When projects run out of gas, there are steps you can take to keep the momentum and the benefits flowing.
The management team was perplexed. A process improvement program the food manufacturing company had put into place two years ago to reduce inefficiencies generated outstanding cost savings for the past year, but progress was abating. Employees were slow to submit improvement ideas and the suggestions were no longer especially innovative or valuable. Was one-year of savings all the company could expect from its major investment in process improvements?
This type of outcome is not uncommon for small and mid-size enterprises (SMEs) that embark on new business process improvement projects. Consider that large manufacturing operations typically have long-established continuous quality improvement cultures where every day trained managers develop and guide cutting edge improvements throughout the organization. Smaller companies generally rely on external consultants, on a temporary basis, to devise and launch improvement initiatives. Once a program is underway, it’s the company’s responsibility to keep it going.
No matter what type of improvement program may be in place – ISO 9000 Quality Standards, Total Quality Management, Just-in-Time, Lean Thinking, Six Sigma, Theory of Constraints, Benchmarking – once the novelty wears off, the challenge inevitably shifts from “how do we start improving” to “how can we sustain the benefits of this program for the long term?”
Rather than abandoning an improvement program and starting over, there are a number of steps management can take to refresh effectiveness. First, it may help to know some of the main causes of process improvement sluggishness.
1. Improvements lead to more work for participating employees. Sometimes the improvements employees identify end up on their personal lists of responsibilities. As their “to dos” increase, their enthusiasm for improvements wanes. That’s why it’s important to find ways of re-engaging people to continue seeking improvements and to offer rewards for doing so.
2. Turnover of key personnel slows momentum. The momentum can slow when original project leaders or enthusiastic participants are promoted, transferred or depart from a company. Find new leaders to inject energy into the initiative.
3. Improvement opportunities dwindle. Process improvement programs tend to focus on a specific area of an operation, such as eliminating waste in production or reducing costs in purchasing. After a program has been in place for several months and the most beneficial improvements have been identified and acted upon, subsequent suggestions deliver increasingly lower value. In these cases, the focus of the program will require adjustment.
Big picture view
For manufacturers considering the implementation of any new process improvement program or wishing to revitalize one that’s fatigued, follow these steps to ensure sustainability and avoid “stale dating:”
• On at least an annual basis, step back for a look at the big picture. Review the company’s goals and identify the most important benefits (cost reductions, product quality, profitability, customer service). Is the current program delivering on the priorities? If not, the program will need an adjustment. It may be necessary to change focus, re-engage employees or rebuild the business improvement team. If opportunities for adjustments are not clearly evident, consult an experienced process improvement specialist for an objective assessment. A fresh perspective often uncovers missed opportunities, determines whether or not new objectives are necessary, and ascertains if a different type of improvement method is required.
• Is the refreshed improvement initiative feasible and sustainable? Outline the necessary steps and the people that would be involved.
• Link the program directly to the company’s goals and objectives.
• Communicate the importance of the program throughout the organization and continually support the efforts of managers and employees.
• Create a supportive culture by empowering employees and regularly recognizing and rewarding those who contribute. Anticipate that employees will want to know “what’s in this for me?” and ask for input regarding their reward preferences (compensation, performance appraisals or recognition).
• Don’t overload people by allocating responsibility for new initiatives only to those who suggest ideas. When implementing new improvement processes, consider where redundant procedures may subsequently be eliminated.
• Regularly assess the improvement program’s progress and watch for new opportunities. Question whether the focus is on the right areas. Ask employees what’s working and what isn’t, and where they see the most opportunity for improvement.
All process improvement programs rely on the enthusiasm and engagement of management and employees who believe there’s value in doing them. Assessing progress, asking for input, creating a supportive culture and making adjustments as they are needed will ensure improvement efforts will deliver value for a very long time.
Carlo Mariglia is a Toronto-based partner in the national advisory services practice of BDO Canada LLP (www.bdo.ca). Call (416) 369-3078 or e-mail CMariglia@bdo.ca. Joseph Gipp is a partner and national advisory leader of BDO’s manufacturing industry practice. Call (416) 369-3091 or e-mail JGipp@bdo.ca.