As a plant manager for the past seven years, I had a unique opportunity to lead a lean manufacturing implementation in two separate facilities. The plants were similar in numerous ways. They were both building-products manufacturing facilities, both were continuous processes, both had roughly 300 hourly people, and they were both owned by the same Fortune 500 corporation. The important difference between the two facilities was that one plant had a relatively mature manufacturing reliability program in place prior to the lean implementation and the second was a typical North American plant that was highly reactive in its maintenance processes.
The outcome of the lean implementation at the two locations could not have been more dramatically different. The lean implementation at the reliable plant was powerful and transforming; the lean implementation at the non-reliable plant did not deliver long-term results. This article will discuss my experience in leading two separate plants and why I believe that it’s critical to have a reliable facility for a successful lean manufacturing implementation.
Blitz events were conducted very similarly in the two plants. Whether they were 5-S events or kaizen events focusing on a process or problem area, they were typically three to five days in length, were facilitated by either a consultant or a corporate Continuous Improvement leader, and had roughly eight to 16 hourly employees engaged in the event.
Blitz Events in a Non-Reliable Plant
The blitz events in the non-reliable plant were tougher to pull together. The first real challenge was getting participants to participate in the event. Because the work days were tough and challenging in the reactive environment, most employees were reluctant to come in and work days in excess of what they were scheduled. Managers and supervisors sponsoring the event would often have to assign employees to work on the blitz event instead of having them volunteer for the project.
An additional problem with blitz events in the non-reliable plant was establishing a baseline of performance for processes. We wanted to measure the improvements made over the course of the event, but there were many times this was not possible because of equipment downtime or process upset occurring in either the baseline measurement or during the measurement of the “after improvements” section. This always resulted in deflation for the participants of the event because “the equipment messed up.”
A particularly aggravating problem that occurred in blitz events in the non-reliable plant was participants getting pulled from the event because of equipment problems. Electricians, mechanical craftsmen and area supervisors were especially hard hit with this phenomenon because their skills were either needed to get the equipment back up or their expertise was required to juggle the production schedule or shipping schedule to react to the downtime. Needless to say, it was disappointing to the team when someone who had been in on all the discussions during the event would “get yanked out of the event” to go take care of the day’s problems.
Probably the most insidious and damaging aspect of blitz events performed in the non-reliable plant was difficulty in sustaining the gains made during the event. Because the workplace was so often either reacting to, or recovering from, a significant equipment problem, managers and supervisors struggled with executing the critical leadership behaviors that were necessary to sustain the gains that were made in blitz events. The eventual deterioration of the area or process that had improved was visible to both hourly employees and the managers. This would, in turn, reinforce the reluctance for employees to participate in future events because they felt their efforts were in vain. Management team’s credibility suffered as well.
Blitz Events in a Reliable Plant
My experience with blitz events in the reliable plant was dramatically different. They were truly some of the most positive workplace experiences I’ve had in my 20-year manufacturing career. The leadership team enjoyed much more management credibility with our hourly employees. This was largely because of the progress that had been made in the prior two years with implementing reliability. Hourly employees’ daily work lives had been deeply impacted by the improvements in machine condition and the operational stability that resulted. They were very aware that we had been implementing the principles of reliability and they were very happy with results even after the first year.
This credibility resulted in hourly employees that were much more eager to participate in blitz events. People were excited about the opportunity to impact their work lives in a positive way. We certainly still had the scheduling challenges of backfilling participants’ normal job in some cases, but there were many participants whose jobs were not backfilled for the event because the stability of the plant did not require them to be on their jobs all the time.
It made an enormous difference to have all the participants in the event stay for the entire duration. The team dynamics were much more positive; it was rare for someone to have to leave the event to “take care of problems.” This allowed all the participants to own the results and, more importantly, own the changes made in the event so they could serve to maintain the improvements and give insight to other employees about changes that were made and why they took that direction.
As the facility performed more and more successful blitz events, employees’ willingness to participate and actually lead events became greater and greater because they saw the positive changes that were implemented and they saw the results being sustained.
The opportunity to create a kanban system in finished goods existed in both plants. Both had fairly typical inventory strategies in that the sites produced inventory to match a sales forecast or to react to working capital directives.
There was a dramatic difference, however, in the ability for both plants to capitalize on the opportunity to utilize kanban for producing to actual demand by the customers.
Kanban in a Non-Reliable Plant
As previously discussed, machine conditions in the non-reliable plant were unstable and the resulting downtime made for frequent schedule changes. Often a machine breakdown would occur which would limit our ability to produce some products. As a result, we would sometimes have to run products that were not needed for orders simply because we still needed to produce products to hit gross production targets stated in pounds.
There was no way we could have implemented a kanban system to produce to the kanban signal. While we still provided excellent customer service as measured by order fill rates and shipping dates, this was largely made possible by having very large inventories that served as buffers to absorb the impact of a chaotic production schedule.
Kanban in a Reliable Plant
After three years of persevering in the implementation of our reliability program, our ability to produce the production schedule became extremely strong. At the encouragement of our Continuous Improvement leader, we designed a kanban system for one of our very popular product lines. There were certainly some formidable “mental challenges” that needed to be overcome. When warehouse personnel and scheduling personnel have had many years of a cushion in inventory, the very thought of taking inventory levels down produced much fear that needed to be managed.
Once the team was engaged and trained in the kanban concept and the workings of the signal for inventory replenishment were created, we simply started running the system. While there were a few tweaks of the system over the first few months, the facility quickly gained confidence in their ability to produce and work with the much lower resulting inventory levels.
On the front end of implementing the kanban system, we felt that improved financials were going to be the primary benefit because of the working capital reduction. In reality, while we saw the financial impact quickly, the improvement in working conditions for our warehouse staff became “the big win.” With much lower inventory, we saw many unanticipated benefits such as the following:
We continued to provide high levels of customer service even with the much lower inventory levels.
The absolute key to this process, however, was the ability to produce the right products for our customers at the right time, and by having the production machinery reliable, this gave the plant the ability to produce what the schedule called for.
The experience of leading these two similar, but very different, facilities really underscored the importance of having a plant be reliable before implementing lean manufacturing. The cadence of execution that is learned by the organization through having equipment maintenance work planned, scheduled, completed and closed out becomes a cornerstone of organization discipline that is fundamental when the elements of lean manufacturing are utilized.
About the author:
Paul Borders, a principal consultant with Life Cycle Engineering, has 17 years of progressive experience in top quality plant operations, quality control, safety, and environmental management. He delivered consistent and significant performance improvements in all operating metrics: productivity, quality, safety, cost effectiveness, profitability and employee engagement. For more information, e-mail pborders@LCE.com or visit www.LCE.com.