Frank Rzeznikiewicz

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Category: Leading an Organization (page 2 of 3)

October 7, 2020

Organizational Structures and their Impact on Performance

In business, there are numerous organizational structures that exist. They can be classified as “traditional” or “flat”, or even “mechanistic” or “organic”. It is commonly debated which structure reigns supreme, but what it comes down to is what structure best suits the needs of the company. The structure and design of an organization is the basic framework that dictates things such as roles and responsibilities or the reporting structure and compensation. In deciding which design is most beneficial to the company, many factors need to be taken into account. Some examples of these factors are the changing culture, future opportunities, and what the financial and business goals of the company are. The structure should clearly define the reporting relationships of employees and the basic hierarchy of positions. The design of the company in essence gives power and responsibility to employees and solidifies it with a formal chart. It is important to keep in mind that the organizational structure is not only seen on paper
but can also be seen in the everyday relationships of employees.

The strictest and most formal type of organizational structure in business would be considered a “mechanistic” design. The mechanistic organizational structure has fine divisions of labor which results in a high output of specialized jobs. They have a very strict chain of command and rely on high level management to make the brunt of the decisions. A textbook example of this type of design would be the United States Military. There is a clearly defined hierarchy with a tight chain of command. The decisions are typically made from the top down and the contrary would need special and individual approval. The compensation and power of each position is also clearly defined by its place in the order. The mechanistic structure was established in the early twentieth century when mass production was the trend and the industrial age was in full swing. Leaders looked for something that promoted efficiency as well as productivity through bureaucracy and found that this structure fit the mold. Unlike some structures that flow horizontal or even vertical, the mechanistic model is strictly vertically oriented. This means that the chain of command goes literally from the top down and typically in a triangular shape. The employees are grouped into different specialties with each grouping having a clearly defined leader. As you climb the structural tree, the control starts to tighten to a point where managers are managing other managers rather than employees. The top of the structure is the individual with the most power and control which is most usually the “CEO” or Chief Executive Officer. As with anything, this type of design does come with its negative attributes. The biggest downfall to this structure would be the ability to quickly and efficiently adapt to changes in the market and outside variables. With such a strict chain of command, employees are not free to problem solve through creative means and are held up waiting for approval of leadership. This could cost the company productivity which directly equates to profits. Another issue with this model is the difficulty in collaborating with other departments in achieving a common goal. This structure groups employees into specialties which creates a sense of isolation among departments. For creativity to thrive and efficiency to flourish, people need to leverage the abilities of the entire company and all departments and not just rely on their single goal oriented coworkers. Even with opponents across the industry, this model still continues to hold strong to this day. In a stable industry that requires extreme efficiency as well the ability to decentralize, the mechanistic design structure will earn its keep.

In the 1950’s, a man by the name of Tom Burns as well as G.M. Stalker created the term “Organic Organization”. Rather than a design that is rigid and well defined, organic organizations are flexible and can adapt to changing cultural environments. Unlike the mechanistic approach, ideas and decisions tend to flow horizontally rather than vertically. Employees are given the ability to make on the spot decisions that eliminate the need to wait for higher approval. What we see with this design type is the authority is given to the group of employees rather than the manager overseeing the group. What this does is greatly increase the quality of work and products as the employees are encouraged to problem solve and display creativity on their own rather than with approval. Two examples of organic designs are the team and network organizational structure. The team structure utilizes the idea of a team that is made up of different specializations. When a unique problem does arise, most likely one or more of the team members will be capable of resolving the issue. Unlike the mechanistic approach, this organic team structure is led by a single manager overseeing multiple teams. This fosters the idea of adaptability and problem solving as the employees collaborate and leverage self-worth to achieve goals. The network approach does not use teams but rather employs outside vendors to accomplish major work functions. The major advantage or an organic design is the ability for companies to adapt and change with the fluctuating markets. When employees are not held up by bureaucracy, they tend to accomplish the task with minimal oversight and with extreme efficiency. This design also enhances communication among the work force as they use each other to problem solve and collaborate with other departments. This type of structure best suits those companies that deal with extremely volatile markets and unpredictable environments.
Worker productivity can greatly be affected if the organization is employing the incorrect
type of design structure. There is many variables that go into the creating of structure such as the type of work environment, the amount of control needed and what type of production method you are relying on. Something to keep in mind is that if you want to change performance within an organization you must change the design. If the design is not changed to meet the demands of a changing market, then the performance will be severely impacted.

