King's Hawaiian completes crowning achievement
November 20, 2015
by Dan Malovany
There were no high-fives, fist bumps or body slams. That’s not the King’s Hawaiian way. Rather, a sincere “mahalo” — or “thank you” — along with a family-day party this summer featuring Hawaiian food, music and games was more than deserved for the operations team in Oakwood, GA, after they ramped up production on its latest high-speed bun line in less than a month.
For Curtis Taira, the speed of the startup caught him by surprise, and he candidly admitted it moved at a rate so rapid it was a bit out of his normal comfort zone. (Click for a slideshow of King's Hawaiian)
“I’m not used to doing it that quickly,” noted the vice-president of engineering for the Torrance, CA-based Hawaiian foods company. “I’m old school. For me, I’m used to walking through the line and saying, ‘We have to figure this out and that out.’ ”
Maybe the third time was the charm. The company started up two previous production lines during the past six years in Georgia. Conventional wisdom states that practice makes perfect, but in Mr. Taira’s book, that’s not the case — planning does. It’s more about lessons learned, experiences gained and collaborating with vendors — many that he has known for decades since growing up in the family business and working long hours on weekends when it was a tiny bakery in Hilo, HI.
“We did a lot of test runs on specific equipment before we started up the whole line to try to dial in all that we needed with our vendors,” he explained. “But I have to admit, having worked with the equipment companies prior to the start-up on the third line made it a lot easier. We took some of the best of the best from the first line and from the second line, and we incorporated them into our third line.”
The fact that the no-pan line, which makes King’s Hawaiian’s highly popular 12-pack of rolls in bakeable paperboard trays, is nearly a mirror image of Line No. 1 — with the exception of the oven equipment — certainly facilitated the process. This time, however, the company allocated more room for packaging flexibility, and the 125,000-sq-ft facility features the latest in sanitary design.
Having a skilled labor force that’s familiar with the company’s baking process and its equipment certainly helped with training. Line operators — some who started working in the packaging department manually loading packages of bread, buns and rolls into cases just a few years ago — now serve as supervisors in the new bakery. According to Mr. Taira, that bastion of experience made a big difference in getting production up to speed.
“When we started up the first line a few years ago, none of us lived in Georgia,” he recalled. “Many of us from California lived in Georgia for months to start the operations.”
Now the Oakwood bakery also has a seasoned senior management team in place to oversee operations. With the help of Hall County and the state of Georgia, King’s Hawaiian also improved its ability to recruit and train candidates through cooperation with local technical schools and universities.
Moreover, the new facility has enough room to add a fourth line to allow the nimble business to respond quickly to changes in the market with new products or to add capacity, if necessary. Today, the two adjacent bakeries — with a total of 250,000 sq ft — employ more than 500 employees with 120 temporaries. The new bakery and the third line added 120 employees to the operation.
Sense of urgency
Since 2007, the family-owned-and-operated business has been scrambling to keep up with demand as King’s Hawaiian prospered exponentially while it expanded nationally from its base on the West Coast. In many ways, it’s been a combination of a mad dash and a marathon that’s driven the business to be the nation’s leading roll producer and supplier of Hawaiian foods with sales of more than $325 million annually.
As John Linehan, executive vice-president, strategy and business development, described it, there’s been a constant struggle for the management team of this fast-growth company between responding to “urgent” short-term needs that needed to be addressed yesterday and those “important” long-term strategic plans that will fuel the company’s future over the next five to 10 years.
“We try to balance ‘urgent’ with ‘important’ because ‘urgent’ is always louder,” he said.
Since it purchased 20 acres north of Atlanta in 2010, King’s Hawaiian urgently had to revise its plan for its Southeast operation. In 2011, it installed its first production line — codenamed “Concresco” — in the initial 125,000-sq-ft facility. However, sales accelerated at such a rapid pace in 2012 and 2013 that the company installed its second line—named “Iterum” — at the original Oakwood facility by April 2014.
So that it would not get caught short on capacity, the company decided to consecutively build an adjacent new bakery in 2014 as it was installing the second line. During Baking & Snack’s visit to King’s Hawaiian last year, the floor of the new bakery hadn’t even been installed. By December 2014, the new roll line—named “Roku” — began operating. That’s four years ahead of the 2018 schedule set by its long-term strategic plan.
“From an engineer’s perspective, we needed at least six months to get everything designed and put together, especially from ground up, and they gave us one year to put it all together,” Mr. Taira recalled. “Building the new plant at the same time we were installing the second line in the existing operation was trying, I have to admit.”
For King’s Hawaiian, opening the bakery is the crowning achievement that reflects nearly a decade of sustained growth that often exceeds 25% annually. “We have had to triple capacity during the past six years,” Mr. Linehan said.
