SOURCE: The Boston Consulting Group

The Boston Consulting Group

October 04, 2011 12:01 ET

Philips Respironics Wins 2011 Plant of the Year Award from ASSEMBLY Magazine and The Boston Consulting Group

New Kensington, PA Plant Honored for Its Operational Excellence Stemming from Creatively Applied Lean Manufacturing Principles and an Emphasis on Employee-Driven Continuous Improvement

CHICAGO, IL--(Marketwire - Oct 4, 2011) - ASSEMBLY magazine, a trade publication that focuses on durable goods manufacturing industries, and The Boston Consulting Group (BCG), a global management consulting firm and the world's leading advisor on business strategy, today named Philips Respironics of New Kensington, PA as the winner of their 2011 Assembly Plant of the Year Award. Philips New Kensington was chosen for its creatively applied lean manufacturing principles and its ongoing commitment to continuous improvement at all levels of the organization.

The 172,000-square-foot plant near Pittsburgh assembles electromechanical medical devices that provide a continuous stream of air pressure for treating respiratory problems like obstructive sleep apnea. The facility ships its devices to more than 60 countries.

The two-year-old state-of-the-art facility was designed with three things in mind: people, lean manufacturing, and the environment. Efficient manufacturing systems, automation, world-class IT, flexible work teams, self-directed continuous improvement, and mixed-model assembly lines are key tenets of its operations. Among the plant's achievements, which will be featured in the October issue of ASSEMBLY:

  • Since the $32 million plant opened in 2009, assembly errors have decreased by more than 80 percent and labor efficiency has risen by more than 35 percent.
  • In-house teams have developed innovative design solutions for improving product quality based on customer feedback. They have also designed an automated testing platform that performs all aspects of functional testing, calibration, and vision inspection.
  • Management has built a culture of engagement and constant improvement by encouraging employees to focus on five key metrics: quality, cost, delivery, safety, and morale.
  • The plant is a greenfield facility committed to sustainable business: Thirty-one percent of its building materials content, by value, was made using recycled materials, and more than 55 percent of construction waste was recycled. Premium parking spots are reserved for employees who own electric and hybrid vehicles.

"Philips New Kensington is a model of excellence for high-volume manufacturing," said Austin Weber, senior editor of ASSEMBLY. "Employees are organized into self-managed work teams, and this has produced remarkable results and innovations. 'Move parts, not people' has been the rallying cry, encouraging new efficiencies."

"We are very impressed with the level of engagement and commitment on the part of all Philips Respironics employees to building a culture of continuous improvement," said Michael Zinser, a partner in BCG's Chicago office and a co-leader of its global manufacturing practice. "Many organizations struggle to achieve this level of success, but at Philips the management team's active participation in developing its lean programs and the emphasis on employee engagement from the onset have been fundamental to the company's strong performance."

Eric Kulikowski, senior director of North American operations at Philips Respironics, told ASSEMBLY that the plant's success is based on a portfolio of lean manufacturing practices and a customer-focused culture. "But successful organizations are defined by more than the numbers they produce or the metrics they track," he explained. "Our people are what define who we are today. And the people side of our business is our greatest reason for sustainable performance going forward."

Respironics was founded in 1976 by Jerry McGinnis, a biomechanical engineer. Royal Philips Electronics N.V. acquired Respironics in 2008 for $4.9 billion. Philips is a $33 billion multinational company based in Amsterdam. Its three main business units are health care, lighting, and personal care.

Philips New Kensington is the eighth recipient of the Assembly Plant of the Year competition, which is judged by ASSEMBLY'S editorial staff and BCG's Operations practice. Previous recipients are Eaton Corporation (Lincoln, IL); Batesville Casket Company (Manchester, TN); IBM Corporation (Poughkeepsie, NY); Schneider Electric/Square D (Lexington, KY); Lear Corporation (Montgomery, AL); Xerox Corporation (Webster, NY); and Paccar/Kenworth Truck Company (Renton, WA).

The nomination form for the 2012 award will be available at www.assemblymag.com in January. For further information on the award, please contact ASSEMBLY's Austin Weber at (847) 405-4013 or webera@bnpmedia.com.

About ASSEMBLY Magazine

ASSEMBLY (www.assemblymag.com) is a monthly trade magazine that has been published since 1958. It is read by plant managers, manufacturing engineers, and design engineers in a wide variety of industries, including automotive, aerospace, appliances, consumer goods, electronics, industrial machinery, medical devices, and telecommunications. ASSEMBLY covers the systems, equipment, tools, and materials used by original equipment manufacturers and contract manufacturers to assemble discrete parts into finished products, including manual and automated production processes. ASSEMBLY is published by BNP Media.

About The Boston Consulting Group

The Boston Consulting Group (BCG) is a global management consulting firm and the world's leading advisor on business strategy. We partner with clients in all sectors and regions to identify their highest-value opportunities, address their most critical challenges, and transform their businesses. Our customized approach combines deep insight into the dynamics of companies and markets with close collaboration at all levels of the client organization. This ensures that our clients achieve sustainable competitive advantage, build more capable organizations, and secure lasting results. Founded in 1963, BCG is a private company with 74 offices in 42 countries. For more information, please visit www.bcg.com.