Danco Machine Inc.: Fielding the Toughest Technical Demands

Danco Machine Inc. (Danco) stands as a testament to the fact that U.S. manufacturing is alive and well. The Santa Clara, Calif.-based company is a contract manufacturer specializing in precision CNC machining, complex assembly, precision grinding, precision tooling, welding, sheet metal services and electrical discharge machining. While many specialized manufacturers floundered in the wake of the economic downturn, Danco reinforced its core competencies to produce products with even more exacting tolerance requirements and extreme precision than ever before.

The efforts paid off, as Danco managed to make 2010 one of its best years yet. Danco has positioned itself to become the medical device-focused, CNC machining expert of choice in California, and the company is alongside the best in the country. Danco’s experienced machinists and engineers partner with customers’ supply-chain experts and design engineering teams to deliver greater value and superior product consistency.

“The company was founded in 1979, but over the past three or four years we’ve undergone a series of significant transformations to prepare for the next phase of growth,” asserts Jay Wakenshaw, president of Danco. The broad scope of services allows Danco to work with clients at any stage in a product’s lifecycle and provide concurrent engineering support from the research and development phase straight through prototyping, ramp-up and production rate manufacturing.

The lion’s share of Danco’s customers reside stateside, though the company’s staff of 85 does supply a few accounts overseas, primarily in Korea and Costa Rica. The Danco fabrication facilities cover 30,000 square feet and the company’s 85 employees represent a healthy mix of heavily experienced engineers, career machinists, CNC programmers and supply-chain specialists. The balance of broad capabilities and a relatively intimate team has made Danco exceptionally attractive to many start-up or early stage companies, as well as longtime manufacturers of medical devices and defense sector manufacturers.

Investing in Quality Management

Danco has become increasingly focused on aligning itself with the precision medical device market. In fact, Wakenshaw admits that much of the company’s recent transformation resulted from an across-the-board push to implement even stricter quality assurance standards that would secure its place amongst the country’s most respected manufacturers. “We worked really hard for the last three years to obtain our ISO 13485 certification, which we were awarded in October 2011,” adds Wakenshaw.

The certification builds upon Danco’s already strong quality management systems with supplemental parameters to identify risks, improve consistency amongst key processes and provide an overall increased level of control. The certification also compliments Danco’s strong enterprise resource planning (ERP) system, providing a boost of transparency to ensure products are completely traceable from raw material through packaging and shipping.

“Achieving [ISO 13485] certification has really allowed us to take the lid off of this business,” admits Wakenshaw. “Without knowing the exact numbers I would estimate we added somewhere around 10 new customers within the eight- or nine-month period following our certification.”

The achievement held a special weight for Danco, especially in lieu of the company’s recovery following the economic downturn. Wakenshaw joined the company as COO just a couple of weeks before the collapse of Lehman Brothers in 2008, and in early 2009 saw Danco’s business fall between 35 and 45 percent by Wakenshaw’s estimates. Nevertheless, Wakenshaw and the tightly knit Danco team were able to react swiftly to recover the last two quarters of 2009 and make 2010 one of its most successful years to date. “It required a lot of active and proactive management, but even though 2011 customer demand was choppy and less predictable for us, we’re definitely coming out of it now and even hiring; we’ve added six new employees so far this year,” adds Wakenshaw.

Total Precision

Danco’s recent growth spurt has much to do with the company’s increasing focus on the precision medical device market and especially on emerging technologies. Invuity is one such company that enlisted the help of Danco’s engineering, manufacturing and customer teams, using their strength in DFM (design for manufacturability) to help refine and produce a critical new medical device product family. This particular Invuity surgical device was specifically designed for breast surgery both for oncological and cosmetic purposes. The device uses Invuity’s patented Eigr technology to direct a uniform illumination toward a target deep within an incision without interfering with other surgical devices.

“Invuity encountered some challenges in scaling an aluminum retractor, but Danco developed a method to produce the product in large volume and with improved quality and consistency,” adds Wakenshaw. “With further CNC programming, Danco was also able to transform an initially welded product into a single piece for manufacturing, which made it more appealing aesthetically, more predictable in production and of a higher quality.”

Succeeding Together

Danco often benefits equally in partnering with start-up and growth-phase companies, as each party pushes the other to innovate and develop highly specialized skill sets, which subsequently benefit other Danco customers and the broader manufacturing industry as well. One such case is Danco’s work with Simons Design Innovation, a start-up company headed by founder Steve Simons, formerly of Rockshox, a developer and manufacturer of bicycle suspension products. The fledgling company partnered with Danco during 2010 and 2011 to develop and refine the companies’ patented “Smart Valet” automated CNC machine loading device, which is compatible with both currently available vertical and soon to be available horizontal machining centers (the latter of which can improve production efficiency and automation).

“The product performed very well in field trials and generated useful user feedback, but Danco also benefited by becoming an early user of the technology, gaining some extra labor efficiency in the process,” adds Wakenshaw.

Similarly, Danco has partnered with 1Factory as a test facility for the company’s cloud-based supply-chain quality control software. The 1Factory product unites buyers and suppliers across the supply chain on a cloud-based platform, which enables continual collection, analysis and exchange of manufacturing process and quality control data. 1Factory enables buyer-supplier collaboration, increases supply-chain transparency, eliminates the need for in-person supplier audits, and facilitate swift problem resolution. “1Factory is intuitively learned and easy to use and it will help demonstrate process control to our medical device customers,” asserts Wakenshaw.

Wakenshaw is gearing up for another growth spurt at Danco, delivering intricate, top-quality components and assemblies while facing the challenge of a national shortage of qualified, skilled manufacturing talent head on. Regardless of road bumps, Danco Machine Inc.’s hard-working, driven professionals will work with the company’s ambitious client base to ensure turnkey manufacturing engineering support and mutual success.