Competitive Analysis of the P/M Industry

Report 00-2

Research Team: Walter R. Coyle (Undergraduate Assistant- Honors Thesis) Shivani Shukla (Research Assistant) Diran Apelian (Advisor) Jacqueline Isaacs (Advisor Chickery Kasouf (Advisor)

Project 1: Economic Comparisons of Alternative Technologies

Project Goals § To develop economic assessment tools that allow analysis and quantification of the tradeoffs and attributes of different metal processing technologies § To identify several case studies for components fabricated through machining processes § To develop appropriate technical cost models for machined components § To identify the major cost drivers by quantifying the cost breakdowns of individual manufacturing process steps § To compare economic results from machined components with results from the PowderEx P/M technical cost model, and identify opportunities for infusion of P/M technologies

Achievements Since April:

Since P/M parts compete with machined components in various markets, opportunities to improve P/M competitiveness are explored in this project. In an undergraduate honors thesis project started in July 2000, a new set of case studies is under investigation for large gear components. A technical cost model has been developed for machined gears to compare the economic manufacturing costs with P/M part costs generated from the PowderEx technical cost model. Each model is used to identify major cost factors within each fabrication route. Analysis of results will target the areas in the P/M process where cost reductions provide the greatest impact.

Thus far, accomplishments include: § Development of a machined gear technical cost model § Identification of three potential case studies for investigation § Analysis of one component for comparative manufacturing costs

The machined gear model is a stand-alone technical cost model, like the PowderEx model. Output from the model will provide P/M manufacturers with information on process economics for production of gears of varying dimensions and complexity.

1 Component size, required quantities, tolerances, performance requirements and process economics must be considered together when selecting of the best method of production.

Most machined gears follow a generalized process, with small deviations for gear specific requirements or specifications. First a gear blank is produced. The gear blank may be either cast or machined. This model assumes the gear blank is outsourced and the price per piece is input. The inner and outer diameters are cut to size, and the relevant surfaces are surface ground to tolerance. Inner features, such as keyways and splines, are broached into the inner diameter. The teeth themselves are cut into the gear using a gear hobbing machine. After hobbing, shaving may be required, after which, the gear is heat- treated. The technical cost model includes manufacturing process steps for all of the processes discussed above.

One of the goals for development of the machined gear model is to make the model robust enough to handle many different types of gears and machining processes. For this reason, process steps can be switched on and off as needed. For components that do not require every process step available in the model, the steps can be switched off. Additional process steps can be added to the model later if required. With each process step modeled, changes to the various input parameters can be varied and the effects on total cost can be investigated.

The main goal of this project is to assess whether it is more economically advantageous to create a part using P/M processes, or by machining. Three gear components have been selected with the help of PMRC members: a timing gear, a transmission sprocket and a helical balancer gear. These gears are chosen to provide varying part complexity. Showing greater complexity than the timing gear, a transmission sprocket with a 5" total outer diameter and a 2" ID, will provide the first case study for investigation. Results from the machined gear model will be used in conjunction with results from the PowderEx model to determine the scenarios where one method of production is favorable over the other. Initial results will be presented at the Fall 2000 meeting.

For each gear or case study under consideration, it is likely that different trends will result. Identification of general trends for manufacturing costs using specific case studies will allow P/M manufacturers to make more informed decisions.

Future Work

• Additional case studies using the machined gear technical cost model, which will be fine-tuned. • Additional case studies using the PowderEx model. • Comparative economic analysis of each component

2 Project 2. Statistical Data Base for the P/M Industry

Objectives Develop of a statistical data base for the P/M parts industry to enable firms to:

• Benchmark key performance data vis- -vis other part producers • Develop relationships between success measures and independent variables

Strategy • Develop a relationship with the PMPA to develop a joint statistics project • Initiate a set of annual questionnaires to develop a continuing industry data base.

Achievements Since April:

• Chick Kasouf worked with Craig Paullin, the PMPA Statistics Committee, and MPIF to develop three questionnaires that were mailed to PMPA membership during the summer. Response rates were approximately equal to earlier PMPA efforts. After meeting with the Statistics Committee at the MPIF Fall Management Conference, a second mailing of the questionnaire will be administered to nonrespondents with final results for the year presented at the 2001 PMPA Winter Meeting. These surveys are included with this package.

• The cover letter to PMPA members is attached along with a copy of the three questionnaires given in Appendix A.

3 August 28, 2000

Dear PMPA Official Representative:

As we noted in our previous letter, the PMPA Statistics and Benchmarking Committee, working with WPI s Metal Processing Institute, has revised its statistics program. We will be conducting three annual surveys of the industry, each with a specific focus. Each of these new surveys is included with this mailing. These are replacing Reports 2, 3 & 4. After submitting your 2nd quarter data for these reports, please destroy any remaining forms for Reports 2, 3, and 4.

Report A: Expense Asset Management/Sales Distribution Report measures your expenses and asset management to benchmark resource efficiency in the P/M parts industry. It also contains a brief section measuring sales and production distribution in the P/M parts industry. The other two surveys are Report B: Operational Benchmarking Survey (includes plant level data about operational efficiency), and Report C: Wage and Salary Survey (a continuation of the wage and salary survey with additional data on turnover and absenteeism).

By participating in this study, you will have a summary of current practice in the industry. As noted in the cover letter, all responses are confidential and will be analyzed anonymously. John Pavlovsky, CPA will be collecting data for PMPA and forwarding it to the research team at WPI with identification codes to disguise the identity of participating companies. Neither the Statistics Committee nor WPI staff will have any access to your identity when dealing with your responses.

Each participant in the study who completes 75% of the items will receive a customized report that includes a summary of all responses and your responses compared to the aggregate data. As noted above, this report is prepared using codes to analyze data anonymously.

