The recent article by Roger Price in Industry Week ("Systematizing Continuous Improvement: It's Not About the Methodology or the Tools," 4/28/2014) discusses the tendency in manufacturing organizations to provide insufficient priority for continuous improvement efforts in the face of day-to-day production demands. This tension, as I would describe it, was consistent with my experience as a manufacturing operations leader and plant manager. Three plant leaders, representing their Best Plants Winners at the recent 2014 IW Best Plants Conference in Milwaukee, corroborated my experience and provided some insights on overcoming this tension.
There are a variety of reasons why a plant manager would succumb to the pressure to abandon CI work. A couple of the more prevalent ones I saw were the demand to cut costs in order to meet budget or falling behind on production schedules. Cost cuts always involve labor and materials, including layoffs in extreme cases. Faced with losing resources that impact the ability to meet schedule, performance improvement looks like a discretionary expense. (Whacking the training budget was always a favorite pastime.) Both reasons demand shifts of resources away from CI activities. Logic suggests these actions would only make the situation worse (which invariably they did), but under the heavy pressure from the business to deliver results, logic rarely prevails.
Roger suggests three key managing processes to embed CI into the fabric of the manufacturing organization: 1) Set and Implement the Strategy, 2) Identify and Pursue Addressable Opportunities, and 3) Embed the Essentials. I have no argument with his recommendations. The problem is, how do you implement all that when your business director says manufacturing is killing his business, and your boss says you need to get your overtime down or there will be serious consequences?
I think there is one thing a manufacturing organization needs to do before it gets the credibility and permission to accomplish these managing processes. This idea is consistent with the insights of the Best Plants leaders, and a key element of their success. Ready for it? Manufacturing leadership must commit to CI.
What a hackneyed statement, Takacs! Give me a break. Okay, but think about it. Besides the principle of Occam's Razor (the simplest answer is often the correct one), strong, committed leadership, especially in manufacturing, is essential whatever the endeavor. CI is no exception. Let's start with plant leadership, and particularly the plant manager. He/She needs to be prepared to take the heat and not defund CI at the first sign of trouble, but instead show faith that investing in performance improvements is the right answer for the budget and production schedule in the end. This challenge is not for the fainthearted. But those that persevere send a strong message to the shop floor of their commitment to them.
One tangible way to show that commitment to CI, and once again the three “Best Plants” leaders concur on this point, is to establish a full time CI leader for the site, a champion accountable and committed to making continuous improvement a reality. He/She is responsible to deliver the key managing processes, establish the CI management system, and partner with line leaders to drive impactful improvements. Importantly, when plant leadership wavers in their commitment, this person needs to remain resolute and uncompromising and be able to challenge leadership to maintain their support for CI.