Sage Supplier: Wind energy helps Cardinal soar

Bolter of wind rises to leadership perch

By Lou Kren

January 1, 2011

Cardinal Fastener & Specialty Co. manufactures fasteners that find their way into bridges, buildings, machinery, and transportation equipment, but the wind-energy sector is where the company expects the biggest growth. The company has worked hard to develop expertise in producing these critical parts wind-energy bolts, including going lean and achieving ISO 9001-2008 accreditation.

How do you bolt down the wind?

Bolstered by rising costs of traditional energy sources and a congressional extension of the Section 1603 Investment Tax Credit for renewable energy, many U.S. manufacturers have geared up to serve the wind power market. In fact, more than 400 domestic plants supply the wind industry, and employ a large chunk of the 85,000 Americans in that sector.

Bedford Heights, Ohio, boasts one such manufacturer. Because of its aggressive approach to securing renewable-energy work, Cardinal Fastener & Specialty Co. Inc., a manufacturer of large bolts used in wind turbines to attach blades and secure tower segments, has reached a leadership position in the wind-power supply chain. Its president, John Grabner, serves as adviser to the American Wind Energy Association (AWEA) board of directors (see Figure 1), and he also helps lead efforts that are expected to bring wind turbines to Lake Erie in the near future.

Green Focus Brings Rapid Growth

Cardinal Fastener & Specialty Co. has provided all manner of fasteners that find their way into bridges, buildings, machinery, and transportation equipment, but the wind energy sector is where the company expects the biggest growth. Sales increased 35 to 40 percent in 2010, with a similar bump expected in 2011—in large part due to wind energy contracts. Company revenue is expected to approach $10 million annually in 2011.

In 1983, the company encompassed only about 40,000 square feet of manufacturing space. Now double that size, the facility has the space to continue growing, said Grabner.

“In many ways, fasteners have become commodities, but wind-energy bolts are critical parts. We have worked hard to reach our level of expertise,” Grabner said. “In addition, we have built this company on service, which leads to lower costs and better quality. That has spurred our growth.”

Cardinal entered the wind energy market in 2007 via a phone call from a supplier of turbine tower parts, lamenting the poor quality of bolts as well as a poor delivery schedule.

“We were asked if we could supply quality fasteners quickly,” recalled Grabner. “We said we could do that and we did. Intellectual curiosity drove us into that market, and we happened to be at the right place at the right time.”

The company then joined AWEA and attended the association’s tradeshow in 2008, in the process meeting many windtower manufacturers.

“Mostly from Europe, these manufacturers said they were coming over to the United States and wanted to buy from a U.S. supplier,” Grabner says. “To be a dependable supplier, we had to continue to grow lean, and we had to ensure quality.”

In January 2009 the company was registered to ISO 9001:2008, the first U.S. fastener manufacturer to accomplish that, according to Grabner. Achieving ISO registration helped the company win work from European windpower transplants. Another challenge to overcome was the language barrier.

“We hired a German translator to integrate drawings and specifications, and even help us create drawings,” Grabner recalled. “In some cases, drawings did not even exist for parts needed by these new customers as they had worked for years with suppliers in Europe and had never formally drawn up a part.”

Efforts like these have paid off for Cardinal Fastener and situated the company to reap additional work.

The Nuts and Bolts of Wind Turbine Fasteners

Large bolts that Cardinal Fasteners supplies find use throughout wind turbine projects. Consider that the attachment of a single blade on a wind turbine requires as many as 100 of these special, safety-critical bolts. More bolts are needed to connect the turbine to the tower. Additional bolts hold tower segments together and attach the tower to the base. If that’s not enough, large bolts are required for hold-down as parts transport to their final destination. Add them up, and a single large turbine and tower may require as many as 1,000 of these critical fasteners.   

On its 88,000-sq.-ft. shop floor, the company manufactures fasteners in diameters from 0.5 to 3 in. and M20 to M72, weighing as much as 80 lbs. Though not a producer of nuts and washers for the wind power market, the company sources those from its qualified and approved vendor base. The fasteners are of carbon alloy-based steel, specially blended per customer and application requirements, and sourced from nearby steel providers. Cardinal Fastener hot-forges its bolts, employing induction heating equipment and closed-die vertical forging machines, with machinery in-house for rolling and cutting threads (see Figures 2, 3).

“Do what we do best, and buy the rest,” Grabner said, regarding the company’s ability to forge and machine in-house while outsourcing plating and other specialty work.

A Lean Path to Prosperity

As mentioned previously, Cardinal Fastener had to prove to European wind OEMs that it was a dependable supplier that could ensure quality and grow lean. Both manufacturing and service have benefited from the company’s laser-sharp focus on lean.