It is essential that the company utilizes the type of design structure that best fits its goals. The structure needs to change as the goals and environments change as well. If you shift ideas and want to create change, you must first look at the foundation or the very basic level and that is the structure of the company.

May 9, 2020

Stepping into a New Leadership Role

One of the most difficult situations that a leader can be placed into is the new company, new role, and new organization. How you begin your new path is certainly one of the most important aspects of your team’s perception, willingness to change, eagerness to resolve, and conquering the pessimism. The first ninety days are critical to your success and not phasing in correctly can create damages that can take a year to recover. You must look at your leadership team from their paradigms and realize the impact and reservations they may have with you. There are certain Do’s and Don’ts that come with your initial participation within the organization. Be aware of them and do not make these common mistakes.
1. Don’t – Do not make any immediate changes to the organization. The first mistake you can make is to change a culture you do not understand.
2. Do – Become a sponge for fro understanding the business. You cannot make a strategic plan for a business that you do not understand. It takes time to understand the paradigms that the business is run within and the informal and formal communications, relationships, and interactions. Understand the business well before you come to conclusions.
3. Don’t – Do not overact to immediate relationships and alliances. Initially, you will be approached by and included into some casual conversations and invites. Do not refuse them but take the communications you receive as a perspective. Too often, we form early relationships but find out that they may be tainted or ones with ulterior motives.
4. Do – Reach out to the quiet and standoffs. Some of your best employees will be those that are quiet and reserved. These employees may be your best contributors so reach out to them, start conversations, and ask for input.
5. Don’t – Do not discuss your plan within the first sixty (60) days with anyone. It is essential that you arrive to your plan based on observations and inputs. However, discussion of that plan may change the way people act and react in their current operations and therefore your understanding of the work paradigms may be thwarted.
6. Do – Speak with customers to understand their concerns and observations. Speak with all customers at all levels including the ones that receive your products and perform additional tasks on them. Speak to suppliers to understand their perspectives and working relationships. Ask for honest feedback so that you can improve relationships. Some people may be conservative in their feedback and not want to hurt existing relationships. Ask for detailed information that is not only subjective but one based on data driven questions.
7. Don’t – Jump to immediate conclusions. Take the first (60) days to absorb information without forming any conclusions. If you form a preliminary option, it could allow you to roll additional inputs to support your theories.
8. Do – Reach out to all levels of the organization. The golden nuggets are usually hidden deep with the rank and file. Hold skip-level meetings and all hands meeting also. They can be invaluable in your understanding of the business.
9. Don’t – Rush the process. Form a strategic plan over time and base your opinions, actions items, and plan direction on data. Don’t make purely subjective decisions but validate your opinions with data.
10. Do – Enjoy the process as it is the building blocks for your success. Review the plan and vision with your leadership team and assure that you have consensus. This is the first steps to your success as a leader and your will be rewarded if you complete the transition successfully.

March 17, 2020

Getting Your Business Visual

One of the most difficult phases of improving business efficiency is implementing a visual workplace. We have all seen the isolated examples that consultants and academia recite but getting the correct systems in place for your business environment is essential. Do not adapt huge expense in getting the methods in places in their infancy of the conversion, but place simple methods that may require more administrative effort during development. Visual systems tend to evolve as the workforce becomes familiar with them and offer suggestions.
The most important visual systems are ones that show what is expected for outputs. You may want to simply invoke a white board that is updated daily with an indication of what is expected daily. As your system develops, you will include meaningful metrics of performance. This can be, but not limited to, a weekly output, monthly output, year to date outputs, efficiencies, productivity etc. The workforce will tell you what is meaningful to them and that which allows them to know how they are performing. Most industries show do not go beyond monthly information at this stage and save the year to date performance for all-hands meetings. If is essential that the posted information is meaningful. The system should evolve to a visual display of takt time versus performance. There are several digital displays that allow people to hit a toggle a button or switch every time a deliver is made. Either the lead or supervisor in the area can administrate the takt time. This allows a real time display of performance that is accurate to the minute.

