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8:28 pm
January 20, 2014
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Mapping a Way to Manufacturing Excellence

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Reaching a specific destination on time takes careful planning. Heeding the advice of those who’ve made the journey can help.

By  Jane Alexander, Deputy Editor

Line managers in manufacturing operations shoulder responsibility for a diverse set of plant goals, including profit and loss (P&L), safety, cost, production, customer service, product quality, environmental compliance, return on invested capital and facility preservation. 

They must handle the targeted annual improvement in these areas while simultaneously addressing the routine operation of the plant. This is no easy task, as the routine demands of daily maintenance, capital upgrades, scheduled outages, employee scheduling, hiring, training, union relations and customer visits represent only a partial list of areas requiring attention. According to long-time manufacturing executive Bob Taylor, managing those responsibilities in a piecemeal way doesn’t work. “It can turn a line manager into a juggler,” he notes, “and balls will be dropped.”

A better way is through a comprehensive and integrated approach, Taylor says. He should know. His career spans 35 years of operational experience from entry-level engineer to CEO, including positions with Hudson Bay Oil and Gas, CIP, International Paper, Sappi Fine Papers, Armstrong World Industries and Neucel Specialty Cellulose. Working with talented people at every stop led to the development of what he calls a “RoadMap for Manufacturing Excellence.” Based on a perspective of minimum effective design, the route Taylor proposes is laid out for ease of use, efficiency and delivery of desired results—particularly valuable in plants with limited resources.

Drawing the map
The RoadMap is organized under two broad categories: principles and tools. The principles are further separated into those that influence individual actions and others that define organizational guidelines for routine work. The tools are organized under the categories of operations, maintenance, engineering and organizational excellence, along with a focus on results.

All of the previously referenced measures of plant success (P&L, safety, cost, etc.) are considered. For example, the familiar components of variable and fixed cost are reviewed, but so is the less familiar marginal cost which can potentially have a very negative impact on P&L at the low end of a pricing cycle

A special emphasis is placed on reliability—which Taylor refers to as the bedrock support for all manufacturing results. The RoadMap’s in-depth analysis of reliability includes measures of both plant reliability (PR) and the cost of unreliability (COUR). Without these key quantitative measures, the impact of reliability is underestimated, and management attention is diverted to other less vital needs of the business. 

Emphasizing principles
Although the RoadMap’s “principles” represent the “soft side” of manufacturing excellence, Taylor says that when properly chosen and applied, they have a wide impact on how work gets done and can be very influential in changing the behavioral norms in a plant. For example, the personal principal of “Tell the Truth” encourages full disclosure; never holding back on the delivery of unpleasant news; and never misleading anyone regarding your knowledge or understanding. An organization that deals with the truth doesn’t waste valuable time trying to sort fact from fiction, and solves its problems in a much more efficient and effective way than those where reality is shaded by half-truths and misinformation.

 The work principle example of “Implement via Minimum Effective Design” is a reminder to never complicate things any more than is absolutely necessary to produce a desired outcome. This requires a consistent effort to simplify work and avoid the creeping bureaucracy and complexity that will lower operational efficiency and add cost. As Taylor explains, becoming “so minimum” that policies, SOPs (standard operating procedures), etc., are meaningless provides no advantage—but looking for simplicity while still retaining required effectiveness does.

Focusing on results
The next step toward manufacturing excellence is establishing the correct focus on results—starting with an assessment of plant stability. It is pointless, notes Taylor, to embark on a major change initiative involving cost, customer service, etc., if the operation of the plant is highly unstable (i.e., if it is unreliable). If faced with this challenge, the only option is to move all operational initiatives to the background and narrow the focus to improving plant reliability (PR).

According to Taylor, improving PR to an acceptable level (90-95%) will automatically improve results in every other operations area, while a low PR will mask the impact of most other improvement initiatives. “For example,” he says, “total manufacturing cost can be elevated up to 15% in a plant that’s operating 20% below its PR potential, and the cost variations associated with a changing PR will render the impact of most other cost-improvement initiatives unrecognizable.”

The specific target chosen for PR, Taylor asserts, can be determined using the RoadMap’s Flow-Down Tool that provides an assessment of the plant’s true PR potential. The associated dollar value is calculated from COUR and compounded by the extra profit from higher sales, if plant sales were production constrained at the lower PR levels.

