2017 Assembly Plant of the Year: AGCO Leads the Field With Lean Technology
Wearable devices help build better tractors in Jackson, MN.
Farmers never take a day off. Nor do their tractors. Growers rely on their machines to plow, plant, till, spray, bale and harvest a wide variety of crops in all sorts of conditions.
Whether it’s a muddy soybean field in central Illinois, a frosty vineyard in France, a steamy sugar cane plantation in Brazil or a dusty wheat field in western Canada, tractors produced by AGCO Corp. are hard at work on farms, orchards and ranches around the world.
During this time of the year, it’s not unusual for those machines to run all hours of the day and night to finish the fall harvest. And, believe it or not, AGCO tractors can also be found at the South Pole, where they’re used to haul supplies over snow and ice.
AGCO is one of the world’s largest manufacturers of agricultural equipment. The company produces several brands of high-horsepower tractors, including Challenger, Fendt, Massey Ferguson and Valtra.
“AGCO has a long-standing reputation as a global leader in innovative thinking and practical, leading-edge agricultural technologies,” says Martin Richenhagen, chairman, president and CEO of the $7 billion company, which is based in Duluth, GA. “Our multibrand strategy makes us well positioned to lead the way in engineering food security in all parts of the world.”
AGCO subscribes to a “design anywhere, build anywhere” production philosophy. High-tech component manufacturing is centralized globally for economies of scale, while assembly is more regional to respond better to the local market.
A wide variety of tractors are assembled at AGCO’s state-of-the-art factory in Jackson, MN. The facility is home to Challenger and Massey Ferguson high-horsepower wheeled row-crop tractors, as well as articulated and tracked Challengers.
In addition to building multiple types of tractors, the flexible factory assembles three- and four-wheeled applicators. The self-propelled RoGator and TerraGator vehicles are used by growers to spread many types of dry fertilizer and liquid chemicals.
The 1-million-square-foot Jackson facility is the recipient of the 2017 Assembly Plant of the Year award sponsored by ASSEMBLY Magazine. The world-class plant was chosen for the 14th annual award because of the way it has applied cutting-edge technology to build complex products better, faster and more efficiently.
During the past five years, AGCO has invested more than $50 million in the Jackson factory to increase production capacity and efficiency. The 52-year-old plant embraces plant floor innovations ranging from automated guided carts to cordless screwdrivers.
AGCO Jackson also recently launched a wearable technology initiative that uses augmented reality tools to enable assemblers to work more productively. More than 100 pairs of Google Glass are being worn by employees for quality inspections and assembly work. And, the plant has applied cutting-edge lean manufacturing principles to boost quality and drive continuous improvement efforts.
“As an industry built on technology, the Jackson plant has embraced innovation on the plant floor,” says Eric Fisher, director of operations. “We have led the world in Industry 4.0 and Internet of Things solutions.
“Farmers expect the best when they purchase AGCO equipment, and we intend to beat those expectations,” adds Fisher. “With the continuous improvements we’re making here, we provide our dealers and farmers the highest-quality agricultural equipment available.”
The 2017 Assembly Plant of the Year is located in the heart of America’s farm country, near the Iowa-Minnesota border. In fact, it’s just a short drive from the “home” of the Jolly Green Giant and his famous brand of vegetables.
The Jackson facility is one of AGCO’s largest plants. It also produces the product with the highest margin contribution to the North American region.
In addition to two state-of-the-art assembly lines, the 164-acre campus includes an in-house metal stamping and machining center that produces numerous components. It’s also home to design engineering, research and development, and a test track.
“Jackson is much more of a low-volume, high-complexity operation, having the longest and most complex supply chain within AGCO,” explains Fisher. “But, what really makes it different is the culture.
“AGCO is a corporation that has grown through acquisition, so the cultures are a little different plant to plant,” Fisher points out. “Workforce engagement and empowerment are strengths in Jackson.”
One reason for that upbeat atmosphere is a nice perk that employees receive. The plant has a part-time physical therapist and a chiropractor on staff, in addition to a full-time occupational nurse, who address employee health concerns on-site. All employees also have access to a fitness center that’s open 24 hours a day.
AGCO, an acronym for Allis Gleaner Co., was established in 1990. That’s when four members of the U.S. management team at Deutz-Allis Corp. purchased the company from German parent Klockner-Humboldt-Deutz AG (K-H-Deutz). The paint scheme on German-built Deutz tractors was changed from green to orange and the machines were rebadged as AGCO-Allis models.
Through a series of strategic acquisitions, AGCO quickly grew from a small North American firm into one of the world’s largest manufacturers of agricultural equipment. Over a 15-year-period, the company made 21 acquisitions that boosted sales from $200 million in 1990 to more than $5 billion by 2005.
Along the way, AGCO has acquired some of the best-known and most-respected brands in the agricultural industry. In fact, although the company is one of the newest players in the sector, it boasts a rich tradition. AGCO can trace its heritage back to some of the biggest names from the past.