Another vital part of the visual system is an Andon light. This is an indicator of two elements. The first is the performance obstacles in the cell. A red, yellow, green light display is easy to understand. A green light may indicate the work cell is on target and all assets are running correctly. A yellow light indicates that takt time cannot be met but all assets are running correctly. A red light that indicates there is an asset problem or material shortage that is slowing of shutting the cell down. The yellow light indicates that manufacturing or industrial engineering needs to speak with the cell for changes and/or resolution. The red should require that management, your maintenance group, or engineering needs to expedite resolution. It is essential that we react to those lights expeditiously because the lack of response will evolve a culture suggesting that the light is not valuable and executing the visual signal is therefore useless. The second type of Andon light is usually used in an assembly environment. This light would be a digital readout of any parts holding up the production of a cell creating delays and wait time. This light requires that communications be made to the cell and timelines associated with resolution be developed. None of these lights should get turned off or returned to green unless the issue is totally resolved or parts are now on hand. These lights should be periodically reviewed by dedicated personnel and certainly reviewed during a daily Gemba walks.

The next part of a visual workplace is a visual workflow. A hospital may put different stripes on the floor so that everyone understands where to go. It also can be signage that shows the steps or stations in a process. This allows everyone to identify workflow and observe any bottlenecks. This is easy to accomplish in a standardized high volume tasking but can be more contrived in a mixed model or tasking flow. However, they are all attainable and easy to implement.

Finally, we need to create Kanbans, Heijunka box or wheels, or other visual signals to accommodate lean pull and overproduction elimination. As we progress through lean, we will continue to reduce inventory and waste through more efficient methods of lean tool usage. There are many other tools and methodologies that can be implemented. Educate your workforce and empower them to implement what is the most effective communication methods for good productive flow and waste elimination. They know the processes and know what will indicate to them their performance. Enjoy the process and admire your workforce’s knowledge of lean implementation. They will make your system successful if you engage and empower them.

February 7, 2020

The Journey Begins

The challenge of starting systemic productivity improvements in a facility and knowing where to start is not academically taught and is usually based on experience. Consultants my give you a program that it so large to implement that success is limited. When you decide that your company has used all the conventional methods to improve efficiency and productivity and they have “block and tackled” every avenue to increase outputs, what do you do? The answers are not simple but they all follow the same theme.

The first step is stop and look. Let the processes flow normally and look for two types of changes, systemic and points of production. The first type of change is systemic and you must form a three to five year plan and an initial plan. First observe the flow and identify evident systemic gaps. It could be a process, an element of production (i.e. safety, quality), a product flow, the placement of an order, or procurement. The second type of change is individual points of production changes. You must find three to four small areas of change that will be the example for the changes in the future. You must remember that you probably have not changed the culture of the facility and have not communicated well with your workforce. You need to pull ideas out of employee’s heads for understanding their efficiency roadblocks. These small areas of change are critical for changing the culture to one where employees will be your consultants. The quickness and sincerity of your responses to ideas they give you is critical. If you want to improve, you have a wealth of information in your workforce that will provide you success and them with a sense of accomplishment.

Form a plan that employs the overall systemic changes you want in the long term. Take that overall plan and divide it into smaller sequential system changes that will align your vision and your overall systemic change plan. These systemic changes must be ones that are smaller in nature when you begin your journey to change a company. They must be ones that will improve the processes but also ones that have minimal negative side effects within the workforce. You may want to relocate a department to increase flow. You may want to separate processes and remove production delays by segregating workflows to their proper elements.

The first changes you make must be reviewed with your leadership team to attain both consensus and comradely. After that has been accomplished, you must present your long-term systemic change plan and the initial changes to your entire population to explain how your vision and strategic plan align themselves. Remember to speak with anyone that may perceive your changes as affecting them negatively. The worst tactic is to present material to all your people at a group meeting and someone that is affected being advised at the same time. You need to assure that people are not being surprised and not feeling that you did not speak to them to get their inputs. They may not always agree but they will at least understand you motives and expectations. You can never over communicate. Once you have presented the material to all, act on it. Failure to do what you say will create a perception that management does not do what they say they are going to do.