In order to facilitate timely analysis of the data, could you please return the questionnaires to Mr. Pavlovsky s office by September 18, 2000?

If you have any questions, please feel free to call Pete Johnson (609.452.7700; [email protected]), Craig Paullin (310.715.9800; x 108; [email protected]) or Chick Kasouf (508.831.5548; [email protected]).

We look forward to your participation and hope to see you at the Fall Management Conference.

Best regards,

Craig Paullin Chickery J. Kasouf President, Pacific Sintered Metals Metal Processing Institute Chairman, PMPA Statistics and Worcester Polytechnic Institute Benchmarking Committee

4 PMPA/WPI Report A: Expenses, Asset Management/ End Market Sales Distribution (Corporate Level)

Summer/Fall 2000

5 Report A

Expense, Asset Management/End Market Sales Distribution Report

This questionnaire measures your expenses, asset management, and end market sales distribution to benchmark the resource efficiency of P/M part producers at the company level. By participating in this study, you will have a summary of current practice in the industry. As noted in the cover letter, all responses are confidential and will be analyzed anonymously. John Pavlovsky, CPA will be collecting data for PMPA and forwarding it to the research team with identification codes to disguise the identity of participating companies. Neither the Statistics Committee nor WPI staff will have any access to your identity when dealing with your responses.

Each participant in the study who completes 75% of the items will receive a custom report that includes:

• A summary of all responses • Your responses compared to the aggregate data. As noted above, this report is prepared using codes to analyze data anonymously.

Please use data from your most recently completed financial statements. Section I uses data from your income statement and Section II uses data from your balance sheet. Section III asks for information about firm size to classify companies in the analysis. Section IV measures sales end market and production distribution.

To facilitate timely analysis of the data, could you please return the survey to Mr. Pavlovsky s office by September 18, 2000?

If you have any questions, please feel free to call: Peter Johnson (609.452.7700; [email protected]) Craig Paullin (310.715.9800; x 108; [email protected]) Chick Kasouf (508.831.5548; [email protected]).

6 Report A I. Expense Statistics Please provide information regarding aggregate company operations from your most recently completed fiscal year. Each item asks you to report data in percentage of net P/M sales, i.e, total sales of P/M parts, tooling, and services less returns. Please refer to the glossary at the end of the questionnaire for definitions of each variable. Please note that these are annual expense items taken from your income statement. Please do not include net capital expenditures. Raw materials ______% Direct labor costs - wages ______% Direct labor - benefits ______% Out of pocket purchases of secondary operations ______% Net new tooling costs and expenses ______% Net replacement tooling costs and expenses ______% Maintenance costs ______% Utilities costs ______% Insurance ______% Depreciation ______% R&D expenses ______% Total manufacturing expenses ______% Sales and marketing expenses ______% General and administrative expenses ______% Income before interest and taxes ______%

II. Asset Management Statistics This section asks for information from your balance sheet Current assets (as a percentage of your total assets) ______% Average collection period ______days Current ratio at the end of the last reporting year ______Quick ratio at the end of the last reporting year ______Average raw materials inventory ______days Average work in progress inventory ______days Inventory turnover ______days Return on adjusted gross assets ______% Return on adjusted net assets ______%

7 III. Classification Data These data are used to classify firms in the analysis. No company sales or assets will be identified.

Total assets (in US dollars) ______Net P/M sales in your last fiscal year (in US dollars) ______Average number of employees in the last fiscal year ______

IV. End Market Sales Distribution

Please provide a percentage breakdown of your net P/M sales by market

Automotive OEM ______% Automotive tier 1, 2, or 3 ______% Automotive replacement parts ______% Heavy duty truck ______% Off-road vehicles ______% Construction ______% Lawn and garden ______% Agricultural ______% Appliance ______% Office equipment ______% Other (please specify) ______% Other (please specify) ______% Total 100 %

Please provide a breakdown of your net P/M sales by region. Please provide this information by the country where the part is delivered, not by the ownership of the customer. For example, a sale to Toyota in the United States should be considered a United States sale.

United States ______% Canada/Mexico ______% Central America ______% South America ______% Western Europe ______% Asia/Pacific Rim ______%

8 Please break down your P/M production by region. Production is the site at which the part is produced,

United States ______% Canada/Mexico ______% Central America ______% South America ______% Western Europe ______% Asia/Pacific Rim ______%

Please return by September 18, 2000 to: John Pavlovsky Jr., CPA 176 Northfield Road Bridgewater, NJ 08807

E-mail: [email protected] FAX: (908) 927-0213

9 Definition of terms

Unless noted otherwise, all data are annual from your most recent financial statements).

Raw materials: Cost of raw material used in the product plus related freight in; not indirect materials or supplies or freight materials thereof.

Direct labor - wages: All straight-time wages of workers directly involved in the production of the sales product, such as compacting press operators, sintering furnace operators, and secondary equipment operators (Include shift differential but exclude overtime premium, benefits, supervision, and set-up).

Direct labor - benefits: The cost of all benefits for hourly workers, including health, dental, and life insurance, unemployment or disability benefits, vacation, retirement contributions or other costs associated with your benefit package.

Out of plant purchases of secondary operations: All outside purchases of services that relate directly to the production of the sales product (such as machining heat treating, impregnation, etc.).

Net new tooling costs and expenses: Internal and external costs including labor and new materials incurred to acquire the initial set of tools, fixtures, jigs, etc. to manufacture a P/M part, less the portion of any such cost funded by the customer.

Net replacement tooling costs and expenses: Internal and external costs including labor and new materials incurred to repair and/or replace tools, fixtures, jigs, etc. to manufacture a P/M part, less the portion of any such cost funded by the customer.