For most of the 20th century, the Allis-Chalmers Co. was a leading manufacturer of tractors and agricultural equipment. The Milwaukee-based company also produced a wide variety of construction equipment, industrial machinery, and power generation and transmission equipment.
Allis-Chalmers evolved from a small shop that made metal castings, sawing machinery and other heavy equipment in the 1840s. By the end of the 19th century, the company had become one of the largest industrial steam engine manufacturers in the world.
In 1914, the growing company entered the farm equipment business and eventually grew to become one of the largest and most diverse manufacturers in North America. The tractor division pioneered many innovations, such as the first machine with pneumatic tires and the first turbocharged tractor.
In its heyday, Allis-Chalmers’ huge production complex in West Allis, WI, was a beehive of activity. Thousands of workers produced more than 200 tractors a day. The orange-colored machines adorned with diamond-shaped A-C logos were well-known to generations of farmers.
However, by the late 1960s, Allis-Chalmers became a victim of rapid change and globalization. The once-proud company was eventually forced to sell its farm equipment division to K-H-Deutz in the mid-1980s. Gleaner was a popular brand of combines produced by Allis-Chalmers, hence the Allis Gleaner Co. (AGCO) moniker.
Massey Ferguson is another legendary brand in the agricultural machinery industry. It was established 170 year ago by Canadian Daniel Massey. In 1847, he started making tools for local farmers in Newcastle, ON.
Massey’s company eventually merged with another manufacturer in 1891 to form Massey-Harris. In 1917, it began to sell tractors and developed a reputation for technical innovation.
A few years later, an Irish mechanical engineer named Harry Ferguson started to experiment with tractors. His Ferguson Type A was unveiled in 1936. It featured a three-point linkage system with hydraulic draft control.
Ferguson’s invention helped revolutionize agriculture. The principle of the Ferguson System was to transfer the weight of the drawn implement to the tractor—making the tool integral to the tractor—thus allowing a smaller, more nimble tractor to safely do the work of a heavier machine. It enabled farmers to use the tractor’s hydraulic power to lift and lower implements, such as plows.
In 1953, Ferguson’s tractor company was acquired by Massey-Harris, resulting in the Massey Ferguson brand, which became a perennial leader in global tractor sales. In 1994, Massey Ferguson was acquired by AGCO and today remains the company’s biggest brand.
A key factor in AGCO’s initial success was it flexibility. It allowed dealers to become multibrand outlets, providing farmers with a wide choice of tractors and equipment.
AGCO’s first acquisition, in 1991, was the White Farm Equipment Co., a company that was created in the early 1960s by the merger of well-known tractor companies such as Cockshutt, Minneapolis-Moline and Oliver. That same year, AGCO also acquired Hesston Corp., a leading producer of hay and forage equipment.
AGCO went global with the purchase of Massey Ferguson. As a result, by 1995, more than 50 percent of the company’s revenue came from outside North America. That number has now climbed to 76 percent.
In 1997, AGCO acquired Fendt, a leading European agricultural equipment firm based in Germany that’s known for its innovative technology, such as continuously variable transmissions. In 2002, AGCO purchased Caterpillar’s agricultural tractor business and the Challenger brand. In 2004, the company acquired Valtra, a Finnish tractor company that has a strong presence in Europe and South America.
The 2017 Assembly Plant of the Year traces its roots back to 1963. That’s when a local fertilizer salesman started Ag-Chem Equipment Co. in a small garage in southwestern Minnesota. In 1967, the company began producing a self-propelled sprayer called the Ag-Gator. AGCO acquired the company and the Jackson plant in 2001.
Today, AGCO operates 50 factories on five continents. It sells its products in more than 1,500 countries through a network of more than 3,000 independent dealers and distributors.
AGCO, which touts itself as “Your Agriculture Company,” maintains a healthy roster of brands that range from tractors to combines, and includes just about everything in between. Its goal is to be a single resource that farmers can depend on for innovative, leading-edge equipment that helps them maximize yield, reduce loss and conserve resources.
Each of the four core tractor brands is designated by a different color: green for Fendt, red for Massey Ferguson, silver for Valtra and yellow for Challenger. In addition to tractors, three of the brands include a line of hay processing equipment, such as combines and balers.
AGCO’s harvesting equipment lineup also includes the Gleaner brand of self-propelled combines. And, the company produces a wide variety of implements that are towed behind tractors, such as Sunflower tillage tools and White planters.
Another major AGCO brand is GSI, a leading manufacturer of steel bins, silos and tanks, and material handling equipment for drying, moving and storing grain.
The agricultural equipment industry is extremely competitive and prone to constant ups and downs, due to variables such as foreign currency fluctuations, the commodities market and weather conditions.
Ample rain and moderate temperatures can lead to record-high yield and production for crops such as corn and soybeans. On the other hand, heavy rainfall can delay or impede planting altogether, while other regions may be battling a drought.