Creating the correct change path is vital. You need to create a few small changes that will support the overall long-term plan. Remember that any huge change usually takes a long time and your employees are watching to see if things are really going to ascend to a better The challenge of starting systemic productivity improvements in a facility and knowing where to start is not academically taught and is usually based on experience. Consultants my give you a program that it so large to implement that success is limited. When you decide that your company has used all the conventional methods to improve efficiency and productivity and they have “block and tackled” every avenue to increase outputs, what do you do? The answers are not simple but they are all follow the same theme.

The first step is stop and look. Let the processes flow normally and look for two types of changes, systemic and points of production. The first type of change is systemic and you must form a three to five year plan and an initial plan. First observe the flow and identify evident systemic gaps. It could be a process, an element of production (i.e. safety, quality), a product flow, the placement of an order, or procurement. The second type of change is individual points of production changes. You must find three to four small areas of change that will be the example for the changes in the future. You must remember that you probably have not changed the culture of the facility and have not communicated well with your workforce. You need to pull ideas out of employee’s heads for understanding their efficiency roadblocks. These small areas of change are critical for changing the culture to one where employees will be your consultants. The quickness and sincerity of your responses to ideas they give you is critical. If you want to improve, you have a wealth of information in your workforce that will provide you success and them with a sense of accomplishment.

Form a plan that employs the overall systemic changes you want in the long term. Take that overall plan and divide it into smaller sequential system changes that will align your vision and your overall systemic change plan. These systemic changes must be ones that are smaller in nature when you begin your journey to change a company. They must be ones that will improve the processes but also ones that have minimal negative side effects within the workforce. You may want to relocate a department to increase flow. You may want to separate processes and remove production delays by segregating workflows to their proper elements.

The first changes you make must be reviewed with your leadership team to attain both consensus and comradely. After that has been accomplished, you must present your long-term systemic change plan and the initial changes to your entire population to explain how your vision and strategic plan align themselves. Remember to speak with anyone that may perceive your changes as affecting them negatively. The worst tactic is to present material to all your people at a group meeting and someone that is affected being advised at the same time. You need to assure that people are not being surprised and not feeling that you did not speak to them to get their inputs. They may not always agree but they will at least understand you motives and expectations. You can never over communicate. Once you have presented the material to all, act on it. Failure to do what you say will create a perception that management does not do what they say they are going to do.

Creating the correct change path is vital. You need to create a few small changes that will support the overall long-term plan. Remember that any huge change usually takes a long time and your employees are watching to see if things are really going to ascend to a better organization. Several small changes will involve more people and therefore can be more effective to promoting a culture change.

In the points of production changes, you must address a process improvement project for each major sector of your business. These should be the result of interviewing the people and finding out parts of their job that are troublesome and hindering productivity. They may not be what you think is of the utmost importance but they are the issues that concern your workforce. Accomplishing these is vital to your changing the overall business and a significant step in changing the culture of your organization.

You must remember that you have probably forced as much change through the organization that is possible by your powering the organization forward. You now must take a different tact. Embrace the workforce for ideas and act on them. Regard safety as not only a benefit to the people and company, but realize an unsafe environment will create inefficiencies. As you work down this strategic path you will enact your vision to actualization and display the correct atmosphere and culture.

Finally it is critical not to make this a one-time event. Continue this philosophy and continue to take small strides that will change the overall effectivity of the business. Embrace your workforce, communicate with them continually, and improve the business one step at a time. The time for larger strategic changes will come with time and may result in reorganization of the business. You will weave in all the elements of a lean environment such as value stream maps, kaizens, standard work and 5S in the ongoing change plans. The overall goal is to create a culture that self-actualizes itself to the best in the business sector.
organization. Several small changes will involve more people and therefore can be more effective to promoting a culture change.

