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E3: Economy, Energy and Environment

E3 Success Story - Recovering Profit Margin: Lehigh Press Puerto Rico

Assessment Details

  • Year: 2005
  • Team: PRIMEX

This case study was written by PRiMEXExit

Lehigh Press Puerto Rico is located in Juncos and it manufactures inserts and labels for the healthcare, food and general consumer sectors. Production is consumed locally and is also exported to Latin America and United States. The company has approximately 140 employees.

The Challenge

Lehigh's management had given away profit margins in exchange for volume; they understood they had to identify means to be more effective in order to recover the necessary profit margin.

The Solution

Lehigh Press was invited to participate in the Green Supply Network (GSN) program sponsored by the Environmental Protection Agency through PRiMEX and the MEP centers. This program promotes its initiative known as "Lean and Clean" based on the Lean Manufacturing methodology which is intended to reduce environmental wastes in operational processes.

After attending this meeting, Lehigh Press decided to participate in the program and contacted PRiMEX to assist. The first stage was to complete a competitive review questionnaire. Using this data, a transformation planner was prepared to measure their level of performance against others within the same industry sector. These results showed improvement opportunities ranging from on-time delivery to energy utilization.

The second phase was followed with a value stream mapping which included training and development of current and future value stream maps. This allowed opportunities for potential operational savings and the increase of profit margins. An action plan was put in place to address this.

The third stage was to develop a process map to optimize resources utilization and reduce the generation of environmental wastes.

Impact

Top management reviewed the opportunities and measured the potential impact and savings:

  • Improved material handling practices – $27k
  • Maximize material utilization – $53k
  • Reduce waste generation – $47k
  • Improvements opportunities add up to more than $200k/year

In a second GSN meeting held in Puerto Rico, Lehigh Press shared their success with the participants from local industries and governmental agencies. Furthermore, the company was also invited to make a presentation to the MEP/NIST Director's Meeting in Maryland.

"Thanks to this initiative, we were able to participate in the QUEST competition sponsored by the PR Manufacturing Association, where we were awarded the First Prize for the local industry sector."

— Luis Herrera, Plant Manager, Lehigh Press