The world of agriculture is constantly changing and farming can be unpredictable. Producing tractors and equipment can be like riding a rollercoaster at times, which requires manufacturers to carefully balance their assembly lines.
For instance, in the first half of 2017, sales of high-horsepower machines in North America were down due to ongoing weakness in the row crop sector. Many farmers have been reluctant to purchase new equipment, due to a multiyear slump in grain and livestock prices.
“Compared to the previous year, most manufacturers feel their inventories are staying about the same,” says Curt Blades, senior vice president and ag sector lead at the Association of Equipment Manufacturers, which tracks U.S. demand on a monthly basis. “We still see major discrepancies between the sale of large, high-horse power tractors and combines vs. smaller tractors. Sales for tractors under 40-hp are up 11 percent from last year, while sales for 100-hp or more tractors are down 16 percent.”
At the same time, however, demand for tractors and equipment is skyrocketing in South America, due to record harvests and favorable exchange rates. The market is also being driven by more supportive government policies in countries such as Argentina.
AGCO reported net sales of $2.2 billion for the second quarter of 2017, an increase of approximately 9 percent compared to the second quarter of 2016.
“[We] achieved sales and earnings improvement in the second quarter in the midst of challenging market conditions,” says Richenhagen. “Higher demand and margins in our Europe-Middle East region are driving our improved results and increased outlook for the full year. AGCO’s sales and earnings growth also reflect the benefit of our efforts to reduce expenses, improve the efficiency of our factories and launch new products.
“Commodity prices have not changed materially from last year, while difficult weather conditions could impact yields across many of the key U.S. crop production states,” adds Richenhagen. “Despite challenging early growing conditions, the USDA is estimating global grain inventories will rise during 2017, maintaining pressure on commodity prices.
“After multiple years of decline, global industry demand is continuing to stabilize as some farmers are returning to more normal equipment replacement schedules,” Richenhagen points out. “Looking past the current operating environment, our long-term view remains optimistic, with expanding demand for grain supporting farm economics and healthy growth in our industry.”
According to the United Nations, the world’s population will rise from 7.5 billion today to 9.7 billion by 2050. Food production must keep pace with that anticipated growth. Farmers will be tasked with producing more fruits, grains and vegetables on less land in the face of ongoing climate changes.
One important tool in the fight to meet global food demand will be advanced tractors and agricultural equipment loaded with technical innovations. Tomorrow’s farmers will demand machines that till more effectively, plant more accurately and harvest more efficiently. They’ll turn to companies like AGCO to produce more powerful, productive and reliable equipment.
The Freedonia Group Inc., a market research firm, predicts that global demand for agricultural equipment will grow 7 percent annually between now and the end of this decade.
“Sales of agricultural goods will rise at a healthy pace in most countries because of economic, population and per capita calorie intake growth, and the expansion of processed food and beverage industries,” says Gleb Mytko, an industry analyst at Freedonia. “As local agricultural commodity demand rises, farmers will need to invest in equipment and replace outdated machines in order to boost output and increase the productivity of their operations.”
AGCO is well-positioned to capitalize on that increasing demand. For one thing, the company is different than its two main competitors, because it only focuses on agricultural products. Unlike its main rivals, AGCO does not produce construction equipment.
It has also focused considerable resources and R&D efforts on different types of technology. The company has invested in products and services that are transforming agriculture, such as interconnectivity and precision farming.
Fuse is AGCO’s next-generation approach to precision agriculture that connects the entire crop cycle, including planting, crop care, harvesting and storage. That enables farmers to make more informed business decisions, resulting in enhanced productivity and profitability.
They can monitor their crops with wireless sensors that measure variables such as air temperature, humidity, soil temperature, soil moisture, leaf wetness, atmospheric pressure, solar radiation, and wind speed and direction.
All of that information combines with data coming off the equipment to ultimately increase crop yields. Farmers can also use information about the equipment itself, such as tractor idling time, fuel usage and speed, to optimize performance and prevent costly interruptions and downtime.
Several years ago, AGCO engineers developed a GPS-based navigation system called Auto-Guide. The optional auto-steering tool enables farmers to work faster and smarter. Tractors can also be equipped with sensor-assisted intelligence that features benefits such as yield monitoring and automatic engine protection.
AGCO recently unveiled an unmanned aerial vehicle that’s equipped with a RGB camera for color imaging and a near-infrared camera for monitoring plant health. The easy-to-operate drone gives farmers insight into their fields and helps them spot potential yield-limiting problems.
One of AGCO’s most recent acquisitions is a company called Precision Planting LLC. The former subsidiary of Monsanto Co. develops high-tech mapping devices to improve yield by automating labor-intensive parts of the farming process. That enables farmers to reduce the waste of fertilizer, pesticides and water.
AGCO engineers have developed a variety of autonomous tractors. For instance, the MARS (mobile agricultural robot swarms) project uses small robots that operate in unison to precisely plant corn.