In the points of production changes, you must address a process improvement project for each major sector of your business. These should be the result of interviewing the people and finding out parts of their job that are troublesome and hindering productivity. They may not be what you think is of the utmost importance but they are the issues that concern your workforce. Accomplishing these is vital to your changing the overall business and a significant step in changing the culture of your organization.

You must remember that you have probably forced as much change through the organization that is possible by your powering the organization forward. You now must take a different tact. Embrace the workforce for ideas and act on them. Regard safety as not only a benefit to the people and company, but realize an unsafe environment will create inefficiencies. As you work down this strategic path you will enact your vision to actualization and display the correct atmosphere and culture.

Finally it is critical not to make this a one-time event. Continue this philosophy and continue to take small strides that will change the overall effectivity of the business. Embrace your workforce, communicate with them continually, and improve the business one step at a time. The time for larger strategic changes will come with time and may result in reorganization of the business. You will weave in all the elements of a lean environment such as value stream maps, kaizens, standard work and 5S in the ongoing change plans. The overall goal is to create a culture that self-actualizes itself to the best in the business sector.

January 27, 2020

Business Stagnation

If you have not created a vision that is the result of an engaged workforce and one that the population does not understand and embrace, substantial changes will only occur temporarily and will not sustain. The absolute worse position that a business can be experiencing is stagnation. Change is good. Organic growth reflect the lack of a competitive and forward thinking leadership team. A business must always look to another step change to increase its competitiveness and fend off competition. There are so many businesses that “copy cat” other business models that you must continue to re-invent yourself. Leaders must continue to benchmark and analyze their business model. Create a different vision that has long term and short term strategies. Contingency plans are necessary for all step change initiatives as they fend off high risk adventures. Plan and re-plan for failure. If your changes fail, you will have a contingency in place and you can quickly adapt to it. Do not stagnate and be satisfied with organic growth. Competition may steal your market and your niche can disappear quickly. We all know of the business that we state, “Remember when they owned the market. What happened to them?” Stagnation probably occurred in all those businesses. Don’t change everything that made you successful but change your path to re-invent and expand your business vision and mission. It is difficult to catch up to a moving target and your competition will get frustrated.

September 9, 2019

Standard Work Assures Consistency and Opportunities for Ever Evolving Improvement

The misconceptions of standard work throughout the consulting sector is staggering. Standard work is not merely written work instructions. Standard work is the application of the proper resources to the appropriate workload. It is the standard by which we can measure productivity and also allocate the proper resources to assure efficiency.

The simple portion of standard work is the visual written work instructions to all elements of the business. The instructions should assure that all personnel could complete the tasks with little or no training. While that is simplistic in nature and assumes there are no skill levels required for tasks, it is a goal that if not attainable can be closely assimilated. When we think of standard work instructions, we think of the operational ends of the business as it is a simple interpretation. For these work instructions, we should have step by step instructions stating the tools required, quality requirements necessary, critical features identified and visuals to assure interpretation is correct. However, the implementation goes greater than the operational end of the business. The application should include all interests including, procurement and the appropriate decision trees for a make /buy decision, financial reporting to assure consistency during attrition, management practices for capital ROI decisions and headcount allocations, sales with standards for meaningful profit margins, maintenance for continuous allocation of resources, quality for standardization of inspection standards, and many other elements that are necessary for the business. If these instructions rely on IT functions, screen shots should be part of the standard work.

As we assimilate the standards, we then need to look at our value stream maps to assure that the standard times for operations are level loaded through the production cycle. Once we have a level loaded value stream, we then can calculate the resources necessary for the volume increases and decreases. Our value stream should engulf more than a statement of operations and work tasks and should include the min/max of personnel and shift allocations, resources necessary to support those functions, and standards for operational efficiency. Finally, the value stream maps should then include a standard work contingency for each operational failure that can occur. Once those failure points are established, a risk level needs to be assigned to them. We can then prioritize the contingency plan development needs.

Standard work is ever evolving and is the backbone for predicable production and financial success. Implementation of standard work must grow with the evolving culture change to a leaner environment. The culture must understand that standardization does not threaten their job security as they define tasks, but allows them to spend their resources on creativity and strategic development. We must be patient with the evolution of standard work. If the workforce embraces the conceptual, we will actualize the benefits in a shorter time span.

