An unsurpassed knowledge session: The future of the steel construction supply chain

The future of the steel construction chain is uncertain. More uncertain than ever, perhaps. Energy and steel prices, personnel shortages, increasing complexity in laws and regulations... How do we prepare for this? Meco Metal, Infosteel, Building with Steel and Liemar Software organized a knowledge session to share Meco Metal's approach. The meeting exceeded all expectations.

Harry Seijkens, manager of Meco Metal, was able to tell 110 interested attendees about his adventure. In a candid interview, he took his audience on a journey through more than six years of entrepreneurship at Meco Metal. His Dutch and Belgian listeners were taken into his world of lean, reduction of fixed costs and ERP software.

"We see several uncertainties for the future," says Seijkens. "The volatility in steel prices is troublesome. Combine that with skyrocketing energy prices and you have a challenging situation when it comes to costs. In addition, everyone seems to be facing a significant shortage of qualified personnel. Moreover, there seems to be a recession coming, in which the demand for our products and services may decrease." Jan van Hapert of Liemar Software, adds: "Projects are becoming more and more complicated. And that is mainly due to factors that are not about steel. Think of circularity, building codes, CO2, regulations, nitrogen, PFAS, quality requirements, ... But what we see above all is a lack of time."

When Seijkens joined Meco Metal as managing director, he was given a clear assignment: "To professionalize the company, make it independent and profitable. "Fortunately, I like a big challenge," he says. "Because what I found here was a sawtooth production process (hollowing out and standing still), a total lack of site management, unclear processes and, above all, a lot of waste."

"My approach is a combination of working lean, addressing strategic cost items and deploying ERP software," Seijkens said. "You don't do something like this on your own, so I formed a strong team to work together day in and day out. Together we started working directly and concretely with our wastes. From the beginning, we kept a list of areas for improvement, big or small. That list now consists of 690 points, of which about 50 are still open. Those, of course, are the toughest. New points are also still being added, because you can always keep improving."

"Learning from each other and with each other, taking out every waste, every day: that does something to the people in your organization, who have an unchanging environment as their history. And of course there is a lot of resistance. But you have to get through that," Seijkens said. "Just tell someone who has been doing welding for 25 years that he also has to learn to work with the sawmill. That's a bit of a shock. Yet that's exactly what we did, because it brings flexibility in scheduling and work. We took a close look at three major cost items, each with impressive results. For example, we adjusted our waste management. In fact, separating waste properly is much more cost-effective and not at all difficult. In addition, when I started here, we had a six-man maintenance team. Now we have switched to a maintenance contract with the relevant suppliers for everything. They take care, periodically and on demand, of machines, equipment and clothing. We no longer employ maintenance personnel. The biggest cost, however, is energy. Consumption was enormous. And that was five years ago, when we didn't think it was as important as it is now. Still, we started working on it, by mapping and adjusting the major consumers."

The third measure concerned ERP software. Van Hapert: "Meco Metal already had several software programs running, of course, but they weren't going to take these big steps with that. They didn't have control over the company and the projects.    

That's why we introduced our program The New Efficiency Thinking. This means that based on five metrics, which are always up-to-date and online, you are in control of your business and your projects. One of those five metrics is your project and production planning. We see more and more that this is the common thread in a company. This is where everything that is important to control your projects and your business comes together. So everything related to time, money, quality, information and organization. Time is at the top of this, because everything else follows from that and because time is more important than money."

Before choosing Liemar Software, Seijkens also contacted other ERP vendors. "We started with a longlist of about ten vendors," he says. "From there, after some tough questions, eight quickly fell off. The other remaining candidate turned out to use a method I called 'the shopping cart model.' She made a tour of the company asking everyone - work planner, calculator, buyer and you name it -: what do you want? Then she came back to me with a predictable message: a lot of customization is required. That means you still have no idea of the number of licenses, the expected cost or the lead time, even though you can feel in your bones that it's going to cost a lot and take a long time. I had experience with those processes and was scarred by them."

"Liemar Software did something very different," Seijkens said. "Jan told us that he has a standard package for all his customers. Industry-specific and developed in consultation, sure, but standard and for a fixed price. He doesn't do customization. His clientele consists of about 85 satisfied customers, who have adapted their processes to the software and not the other way around. Are improvements made? Then they are made available to each customer. Jan's story kept us awake for a weekend. Because we knew: we had to break through resistance again and adjust processes. And people might quit again. Yet we went for it. For the first time in my working life, an ERP package was implemented within budget, on time and without any loss of production. That impresses me."

Domien Driessen, as production manager responsible for calculation and rough planning within Meco Metal: "An important change was a switch from planning by tonnage to hours. That really is a fundamentally different way of dealing with your processes. We now have much more insight into our planning and capacity. This in turn has allowed us to eliminate a lot of waste, such as unnecessary transport, unnecessary inventory, duplication of effort and cumbersome invoicing. Especially the searching - for all kinds of things and information - has decreased tremendously."

Remi Moonen, whose responsibilities as workshop manager include fine planning: "I plan the work for the next two weeks. We have agreed with each other: whatever is in there, stays there. This gives us a good grip on the lead time of projects and enables us to anticipate better. Planning stands or falls with how you have set up the company. We have ensured that we are flexible. For example, assemblers can weld and vice versa. In this way, we can ensure that production can continue even when there are downtime. If someone drops out, Liemar helps me find replacements and adjust the planning flexibly, without having to search for it myself. So not in the head, but on the screen."

"With Liemar, you can automatically schedule back from the scheduled delivery date. You set your own process and how much time you want to reserve for what. If your project is worked out in Liemar, you can fine-tune it if you want. By always planning projects in the same way, everything is clear at a glance. So make your processes unambiguous. Figure out what is still not right and make an improvement. I now spend an hour a day on fine planning. The rest of the time I spend implementing improvements using our lean methodology."

The result of all the effort is impressive. Meco Metal has increased production from 4,000 tons to 8,000 tons, without hiring additional staff. In fact, the company went from 55 to 35 permanent employees, while the flexible shell remained the same. So is Meco Metal ready for an uncertain future? Time will tell, but the omens are good!