The company also recently unveiled a battery-powered compact tractor. The e100 Vario features a 650-volt lithium-ion battery that can operate up to 5 hours under normal conditions.
AGCO produces three types of tractors. High-horsepower machines assembled in Jackson, MN, are used on large farms, primarily for row crop production. Utility tractors are designed for small- and medium-sized farms and specialty agricultural industries, such as dairy, livestock, orchards and vineyards. Compact machines are used on small farms, as well as for landscaping and residential applications. AGCO builds utility and compact tractors at assembly plants in Edgewood, MD; Houston; and Tacoma, WA.
The Jackson plant supplies the entire North American market with high-horsepower tractors, but also exports approximately 21 percent of its production. AGCO’s other big U.S. assembly plant is located in Hesston, KS. It assembles balers, combines, mowers, windrowers and other products that are used to produce hay and wheat.
High-horsepower tractors have always been a major strength and focus for AGCO. The machines feature powerful diesel engines that range from 205 to 517 hp. Engines are imported from an AGCO plant in Finland, while most of the transmissions are assembled in Germany. However, some Challenger tractors use transmissions supplied by Caterpillar.
Most of the machines built at the 2017 Assembly Plant of the Year use big tires, but some run on rubber tracks. The Jackson plant first started to assemble tractors in 2003. That’s when production of Challenger track tractors and articulated tractors was transferred from Caterpillar’s ag plant in DeKalb, IL, following its acquisition in 2002.
Several years ago, AGCO management decided to build Challenger and Massey Ferguson high-horsepower wheeled row-crop tractors in North America. The strategic move came after Bob Crain, senior vice president and general manager, attended a dealers meeting.
The dealers wanted to see the tractors built domestically. According to Crain, they said “if you’re ever going to be serious with tractors in North America, you’ve got to produce them here. We took that to heart and expanded the plant in order to grow our business.”
The expansion project increased production capacity by 25 percent, while maintaining best-in-class product quality.
Previously, the Jackson facility was building Challenger MT700C and MT800C track tractors, as well as Challenger MT900C articulated four-wheel drive tractors, TerraGator and RoGator applicators and SpraCoupe self-propelled row-crop sprayers. Since then, several other products have been added to the manufacturing mix at the Jackson facility.
The expansion included a complete overhaul of the tractor assembly line, which now encompasses 16,000 square feet, including state-of-the-art testing equipment at the end of the line. Application equipment, the other half of the Jackson plant’s output, is assembled on a separate assembly line in a nearby building.
A 30,000-square-foot expansion of the component manufacturing area, which builds metal parts such as booms, brackets, cabs, frame rails and spring mounts, increased in-house capacity by 20 percent and improved efficiency by re-engineering the flow of materials to assembly workstations.
A 42,000-square-foot automated warehouse delivers parts and materials to the assembly line as needed for each individual tractor. The expansion also included the Intivity Center, a 17,000-square-foot visitor center that features observation windows for viewing the tractor assembly line.
“Continuing to invest here reinforces AGCO’s commitment to bringing our customers high-quality tractors and application equipment, built how the customer wants them and delivered on time,” says Fisher. “Manufacturing them here allows us to configure the machines to match the production systems used by North American farmers.”
The 2017 Assembly Plant of the Year builds five distinct types of products in multiple variations:
- Articulated, four-wheel-drive tractors. Massive machines, such as the Challenger MT900C and MT900E, typically contain eight tires and are powered by a 16.8 liter engine. They are used by farmers to tackle vast acreage and pull large seeding and tillage implements. The tractors are also used for some construction applications, such as towing scrapers.
- Challenger row crop tractors. These machines, which range from the MT500D to the 1000 Series, are produced with either tires or rubber tracks. Each tractor is available in different models, depending on the engine size, which ranges from 6.6 to 16.8 liters.
- Massey Ferguson row crop tractors. Machines, such as the MF 7600 and MF 8600, are assembled with traditional tires. Each tractor is available in different models, depending on engine output, which ranges from 270 to 370 hp.
- RoGator high-clearance applicators. Self-propelled sprayers, such as the RG700, dispense liquid chemicals and dry fertilizer on crops and weeds. They’re equipped with tall, narrow tires and all-wheel traction control that adjusts motor displacement when a wheel starts to slip, keeping the machine moving in the field. Adjustable track widths enable operators to use the machines in a wide variety of rows, crops and field conditions. Large chemical tanks hold up to 700 gallons, while foldable booms lined with spray nozzles extend up to 90 feet on each side of the machine.
- TerraGator high-flotation applicators. These three- or four-wheel self-propelled machines dispense liquid and dry fertilizer. Because the machines are typically used in the spring before crops come up, they’re equipped with big, fat tires that can handle muddy field conditions. For dry fertilizer applications, the machines are equipped with large bins that can hold up to 355-cubic-feet of fertilizer, which is dispensed either via air spreaders or spinners. For liquid applications, the machines are equipped with a 2,400-gallon stainless steel tank.