“Safety,” Taylor contends, “should be added to this reduced focus.” That’s because even though low PR and safety problems go hand in hand and improving reliability will automatically improve safety, it will be difficult to ignore a direct focus on safety without generating organizational resistance to the overall improvement effort.

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Developing improvement goals for the remaining operational areas requires a detailed knowledge of the plant’s customers, supply chain and manufacturing operation, as well as those of its competitors. Taylor says improvement targets in these areas can be developed using the RoadMap’s internal or external benchmarking tools. “Like plant reliability,” he explains, “translating as many of these improvement goals expressed in process units to their dollar equivalent and impact on P&L is a more powerful motivator at the shop-floor level.” Safety and environmental goals, he adds, can be justified in terms of their obvious impact on people and the surrounding community, in addition to meeting regulatory demands. 

Whether a plant’s initial focus is restricted to reliability and safety, or is part of a more comprehensive improvement effort, Taylor cautions that initial application of the RoadMap’s tools should include only a foundational subset of its complete toolkit. There’s little point in overwhelming an organization with an excessive number of new methods when a thorough application of the basic tools listed in the accompanying table will jumpstart the targeted improvements.

According to Taylor, although the initial application of the foundational set is limited to less than one-half of the full complement of available RoadMap Tools, he feels the complete list should be previewed during the introductory phase. Providing even a brief picture of this possible endgame, he says, will limit the frustration that generally surfaces as new tools are continually introduced over an extended period—something that is often construed as a never-ending list of new demands. Still, in keeping with the minimum effective design principle, tools beyond the initial foundational set should be used only where absolutely necessary.

NOTE: Although some RoadMap tools will be familiar, Taylor says their performance expectation is raised considerably by the documented standards for excellence and the defined roles and responsibilities. Consider operator rounds, for example: They’re are covered in most manufacturing plants under the umbrella of Autonomous Maintenance/TPM/Basic Care, etc.—yet few are ever implemented to the level of the RoadMap standard for the operator-rounds cycle.

Organizational excellence is also required
Manufacturing excellence, Taylor points out, is often pursued strictly from the perspective of operations, maintenance and engineering excellence. In his view, that short list overlooks the critical role of people in the implementation process. “Excellence cannot be achieved only through superior engineering designs, optimum process configurations and a superior system of manufacturing procedures,” he says, “although they are all important requisites.”

Equipment must be maintained in excellent condition and procedures implemented with care and precision by people. The needs of people, Taylor notes, are generally more difficult to address than technical concerns, but invariably play a larger part in implementation success. That’s why the organizational excellence section of the RoadMap reviews, at length, the role of people and topics like hiring, effective teams, supervisor skills development, performance management, and working within union environments—and, importantly, puts special emphasis on key attributes required of plant leadership.

The implementation process
Taylor acknowledges that any system purporting to deliver manufacturing excellence is only as good as the results it ultimately delivers in a plant application, and that while process documentation on manufacturing excellence abounds, successful applications are rare. The RoadMap addresses this by including a separate section devoted to implementation to ensure that what is described is actually practiced.

Among other things, implementation is supported by a description of the roles and responsibilities required for the successful application of the principles and tools. Also, questions are posed at the conclusion of each segment to stimulate group discussion and improve understanding. The goal is to help employees grasp the full scope of the endeavor, which will ultimately pay off in a greater sense of ownership and a speedier and more substantial implementation. A concise “RoadMap on a Page” overview provides added support in comprehending the full scope. This summary helps maintain the perspective of the RoadMap as holistic—and of minimum effective design—as changes/additions are considered over time.

Summary
Asked to sum up the RoadMap, Taylor highlights the fact that it covers all aspects of manufacturing excellence and is not just aimed at meeting plant goals. It also provides a way to better define these goals and develop a comprehensive plan to achieve them. Set up to be “evergreen” and easily amenable to adding new principles and/or tools, the RoadMap can be presented to plant employees as a means to “organize what we know and adapt what we learn,” which builds in ownership for manufacturing excellence.

Because the entire RoadMap is built on the concept of minimum effective design, Taylor says it is simple to follow and straightforward to apply. To him, this minimalism is a critical feature, as it provides better support to line managers who are responsible for a host of varied demands in their plants than the types of complicated and/or piecemeal approaches that may have hindered them in the past. MT&AP

Bob Taylor recently joined Reliability-Optima as an Executive Vice President specializing in manufacturing excellence. For more information related to this article, telephone him directly: (901) 303-7009 or (281) 359-2162; or email:  btaylor@reliability-optima.com.

 

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