H.B. Fuller Company
H.B. Fuller is an international producer of specialty chemicals and glues. The company had a proud history of environmental, health and safety (EHS) awards for its compliance programs. It also had a reputation for valuing the differences and professional experiences of employees.
SmithOBrien was engaged to perform a Corporate Responsibility Audit® of the company's practices across four key business functions: quality management systems, EHS practices and energy conservation, human resources, and community involvement.
As is typical of our process, we visited several facilities, mainly to learn how deep and wide senior management's goals and understandings of the corporate policies are effectively applied at an operating level. In one small manufacturing plant, producing 300 different products and considered by company officials as one of its safest facilities, the audit team interviewed key plant employees, as well as neighbors and local political and community leaders. The team also reviewed the plant's environmental and safety records, production schedules and expense reports.
The team found that routine and repetitive EHS training required of all personnel was causing regular production disruptions. Having to shutdown and restart production not only decreased output, but consequently led to delays in fulfilling customers' normal orders and higher costs.
We also found that R&D would send new product specifications to the plant for prompt manufacture without regard to the financial, operational or environmental implications. This aggravated the production scheduling problems.
Production disruptions also caused human resource problems. Plant employees who worked overtime to fill orders were allowed to return to work late the next day, leaving the plant shorthanded.
Our audit recommendations included:
- Replacing certain toxic chemicals with non-hazardous ones in the product formulations. This obviated some EHS regulatory training requirements and reduced production shutdowns. This would save the plant $197,000 annually.
- We urged the R&D, production, environmental, and sales departments to work closely at the start of new product development and in annual strategic planning to ease production schedules, improve customer satisfaction, and reduce disposal costs.
- Installing a double-lined piping systems so that delivery trucks could pump raw materials from the truck directly to the plant so as to eliminate demurrage charges and prevent spills
The combination of reducing use of some toxics, resulting in lower compliance costs and fewer plant shutdowns, and reducing waste and disposal costs would not only lower operating costs by $197,000 annually, but would increase production capacity 25%.