At the recent Farm Progress Show in Decatur, IL, AGCO launched two new products that are being built at the Jackson plant.
The newest product in the Challenger line is the MT700 track tractor. The next-generation machine features new styling, as well as a new engine, transmission, undercarriage and hydraulics that have been improved to provide a smoother ride for operators. It is equipped with continuously variable transmission technology, which was pioneered in the wheeled Challenger 1000 and modified for track use.
“This innovation allows the tractors to run in the maximum torque range, while delivering low fuel consumption to help increase productivity and reduce costs,” says Richard Kohnen, director of tactical management for application equipment and high-horsepower tractors. “The AccuDrive system allows full output at 1,700 rpm.
“Not only does this allow for the tractor to run in the peak torque range of 1,200 to 1,600 rpm, but it does so more efficiently with less engine wear,” adds Kohnen. “This system also results in a quieter working environment for the operator.”
Tracked machines, such as the MT700 Series, appeal to farmers because they provide a much smoother ride on rough surfaces. “They also reduce soil compaction,” explains Kohnen. “That’s important, because some soils are more prone to compaction than others.”
The other new Jackson-built product is the RoGator C Series self-propelled row crop applicator.
“With the prevalence of herbicide-resistant weeds throughout the country and the introduction of new herbicide systems to control these weeds, greater management and attention to detail will be needed for anyone applying herbicides,” says Kohnen. “The new machine is equipped with recirculation
plumbing and self-priming booms that keep product moving through the system to reduce chemical buildup and help eliminate plugged spray tips.”
AGCO Jackson’s assembly lines are extremely flexible so the plant can quickly respond to sudden downturns or spikes in demand. Challenger and Massey Ferguson tractors are built on the same assembly line with variable line speeds that ensure that the operators’ work load remains constant. RoGator and TerraGator applicators are also assembled on a mixed-model line in a nearby building.
All products built at the 2017 Assembly Plant of the Year are built to order. Dealer requests are electronically transmitted to the factory. Andon boards located throughout the plant include each dealer’s name and location so that assemblers know where each product is headed.
All products move down the assembly line attached to an in-floor towline conveyor that indexes forward. Sequenced kit carts are positioned on both the left and right side of the line to reduce operator movement.
The tractor assembly process starts with the power train and frame, which forms the core structure on all machines. Engines and transmissions are transported from the warehouse on automated guided vehicles and adjustable tugger carts, then lifted into place using overhead gantries and jib cranes.
Next, all hydraulic lines and electrical wiring harnesses are routed and attached. On a typical tractor, there are 30 to 40 different hydraulic lines alone. The tractor assembly line features an in-line paint system. The manual process takes approximately 40 minutes.
After a tractor emerges from the paint booth, assemblers attach the cab and various exterior components, such as hitches, hoods, radiators and tanks. Finally, either tires or tracks are attached to the machine.
The tractor assembly line enables operators to easily switch back and forth between tires and tracks. That’s because no two machines on the line are ever alike. For instance, the build sequence can call for a Challenger on wheels, followed by a Challenger on tracks and then a Massey Ferguson with a dual set of rear tires for extra traction. Factors such as track type, track width, track spacing and bogie wheels can also vary.
“Work content on the main assembly line is very similar,” says James Croxton, director of manufacturing. “However, there is more work involved in assembling track units. That added work is isolated and done in a subassembly area so the main line stays balanced to takt time.”
Other components, such as frame rails, pumps and valves are also built up on subassembly lines and moved to the final assembly line with tuggers. In addition, cabs are built in a separate area of the plant.
Although they may appear similar to casual observers, tractor cabs can be completely different. Farmers consider the cab to be their “office,” so they’re often stuffed with multiple comforts, starting with the seat. Joysticks, switches and controls are color coded and located on the armrest within easy reach.
Customers can specify numerous options, such as exterior LED lighting, HVAC systems, cameras, antennas and receivers, advanced navigation systems, side window wipers, refrigerators and roof beacons. Other options include weather stations that can report on real-time field conditions, such as air temperature, barometric pressure, dew point, relative humidity and wind speed.
Today, most tractors also contain amenities such as 10.4-inch touch screens, some sort of cellular modem or Wi-Fi device, Bluetooth capability and USB power ports that help farmers stay connected through remote communication.
“Because of all the lighting and electronic options, cabs are a very complex subassembly,” says Croxton. “The roof alone contains a lot of content, such as wiring.”
The application equipment assembly line operates similar to the tractor line. For instance, booms, tanks and hoppers are built up on subassembly lines.
“Tractors and applicators are basically produced the same way,” explains Croxton. “However, application equipment is more complex, because it has a system that gets integrated with the chassis. It’s like building a tractor with an implement on the same line.”
Fastening plays a critical role on both assembly lines. Assemblers use multiple sizes and configurations of screws, nuts and bolts.
