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From Turnaround To World ClassFrom Turnaround To World ClassCMC 91st Annual Conference

Adrian Butler

May 5th 2011


Why is Improvement so Hard to Sustain?

What is the Board Room talking about?

Re-structuring N IT

Partnering Agreements I know!!

Re-structuring New IT Systems

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Rationalisation

Consolidation

Move to China

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Consolidation

J i t

Cut Heads

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Joint Ventures

Buy New Technology

Squeeze Suppliers

O

©

TechnologyOutsource

What is the Board Room talking about?

Let’s improve the way we

But we’ve always done y

work?it that way!

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What? With that old equipment?

It’s the Nature of the Beast!

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You won’t change anything

We’ve already done continuous

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anything around here

continuous improvement

Myths and Legends - 1

Belief

“We know what our problems are it’s fixing them that’s the difficult bit!”We know what our problems are, it s fixing them that s the difficult bit!

Fact

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• On over 400 processes we have asked the operational management team “what are the top 3 causes of lost opportunity on the shop floor?”

• Only once have we had the correct answer onsu

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• Only once have we had the correct answer

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Estimated Top 3 Problems

• 15 managers

ze

• What are top 3 problems?

• 36 different answers

• All chose 3 problems in hts

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Prob

lem

Si All chose 3 problems in

someone else's area

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Prob

lem

1

Prob

lem

2

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3

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lem

4

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5

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6

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P P P P P P P P P Pr Pr Pr Pr Pr Pr Pr Pr Pr Pr Pr Pr Pr Pr Pr Pr Pr Pr Pr Pr Pr


Belief

“We are already doing the best we can we are running at 90% efficiency”We are already doing the best we can, we are running at 90% efficiency

Fact

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• True performance and opportunity is often hidden

• This hides the potential and reduces the drive for improvement

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• Self fulfilling prophesy

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Measured Efficiency by Industry100

80

95

858580

90

80

70

65

75

6560

70

(%)

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erve

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60

45

60

4540

50

rue

Effic

ienc

y

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40

30

20

30

Tr

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0

10

20 ©

0Ship Build &

RepairFMCG Manual Batch Automated

BatchAutomotive Paper Mill Contiunous

ChemicalsContinuous Chemicals


Belief

“It is all about which methodology – should it be lean, six sigma or world class manufacturing?”manufacturing?

Fact

• It is about prioritising problems and solving them hts

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erve

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• It is about prioritising problems and solving them

• Any rigorous process will do this for you. Some will be marginally better than others

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• Any is better than none

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Belief

“We’ll never improve until they get us some new equipment”We ll never improve until they get us some new equipment

Fact

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• Locked into a mindset that links progress with new machinery, many manufacturers fail to see the additive power of lots of small inexpensive improvements

• Many shop floor problems seem trivial but they are exactly the problems that are onsu

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Many shop floor problems seem trivial but they are exactly the problems that are slowing down your production line while you sit here now

• Do we really know that we have squeezed every ounce out of the existing kit?

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Belief

“We need to start a company wide initiative – we will wait until the right time”We need to start a company wide initiative we will wait until the right time

Fact

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• It will never be the right time

• It is best to start in one small area and get a big result

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Belief

“The workforce is the problem they want to do things the way they have always doneThe workforce is the problem, they want to do things the way they have always done it”

Fact hts

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Fact

• Almost without exception, the employees we meet are desperate to see their daily problems sorted out and are keen to be part of the solution

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• The biggest resistance to change often lies with the supervisory and middle management team

“Of the 43 companies I have worked with, I have only ever had problems with one © N

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Of the 43 companies I have worked with, I have only ever had problems with one group of employees. I have, however, had problems with 43 management teams.”

©

A Point of View

The Shop Floor Worker

• Little focus on budget, often just wants to do a ‘quality job’

• Frustrated at lack of action on simple issues

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• “They’ve changed the management but problems are the same”

• What do all those people in the office do?

• It used to be much better onsu

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It used to be much better

• I guess it’s the nature of the beast

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A Point of View

The Director

• Focused on customers, budgets & improvement programmes

• Tends to only hear about ‘big’ issues – the system materials supply retention old kit ht

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system, materials supply, retention, old kit...

• Rarely hears any detail from the shop floor

• Their toolbox is strategic – re-organisation, new systems, outsourcing, etc

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A Point of View

The Middle Manager

• Focused on delivery and budget

• Gets all the gripes from the shop floor but will only report the ‘big ones’

• Often pushed to report progress repeatedly

T d t bl th t d f bl hts

Res

erve

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• Tends to blame other trades for problems

• Typically rewarded for fire-fighting, not for continuous improvement

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What are the Steps to World Class?What are the Steps to World Class?

