4 Ways High Performing CNC Machine Shops Get That Way
November 26, 2013
For the third year, Gardner Research conducted an in-depth study of CNC machine shops to better understand the reasons some companies perform better in terms of income, profit and growth. The study focused on 4 keys to success:
Investment in machining technology: 61% of these high performing shops use horizontal machining centers (HMC) as opposed to 44% for other shops. This enables them to be twice as productive as shops using only vertical machining centers (VMC). Significantly more top shops use advanced 5-axis machining with contouring capabilities. The most successful shops also are more likely to use custom or specialty tooling (75% versus 50%) and quick-change fixtures for fast changeovers.
Improving manufacturing processes: The leading shops look for every opportunity to improve workflow and reduce waste. They typically have higher spindle utilization (80% versus 65%) and better delivery times. They are also more likely to implement lean practices and employ robotic-assisted automation.
Human resource policies: According to the survey, salaries for those working in the leading shops are only slightly higher than average. However, they are more likely to have bonus plans and other incentives. They are also more inclined to conduct annual performance reviews, have team-building and leadership development programs, and reimburse for continuing education.
Business strategies: A primary strategy for the most successful shops is to invest more than twice as much (13% versus 6%) of their revenues on capital equipment, and focus on improving processes. As a result, this survey reveals that the top performers have profit margins nearly double those of other shops.