April 4, 2019

Leaning Out a Mix Model Assembly Line

One of the more challenging industries to get lean is the mixed model, made to order, assembly production lines. We all have read the success in high volume production lines with options but what if you are producing several distinctly different products on the same line. It becomes a challenge as each station needs to be level loaded for the processing time so the overall cycle time remains consistent. There are several pieces of ground work that must be accomplished prior to any indoctrination of lean processing. While this may seem like a huge task that will take significant time to complete, the manager must remember the basic elements of success – a vision and a strategic plan that states which product line is approached first. Your vision should state what the perfect production line would resemble and the plan will state the cadence of products and the sub-steps to completion. You must remember that cellular or assembly processing must call for the same processes to be followed each time a product is produced. Repetition makes it easier to control quality and also allows you to track whether improvements have a positive or negative effect.
1. Value stream map each assembly
2. Create sub assembly operations and co-locate them to the line in a balanced process and cycle time
3. Break out and balance the tasks
4. Layout inventory, tools, workbenches so that tasks can be eventually and linearly be produced
5. Create inventory feeder line strategies and kits for common sub-assembly operations
6. Define and set in place Standard WIP
7. Create standard work
8. Determine the proper spacing in the flow. Make every a incorporate a “U” shaped cell (Rabbit Chase)
9. Cross train operators
10. Create standard work for the “load versus operators” necessary to meet Takt time
11. Determine the vortex operations and assure that all operators are trained in these operations
12. Assure that there is contingency planning for excess load and equipment failures

While these are not the only elements that must be addressed they are the basics for your journey’s inception. Do yourself a favor and benchmark other and similar industries. Most manufacturing facilities are eager to share their successes and you will not be re-inventing your entire operation as you can use the “Best in Class” practices. You must remember that this is not easy and you will never be complete in your leaning of the lines. After each iteration, you will discover new avenues for improvement.

October 24, 2016

A True Leader

There are seldom times that you can work for a true leader. Not only was I blessed with working for this man, but I was blessed for over ten years. I sit back and wonder why this leader was so effective and beloved by his workforce. The attributes of this man were outstanding and I have taken the time to reflect on what made him great and listed them below. He was a driver and drove his workforce to levels that the company had never seen and will probably never witness again. He was a compassionate leader who understood what it was like work his way up in a company. He did not forget his roots and his team had an allegiance to him that was unmatched. These are the attributes that made him so great of a leader.
1. Reward success. We are always under budget restraints but he taught me to take the time and money to reward a successful team. The text books will tell you that money is not the greatest motivator but there are times that you must make the financial life easier for your team because of the time away from there family that is required. It is not always money, if could be a dinner, an outing, a picnic, or just a simple reward of no intrinsic value. But you must reward success to be effective.
2. Lead by example. Whether it is ethics or principles, one must always take the high road. As a leader your team will follow your example. A great team always sustains by superior values and ethics
3. Recognize performance. A verbal recognition of a team goes a long way. A “Thank you”, “Good Job”, “Great Effort” means so much to people. Seldom do we work to merely get a check. People go the extra mile because they want to be successful and please others.
4. Mentor people. We all believe that we are good workers but we all know, or should, that we have deficits. We have strengths but there is always room to improve. A great leader takes the time to mentor people to a more successful career. They do not mentor when it is time to reprimand poor performance but they take the time to explain why we haven’t risen to the next level.
5. Drive performance with measurable metrics. People need to know what success looks like. They want to succeed but many times a leader does not spell out what success is. Give our team objectives that they can drive forward towards and be successful. Discreet, measurable, and attainable goals are necessary for a team
6. Be a good human being. Many times there are people that are successful because they drive a team. But will the team work so hard so their leader is proud? Not always. The leaders that have a team that will put their heads down and work themselves to new levels and repeatable sustain are the ones that are led by a good person who cares about each and every one of them. The team will recognize that and will follow that leader through every challenge to assure his/her success.
7. Be honest. You must tell the truth because you need your team to believe in you. You may not be able to say everything to the team at all times and a simple “I can’t discuss that right now” earns more respect than a deceitful answer. Tell the team of the challenges that it has to face and the repercussions of failure. Don’t dodge the hard conversations. We all fall short of expectations in time and a leader understands. A great leader can discuss the shortcomings and will coach the team in how to be successful next time.