Maintenance costs: Expenses associated with plant and equipment maintenance (including office space).

Utilities costs: Gas, electricity, nitrogen, ammonia, and other utilities costs associated with the production of product. EXCLUDE telephone.

Insurance: Purchase of business insurance to cover operations (but not including employee benefits)

Depreciation: Depreciation expenses for the last accounting period

R&D expenses: Expenses associated with new product development and general research

10 Total manufacturing costs: Costs associated with the production of P/M parts, not including depreciation, interest, taxes, or general and administrative costs.

Sales and marketing expenses: Expenses associated with sales and marketing, including salaries and commissions.

General and administrative expenses: Executive and office salaries and benefits not included elsewhere, legal and audit services, rent for offices, telephone, office supplies, office equipment expense, and all other expenses (NOTE: Exclude interest income and expense and income taxes.)

Income before interest and taxes: Earnings before interest and taxes as a percentage of gross sales.

Current assets (as a percentage of your total assets): Current assets divided by total assets.

Average collection period: Accounts receivable divided by credit sales per day.

Current ratio at the end of the last reporting year: Current assets divided by current liabilities at the end of the last reporting year.

Quick ratio at the end of the last reporting year: Cash plus accounts receivable divided by current liabilities, at the end of the last reporting year.

Average raw materials inventory in days: Average inventory of available raw material divided by average daily raw material consumption (in pounds)

Average work in progress inventory in days: Average work in progress inventory divided by average daily production (in pounds)

Inventory turnover: Average daily sales divided by average inventory.

Return on adjusted gross assets: Net profit divided by gross assets, i.e.:

The sum of all recorded assets employed in P/M parts operations after elimination of cash, marketable securities, accumulated depreciation (to include fixed assets at gross value), and investments, plus the capitalization of leases

Return on adjusted net assets: Net profit divided by: gross assets as defines above less total accumulated depreciation.

11 PMPA/WPI Report B: Operational Benchmarking Analysis (Plant Level)

V. Summer/Fall 2000

12 Report B Operational Benchmarking Analysis

This report collects data on critical benchmarks identified as competitive milestones by the industry. Data will only be reported to the group in the aggregate, but you will receive a customized report summarizing the results of the entire sample and compares your answer to the group.

All responses are confidential and will be analyzed anonymously. John Pavlovsky, CPA will be collecting data for PMPA and forwarding it to the research team with identification codes to disguise the identity of participating companies. Neither the Statistics Committee nor WPI staff will have any access to your identity when dealing with your responses.

Each participant in the study who completes 75% of the items will receive a custom report that includes a summary of all responses and your responses compared to the aggregate data. As noted above, this report is prepared using codes to analyze data anonymously.

To facilitate timely analysis of the data, could you please return the survey to Mr. Pavlovsky s office by September 18, 2000?

13 Report B Operational Benchmarking Analysis

Please provide the data requested below. Definitions for each item are included at the end of this survey. Please use data from your most recent reporting year.

Number of P/M employees ______Total pounds of P/M parts shipped ______Net sales of P/M parts ______Square footage of P/M operations ______Total energy costs ______Average number of presses operating ______Total press hours ______Average capacity utilization ______Percentage of on time product delivery ______Percentage of sales using premium freight (due to late production) ______Defective parts per million at final inspection ______Percentage of accepted first article (or PPAP) submissions ______P/M shipments per molding set-up employee ______Percentage of sales in scrap ______Percentage of sales requiring rework ______Percentage of sales returned ______The total number of new product tooled ______New tooling as a percentage of net sales ______The percentage rate of sales growth or decline from the previous year in dollars ______The percentage rate of sales growth or decline from the previous year in pounds ______Percentage of sales from parts less than one year old ______Percentage of sales from parts less than three years old ______Percentage of bids won last year ______Expected percentage of sales this year from bids won last year ______

Please return by September 18, 2000 to: John Pavlovsky Jr., CPA 176 Northfield Road Bridgewater, NJ 08807

E-mail: [email protected] FAX: (908) 927-0213

14 Definition of terms

All data are annual from your most recent reporting year. PLEASE NOTE THAT NET ANNUAL SALES ARE THE DOLLAR SALES OF P/M PARTS, TOOLING AND SERVICE, LESS RETURNS. Number of P/M employees: The total number of employees assigned to your P/M business (including production workers, executive, sales, clerical, and support staff. Total pounds of P/M parts shipped: The total volume of P/M parts (in pounds) shipped during the year. Net sales of P/M parts: The total dollar volume of P/M parts, tooling and services, shipped during the year less returns. Square footage of P/M operations: The total square footage used in the manufacture of P/M components, including office space. Total energy costs: The total costs for utilities and fuel related to your P/M operations. Average number of presses operating: The number of presses that were available during the period, even though some may have been operating intermittently. If there is a change in the number of presses during the period (such as the introduction of a new press or the removal of an obsolete press, show the nearest whole number of presses representing the AVERAGE number of presses available. Total press hours: The total hours run for all presses in y our operation during the period. For example, if 10 presses are operating for 40 hours a week, for 52 weeks, then total press hours are 20,800. Average capacity utilization: Total hours of press utilization divided by 6240 (120 hours per week x 52 weeks) Percentage of on time product delivery: Percentage of your orders which were delivered complete and on schedule. Percentage of sales using premium freight: Percentage of sales that required premium freght charges because of late production. Defective parts per million at final inspection: Total parts rejected by your customer divided by the total parts shipped, multiplied by 1,000,000. Percentage of accepted first article (or PPAP) submissions: The total parts accepted by the customer on a first submission basis. If modifications are made to the component but are still approved by the customer, this would be considered first article approval.

