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OMAX Corp.

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The PC was a tool that led to  OMAX Corp.’s success, but when the company got its start in the early 1990s, there was little confidence that the market would accept its new technology. OMAX’s founders wanted to use state-of-the-art technologies to make high-pressure abrasive waterjet machining practical, affordable and easy to use. Their success stems from their dedication to this objective, and ongoing search to find new ways to help customers with its machines.

“Dr. John Cheung and I developed this waterjet technology for another company, but they decided not to go with that area of the operation when that company went public,” explains Dr. John Olsen, vice president of operations. “As PCs became popular, we developed the waterjet cutting tool to work with the PC, so users didn’t have to be an expert – the computer provided motion-control technology. That was in 1992, and our enabling technology was the PC – it has been a great horse to ride. Our growth has increased so fast since we started.

“When we started, people said there would never be a PC on the factory floor, but now almost every machine has one on the front end,” he adds. “We are proud of our steady growth and the fact that all of our manufacturing is done in the western United States.”

Since its inception, OMAX has become the world’s leading provider of precision abrasivejet machining systems in the general machine shop environment. Olsen explains OMAX is the only fully integrated waterjet company that designs and produces its own pump, high-pressure plumbing, machine controller, software and tables, and its machines are controlled by a patented “Compute First – Move Later” programming system. He notes the machines’ capabilities constantly evolve to serve new needs of customers.

In speaking with Manufacturing Today, Olsen explained how OMAX’s operation is organized to ensure customers get the highest-quality machines, and how the company is situated to maintain its worldwide leadership position.

Manufacturing Today: Where do you sell, and who are your customers?

John Olsen: When we started, our first focus was very small job shops. Large manufacturing operations tend to be extremely conservative and resistant to change, but small shops are more open to new ideas. That is changing now, however. The technology is becoming widely adopted, and large companies are seeing how their subs are making things at a much lower cost. As a result, the large manufacturers are starting to adopt our technology.

Geographically, we go anyplace that’s in manufacturing. About 50 percent of our sales are outside the United States – we can serve any company that makes things. We’re beginning to sell into China.

MT: Do you compete against Chinese products?

JO: We have quite a few Chinese competitors. The key is that we have to compete against them with quality while keeping our costs low. We may have a slightly higher price, but we also offer a higher level of quality and precision.

MT: What do you do to maintain a high level of quality in your operation and products?

JO: Our customers need to know what the jet is going to do, so we have to know the motions – that is the key to making precision parts. You can’t just take a conventional machine tool and make precision parts with an abrasive jet. We build our own motor controls and our own drive systems, which doesn’t just help with quality, it also helps with costs.

Our constant goal is that we’re working toward becoming a leading first-class manufacturing operation that’s effective from a cost viewpoint.

MT: What about quality from your supply chain?

JO: We are trying to be as lean as possible. We ask vendors to deliver to the specs of our drawings, and we do random, statistical inspections to check quality. We value our suppliers, but we are moving toward more in-house manufacturing just because it helps us to lower costs and gives us better control over our schedules. 

For example, we are located in the Northwest in an area heavily influenced by Boeing. We share some suppliers with Boeing, and if we place an order the same time Boeing does, the supplier most likely is going to serve Boeing first. We understand that, but it can have a big impact on our schedules.

MT:  Are there any areas of your operation that you are focused on improving?

JO: We have made a big effort to improve the company’s information systems, and we’ve been using a mix of purchased systems combined with in-house enhancements. We’re pulling everything into one unified system that we’re writing in-house, which will give us the ability to do continuous improvement on our own IT systems.

Some changes that have already taken place are that we now have tablets in use on the shop floor, and our sales people have the ability to login to our system from anywhere in the world.

MT: What about aftermarket quality – how do you support your products in the field?

JO: We’ve made quite an effort on that front because it’s such an important aspect of the business. Our machines can yield a revenue stream of $1,000/day for our customers, so we don’t want our customers to be down. We have an active spares program so we can ship quickly if a customer has a need. We also have field service technicians located throughout the United States and we offer in-house phone support. Additionally, we’ve developed our software to be an incredible help system because it’s very easy to find things.

In the United States, we can put a field tech at a customers’ plant within a day or two. In the international market, distributors handle this area, but we provide them with extensive training every year. We support 14 languages.

MT: What are your lead times?

JO: Some materials have 50-week lead times, and we account for that. But when a customer orders a machine, it’s like getting a new car – they decide what they want and they want it right away. As a result, we generally build to forecast, and in general, we ship one to two weeks after the order is placed. We try to have a good inventory of all materials with long lead times.

MT: Have you implemented lean manufacturing or any other similar techniques or philosophies?

JO: We use a pull system – we don’t write work orders, we just fill bins when they are empty and vendors fill some bins on the shop floor. We also have an arrangement with an electric motor supplier to get another the day after we consume one. All of this lowers the work in our purchasing department quite a bit.

We have a long way to go with lean, but we have been moving that way in the last three to four years. There is much more work we can do to improve, however.

MT: What are the company’s plans for  future growth?

JO: We see a trend toward larger machines in the market, and we believe that will continue, especially as larger companies come into the game. We think the market for this equipment is just barely penetrated, and we see continual growth for the foreseeable future.

The PC is becoming evermore powerful and the design world is going more toward 3-D design software. We’re building software tools to help our customers work with 3-D models and with that, we’re expanding the range of what our current products can do, which will lead to more growth.

What keeps this company going is that people like working here, and I’m very proud of that. There is good communication in this company and no nasty managers, which ensures a good working environment. That is a good foundation for growth, and we’re proud of what we have here.

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