There are successful bad leaders who the team has no real respect towards. They cannot sustain and at the end of the day the teams dismisses their leadership skills and seek out new opportunities that are led by a true champion.

September 11, 2016

Where Do You Begin?

You have taken on a new position or decided that a step change needs to be made to improve your business’s efficiency. Where do you begin and how do you make the transfer effective without slowing down the business to an unprofitable margin, alarming customers with late deliveries, or creating a total disarray of the business? We have witnessed many businesses over the years go through a restructuring plan that has severely effected the business in a negative financials and has forced the owners to recoil initiatives. These businesses then pull back to a ’year over year’ small percentage change and never make the step changes necessary to evolve the business thereby capturing new markets. There are steps that can be taken and a strategic plan that can be developed whereby all owners know what is expected and the pace of which improvements will occur. The following points must be considered to be successful on your journey.
1. You need a Vision that states where you want the company to evolve to in one, three, five and ten years. That vision must be accepted by the CEO, COO and the Board of Directors.
2. There must be a yearly strategic plan. This plan must be clear and must state details, expectations and risks.
3. Know your risks and the impacts of them. Divulge them at your strategic plan discussions. Too many plans are overly optimistic and do not inform the owners of the inherent failures that can happen to even the best strategy.
4. Contingency plan every avenue of defined risk. It is acceptable to have different levels of risk in your plan. Categorize them and all high and medium risks must have contingencies constructed ahead of time to ensure that the effects are minimized.
5. Do not change the plan to hit financials quarter points. You can adjust your strategy to accomplish the tasks necessary but you must not chase a metric for a quarter point and change your strategy in a haphazard manner.
6. Assure you understand how changes affect costs, workers and managers. Minimize wastes of people waiting, overproduction, procurement or idle equipment, and excessive stagnation and transportation of product.
7. Process change one piece at time. When you process change in too many areas, you cannot understand the data and the attributes. Therefore, you cannot construe a cause and effect relationship as the changes and their effects are muddled together.
8. Use Kaizen bursts to implement small changes to a larger value stream improvement.
9. Realize that new capital is a financial drag. The more the expense that capital incurs, the more cost structure you must absorb immediately. Think small and less expensive. Anyone can engineer a process with the most elaborate equipment. A good plan is one that uses current resources and equipment with some intermediate investments.
10. Realize that this is not easy. Never become discouraged. A failure or setback is merely an opportunity for improvement. You can accomplish the tasks if you plan out your process improvements. We tend to apply these improvements to the manufacturing world. In reality, the service industry needs the same overhaul and drive for efficiency.

August 7, 2016

Re- invention – the Key to a Company’s Success and a Key to Your Survival

We continually speak of a short term and long term vision. We usually back them up with a strategic plan. Be very careful with your vision. You may have to look at your vision and listen to your customers regarding their wants and needs. Customers will tell you what they are looking for in the future and you may want to give serious consideration to amending or augmenting that vision. We can all remember the industries that did not listen. Do you remember the lines and availability at the video stores of the 1990s? Those companies died because they did not listen. Imagine if those companies changed to on line stores, Netflix would have not owned the industry. Customers have told the American furniture industry that they do not want to spend a fortune on furniture but they want something that has a better longevity. They are not listening but the European and Middle Eastern companies are responding. What will the furniture industry look like in ten years? We cannot say today but we could predict they are on the same predicted path. Lean up your business, reduce costs of production by eliminating waste, change the culture and stay as a world leader.
Leaders need to drop their egos and re-examine their vision. There is not an easy fix. Automation works in some industry facets but not all. Reduced cost of materials can assist you margins but only in areas that do not effect quality or the customer. Don’t work faster, design processes that work smarter. Lead the industry you are in by examining your vision and adapting. Your competition may have a hard time challenging an ever evolving target. Listen to your customers, embrace your employee’s ideas, and own the industry.

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