Where do we start?

Understand current status• Understand current status

• Be objective• Some elements of the operation may be world class, while others will be turnaround

• Actions taken must match the problem

• A new ERP system will not help if all the base processes are broken hts

Res

erve

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y p p• Driving process speed will not work if the process is not robust

• Helps to categorize the areas by: Turnaround, Transition or World Class status

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Consumer Model

• Process Lock Down• Performance Tracker

• Labour Optimisation• Scheduling Optimisation

• Work Flow Modelling• PLC Modification

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• OEE• Variance• Waste• LossesO hi d t bilit

• Training: Problem Specific• Training: Generic

(Lean/Six Sigma)• Giveaway Manager

NPD F l

• Speed/Output Debottleneck• Training: Advanced Problem

Solving and Improvement• Value Engineering

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• Ownership and accountability• Improvement Cycle Measure• Labour Manager• Training: SOP Establishment• Efficient Physical Logistics

• NPD Funnel• Changeover Improvement• Variance Tracker• Supply Chain Developer

• Capital Investment Reduction• Automation• Accumulation• Supply Chain Optimiser

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• Efficient Physical Logistics ©

Benchmarking at a Food Company

Planning

Production Control

serv

ed

Engineering

Production Imp Cycle

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ight

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Labour Management

NPD

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Hygiene

Quality / TechnicalManagement

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

Total Shopfloor

TransitionT d W ld ClTransitionTurnaround World Class

Turnaround Businesses

These are the hardest companies to improve• These are the hardest companies to improve

• The basic systems need to be built by blood, sweat and tears while all the pressures of firefighting are crashing around


crashing around

• About 20% of manufacturing has an element of this category

• Red technical audits• Few SOP’s hts

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• Few SOP s• Variation in product, settings, little black books• Technical data filled in prior to the run• Frequent plan changes• BOM’s being consistently error ridden• Regularly running out of components and packaging on

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g y g p p g g• Limited tracking performance• Limited labour control• Large turnover of senior staff• New products hitting the production with the wrong packaging, high

waste levels, little visibilityL k f hi d t bilit ©

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• Efficient Physical Logistics • Lack of ownership and accountability

• This is where the true visionary management teams are needed. There are no easy answers or short cuts. The foundation needs to be built up brick by brick in a

©

p ystructured methodical way.

Turnaround Example: Process Lock Down

W i ht T (G d B f)W i ht T (G d B f)

12.5

13.0

Weight per Tray (Ground Beef)

12.5

13.0

Weight per Tray (Ground Beef)

11.5

12.0

s)

11.5

12.0

s) hts

Res

erve

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10.5

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ay W

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9.0

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8.0

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1 5 9 3 7 1 5 9 33 37 41 45 49 53 57 61 65

8.0

8.5

1 15 29 43 57 71 85 99 13 27 41 55 69 83 97 11 25

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1 1 2 2 2 3 3 4 4 4 5 5 6 6

Tray #

1 1 1 1 1 1 1 2 2

Tray #

Turnaround Example: Performance Tracking

110

120

Wet Pounds per Man Hour

90

100

110

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80

90

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70

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10 t-10

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c-10

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r-11

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26-A

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24-M

ay31

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07-J

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21-J

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Improvement Project

Bad Product Mix

90

100

110

Good Product Mix

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Production t i d ©

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Improvement Project

Sales constrained, implement no production “cleaning days”

constrained ©

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Transition Businesses

This is where the• This is where the majority of processes are

• The factory is now

• Smooth operation is maintained by the efforts of a few

• The huge opportunity of


The factory is now under control and operating consistently

• Audits are usually

• The huge opportunity of an engaged workforce with the ownership and accountability to drive the performance forward ht

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NPD F l

green, occasionally amber

• Delivery performance is over 99%

performance forward remains largely untapped

• Problems are often hidden or accepted as the nature on

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over 99%

• Short interval control is established and understood

pof the beast

• There is no “burning fire”

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• Factory measures drive performance

• The challenge here is often getting the “vision “of what is possible.

