Load Balancing 101
The oil and gas industry is brutal on small business. One minute you can be waiting for the phone to ring while fighting to keep employees and customers and the next minute you are “hair on fire” busy, short of manpower, and working 70 hour weeks.
Our clients felt it also. Our machine shop was getting a name for itself and we were hard-pressed to keep up with demand. Then there would be a glitch in oil or gas prices and we would go quiet for a month. Nerve-wracking for a business owner.
Meanwhile, machine shops and other manufacturing facilities in other parts of the country were quiet or slow and steady.
There had to be a better solution.
To tackle this problem, we needed something different and unique.
We started hunting down resources that were not on the same business cycle as the oil patch and could offer expertise into our arena.
What we developed was a consortium of manufacturing talent all across the planet:
A waterjet shop in Ontario set up for the automotive industry that had capacity
An Injection molding facility in Michigan used for making toys that were looking to fill an off-season production line
A lighting board manufacturer in India that was quiet between key seasons
An automotive part machine shop in China that had expertise and was looking for a market
We sifted through hundreds of resources.
We kept the high-quality shops and weeded out the inferior facilities.
We established relationships with each of them, toured factories and shop floors, met staff and management.
We reviewed quality control procedures and documentation.
We imparted our values and let them know we were a service company first, a manufacturing company second.
It’s an ongoing process and we are still adding and qualifying suppliers on a daily basis.
As a result, when times got busy we had the resources to balance demand and when business slowed down we weren’t burdened with significant overhead.
Over time, our manufacturing network model was so successful, we tailored our ongoing business structure around this successful venture.
The rest is history…
