People and productivity
How to make the connection.
Improve the performance of your manufacturing operation by engaging employees to drive productivity improvements.
Manufacturers are facing unprecedented competition. As raw materials and other costs rise, company owners are feeling the pressure to lower costs and increase productivity.
There are ways to improve business without breaking the bank. Almost every plant can improve operational performance by at least 10%. Indeed, in some cases efficiency can be improved by as much as 50%, but employees must be engaged.
People drive productivity. Working with front-line staff will identify the best ways to increase profits. One plant that pursued this ‘people and productivity’ agenda continues to reap the benefits.
The supplier of household products harvested significant savings at its powdered laundry detergent packaging plant by addressing issues that affected productivity and material yield.
The plant was having trouble keeping up with production demands and cost overruns were significant, including annual material losses of $2.4 million from product overfill. Equipment was not used efficiently and downtime was an issue. There was also a lack of standardized training on the shop floor, which made it difficult to maintain consistent performance.
The plant’s employees were brought into the transformation process from the beginning. The plant manager, supervisors and those who worked on the shop floor were shown that the operation was not performing to its potential because of three related issues: equipment was running below target speed, the amount of downtime on the packaging lines and material waste. They learned the solution to these issues required engagement and accountability.
Key personnel were coached and several workshops were held to show them:
• How to identify the biggest opportunities for change within the plant.
• How to quantify performance and prioritize the problems causing lost time and money.
• Advanced problem solving techniques.
• Principles of continuous improvement and what’s required to continue a process of focusing, prioritizing and problem solving.
To sustain results and accelerate internal improvements the project team worked with employees to determine what they were doing on an hourly basis, built tracking mechanisms and then developed accountability structures. All levels of management were empowered to review performance every hour.
The result was improvements worth $1.36 million annually from a 39% reduction in material overfills and a 19% improvement in equipment efficiency and workforce engagement, training and accountability structures at all levels of the organization helped to sustain the improvements.
Here are some tips that will help you improve productivity:
• Follow the money. Prioritize and examine the areas that represent the largest annual cost to the business and prioritize the ones that represent the best opportunities for improvement.
• Compare plant IT data from the last six to 12 months with an on-the-ground assessment. What does the data say should actually be happening? Are there discrepancies with what is observed on the shop floor?
• Interview as many people as possible about their perceptions of the data. After observation and analysis, circle back to the shop floor, supervisors and management to get a sense of how issues and challenges are perceived. These insights are crucial when it comes to implementing recommended changes.
• Challenge processes and solutions. If the problems were simple to solve they wouldn’t exist. Take the perspective that “this machine can run better, let’s figure out how” rather than “this is as good as it gets” or “it has always been that way.”
• Measure and prioritize problems. Always base prioritization and action on evidence and facts.
• Provide training and facilitate buy-in from those who will drive the change. Determine who can best drive the change and train them. Train staff on process changes and implement accountability structures.
Most importantly, show people the results they have achieved, which will help position the plant for long-term success.
Alan Rogers is business manager at Newton North America, an operational and financial improvement firm with offices in Canada, Europe and the US. To access Newton’s whitepaper on world-class manufacturing go to http://bit.ly/Vy9ROu.
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This article appears in the July/August 2013 edition of PLANT.