Reason #2: Improve Focus
Six Sigma talks a lot about the importance of surgical focus, the “inch-wide, mile deep” approach to mastering aspects of the manufacturing process. It’s about solving problems at the system and root cause level. It’s implementing robust control plans that allow for continuous improvement and the ongoing elimination of waste. It’s about intimately knowing your lead and lag metrics and working to reduce process variability in the efforts to produce consistent World Class results.
The challenge manufacturers have, is that it’s impossible to be the master of everything. World Class organizations therefore have to work to implement strategic mastery. Mastering the specific aspects of their process that will sustain their competitive advantage. Every company has a set of core processes, the processes where they have robust systems in place, they have the in-house expertise required to determine root cause when results start to deviate from expected results and they use KPI data to drive their day to day activities.
So how do you know when a process is non-core? How do you know when it’s time to consider outsourcing an aspect of your operation to a strategic partner that has the systems, expertise and data driven execution necessary to optimize this aspect of your plant?
We look at two factors when determining whether there is an opportunity to significantly move the needle at a facility.
1) If the company is using time based preventative measures to manage aspects of their process, they are not using KPI data to drive their corrective actions.
2) If the process is in a constant state of reactive problem solving. Whether it’s unexpected quality, availability or throughput related issues that hurts their OEE, health and safety related events, or a work force that simply has no time left to identify and drive improvement, the plant does not have the systems, expertise and/or the KPI data necessary to keep the process in control and improving.
During World Class Process Audit, we find that any process can be categorized into one of 7 different states:
• Unidentified - These are processes that are silently hurting productivity, stealing resources and generating waste and wasteful activity. The plant hasn't built any systems or methodology around this aspect, not recognizing its impact on other processes.
• Anecdotal or Incorrect - These processes are based on past experience vs data, they are "managed" based on tribal knowledge. Often different individuals within the facility have very different perspectives on the cause and effect relationships that exist for these aspects.
• Contained or Time Based - When plants get tired of reacting to issues, they tend to rely on containment strategies. Preventative Measures are used to keep a process in control by ideally staying ahead of the KPI's that eventually drift into the danger zone. Contained processes are very common but very wasteful and offer no real opportunity to improve over time do to lack of KPI data.
• Incomplete - For these processes, some of the KPI's have been identified, there are systems in place and data is used to drive corrective actions, problem is that many of the KPI's have not yet been determined or integrated into the process, so the process is still operating far from its optimal.
• Broken - The KPI's are known, the systems are in place, however the system is not robust, aspects of the control loop are just not happening on a consistent basis leading to unexpected events and waste. Broken processes have logs that are not filled out, data that is never reviewed and acted upon. Broken processes speak to the sustainability challenge of any non-core process.
• Ancient - Beautiful and robust, however ancient systems have not kept up with innovation and change. Ancient processes are very sustainable however offer a step change in improvement by introducing more innovative and efficient approaches.
• World Class - To be world class, a process needs to be working towards 100% quality, 100% on-time at the lowest cost possible. A forever moving target, world class processes are an ideal that manufacturers need to be working towards relentlessly.
Getting all processes within a manufacturing facility to World Class is what keeps companies ahead of their competition and leading the pack. For companies that recognize they can’t do it all, and instead want to focus their resources on their core strengths and competitive advantages, Strategic Outsourcing offers an effective strategy to quickly get non core processes quickly up to World Class Levels.