Ariel corporation, mount Vernon, ohio, UsA www.arielcorp.com
ust in Time JTop Logistics for the Golden Age of Gas Ariel Corporation, Mount Vernon, Ohio, USA, is one of the leading manufacturers of high-speed reciprocating compressors in the world. To this day, Ariel produces exclusively in Ohio. It was at this location that Jim Buchwald, one of the most successful compressor designers in history, founded the company in 1966. While this small city in the heart of the state of Ohio may not be located in the current centers of the oil and gas industry, Ariel stands by the traditional Mount Vernon site. Thanks to a highly modern distribution center, almost all replacement parts for Ariel compressors routinely ship at any destination worldwide within 24 hours. TEXT: Ludwig Schönefeld PHOTOS: Ralf Baumgarten
early a basic valve had a lead time of 13 weeks today just three. replacement parts routinely ship within 24 hours. Steve Thompson vice President Supply Chain Ariel Corporation We are the prime choice worldwide for high-speed reciprocating compressors, explained Steve Thompson, Vice President Supply Chain at Ariel Corporation. We worked hard over many years to achieve this position in the market. We are very proud that we recently shipped our 40,000th compressor. Global market leadership goes hand in hand with a significant logistical challenge. We have a very respectable market share that we plan to increase, Steve Thompson added. The value proposition that Ariel provides to the customers covers everything from shipping the compressor to service in everyday operation. Developing the best systems, including for the aftermarket, has therefore been one of Ariel s strategic objectives for many years. In the early years of Ariel, it could take several months to complete an order. For example, the basic lead time for valves was 13 weeks, Steve Thompson recalls. Today, the majority of HOERBIGER parts can be received in three weeks with specially engineered product in nine to twelve weeks. The new distribution center opened in 2012 has considerably expedited Ariel s replacement part shipments as compared to most of its competitors. Most parts routinely ship within 24 hours. In a few isolated cases, it may take up to 48 hours. HOERBIGER Corporation of America, which supplies the lion s share of all valves used in Ariel compressors, is making a significant contribution to this achievement. HOERBIGER is an extremely important supplier for us, Steve Thompson said. After all, we have a long common history. With the recently shipped 40,000th compressor, Ariel underscores its leading position in the world market.
it S ALmoST impossible To KeeP ALL variations in inventory. hoerbiger really does A very Good Job And ASSureS ThAT We Are AbLe To SuPPLy even rare replacement PArTS WiThin An AdequATe Time FrAme. steve thompson Logistics hand-in-hand: while Bryan Moore (left) records a HOERBIGER shipment in inventory, his colleague Hilary Matthews prepares a customer order (center). Steve Sheets (right) removes replacement parts from the spiral conveyor. Partnership entails obligations This shared history dates back to immediately after the company s founding. At that time, Jim Buchwald met Hubert Wagner, who was in charge of developing the HOERBIGER commercial agency in the USA established in 1963. Hubert Wagner was excited about Jim Buchwald s idea to build a reciprocating compressor that had a speed of 1,800 revolutions per minute. He advocated the development of a matching valve at HOERBIGER in Vienna, Austria. The basic design was the tried and tested RX valve. It was fitted with a newly developed spring plate, which ensured reliable functioning of the valve even at 1,800 revolutions per minute. At 3,600 piston strokes per minute, this equated to a capacity of more than 100 percent over the customary performance. Over the decades that followed, Ariel and HOERBIGER repeatedly joined forces to work on innovative solutions. Soon, the focus would no longer be only technical aspects, but increasingly also the logistical requirements of the supply chain. One example is the IN-SYNC program from 2004. Back then, we replaced the existing manual process for ordering valves with an electronic order system, Steve Thompson reported. The system has been expanded since then: The valves are now shipped configured for the unit and already contain the Ariel serial number. steve thompson Vice president supply chain Ariel corporation Steve Thompson has been in the oil and gas industry for 32 years, 27 of them with Ariel. Since 2000 he has been responsible for Ariel s supply chain.