15 P/M shipments per molding set-up employee: Net annual sales divided by the average number of set-up personnel employed during the year. Percentage of sales in scrap: Value in labor and material of product scrapped during the year as a percent of net annual sales. Percentage of sales requiring rework: Total internal and external costs associated with deviated product correction during the last year as a percentage of net annual sales. Percentage of sales returned: Total dollar vale of product returned by customer as a percentage of net annual sales. The total number of new product tooled: The number of new products tooled for production during the last year. New tooling as a percentage of net sales: Internal and external costs including labor and new materials incurred to acquire the initial set of tools, fixtures, jigs, etc. to manufacture a P/M part, less the portion of any such cost funded by the customer/, divided by net sales. The percentage rate of sales growth or decline from the previous year in dollars: The rate of change in sales based on preceding year s dollar volume, expressed as a percentage. For example, if your sales increased from $20 million to $22 million, your rate of growth was 5%. The percentage rate of sales growth or decline from the previous year in pounds: The rate of change in sales based on preceding year s shipment in pounds, expressed as a percentage. Percentage of sales from parts less than one year old: The percentage of net sales, in dollars, generated by parts with PPAP or first article approval in the last year. Percentage of sales from parts less than three years old: The percentage of net sales, in dollars, generated by with PPAP or first article approval in the last three years. Percentage of bids won last year: The percentage of bids made during the last year that were awarded sales. Expected percentage of sales this year from bids won last year: The expected percentage of sales volume this year from bids won last year.

16 PMPA/WPI Report C: Wage & Hour Classification/ Fringe Benefits Survey

Summer/Fall 2000

17 TO: ALL PMPA MEMBERS

SUBJECT: WAGE & HOUR CLASSIFICATION/FRINGE BENEFITS SURVEY 2000

THIS SURVEY WILL BE COMPILED BY THE MPIF CPA, JOHN PAVLOVSKY JR. NO INDIVIDUAL COMPANY DATA WILL BE RELEASED. THE REPORTING FORMS SUBMITTED BY EACH COMPANY WILL BE DESTROYED AS SOON AS COMPILATION HAS BEEN COMPLETED. TO PROTECT CONFIDENTIALITY A CODE DESIGNATION WILL BE ASSIGNED TO EACH FORM SO THAT THE COMPANY REPORTING COULD NOT POSSIBLY BE IDENTIFIED. RESULTS WILL BE AUTOMATICALLY MAILED TO TIMELY PARTICIPANTS. IF WE HAVE LESS THAN 4 PARTICIPANTS IN ANY GIVEN SECTION, IT WILL NOT BE PRINTED. ______

Reporting Company Code ______Contact Name ______

DEADLINE FOR FILING: SEPTEMBER 18, 2000 ______

RETURN TO: John Pavlovsky Jr., CPA 176 Northfield Road Bridgewater, NJ 08807 Fax: (908) 927-0213 E-mail: [email protected]

** FILL IN ONLY THE SPACE APPROPRIATE TO YOUR ORGANIZATION**

New England _____ Maine, New Hampshire, Vermont, Massachusetts, Connecticut, and Rhode Island.

Mid Atlantic _____ New York, New Jersey, Pennsylvania, Maryland, Delaware, and West Virginia.

Midwest _____ North Dakota, South Dakota, Nebraska, Kansas, Minnesota, Iowa, Missouri, Wisconsin, Illinois, Indiana, Michigan, and Ohio.

18 Southern _____ Virginia, North Carolina, South Carolina, Georgia, Florida, Kentucky, Tennessee, Alabama, Mississippi, Arkansas, Louisiana, Oklahoma, and Texas.

Pacific Coast _____ California, Oregon, Washington, Alaska, Hawaii, Montana, Wyoming, Colorado, New Mexico, Idaho, Utah, Arizona, and Nevada.

Canada _____ Please indicate if wages given are: U.S. Dollars ____ Canadian Dollars _____ For comparison Canadian Dollars will be converted to U.S. Dollars in the final report.

COMPANY LOCALE: RURAL ______URBAN ______(Rural-Metropolitan area less than 25,000 people/Urban-Metropolitan area over 25,000 people)

COMPANY SALES CATEGORY: 0-5 Million ____ 5-10 Million ____ 10-25 Million ____ Over 25 Million ____

NUMBER OF EMPLOYEES: FULL-TIME ______PART-TIME ______(Include both hourly and salaried employees for this location only)

NOTE: Companies with more than one location should submit a separate survey for each location.