“We use 1,800 different fasteners at the Jackson plant,” says Croxton. “The tractor assembly line has 819 individual torque tools in our calibration system, with 2,100 newton-meters being the highest torque value.”
Assemblers also use a wide variety of fastening tools throughout the factory, which has made a concerted effort to go cordless whenever possible.
“Battery-powered tools have proliferated throughout Jackson,” Croxton points out. “But, assemblers use DC-electric fastening tools to attach all critical components, such as marrying the engine to the chassis. We are currently transitioning to wireless torque tools that tie into torque management software.”
At the end of each assembly line, tractors and applicators undergo a rigorous two-hour series of tests. It’s part of AGCO’s end-of-line quality assurance process, which ensures that every machine is ready to hit the ground running after it’s delivered.
All products built in Jackson must pass five quality-assurance tests before being delivered to dealers and farmers. Each product coming off the line goes through quality-check gates to verify proper functioning of the hydraulic system, cab electronics, overall fit and finish, and tire or track width.
A jounce test rocks each machine side to side, mimicking a drive across a rough field. The speed and intensity of the rocking are varied throughout the test to simulate farming conditions from every day to extreme.
“All hoses, fittings and electrical connections are monitored throughout the test to verify there are no leaks or electrical issues,” says Croxton. “The lights, wipers and other switches are manually verified again after the test to ensure everything works correctly for new owners.”
A power take-off (PTO) dynamometer measures rated horsepower and torque output. PTO performance is checked at a variety of speed and load levels to ensure farmers get the productivity they expect.
Every machine must pass a chassis dynamometer test that verifies proper functioning of the steering, brakes and suspension system, as well as transmission shift quality and engine performance. Machines are held in place on a bed of rollers and run at various speeds and resistance levels to simulate conditions above and beyond what they are likely to encounter in the field.
And, before they leave the Jackson factory, all machines are also driven on an outdoor test track.
“Both of our assembly lines are complex, requiring multiple workstations,” says Fisher. “The mixed-line tractor assembly went live in 2011, while the merge of application equipment occurred in 2016. Merging the assembly lines leverages capital investments to enhance quality, optimize material flow to improve productivity, and enable more product mix flexibility to better match seasonality.”
While the factory has the capacity to build more than 5,000 machines a year, production volume varies. For instance, applicators tend to be more in demand during the spring months. But, both spring and fall are peak seasons for tractors.
“In 2014, we began our journey in understanding the current state through direct observations and found that there were some very large opportunities within the assembly lines,” explains Fisher. “For instance, we discovered that some items could be built on subassembly lines.
“We developed assembly and material guidelines that focused on things such as sequenced parts delivery,” adds Fisher. “Everything in the factory now flows west to east. All parts are within 1 meter of each operator to reduce wasted motion. And, every item is labeled and color-coded at dedicated incoming and outgoing locations.
“We are now seeing the benefits of those efforts through improved employee retention by leveling the seasonal traits of our products, improved quality as more effort is focused on one line, and productivity as the work balance between stations has vastly improved,” Fisher points out. “There is a ripple effect to this, as supporting departments of fab, weld and paint now have a single drum beat to work toward, and they are also reaping large benefits in the same metrics.”
AGCO Jackson is a vertically integrated facility. Because fabrication is one of the plant’s core competencies, 50 percent of all metal parts and structural components are made in-house at a 175,000-square-foot facility. It features 100 welding booths that use both manual and robotic equipment.
“Our products have large, complex weldments, many of which require machining after weld,” says Fisher. “With low volumes, flexibility is crucial within our processes. We’ve addressed this by implementing quick changeover aspects to our fixtures, such as quick-change pallet systems and couplers for hydraulic clamping. This has been so effective for our flexibility that we’ve adopted the technology to weld fixtures.
“A single manual weld base can use many fixtures, because they’re all interchangeable,” explains Fisher. “When the fixture is not in use, it is stored in vertical magazines, maximizing floor space.
“One of our robotic welding cells can change out its own fixtures and program itself by reading a 2D matrix code on the fixture,” adds Fisher. “This weld cell design allows single-piece flow of weldments though the cell. When it reads the bar code, the robot knows what part it is, then one arm holds and rotates the fixture while the other arm welds.”
Material handling improvements have also changed the way that tractors and applicators are assembled at the 2017 Assembly Plant of the Year. The logistics department has successfully transitioned from line-side parts storage to value-added kitting.
“That has allowed more variety and complexity of product on the same line,” says Fisher, who has worked at the Jackson plant for 22 years. “The key effort in parts kitting was to make sure the ‘touch’ to kit the part added some value to the assembly process.
“In some cases, the kit cart doubles as an assembly fixture, so we avoid another touch or crane pick,” adds Fisher. “In other cases, there is additional prep work done during the kit touch, such as positioning or grouping to make it easier for the assembler. That is the key to the kitting process.”
Recent investments in automated guided vehicles and other types of automated systems have enabled AGCO Jackson to further streamline production. For instance, material handlers use smartwatches to receive line indexing messages.