Alex Wright, the oldest son of Ariel CEO Karen Buchwald Wright, is managing the new distribution center, which opened in January 2012. Here, 24 hours a day, 7 days a week, 120 employees assure that the network of Ariel s distributors can be supplied with all components of an Ariel compressor within the shortest time from standard replacement components to machined parts. We process approximately 800 orders a week here, Alex Wright explained. The 50,000- square-foot (4,600 square meter) facility offers sufficient capacity to keep up with the strong growth that is expected in the market in the coming years. Previously, we barely had 8,500 square feet (800 square meters) available for the logistics operation, Alex Wright reported. The added space now allows us to process the orders considerably more efficiently, and more importantly we can handle them faster. When it comes to planning the processes, Ariel uses the benchmarks from the automotive and commercial vehicle industry as a guide: the automotive retailer AutoZone, the industrial equipment manufacturer Caterpillar, and the motorcycle manufacturer Harley-Davidson served as inspiration for the development of the new logistics center. We deliberately used companies for reference that have an extensive global spare part business, Alex Wright stated. Alex Wright Director Aftermarket Operations Ariel Corporation The Logistics center is impressive. We have achieved outstanding logistics quality and that s the bottom line. Alex Wright 100 Percent Performance For our collaboration on the supply chain, our goal was 90 percent on-time performance. HOERBIGER achieved nearly 100 percent during the first phase of the program IN-SYNC 1. This was and still is an outstanding achievement. According to Steve Thompson, this high performance is critical for the aftermarket: The aftermarket business is a major logistical challenge for everyone involved, notably for the parts that HOERBIGER produces. Especially when it comes to valves, there are numerous variations depending on the output and application of the compressors despite a largely standardized portfolio. It s impossible to inventory every configuration of HOERBIGER valves. HCA works hard to help Ariel respond to customer needs in a reasonable time frame. All this is done worldwide. Over the years, HOERBIGER has invested in a global network of production plants and service locations. These complement Ariel Corporation s distributor network. Always Close to the Customer We must be prepared that our markets will become ever more global in the coming years, Steve Thompson explained. The new logistics center in Mount Vernon will support the increasing globalization of Ariel s business, but constitutes only a part of the strategic preparation for the challenges of the future. Steve Thompson added: It is extremely important to us that we are represented around the globe wherever our compressors are being used. HOERBIGER is part of this network and contributes to ensuring that we can always procure the necessary components close to our customers. Like all players in the market, Ariel is intensively engaged in analyzing the effects of the economical use of shale gas. Steve Thompson anticipates significant momentum, especially in the North American market: We are a U.S. factory, and as a result our focus is, of course, on supporting the development of the U.S. marketplace. While at present there is uncertainty in the USA to what extent the government will actively engage the availability of shale gas, it is important to note that the use of shale gas will be a significant positive driving force for the national economy. The domestic shale gas deposits provide the USA with the opportunity to reduce its dependence on energy imports. Shale gas will additionally create options to lower the unemployment numbers. Growth through Shale Gas Steve Thompson is convinced: Shale gas will drive the economy like nothing else in the past decades. This will have considerable impact not only on companies that are involved in gas gathering, but also on gas-processing industries, such as the chemical industry: There are many locations along the Gulf Coast in this sector that were shut down over the last few years. These plants can now be put back into operation. He added that a lot of companies moved abroad because natural gas prices were so high. Now that the prices for natural gas are falling,
Part The close collaboration between Ariel and HOERBIGER goes back to the inception of Ariel Corporation in 1966. Virtually all of the standard valves used in Ariel compressors are manufactured by HOERBIGER Corporation of America in Pompano Beach, Florida, USA. When it comes to developing new valves, Ariel works closely with HOERBIGER s research and development. This close cooperation is paramount for us, explained Karen Buchwald Wright, CEO of Ariel Corporation. A common understanding of modern product design, quality and service drove both companies to continually improve their products and business processes. 052 053 John Wise, Valve Cell Engineer, during a functional check of the valve (left) before it is packaged and stored (right). these companies are returning. And they will bring back other businesses, Steve Thompson added. It is critical for Ariel to be prepared for rapid growth. The company has undergone intensive preparations: We have given very careful thought to how we must respond to the new development in the gas market and what strategies we must rely on to take advantage of the new opportunities that natural gas presents, Steve Thompson stated. It is imperative that we have the right processes in production and in logistics to be able to keep up even with strongly rising demand. Ariel invested not only in the new distribution center, it also expanded the workforce. Global, of Course Ariel is also working on new developments for high-speed compressors, which are specially tailored to the value-added chain as it relates to shale gas, from gathering to the end user. To this end, Ariel continues to count on the long-standing partnership with HOERBIGER: We recognize that HOERBIGER is a very R&D driven company, Steve Thompson added. HOERBIGER has managed to continually bring out new products with better performance and higher reliability. With this, HOERBIGER clearly demonstrates that it wants to remain a technological leader in the market. Together, we are well-prepared for the future, Steve Thompson said. Natural gas will be the driving force of this future. Will it also drive globalization? Steve Thompson leaves no doubt: Ariel is a global company. By default, we will expand our presence internationally. This has always been a focus for Ariel. Part OF Ariel Corporation is considered a market leader around the world for high-speed compressors. Initially, Jim Buchwald s idea of combining conventional gas engines with high-speed compressors to form one powerful unit was met with skepticism by the industry. Today, the portfolios of almost all renowned compressor manufacturers include high-speed reciprocating compressors that follow this design principle. For a trendsetter, it is crucial to tirelessly explore the requirements of the customers and respond with customized solutions, Steve Thompson explained, Vice President Supply Chain at Ariel Corporation. Because we do this, we are optimistic about the future of our industry. Partnership The partnership between Ariel and HOERBIGER goes back to very close, friendly relations between Jim Buchwald, the founder of Ariel Corporation, and Hubert Wagner, who was searching for new business partners in the New World for the HOERBIGER commercial agency founded in 1963. Hubert Wagner valued the personal traits of the visionary design engineer from Ohio. From the history of HOERBIGER Ventilwerke in Vienna, he knew the difficulties that pioneers have to overcome to be successful. For this reason, and arguably also because he shared the vision of Ariel s founder, he supported the undertaking to develop a compressor that was to be faster and more powerful than any reciprocating compressors available at the time. To this day, the cooperation between Ariel and HOERBIGER is distinguished by the pioneering spirit from those times to include when it comes to developing innovative logistics processes for the supply chain.