** COMPLETE ONLY FOR POSITIONS AVAILABLE IN YOUR COMPANY ** *** USE ACTUAL HOURLY WAGES NOT WAGE SCALES ***

I. DIRECT HOURLY LABOR Dollars/Hour Average Lowest Highest

A. Compacting Set-Up Operator ______

B. Compacting Press Operator ______

C. Computer Press Operator ______

D. Furnace Loader/Unloader ______

E. Secondary Equipment Operator ______

F. Powder Blender/Operator ______

G. Grinder Loader/Unloader ______

H. Heat Treat Operator ______

I. Part Time Worker ______

19 J. Parts Packer ______

K. Finishing & Tumbling Operator ______

L. Sorter ______

II. Indirect Hourly Labor

A. Production

1. Compacting Set-Up A (Sr.) ______

2. Compacting Set-Up B (Jr.) ______

3. Compacting Set-Up C (Trainee) ______

4. Secondary Equipment Set-Up ______

5. Material Handler/Lift Truck Operator ______

Dollars/Hour Average Lowest Highest B. Production Control

1. Schedulers/Dispatchers ______

2. Metallurgical Technician ______

3. Shipping/Receiving Clerk ______

4. Production Control Clerk ______

C. Quality Control

1. Chief/Precision/Layout Inspector ______

2. In-Process Inspector/Patrol Inspector ______

3. Final Inspector/Quality Auditor ______

4. Process Technician ______

D. Supervision-Leadperson ______

20 E. Maintenance

1. Millwright ______

2. Electrician ______

3. General Repairman ______

4. Janitor/Custodian ______

5. Maintenance Mechanic/Repairman ______

6. Maintenance Helper ______

F. Tool Room

1. Tool & Die Maker ______

2. Tool & Die Maker-Trainee ______

3. Machinist ______

4. Machinist-Trainee ______

5. Tool Crib Attendant/Tool Control ______

6. Tool & Gauge Inspector/Tool Maintenance Inspector ______

III. Salaried Labor Annual Salary (Dollars)

A. Manufacturing Staff Average Lowest Highest 1. Manufacturing Manager ______

2. General Foreman/Production Control Mgr. ______

3. Shift Foreman ______

4. Quality Control Manager ______

5. Engineering Manager/Chief Engineer ______

6. Manufacturing/Process Engineer ______

7. Industrial Engineer ______

21 8. Tool Design Engineer ______

9. Metallurgist ______

10. Estimator ______

11. Draftsman-Sr. ______

12. Draftsman-Jr. ______

13. Personnel Manager ______

B. Office Staff

1. Executive Secretary ______

2. Secretary ______

3. Controller/Accounting Manager ______

4. Bookkeeper ______

C. Sales

1. Sales Manager ______

2. Marketing Manager ______

3. Manager Customer Services ______

4. Salesman ______

5. Sales Correspondent ______

6. Applications Engineer ______

22 NOTE: UNLESS OTHERWISE INDICATED, ALL RESPONSES SHOULD PERTAIN TO HOURLY EMPLOYEES.

Turnover and Absenteeism

Using the categories in pages 2 — 4, please provide the following information about turnover and absenteeism in terms of the percentage of that category: Resignations/retirements: The number of voluntary resignations during the last reporting year. Dismissals: The number of terminations due to work performance. Layoffs: The number of involuntary separations due to head count adjustment. Absentee rate: The percentage of scheduled workdays missed.

Category Resignations Dismissals Layoffs Absentee /retirements rate Direct Hourly Labor Indirect Hourly Labor Salaried Labor

Probationary Period 1) A. Do you have a probationary period? Yes ____ No ____ B. What is the length of your probationary period? ______(days)

COLA • A. Do you have an automatic "COLA" (Cost of Living Adjustment) allowance? Yes ____ No ____ B. Do you have a capped or open "COLA" allowance? Capped ____ Open ____ C. If you have a "COLA" allowance, what index is it based on?

______

Labor Unions 3) A. Do you have a labor union? Yes ____ No ____ B. What is the length of your labor contract in months?______

Increases 4) A. Last general increase: Date ______Percent increase for base wages? ______% B. Provisions for future increases: Date ______Percent increase for base wages? ______%

23 Shift Premiums 5) A. Do you pay shift premiums? Yes ____ No ____ B. Amount paid to second shift: +$.______/hr C. Amount paid to third shift: +$.______/hr

Incentive/Profit Sharing/Bonus Plans 6) A. Does your company have an incentive plan? _____ Profit Sharing Plan? _____ Bonus Plan? _____ B. If your company has an incentive, profit sharing, and/or bonus plan, what is it based on? Production _____ Profits _____ Management Discretion _____ Other _____ C. If your company has a profit sharing plan, are payments made annually? ____ deferred? _____ other? _____ D. If your company gives bonuses, are they given annually? _____ other? _____ E. If you have an incentive/profit sharing/bonus plan, what percent of payroll was paid in the calendar year for this plan?______

Pension Plan 7) A. Does your company have a pension plan? Yes _____ No _____ B. Are the costs shared by employees? Yes _____ No _____ C. Do the employees earn vested rights? Yes _____ No _____ D. After what length of service? _____ (years)

Employee Shareholding/ESOP 8) A. Have you instituted an employee shareholding or ESOP plan? Yes_____ No_____ B. Are you considering doing so? Yes _____ No _____

Holidays 9) A. How many paid holidays do you have? ______

Sick Leave 10) A. Does your company have sick leave coverage? Yes _____ No _____ B. Number of paid sick days: _____

Funeral Days 11) A. Number of paid funeral leave days for immediate family: _____

24 Jury Duty 12) A. Does your company have provisions for jury duty pay? Yes _____ No _____ B. Maximum number of days: ______

Premium Pay 13) A. Does your company provide premium pay for the following? If so, at what rate? (1.5x, 2x etc.)

Over 8 hours per day ______Saturday work ______Over 40 hours per week ______Sunday work ______Holiday work ______

Vacations 14) A. Please indicate the number of years service required to qualify for vacation as indicated below: 1 week vacation ______4 weeks vacation ______2 weeks vacation ______5 weeks vacation ______3 weeks vacation ______6 weeks vacation ______

Life Insurance 15) A. Do you offer group life insurance to your employees? Yes _____ No _____ B. What percentage of the cost does the employee pay? None _____ Under 25% _____ 25-50% _____ Over 50% _____ C. Please complete the following information: ______x annual rate or ______$ Amount - Natural Death ______x annual rate or ______$ Amount - Accidental Death Additional insurance can be purchased: Yes ______No ______Days probationary period required for life insurance coverage

