During an online seminar he gave last week, Boothroyd Dewhurst Inc. President John Gilligan tackled a big question in the manufacturing world: Is it really cheaper for manufacturers to outsource to countries like China?
Sure the labor is cheaper, he said before the seminar. “But if you look at the cost of your product, the vast majority of it is in the material,” he said. “About 95 percent is your product. Your labor is only about 5 percent.”
At Boothroyd Dewhurst, Gilligan’s job is to find out for companies how to cut down those materials and manufacturing costs. The firm works as a consultant, supplying proprietary software and advising large and small manufacturers how to better make their products.
“You need to know, if you’re not involved with the manufacturing process, what things are going to cost,” Gilligan said.
When speaking about what his firm does, Gilligan likes to use the analogy of building a toy for a child – such as a bike with many parts. “You know how frustrating it can be to put together a product that has a lot of different things that you have to screw together,” he said. “What the design for assembly methodology does is allow for developers to analyze that process.”
That includes estimating the assembly time, but it is also based on three “very simple” questions that Boothroyd Dewhurst long ago developed, Gilligan said. Those questions are: Does this part, relative to the parts that have just been assembled, need to rotate or move? Does it need to be a different material? Is it required to be separate for assembly reasons?
“When they go through all of that analysis, then they can look at and use the information of assembly time, combined with justifying the need, to look at areas of the product that should be combined,” he said.
Those that need to be combined – like a few metal sheets being changed to just one solid sheet – are called “candidates for elimination,” Gilligan said.
“Maybe those could all be combined into one part or a complex part,” Gilligan said. “That would eliminate all that assembly and the great part about that is that you’re usually improving quality.”
And there’s another step inherent in creating that new piece: determining its cost. For that, the company created a series of computer programs that allow the designers to estimate those costs during the design stage.
That software provides data for machine-cycle times and uses so that a company can plug in the type of work that needs to be done and figure out the best and quickest ways to do it before negotiations.
“With it, you can have real technical discussions with the supplier,” he said, “instead of just saying, ‘Hey, can you knock 10 percent off?’”
Although that software is designed to be used for the early planning stages, Boothroyd Dewhurst can find itself getting involved in the manufacturing process at any point.
About 25 percent of the company’s revenue comes from services like teaching and workshops with companies. The rest is from setting up software for those companies to use internally.
When they established the business in 1983 in Massachusetts, the company’s founders, Jeffrey Boothroyd and Peter Dewhurst, both were professors. In 1985, they both came to Rhode Island to lead the industrial and manufacturing engineering department at the University of Rhode Island. They brought Boothroyd Dewhurst with them, opening up shop in Wakefield.
Gilligan is Geoffrey Boothroyd’s son-in-law. Vice President Nick Dewhurst is Peter Dewhurst’s son.
In the 1980s and early 1990s, the automotive industry was a big customer, but the consulting business slowly shifted to those companies’ suppliers because “General Motors and Ford started having the top-tier suppliers totally responsible for the main instrument panel, including design,” Gilligan said. “So our customer base shifted as they shifted responsibility.”
It could cost between $30,000 and $50,000 to hire Boothroyd Dewhurst, but the client might save a lot more than that, Gilligan said. Some companies have had their costs cut up to 50 percent.
In recent years, computer, appliance and medical manufacturers have acted as the company’s customer base. It has dealt with many Fortune 1000 companies, including Deere & Co. and Harley Davidson. It doesn’t really matter who the customer is, Gilligan said, because at the end of the day, the company’s goal is always the same: to simplify [customers’] products.” •
COMPANY PROFILE
Boothroyd Dewhurst Inc.
OWNER: Nick Dewhurst, John Gilligan
TYPE OF BUSINESS: Engineering software
LOCATION: 138 Main St., Wakefield
EMPLOYEES: 15
YEAR ESTABLISHED: 1983
ANNUAL SALES: $2 million to $3 million