“The main benefit of our automation is pace making,” says Fisher. “Pacing the material to the line helped us prevent overproduction in the subassembly areas, so we could easily spot other wastes and improve.”
Most of the products assembled at the build-to-order plant are unique. In addition to engines and transmissions, customers can specify numerous options, such as hitches, drawbars and implement valves.
“There are millions of different configuration potentials,” claims Fisher. “Rarely do we build two machines with the exact same configuration in a year. We have large, complex machines with long cycle times, which makes it almost impossible for an operator to remember all the steps required to build a unit.”
The 2017 Assembly Plant of the Year has applied a wide variety of technology on its plant floor to reduce errors, address quality and boost productivity—everything from ring scanners to tablet computers. Its latest initiative involves lightweight, optical, head-mounted displays.
Several years ago, AGCO Jackson was an early adopter of Google Glass wearable technology. Today, it’s one of a handful of manufacturers, including Boeing and General Electric, using the next-generation of the device, now officially called Glass Enterprise Edition. So far, the results have been impressive.
The ability to have access to instructions in quality, assembly and paint prep has led to reduced processing times, reduced defects and reduced training costs. AGCO has seen over a 30 percent reduction in inspection times, a 25 percent reduction in production time and the ability to train staff 300 percent faster.
AGCO refers to the technology as “informed reality.”
“It’s different than augmented reality or virtual reality,” explains Peggy Gulick, director of business process improvement. “The goal of virtual reality is to transport you, making you feel like you are in another physical space. Assisted reality keeps you in your present environment, but provides additional information to your line of sight.
Up until a few years ago, the Jackson factory was using tablet computers to conduct in-depth quality inspections at the end of the tractor assembly line. But, the devices were easily broken and expensive to replace.
“In 2013, the simple, yet chronic problem of rugged tablets being broken on the floor during quality inspections led us to seek a wearable technology solution,” says Gulick. “We wanted a way for employees to easily access all the information they need to get the job done right in their line of sight.
“Glass was introduced as a solution to make employees’ jobs easier and safer, while driving higher quality to our product and our processes,” explains Gulick. “In the end, we have accomplished both.
“Quality checklists are now being done on Glass, with nonconformance workflow built in and quality teams getting real-time issue reports,” adds Gulick. “We no long need to use $3,000 tablets, and employees’ hands have been freed up.”
Glass has also enabled assemblers to scan a machine’s serial number to instantly bring up a manual, photo or video they may need to build a tractor or applicator. In addition, employees can use voice commands to take notes and leave them for the next shift worker, allowing for a more seamless transfer and increased productivity.
Assemblers begin each task by saying, “OK, Glass, proceed.” Or, they can swipe along the right side of the frame and proceed to the next image.
Assembly steps or quality checklists appear in the upper right corner of the tiny screen. Glass tells them things such as what kind of bolt is needed, which fastening tool to use and how much torque is required. If they encounter a problem, such as a damaged part, employees can take a picture of it and ask for help.
“We have been using Glass with a solution called Proceedix for the past two years,” says Gulick. “We found the greatest value from using Glass has been in the assembly and quality areas, through the easy and quick hands-free access to the instructions and checklists necessary to assemble our products.
“In addition, we have discovered that training with smart glasses is a grand slam,” claims Gulick. “New product launches and new hire training are easily administered and audited for success.
“Staff is trained faster on cross-functional operations using Glass, reducing the average learning curve time from 10 days to three,” Gulick points out. “Knowing that smart glasses are a lean tool, and not an industry requirement or cool factor, we have achieved a 30 percent reduction in processing times and a 50 percent reduction in new hire and cross-functional employee training time.”
To help assemblers build products, AGCO Jackson has created operational management sheets (OMS) for each step or task in the build process. Each OMS contains several key components, including a model view of the assembly, a bill of material, and finally, the tool and torque needed for any items on that OMS.
“We are sequencing the OMS’s, or steps, within our manufacturing execution system, where operators can then view a sequenced list of OMS’s dedicated to a serial number within a work cell via a computer or Glass wearable devices,” says Gulick. “This sequencing of OMS’s establishes process quality, which leads to product quality.”
The sequencing table (bill of process) not only has the sequence of the OMS’s for each operation, but also has two key fields of work zone and actual labor. Each OMS is assigned a work zone. For example, each tractor chassis style has six work zones, which minimizes the distance of travel for an operator working within the zone.
“As OMS’s are processed within the Glass application, we are able to get a duration of work for that OMS, or actual labor,” explains Gulick. “As operators use the application, multiple iterations of actual time are captured and we can assign that time to the OMS within the table.
“This is the foundation for future continuous improvement events, because now we have actual times to balance workloads between work cells and between operators within the work cell, and we can predict line requirements,” adds Gulick. “Since data is gathered real time, we can also begin to assess the age old question ‘Am I on track?’