To pay for the ambitious capital project, King’s Hawaiian secured $130 million in financing from GE Capital Corporate Finance, Norwalk, CT. For the Taira family, investing in the company has meant managing risk and focusing on what’s “important” for the long run, according to Mr. Linehan. He noted that revenue has grown 100 times since Mark Taira, Curtis’ brother and CEO, took over the business from his father, Robert Taira, in the mid-1980s.
“I don’t think Mark and his wife ever had a job,” Mr. Linehan observed. “They had a cause. They were trying to build something special in the organization, in the brand and in the products they produce. It was always about putting those special things first.”
Refine the design
The new facility is based on Safe Quality Food (SQF) certification standards. The totally cleanable ceiling features baked-on paint, and the bright white walls support a comfortable working environment, according to Curtis Taira.
Above it, there’s a walkway that houses all utilities. “It was important that we made only vertical drops for all of our utilities. There are no horizontal runs,” he said. “All horizontal runs are located above the ceiling. It’s a walkable ceiling for maintenance. Anytime you have a horizontal surface, you have to clean it more often.”
To ensure product quality, mixing, makeup and packaging are climate-controlled. “The only area that’s not is the separate proofing and oven area,” he noted.
The new line operates three 8-hour shifts, five to six days a week, depending on the time of year. Production ramps up big time during peak seasons such as the end-of-the-year holidays.
For ingredient handling, an indoor AZO bulk handling system dispenses flour from 110,000-lb silos as well as granulated sugar from slightly smaller ones. Minor and micro ingredients such as dried eggs or nonfat dry milk come on skids and are transferred via dump stations managed by AZO Componenter technology.
To secure its proprietary formula and gauge production flow, the company uses a Rockwell Automation system that gathers data on the Georgia facility for the California management team. Closed-circuit cameras provide the eyes on the Oakwood operation. Curtis Taira describes the management of data and process controls as a giant leap from the way the company’s bakeries in California operated. The new line has 33% more throughput than the production lines in California.
“Before, we had to deal with a lot of hand-written information from people working on the line,” he said. “Today, we’re using more of the information from the equipment to monitor production.”
After a proprietary mixing process, the dough travels through two AMF six-pocket dividers, through a zig-zag of rounder bars, a Laramore flour dusting system and into an intermediate proofer before dropping precisely into the bakeable 12-pack trays.
From a Tecnopool spiral proofer, the trays enter a Henry Group three-zone tunnel oven that’s wide enough to bake 20 trays of 12-packs at a time. Hot from the oven, they travel through a G&F cooler and then ride along a Capway conveyor system into the separate packaging room.
Packaged with care
The buns enter one of three stations composed of Formost Fuji baggers, Kwik Lok closure applicators and Mettler Toledo Safeline X-ray systems. While shipping cases are automatically erected, the bun packages are manually loaded because of the delicate nature of the freshly baked rolls.
“Most of our employees work in the packaging area,” Curtis Taira said. “Because we change packaging sizes and master cases all the time on the other lines, it becomes very difficult to automate. Down the road, we’ll be looking into robotics and other potential solutions.”
For employees, King’s Hawaiian invested in creature comforts such as a lunchroom that includes convenience store-like vending operations with a wide variety of snacks, drinks and foods for purchase. Picnic tables outside the landscaped property provide an opportunity to take a lunch break in the fresh air.
Above the offices on the second floor, there’s a 25,000-sq-ft empty storage room for yet-to-be determined additional office space, a pilot plant or a merchandising deli-bakery operation. “We’re thinking about finding new ways to bring in our current or potential customers to teach them new ways to use King’s Hawaiian bread and rolls,” Mr. Linehan said.
King’s Hawaiian recently updated its comprehensive, long-term strategic plan. The new goals include diversifying into other Hawaiian food categories, ensuring the Aloha spirit in its culture, better integrating with its retail partners, enhancing its collaboration with vendors, expanding e-commerce, improving logistics and seeking potential international opportunities, according to Mr. Linehan. It’s also going to take some of the advances in technology and process improvements from the Georgia operation and incorporate them into its California bakeries.
“We’re looking at what capabilities we need as an organization to make us more competitive,” he said. “It’s not about removing costs but creating more value. The ideas of removing costs and adding value reflect two different approaches to business. One is aspirational and the other is not.”
Asked to reflect on what King’s Hawaiian has accomplished over the last decade, Mr. Linehan was temporarily at a loss for words.
“When you launch something like we did here, you have two guiding principles: You have expectations, and you have hopes,” he noted. “You expect one thing, and you hope for more. Our experience in Georgia has been way above our hopes and expectations.”