©

Transition Example: Labour Optimization

Basic shift schedule is 12 people perE l S h d l d • Basic shift schedule is 12 people per shift, modified to accommodate vacations and change requests

12

14

Employees Scheduled

• Modelling tool developed to predict number of employees required based on workload

8

10

ploy

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Num

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1105

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07/0

1/20

1109

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2011

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1/20

1113

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2011

15/0

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1117

/01/

2011

19/0

1/20

1121

/01/

2011

23/0

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/01/

2011

27/0

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1129

/01/

2011

31/0

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11

©

0 0 0 0 1 1 1 1 1 2 2 2 2 2 3

Workers Scheduled Workers Required


D il S h d l d Effi iE l S h d l d

100%

110%Daily Scheduled Efficiency

12

14

Employees Scheduled

90%

100%

8

10

ploy

ees

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70%

80%

4

6

8

Num

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/01/

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2011

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2011

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1121

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2011

23/0

1/20

1125

/01/

2011

27/0

1/20

1129

/01/

2011

31/0

1/20

11

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Scheduled Efficiency

0 0 0 0 1 1 1 1 1 2 2 2 2 2 3

Workers Scheduled Workers Required


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110%

Weekly Labour Efficiency

90%

100%

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70%

80%

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,420

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2,39

2

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432,658

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70%

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$1$1$2$7$4$1$6$9$1$2$2$2$1$3

-$60

$2$3$1$1$1$1$3$1

50%

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Scheduled Efficiency Actual Efficiency Cost Baseline

World Class Businesses

Most elements of production are being continually• Most elements of production are being continually optimised

• Employee led continuous improvement at the factory floor is a reality


floor is a reality

• Daily firefighting has become a structured, rigorous and owned process of problem elimination

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C it l I t t R d ti

• All levels of the organisation have clear ownership and accountability

• The challenge is believing we can get better onsu

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• The challenge is believing we can get better

• In many ways these are the easiest businesses to improve. With a solid foundation and the whole organisation pulling in the same direction single ©

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organisation pulling in the same direction, single changes can have a significant impact

• By definition, these companies cannot stand still• Challenge and innovation

©

• Challenge and innovation

World Class Example: Speed Optimization

C

07:5

0

08:5

0

09:5

0

10:5

0

11:5

0

12:5

0

13:5

0

14:5

0

15:5

0

16:5

0

17:5

0

18:5

0

19:5

0

20:5

0

21:5

0

Open Chamber

Full Production Cycle

pand Take Moistures

Check Moistures in Lab

Unload Chamber hts

Res

erve

d

Blow down with Air

Apply Steam

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Pause in Defrost Cycle

Refrigeration

Load Chamber

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Vacuum Pump-Down

Pause in Cycle

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Heat Applied


P dMoisture Profile by Tray Procedure

• Check Moistures on all trays• Manual Check for wet product

S l M i t t k f “d ” d t6.00%

7.00%

Moisture Profile by Tray

• Sample Moistures taken for “dry” product

5.00%

Sample Moisture

Min Moisture

Max Moisture

hts

Res

erve

d

3.00%

4.00%

Moi

stur

e (%

)

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2.00%

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0.00%

1.00%

1 6 1 6 21 26 31 36 41 46 51 56 61 66 71 76 81 86 91 96

©

1 1 2 2 3 3 4 4 5 5 6 6 7 7 8 8 9 9

Sample #



• Check Moisture• Outliers tracked and problems solved to

t6.00%

7.00%


root cause

5.00%

Sample Moisture

Min Moisture

Max Moisture

hts

Res

erve

d

3.00%

4.00%

Moi

stur

e (%

)

onsu

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2.00%Color Wets

2-3 © N

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0.00%

1.00%

1 6 1 6 21 26 31 36 41 46 51 56 61 66 71 76 81 86 91 96

2 3

4-6

7-10

11-15

©

1 1 2 2 3 3 4 4 5 5 6 6 7 7 8 8 9 9

Sample #16+



• Check Moisture• All samples moisture < 3%

A i t < 1%6.00%

7.00%


• Average moisture < 1%

• Reduce dry time of next chamber by 15 minutes

5.00%

Sample Moisture

Min Moisture

Max Moisture

hts

Res

erve

d

• If failure occurs, update Product Standards to reflect last successful run

Challenges3.00%

4.00%

Moi

stur

e (%

)

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Challenges

• Potential alternate cause of failure

V i bl f ft l ki i ti

2.00%

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• Variable performance after locking in time

