When it comes to driving business improvements, the term “transformation” is overused. Transformation indicates a fundamental shift from one state to another.
Question: How often do organizations make such bold and radical choices and stay the course?
Years ago, I worked for an automotive tier 1 supplier that was facing all kinds of operational problems. Many of their challenges stemmed from an increasing number of additional products that required new machines and equipment, posing the question, “Where do we place them now?” Other challenges included long, complex delivery routes with WIP in every process step, conveyor belts creeping all over the place and inventory build-up. The list was endless. In the midst of it all, the manager had been trying to create efficiency to the best of his abilities but was failing ― slowly but surely.
Drastic change was needed. As a result, the plant shut down for a week, during which all machines were removed, and within that week everything was re-installed but in a complete new configuration based on one overarching principle: Flow!
Such drastic change is surely not always needed ― nor does it happen in many cases ― because most organizations do not have the collective courage to make such a decision. So, often a choice is made for gradual, incremental changes, but incremental to what? In order to build a house you do start with the foundation don’t you?
A solid transformation does not happen incrementally. Instead, it happens dramatically and visibly. Incremental enhancements to operations are Continuous Improvement (CI) efforts, which are crucial to be truly competitive but happen at a slower pace. In situations where bit-by-bit simply isn’t cutting it, organizations should consider real transformation. Only then will dramatic results be achieved through bold change and decisive action.
If you’re considering a transformation effort, where significant results need to be generated fast, be sure to apply these five fundamentals to increase your odds of success:
1. Understand the Objective(s)
Identify one or two significant targets. Make sure that the objectives are quantifiable ― measurable up and down the value stream. Usually this involves a few fundamental measures that have a solid connection to bottom line results. Cost is often used because this mega-process measure wraps up just about everything, but especially materials and labor. But it could be other things like asset utilization or quality. The point is that these are big-picture, corporate target objectives that flow down inside the transformation initiative, generating the business case for change.
2. Make a Plan
The plan has to be simple enough to understand, but detailed enough to answer the basic questions that everyone will have: Who, What, When, Where, How, and How Much? This seems like basic information, but once you start to think about this in the context of a complex system (i.e., the operation), you realize that it really does take some thoughtful consideration. The better you do upfront on these important questions, the less time you will spend re-directing later on. Yet, there will be unknowns, so don’t over-analyze. Make enough of a plan to answer the questions and get started.
3. Apply Resources
Resources to drive transformation fall into two areas:
- The resources necessary to push the organization off center and force the initial change. This takes significant energy and can’t be overlooked. Everyone already has a full-time job. Don’t expect the line organization to have the extra time necessary to effect a dramatic change. The bottom line is that some form of external support is most often required. It can be staff from other locations or external resources who make the initial push, but realize that they won’t be the ones to sustain or ultimately own the change.
- The line organization who must ultimately own the initiative. The skills needed to push the organization in a new direction are not necessarily the skills required to sustain the change. But, once the initial rapid change is accomplished, it will take a lot of energy to hold into place. Don’t worry, this isn’t extra energy; it’s actually less energy than the old, waste-ridden practices prior to the transformation. Even so, the organization will attempt to do both the old and new ways. For this reason, you will need to apply internal resources to keep the new good practices in place, and to add even better ones as time goes on.
Make sure that everyone is clear about the objectives and plan to accomplish the objectives. A well-defined communications plan is an essential ingredient of success. Keep everyone informed about progress, challenges, accomplishments and, most of all, results — even the small ones. Near-term wins along the way will keep people energized and provide powerful ammunition for those who resist the change in favor of the tried and true ways of the status quo.
5. Measure the Results
Results give efficacy to the entire initiative. Many people have put themselves on the line, risen to the challenge and accepted the risk that comes with bold action. Do not abandon the proof that the effort — everyone’s effort — was worth the trouble. The key to sustainability is to make sure to have a system in place that can measure the results on the front line day-by-day and at the operating level month-by-month.
Want to learn more? For a solid example of an organization that dramatically transformed its manufacturing operations, click here to download our white paper, “Transforming Operations into a Strategic Competitive Weapon.”