Hospitalization/Major Medical Insurance 16) A. Do you offer hospitalization/major medical insurance? Yes _____ No _____ B. What percentage of the cost does the employee pay for his/her coverage? None _____ Under 25% _____ 25-50% _____ Over 50% _____ C. What percentage of the cost does the employee pay for his/her dependent’s coverage? None _____ Under 25% _____ 25-50% _____ Over 50% _____ D. Amount of deductible per employee ______per family______

25 Short-Term Disability 17) A. Do you have short-term sickness and accident benefit coverage? Yes _____ No _____ B. What percentage of the cost does the employee pay? None _____ Under 25% _____ 25-50% _____ Over 50% _____ C. Number of weeks benefits paid: ______D. Amount of weekly benefit: Minimum _____ Maximum _____

Long-Term Disability 18) A. Do you offer long-term disability coverage? Yes _____ No _____ B. What percentage of the cost does the employee pay? None _____ Under 25% _____ 25-50% _____ Over 50% _____ C. Number of weeks long-term disability benefits paid: ______D. Percent of weekly pay ______% E. Is it social security integrated? Yes _____ No _____

Dental Coverage 19) A. Do you offer a dental plan? Yes _____ No _____ B. Is there a deductible? Yes _____ No _____ C. Amount of deductible ______D. Does it cover orthodontic treatment? Yes _____ No _____ E. What percentage of the cost does the employee pay? None _____ Under 25% _____ 25-50% _____ Over 50% _____

Cafeteria Plan Defined as: Above a certain minimum medical coverage, employees can elect to give up some insurance and/or benefits in exchange for other insurance and/or benefits. 20) A. Have you instituted a cafeteria plan? Yes _____ No _____ B. Are you considering doing so? Yes _____ No _____

PLEASE ANSWER THE FOLLOWING QUESTIONS FOR SALARIED EMPLOYEES ONLY

Bonus Plan 1) A. Does your company have a bonus plan? Yes _____ No _____ B. Is it based on profits _____, management discretion _____, or other _____? C. Are bonuses given annually _____ or other ______?

26 Pension Plan 2) A. Does your company have a pension plan? Yes _____ No _____ B. Do the employees contribute to the plan? Yes _____ No _____ C. Is the benefit = _____ or > _____ than the benefit offered the hourly employees?

Medical Plan 3) A. Do you offer Hospitalization/Major Medical Insurance? Yes _____ No _____ Is the benefit = _____ or > _____ than the benefit offered the hourly employees? B. Do you offer Short-Term Disability benefits? Yes _____ No _____ Is the benefit = _____ or > _____ than the benefit offered the hourly employees? C. Do you offer Long-Term Disability? Yes _____ No _____ Is the benefit = _____ or > _____ than the benefit offered the hourly employees? D. Do you offer Dental Coverage? Yes _____ No _____ Is the benefit = _____ or > _____ than the benefit offered the hourly employees?

Automobile 4) A. Do you offer a company car to sales personnel? Yes _____ No _____ B. Do you offer a company car to other management? Yes _____ No _____

Memberships 5) A. Does the company pay for membership in APMI? Yes _____ No _____ B. Does the company pay for memberships in other organizations? Yes _____ No _____

Other Benefits 6) A. Does the company offer stock options? Yes _____ No _____ B. Does the company pay for education? Yes _____ No _____ C. Does the company offer other benefits? Yes _____ No _____

7) Do you pay overtime for salaried employees? Yes _____ No _____

27 Metal Powder Industries Federation 105 College Road East Princeton, NJ 08540-6692

(609) 452-7700 Fax (609) 987-8523 www.mpif.org

BRIEF JOB DESCRIPTIONS TO ASSIST COMPANIES IN SUPPLYING INFORMATION FOR THE WAGE & HOUR QUESTIONNAIRE

I. DIRECT HOURLY LABOR

A. COMPACTING SET-UP OPERATOR Sets up and operates one or more compacting presses. Monitors the quality and quantity of parts produced to insure that parts meet standards and specifications.

B. COMPACTING PRESS OPERATOR Operates one or more compacting presses. Removes parts by hand or checks chutes when parts are automatically ejected. Keeps hoppers filled with powder. Does visual and/or micrometer checks to determine quality of parts.

C. COMPUTER PRESS OPERATOR Operates one or more computer presses

D. FURNACE LOADER/UNLOADER Furnace loading responsibilities include loading parts into trays or on to a conveyer belt for sintering in furnaces and removes sintered parts from furnace. Inspects parts visually or with a micrometer to determine quality.

E. SECONDARY EQUIPMENT OPERATOR Operates one or more secondary machines for operation on a variety of parts and/or performs assembly work. Typical secondary machines include lathes; single and multiple spindle drill presses for drilling, tapping, reaming and countersinking; and machines for assemblies, honing etc.

F. POWDER BLENDER/OPERATOR Blends, screens and reprocesses powder using specified tools and equipment. Operates equipment such as lift truck, bulk pack inverter, barrel inverter, scales, blender feed system and dust collecting system. May keep powder inventory.

G. GRINDER LOADER/UNLOADER Sets up and adjusts grinders and feeder. Loads, unloads and packs parts off grinder. Uses hoists and hand tools when necessary.

28 H. HEAT TREAT OPERATOR Operates and adjusts heat treat, draw and generator equipment. Loads and unloads parts using necessary equipment. Makes routine equipment checks and adjustments to furnace and quench, gas flows, pressure, etc.

I. PART TIME WORKER Generally a student or a retired person who works less than the 40 hours per week in an unskilled position such as parts packer, sorter, compacting press operator. For the purpose of accounting number of employees and wage data for part- time workers should be added together to establish a total of part-time workers.

J. PARTS PACKER Visually checks, sorts, counts and hand packs parts. Inspects parts for cracks, burrs or other imperfections. Places finished parts into bags, containers, or cartons for shipment.

