shine, Standardise and signpost and Sustain. 

“It is fantastic that people just picked it up and ran with it.  Everything is cleaner and things are in their proper place.  You don’t see people wandering around looking for gear anymore,” Gerry says.

“This sort of behaviour justifies the trust we put in our workforce.  In New Zealand, we tend to dumb down a lot of the messages we send to staff.  My advice is to trust your people and see what happens.  I think you will find that people are contentious and want to do a good job.  That is why they can do their own checking and improvements.  All they need is a bit of coaching and mentoring,” he says.

The training project is designed to teach supervisors – the only permanent staff in this seasonal business – how to lead and coach.  They have to train the seasonal staff for the busy period of April and May.

“We found out that some supervisors did not know all the processes that well.  Our documentation was also hard to read.  We came up with ‘cheat cards’ which fit in their back pockets but contain all the things people need to know about a certain process – training, policy, reinforcement, hints and safety.  The cards also help standardise our processes as everyone is getting the same simple-to-understand information,” Gerry said.

The preventative maintenance pilot is designed to ensure HukaPak does its maintenance where it matters most.  They are looking to identify the key machines that break down. 

“If we find the problem before it happens, we can work to minimise it.  If it does break down, we want to be ready to fix it as soon as possible.  We now have contingency planning.  Basically, we found the one machine which caused the most downtime.  Of course, it was the hardest to fix but we put a huge amount of effort in to keep it running.  We got a 50% reduction in downtime from that critical machine.  Other machines now have up to 200% less downtime thanks to this project,” he says.

When the Class Two packaging line used to break down, HukaPak would also close down the two Class One (or export-quality) lines.  “The operators did not understand that the Class One lines were adding all the value for our customers.   Now we keep them running and process the Class Two fruit elsewhere in the packhouse until their line is fixed.  ‘Lean’ helps you see these problems,” Gerry says.

The packhouse now also sports sets of traffic lights which let everyone know what speed the line should be running at.  “Green means we can speed up, orange means we need to pull back and red means there is a problem.  It is simple idea – easy to see and easy to measure – and the staff came up with it themselves,” he says.

Gerry admits HukaPak has only just started their journey.  His advice is “spend the money in the right places, focus on what your customers value, use the tools available through ‘lean’ and involve your staff.  People have to understand what matters and why.  People are the heart of the company,” Gerry says.