My name is Ryan Law and I am the President of Law Tanning Company in Milwaukee, Wisconsin. Law Tanning company is a leather tannery that manufactures custom leathers for our customers that cut, stitch, sew and assemble leather goods they then sell to the final consumer. We are a job shop, family-owned manufacturer that has been in business since 1936. I am the fourth generation in the family business management team.
The leather industry in the United States has undergone a great contraction over the last 40 years. Those tanneries remaining in the US are healthy financially because they have catered to customers that want highly specialized products that are unique, fashion/color focused, and need a quick turn-around in both R&D and production quantities alike. While many of the larger, commodity driven domestic tanneries have lost business due to high labor and environmental costs in the United States, demand for commodity leathers has not changed. Most of the commodity leather tanneries of the United States have moved to low wage and low environmentally restricted (high pollution) countries like China, India, Pakistan, and Mexico. Law Tanning cannot be the least expensive, but we are one of the highest quality and product-diverse leather makers in the world. This diversified market strategy keeps us in business and growing.
Last September our General Manager Retired . He had been running the business since 1983 and his father was the General Manager before him. These two men did a very good job navigating the business profitably through the great Tannery contraction that took place in the US over the last 40 years. The business had quadrupled in size over this time, but it was time for change and the 21st century was here. The new General Manager coming in had some different ideas that included using more technology, data driven decision making and modern management techniques. We heard about Cogent Analytics on a cold call from a local representative about a year before the former General Manager retired. After he retired, we called Cogent.
We had Merlin VanGerpen analyze our business a few weeks later and we made the decision to hire Cogent. Our assigned consultant would meet us the following week. Dan Beach arrived February 4th, 2019, and together with the Law Tanning Management team we tore into the business, looking for all of the possible ways to save an annual target dollar amount of $246,400.
Among the many undertakings Dan quickly helped us realize …
The first project Dan worked with us to produce was an accurate organizational chart where all supervisors could see their direct reports and who they reported to. This has never been done before and is a major, yet fundamental change for us. We moved from a top-down micromanaged management hierarchy with relatively few decision makers to a more-flat, evenly distributed organization with more responsibilities and decision making spread among management staff. Accountability, it was clear and like the smell of leather … in the air. Our supervisors now have the power to supervise. Their responsibilities are clear, defined and directly task-assigned. Production of the organizational chart led us into our second project:
performance driven job descriptions.
Performance Driven Job Descriptions may sound simple and logical. But how many companies do you hear using this term? The descriptions incentivize zero, to minimum overtime, clearly defined responsibilities, a summary of our “intentional culture ” and a chart that displays an X/Y axis of culture vs . performance. The job description itself allows for employee self-evaluation and management evaluation in separate columns. During future reviews the employee will know exactly where they stand in the mind of management and with their own abilities. Cultural and performance driven job success will be easier to get both employee and employer in alignment with our objectives.
A thorough, plant-wide head count review and confirmation that we had too many people working for too little product units shipped. (9 FTE’s reduced at this time.) We have right-sized the organization and implemented monetary incentives to reduce and eliminate overtime.
We implemented a scheduling tool that allows us to keep less work-in-process inventory in the tannery. Less WIP leads directly to less lead-time for customers.
The team has investigated, purchased and undergone training for a new ERP system that works with our accounting software. This enables real time data collection, better work instructions, and more accurate costing figures for improved profitability in the future.
We have plans to 5S and use a Kanban inventory system and this will be a future project. We are already working on it in fact.
As I write this, it’s 9 weeks after Dan joined us. We have proven savings of $379,445.00 and what clearly looks like, more savings to come. By using the new tools, data tracking, and policy changes Dan has helped walk us through a process of radical change and business philosophy change that everyone agrees is welcome, healthy, and necessary. When it’ s all said and done, Dan Beach and Cogent Analytics has proven to us what we always suspected. There were a lot of inefficiencies and backwards incentives in place that were taking Law Tanning away from our goal: high profit potential. We are now in a better position to achieve higher profitability due to Dan Beach and the process that Cogent provided us.
There’s no question in my mind that both myself and the upper management team will be in close contact with Dan and Cogent on future projects. There are always more ways to eliminate waste, grow sales, and be more efficient. Dan helped light the fire inside our team to pursue excellence at the level we always knew we could.
If any potential Cogent clients want to speak with us about their system and performance, I would be happy to refer Dan Beach and the Cogent team.
Sincerely,
Ryan Law