K. FINISHING & TUMBLING OPERATOR Operates all tumbling, drying and separating equipment. Selects the media and the method of tumbling or finishing for each type of part or condition. Maintains the necessary hoisting and tumbling equipment and media. May clean out and treat water/waste settling containers.

L. SORTER Sorts and inspects assigned production parts for tolerance compliance.

II. INDIRECT HOURLY LABOR

A. Production

1. COMPACTING SET UP A (Sr.) Sets up and adjusts various presses and monitors the quality and quantity of parts produced from one or more presses to insure that parts meet standards and specifications. Periodically checks condition or presses in his/her assigned group. Assists in training new die setters and operators. Displays judgement, initiative and ingenuity in setting up complicated jobs.

2. COMPACTING SET UP B (Jr.) Sets up and adjusts various presses, not necessarily all presses, and monitors the quality and quantity of parts to insure that parts meet standards and specifications. Periodically checks condition or presses in his/her assigned group.

3. COMPACTING SET UP C (TRAINEE) Learning operations of presses and equipment. Actually run, mold and size on presses as operators. Learn setting up procedures. Removes tooling.

29 4. SECONDARY EQUIPMENT SET-UP Sets up and operates all types of secondary equipment. Changes drills, taps, reamers, cutters, etc. Checks and uses micrometers, gages, thread gages, and related tooling or inspection technique. Checks first runs.

5. MATERIAL HANDLER/LIFT TRUCK OPERATOR Maintains correct quantity and type of powder, parts and supplies at presses and furnaces. Operates necessary equipment. Identifies powder and keeps accurate inventory records for all materials used and scrap processes.

B. Production Control

1. SCHEDULERS/DISPATCHERS Coordinates activities of planning, scheduling and expediting activities. Under direction of Production Control Manager, works with Sales, Purchasing, Production Foremen and Traffic Manager. Maintains necessary records and documents.

2. METALLURGICAL TECHNICIAN Under the direction of the Metallurgist, assists with tests. Helps maintain necessary records and documents.

3. SHIPPING/RECEIVING CLERK Coordinates activities in shipping and receiving. Responsible for counting, packing, loading and unloading trucks when necessary. Responsible for packing slips, bills of lading, and receiving slips. May be involved with finishing activities such as dipping, waxing, impregnating, etc.

4. PRODUCTION CONTROL CLERK Prepares documents and reports. Processes acknowledgements, invoices ad packing lists, shipping lists and efficiency reports. Operates typewriter, computer terminal, calculator, and other office machines.

C. Quality Control

1. CHIEF/PRECISION/LAYOUT INSPECTOR Ability to train, instruct, assist and assign duties to inspectors. Ability to perform in-process and audit inspections on all parts. Will work with employees to develop quality parts, methods and procedures.

2. IN-PROCESS INSPECTOR/PATROL INSPECTOR Performs in-process inspection of parts to master control specifications. Conducts mechanical, visual and density inspections. Verifies physical properties and size of parts.

30 3. FINAL INSPECTOR/QUALITY AUDITOR Performs final inspections of parts to customer specifications. Conducts hardness and density checks as well as inspection of mechanical and visual characteristics.

4. PROCESS TECHNICIAN Assists process engineer in preparing process methods and procedures with new jobs and revisions to existing jobs. Sets up and operates inspection and layout equipment and documents findings.

• Supervision

LEADPERSON Supervises personnel and activities within area of responsibility. Train personnel assigned to department. Maintains adequate inventory of operating supplies. Makes daily discretionary decisions concerning scheduling of jobs and personnel. Is able to operate and maintain equipment when necessary.

E. Maintenance

1. MILLWRIGHT Installs or moves machines such as presses, lathes, drill presses and milling machines. Ability to prepare proper foundations, align and balance equipment. Checks operations when installed.

2. ELECTRICIAN Installs, maintains and repairs generating equipment, transmission equipment and lights. Is concerned with test and power circuits of varying design. Works from wiring diagrams or schematic drawings.

3. GENERAL REPAIRMAN Takes care of routine maintenance and repair of plant, grounds, and equipment. Has the ability to make minor repairs and oversee more extensive work. Has more responsibility for plant and grounds than equipment.

4. JANITOR/CUSTODIAN Cleans and services building, offices and shop areas, furniture and fixtures and lavatories. May do some minor maintenance work on buildings and fixtures. May maintain grounds and premises.

5. MAINTENANCE MECHANIC/REPAIRMAN Ability to examine each machine, furnace, generator, air compressor and mechanical device and be capable of determining its condition and correct faults. Moderately skilled in several trades such as welding, electrical work, plumbing, carpentry, etc. Is able to direct more extensive repairs.

31 6. MAINTENANCE HELPER Assists the Maintenance Mechanic in whatever general maintenance and repairs are a routine part of the company. Routine work might include oiling and greasing moving parts of mechanical equipment. Assists with plant maintenance.

F. Tool Room

1. TOOL & DIE MAKER Specializes in the construction, repair, maintenance and calibration of tools, dies, jigs, fixtures and instruments. Operates various machine tools and performs precision work such as laying out, fitting, and assembling parts. May train other employees in tool and knowledge.

2. TOOL & DIE MAKER TRAINEE Assists in the construction, repair, maintenance and calibration of tools, dies, jigs, fixtures and instruments. Under supervision operates various machine tools. May be in an apprenticeship program.

3. MACHINIST Operates tool room milling machines, lathes, grinders and associated power and hand tools to produce various tooling adaptors, tool components and other items as instructed. Performs minor repairs of tool components and assists in various tasks as assigned. Performs routine machine maintenance.

4. MACHINIST TRAINEE Assists the machinist with the objective of learning a machinist’s skills. Operates various machines under close supervision.