“This is a strategic component of our Industry 4.0 vision, as we believe we can tie that information into our andon boards along with notification thresholds,” says Gulick. “The vision is communicated to the business during pre-event planning and throughout the event in the form of a storyboard.”
AGCO plans to double the number of Glass devices in use at the Jackson plant by the end of next year. It’s also in the process of introducing the wearable technology at six additional factories.
In addition to applying state-of-the-art technology, the 2017 Assembly Plant of the Year has implemented numerous lean manufacturing initiatives. Continuous improvement is practiced daily to improve throughput, reduce operating costs and boost quality.
In addition to communicating policy deployment initiatives and statuses, the plant uses a lean daily management system to ensure that critical information is communicated in timely, proceduralized forums.
Every morning at 9:30 am, the AGCO Jackson management team meets on the plant floor to review key performance indicators, such as cost, delivery, quality and safety. They spend about 20 minutes discussing standardized control point sheets and metrics posted on centrally located boards and revolving kiosks.
“Problem-solving tools, such as 3SP, 5 Why and fishbone diagrams, play critical roles in these discussions and follow ups,” says Rick Reuter, continuous improvement manager. “In addition, all employees are encouraged to participate in daily meetings.”
Shop floor meetings are built around the pyramid structure. Shift start up meetings take place at 6:30 am at team kiosks. Later in the morning, team leaders, supervisors and production managers meet to discuss issues, assign remediation or address long-term prevention.
Every Thursday afternoon, the plant shuts down for one hour to address continuous improvement. Employees focus on a suggestion program that’s based on a two-page kaizen action sheet (KAS), which is available in both a paper and online version.
“Three-step problem solving is a way of life at AGCO Jackson,” explains Reuter. “Our employee KAS tool has created incredible value and engagement. Employees are encouraged to enter ideas that will add safety, quality or cost reduction to their work function or area of the plant.”
Since the program was initiated in 2013, employees have submitted more than 13,000 ideas. Last year alone, more than 4,000 suggestions were completed, resulting in almost $1 million in savings.
Click here to watch a video about how AGCO Jackson is using Glass technology to improve productivity and boost quality.
Click here to watch a video about the history of AGCO Corp. and to see some of the company's machines in action.
About the Award
The Assembly Plant of the Year award was initiated in 2004 to showcase world-class production facilities in America, and the people, products and processes that make them successful. There is no entry fee. All manufacturers that assemble products in the United States are invited to nominate their plants. The winning plant receives a crystal award and a commemorative banner.
The Assembly Plant of the Year award is sponsored by ASSEMBLY Magazine. The goal of the award is to identify a state-of-the-art facility that has applied world-class processes to reduce production costs, increase productivity, shorten time to market or improve product quality.
All nominees were evaluated by ASSEMBLY’s editorial staff, based on criteria such as:
•Have assembly processes been improved through the use of new technology?
•Has the plant improved its performance by making more effective use of existing technology?
•Has the plant taken steps to reduce production costs?
•Have new or improved assembly processes resulted in increased productivity?
•Has the plant used assembly improvements to reduce time to market?
•Has the plant boosted bottom-line profits and competitive advantage?
•Did operators play a role in the successful implementation of new assembly strategies?
•Has a product been effectively designed for efficient assembly?
•Has the plant attempted to protect the environment and conserve natural resources?
As winner of the 14th annual Assembly Plant of the Year competition, AGCO’s facility in Jackson, MN, received an engraved crystal award and a commemorative banner.
Previous recipients of the Assembly Plant of the Year award were Bosch Rexroth Corp. (Fountain Inn, SC); Polaris Industries Inc. (Spirit Lake, IA); STIHL Inc. (Virginia Beach, VA); Northrop Grumman Corp. (Palmdale, CA); Ford Motor Co. (Wayne, MI); Philips Respironics (New Kensington, PA); Eaton Corp. (Lincoln, IL); Batesville Casket Co. (Manchester, TN); IBM Corp. (Poughkeepsie, NY); Schneider Electric/Square D (Lexington, KY); Lear Corp. (Montgomery, AL); Xerox Corp. (Webster, NY); and Kenworth Truck Co. (Renton, WA).
A nomination form for the 2018 Assembly Plant of the Year award will be available on ASSEMBLY's web site in early January.
To read about previous recipients of the Assembly Plant of the Year award, click on the links below:
- Bosch Rexroth Flexes Its Lean Production Muscle.
- Flexibility Shines Bright at Polaris.
- STIHL Stays a Cut Above the Competition.
- Northrop Grumman Soars With Automation.
- Ford Focuses on Flexibility.
- Philips Doesn’t Rest on Lean Laurels.
- Lean Thinking Helps Eaton Stay Healthy.
- Lean Lives at Batesville Casket Co.
- Big Blue Goes Green.
- Square D Runs Circles Around the Competition.
- Lear Puts Quality in the Driver’s Seat.
- Xerox Success Is Hard to Copy.
- Technology Drives Kenworth to Excellence.