“In 1998 we blew up this company to create cells,” Grabner said, describing his company’s lean evolution, which continues to this day. “We go through an iteration of lean about once a month,” he said, noting that the company’s nearly 100 employees, across two shifts, have bought into the lean approach.

Arising from the lean initiative, manufacturing cells encompass the entire manufacturing process. Jerald Hawley, who operates one such cell, explained to Green Manufacturer just how it functions. He pulls a work order off the board and sets up machinery to process that order. The equipment in his cell allows him to saw a blank to length or use a chopper. He can cut or chop two blanks at a time and then chamfer and thread. Prior to the cell arrangement, this process was handled by as many as four different departments, and an order that at one time took three days to complete now can be completed instantly in this cell.

Josh Gilbert operates another cell, measuring steel rods and then cutting to length and chamfering so that they can be rolled. From there the processed blanks are stamped with a customer and size code, and then threaded. Cells like these, besides saving time, reduce costs and space related to WIP, or work-in-process.

Implementation of the lean philosophy also has affected shipping. A shipping associate prepares and packs an order, handles the paperwork, and ships it. “Before, those tasks were handled by different people. There is no handoff anymore,” Grabner said.

The company also employs portable workstations that allow shipping functions to move to where the work is. Beyond that, Cardinal Fastener will ship to each customer’s specs. Each wind-energy customer has unique delivery and packaging requirements.

“If a customer wants one bolt in one box, we will do that,” Grabner said.

All of these lean improvements manifest themselves in the fulfillment process, where, in many cases, orders are received and shipped the same day.

“We keep notes on each customer and can call that up immediately during the quoting process,” explained Danielle Taylor, who handles quoting and customer accounts. ‘The software puts part numbers and our inventory at our fingertips so we have answers right away for quotes. And confirmed orders reach our shop floor within eight minutes. That capability allows many orders to be shipped within 24 hours.”    

That’s a huge improvement over the previous process.

“The quoting process used to involve four or five departments, and with all the routing and hand-offs an order could take four to five days to reach the shopfloor,” Grabner said. “Now we save time and make sure the customers get what they need.”

Changes Challenge Management, Demand Buy-in From Associates

The lean quest and move to cellular manufacturing demands much of Cardinal Fastener associates, so training is paramount.

 “We’ve been on a lean journey for 12 years,” said Wendy Brugmann, executive vice president and chief operating officer. “It is a culture change, getting associates to want to be cross-trained.” Doing this allows associates to expand their skills base and adds variety to their workday. They are able to move to where the work is, eliminating wasted time.

The company practices TTC—teaching, training, and coaching—and a lot of it, according to Grabner.

“Take a manufacturing cell, for example,” he said. “Before, one guy would pull a bolt from stock. That is all he did. Everyone would have to go through him. Now, as many as eight people may need to know how to do that, so we have to train all eight. That puts a great deal of responsibility on management to make sure the correct training takes place.”

To assist the associate buy-in process, the manufacturer employs pay for performance (PFP) with the goal of transferring maintenance ownership back to the operator.

“More pounds produced, minus bad-part production, equals a higher wage,” Brugmann said, explaining PFP. “We don’t want to make the job fit the hours. Instead, we want our associates to volunteer improvements (that will increase profit by lowering manufacturing costs) because we can all benefit. We even put pictures up of a turbine or tower by a workcell so that everyone knows what happens to the parts they produce.”

A Bright Future in Wind

Moving forward, the political landscape presents a major challenge to Cardinal Fastener’s windenergy business.

“We have a political environment that ebbs and flows in regard to green energy,” says Grabner. “We have opened our doors to showcase wind energy, and we want to be a spokes-company and an example of how renewable electricity can grow manufacturing jobs.”

In 2009 Cardinal Fastener was publicly recognized by then President-elect Obama as an example of a manufacturer capitalizing on the renewable-energy market (see A Visit From the President-Elect sidebar).

Jeff Grabner, John’s son and director of sales for wind products, supports his father’s vision for the company’s direction.

“The driving force for growth in our company is wind energy,” he said. “Ninety percent of European wind turbine manufacturers have offices in the United States and by 2012 all of them will have manufacturing operations in this country. That is due to the success and potential of the U.S. market.

“We had the chance to meet with U.S. Treasury Secretary Timothy Geithner,” he continued. “He told us that renewable energy will be the third great economic revolution in this country, following the industrial and dot-com revolutions.

“The most exciting part of all of this is that we are now a fast-paced, dynamic young world,” the younger Grabner said. “There is a younger generation in place that will have a great effect on local and global momentum for alternative-energy sources. These people are saying ‘We want green energy and we need it now.’”