• Chambers E, G vs. A, B, C, D0.00%

1.00%

1 6 1 6 21 26 31 36 41 46 51 56 61 66 71 76 81 86 91 96

©

1 1 2 2 3 3 4 4 5 5 6 6 7 7 8 8 9 9

Sample #


C

07:5

0

08:5

0

09:5

0

10:5

0

11:5

0

12:5

0

13:5

0

14:5

0

15:5

0

16:5

0

17:5

0

18:5

0

19:5

0

20:5

0

21:5

0

Open Chamber


pand Take Moistures


Unload Chamber hts

Res

erve

d

Blow down with Air

Apply Steam

8% onsu

ltant

s Lt

d. A

ll R

ig


Refrigeration

Load Chamber

8% decrease in process time

© N

ewto

n In

dust

rial C

o

Vacuum Pump-Down

Pause in Cycle

©

Heat Applied


C

07:5

0

08:5

0

09:5

0

10:5

0

11:5

0

12:5

0

13:5

0

14:5

0

15:5

0

16:5

0

17:5

0

18:5

0

19:5

0

20:5

0

21:5

0

Open Chamber


pand Take Moistures


Unload Chamber hts

Res

erve

d

Blow down with Air

Apply Steam

onsu

ltant

s Lt

d. A

ll R

ig


Refrigeration

Load Chamber

© N

ewto

n In

dust

rial C

o

Vacuum Pump-Down

Pause in Cycle

©

Heat Applied


C

07:5

0

08:5

0

09:5

0

Open Chamber

Changeover

pand Take Moistures


Unload Chamber hts

Res

erve

d

Blow down with Air

Apply Steam

onsu

ltant

s Lt

d. A

ll R

ig


Refrigeration

Load Chamber

© N

ewto

n In

dust

rial C

o

Vacuum Pump-Down

Pause in Cycle

©

Heat Applied

C


07:5

0

08:5

0

09:5

0

Open Chamber

Changeover

pand Take Moistures


Unload Chamber hts

Res

erve

d

Blow down with Air

Apply Steam

onsu

ltant

s Lt

d. A

ll R

ig


Refrigeration

Load Chamber

© N

ewto

n In

dust

rial C

o

Vacuum Pump-Down

Pause in Cycle

©

Heat Applied


C

07:5

0

08:5

0

09:5

0

Open Chamber

Changeover

pand Take Moistures


Unload Chamber hts

Res

erve

d

Blow down with Air

Apply Steam

41% onsu

ltant

s Lt

d. A

ll R

ig


Refrigeration

Load Chamber

41% decrease in changeover

time © N

ewto

n In

dust

rial C

o

Vacuum Pump-Down

Pause in Cycle

©

Heat Applied


C

07:5

0

08:5

0

09:5

0

10:5

0

11:5

0

12:5

0

13:5

0

14:5

0

15:5

0

16:5

0

17:5

0

18:5

0

19:5

0

20:5

0

21:5

0

Open Chamber


pand Take Moistures


Unload Chamber hts

Res

erve

d

Blow down with Air

Apply Steam11%

decrease in

onsu

ltant

s Lt

d. A

ll R

ig


Refrigeration

Load Chamber

cycle time

© N

ewto

n In

dust

rial C

o

Vacuum Pump-Down

Pause in Cycle

©

Heat Applied

Consumer Model




hts

Res

erve

d




NPD F l



C it l I t t R d ti onsu

ltant

s Lt

d. A

ll R

ig




© N

ewto

n In

dust

rial C

o

• Efficient Physical Logistics ©

Does the Process Deliver Value?

ed

110%

Output Efficiency by Week

td. A

ll R

ight

s R

eser

ve

90%

100%

dust

rial C

onsu

ltant

s Lt

80%

© N

ewto

n In

d

60%

70%

50%

5/20

114/

2011

4/20

113/

2011

3/20

112/

2011

2/20

11/2

011

/201

12/

2010

2/20

10/2

010

/201

00/

2010

0/20

100/

2010

9/20

109/

2010

8/20

108/

2010

7/20

107/

2010

6/20

106/

2010

5/20

105/

2010

5/20

104/

2010

4/20

103/

2010

3/20

102/

2010

2/20

10/2

010

/201

02/

2009

2/20

09/2

009

/200

9/2

009

0/20

090/

2009

9/20

099/

2009

8/20

098/

2009

7/20

097/

2009

6/20

096/

2009

5/20

095/

2009

5/20

094/

2009

4/20

093/

2009

3/20

092/

2009

Improvement Project

Improvement Project

01/0

517

/04

03/0

420

/03

06/0

320

/02

06/0

223

/01

09/0

126

/12

12/1

228

/11

14/1

131

/10

17/1

003

/10

19/0

905

/09

22/0

808

/08

25/0

711

/07

27/0

613

/06

30/0

516

/05

02/0

518

/04

04/0

421

/03

07/0

321

/02

07/0

224

/01

10/0

127

/12

13/1

229

/11

15/1

101

/11

18/1

004

/10

20/0

906

/09

23/0

809

/08

26/0

712

/07

28/0

614

/06

31/0

517

/05

03/0

519

/04

05/0

422

/03

08/0

322

/02

FromTurnaroundToWorldClassFrom Turnaround To World Class · fail to see the additive power of lots...

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Transcript of FromTurnaroundToWorldClassFrom Turnaround To World Class · fail to see the additive power of lots...