Set New Standards For Custom Products

Nortek Air Solutions is the largest family of custom HVAC brands in North America.

52,000 To 256

They went from 52,000 to 256 potential cube sizes.

For more information on this story, contact
Jonathan Peters, Operations Project Manager, NAS: [email protected]

Process
After embarking on the product line simplification (PLS) journey for its custom line of air handling units (AHUs), Nortek Air Solutions (NAS) started to gather data across all the custom units sold over the past three years. They looked at the components in nearly all custom units. They determined that one of the most used fans was their FANWALL TECHNOLOGY®, which allows customers to specify multiple areas of the fan
for customization.

NAS pulled all data on fan selections and started to visualize the data in Pareto charts and matrices in Power BI. They sliced the data set in multiple ways until key indicators and tendencies appeared. It became evident that although customers could specify the height, width, and depth of the cubes in half-inch increments, over 90% of cubes were landing on two-inch increments. Most customers who selected sizes outside those increments didn’t need to choose those odd increments. They could have gone up or down to a two-inch increment and everything would have fit.

Results
The data was so compelling that NAS started to think beyond what customers had selected. They explored why customers made those selections. Were some people choosing odd sizes because they didn’t know any better? Digging into the data further, NAS discovered that small increments were even less necessary for the depth of the cube. They agreed to move forward with four-inch increments for depth.

Once all the sizing decisions were made, NAS went from 52,000 potential cube sizes utilizing 105 dimension lengths (which required the plant to be ready to cut any of those 105 different lengths at any time) down to 256 permutations using eight dimension lengths. Now, the bill of materials team can use standard parts numbers, something rare in the business and in their organization. And the operations group can stock standard parts based on historical usage and demand.

“Just because the product is custom doesn’t mean we can’t utilize standard parts,” said Jonathan Peters, Operations Project Manager, Nortek Air Solutions. “This single unified decision based on compelling data is driving the team to see what else the data will reveal
so clearly.”

Key Learnings

Follow the data.
Don’t be constrained by what you’ve always done (e.g, offering all options when just a few options can fulfill customer needs).
Custom products can be assembled with standard parts.
Understanding the customer’s needs is just as important as understanding historical buying habits.