5. TOOL CRIB ATTENDANT/TOOL CONTROL Maintains inventory of tooling to meet production schedules. Will pre-select tools and adaptors to be used, checking fits and clearances. Makes recommendations and follows through on necessary repair or replacements of tools and hardware. Cleans tooling and adaptors after production runs.

6. TOOL & GAUGE INSPECTOR/TOOL MAINTENANCE INSPECTOR Performs inspection and minor repair on all incoming tooling, gauging, and raw material. Schedules and/or provides for calibration of quality control gauges and equipment. Ability to read blue prints and tool drawings.

32 III. SALARIED LABOR

A. Manufacturing Staff

1. MANUFACTURING MANAGER Manages all plant and manufacturing activities. Schedules or approves all schedules of equipment and personnel to meet customers and plant requirements. Develops and supervises plans to train personnel. Develops and supervises plans for new processes. Maintains and improves production standards. Works to control costs.

2 . GENERAL FOREMAN/PRODUCTION CONTROL MANAGER Supervises and trains department and shift supervisors. Evaluates performance. Recommends organization changes. Coordinates production activities. Recommends additions or deletions to work force. Consults with other supervisory people on equipment changes.

3. SHIFT FOREMAN Supervises shift operations. Coordinates assigned personnel to meet production and shipping schedules. Makes adjustments to equipment and machinery. Gives performance reviews. Consults with supervisor on major problems.

4. QUALITY CONTROL MANAGER Establishes and maintains standards of quality which are practical for manufacturing and acceptable to the customer. Supervises all inspection activities. Designs and develops test methods, gauging and measuring devices and procedures. Compiles and maintains all inspection data and records.

5. ENGINEERING MANAGER/CHIEF ENGINEER Responsible for all engineering activity. Coordinates activities within engineering department and with sales, production, and customers. Supervises engineering subordinates. Selects sources and arranges for tool purchases and repair and maintenance. Assists in improving and acquiring production equipment.

6. MANUFACTURING/PROCESS ENGINEER Develops correct manufacturing processes for new jobs. Reviews, revises and updates methods for old jobs. Analyzes production equipment needs and makes recommendations for purchase of capital equipment.

7. INDUSTRIAL ENGINEER Responsible for planning, developing, maintaining and monitoring manufacturing processes and methods. Writes standard operational procedures. Analyzes existing manufacturing practices and methods. Works for improved efficiency.

33 8. TOOL DESIGN ENGINEER Responsible for the design of dies, fixtures, adaptors and gauges and equipment for use in the company. Responsible for drafting, reproduction and maintenance of tool design files. Responsible for working with process engineer and set up people for initial set UPS.

9. METALLURGIST Engages in varied research work having to do with powders and powder metal parts. Verifies that the proper blends of materials used meet chemical and dimensional requirements for assuring proper manufacturing processing. Advises on different aspects of manufacturing such as sintering. Analyzes powders and parts by performing varied tests such as density, hardness and microstructure tests. Assists Engineering and Manufacturing Departments in solving problems related to part structure after sintering and heat treating processes.

10. ESTIMATOR Prepares quotations for final pricing. Interfaces with operations engineering to obtain sequence of operations, part weight and outside processing information required to quote feasible parts. Review current jobs for pricing accuracy.

11. DRAFTSMAN SR. Under direction of designer prepares detail drawings. Makes changes in existing drawings. Requires working knowledge of machines and tools, drafting methods, symbols, and procedures.

12. DRAFTSMAN JR. Makes detail drawings of simple to average parts and assemblies. Works under close supervision.

13. PERSONNEL MANAGER Responsible for employment, benefits program, safety, training, wage and salary administration and medical activities. Handles grievances. In a union organized plant, prepares for and participates in labor contract negotiations.

B. Office Staff

1. EXECUTIVE SECRETARY Secretary to major executive. May make minor administrative decisions based on knowledge of company’s organization, policies and personnel. Handles some correspondence. Maintains confidential files and arranges appointments. May instruct and assign work to other clerical employees.

2. SECRETARY Under direct supervision, acts as stenographer and typist. Is responsible for confidential files, dictation and transcription, mail, locating information from files, and preparing various reports for superior.

34 3. CONTROLLER/ACCOUNTING MANAGER Is responsible for all day to day accounting functions. Supervises cost accounting, accounting analyses, payroll, timekeeping, and usually data processing.

4. BOOKKEEPER Posts and maintains books for accounts and related records in general accounting department. May do payroll, trial balances and general ledger accounts.

C . Sales

1. SALES MANAGER Directs staffing, training, and performance evaluating to develop and control sales programs. Controls sales expenditures to conform to budget. Establishes sales territories, quotations and objectives. Participates in company publications, and submits periodic sales reports.

2. MARKETING MANAGER Develops marketing strategies, analyzes sales statistics for making sales policy. Establishes sales goals by determining customer needs. Volume potentials, prices and new market areas. Establish overall sales campaign to meet goals.

3. MANAGER CUSTOMER SERVICES Directs and coordinates customer service activities. Determines services needed by utilizing product knowledge within the confines of company policy. Reads correspondence to determine needs of customer, confers with Engineering and Production Departments to determine feasibility, cost and delivery. Talks to and corresponds with customers on problems and requests.

4. SALESMAN Person who sells powdered metal parts. Makes direct sales calls on customers. Keeps track of sales histories.

5. SALES CORRESPONDENT Maintains daily, routine contact with customers regarding open and new orders, schedules and other general questions.

6. APPLICATIONS ENGINEER Responsible for reviewing new product applications. Discusses products with customers and consults with internal manufacturing and engineering and sales personnel.

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