Category: Frank Rzeznikiewicz (page 2 of 2)

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.

As productivity rankings are released, the United State’s manufacturing sector appears to be gaining momentum

Globally, the U.S. continues to gain ground in the manufacturing sector. With the renewed capitalization of the industry, the renewed government interest in growing the sector, and the knowledge of lean manufacturing, the U.S. will continue to grow in this sector. The sector was once battered with old technology and excessive inventories that drove cost numbers to be uncompetitive with competing nations. There is a new generation of manufacturing that emphasizes standard work, quality, increased throughput, and lost cost that will capture the market. It is through the balance of low cost labor and the aforementioned with implementation of automation where is intelligent to automate that will make the U.S. a premier supplier of high technological production.

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.

Sourcing Decisions – Do You Re-Shore, Near Shore, or Remain Outsourced

The decision of re-shoring work to domestic suppliers and internal to your own operations can be a contrived and convoluted strategy. Many corporations have historically arrived at the conclusion that the short term savings from global outsourcing would benefit the company to extremes that were not realized for extended timespans. In addition, the quality from developing nations and low cost initiatives require a larger infrastructure to support in both the quality and logistic factions. The incurred costs for excessive quality checking and support infrastructure can undermine any potential financial savings and often substantially increase overall costs. Attrition is intensifying offshore, leading to inconsistent and unsettled operations. Combined with a rise in global salary demands, improper offshoring has driven overall costs to an uncompetitive state. This does not translate to a total de-globalization of supplies but has created a multifaceted solution for sourcing strategy. Approximately twenty to twenty-five percent of products that were outsourced globally over the last decade are projected to return to the United States in the next five years. Therefore, there is credence in re-shoring but logic must direct the operation.
There are several steps in the decision process. They include financial modeling, footprint optimization, site selection, production planning, supply chain selection, manpower needs (support and direct labor) and most importantly the implementation of lean. The process is one that will take substantial effort but developing your strategy is the most important faction of your justifications. The process needs to start with an efficiency and cost analysis of products procured and produced. You need to construct a model that takes the cost of the product, the cash conversion cycle costs, the cost of cash velocity, the cost of poor quality and its effects on customers and the required inventory costs that are required to offset longer delivery distance and delays. After that comparison is completed, you need to analyze the impacts of delivery delays and poor quality on customer retentions. While a subjective conversation will occur, there can be a valuable cost associated with outsourced product’s impacts on customers that can be quantified. The analysis will lead you to a pareto analysis of high cost and high pain products that are currently outsourced.

The next step is analyzing the top ten to twenty percent of these products and determining if you have internal capabilities or will need to near source the products. Near sourcing may be more profitable if you do not have the capacity and capability to insource them to your facility. After the pareto is completed, your procurement department must then quote sources for external suppliers and the operations management within your company must analyze the internal production costs. This will allow a full comparison of price. There may be decisions that sway internal or near sourcing that have quality performance indicators in them. You may need to review supplier quality performance and customer satisfaction with peer companies. You will find that companies that are involved in the re-shoring of manufacturing are eager to share the data they have collected. Your internal operations may not be the best answer as your quality performance may be lacking in certain areas. Factor your quality into the equation and determine if you are indeed the best option for production. When all your data is collected you will have a list of products to possibly go forward with for insourcing efforts.

The next stage is the estimation of the strengths, weaknesses, opportunities and threats to your plan. This is the risk assessment that accommodates the financial conclusions. Weigh each element and create a numeric score for each category of risk and opportunity. Of course, risk to the customer carries the highest weight and discretion. The cumulative score then can create a cost factor to apply to the financial data. An example of this is a product that is significantly higher cost in the domestic market because of environmental, technical expertise, health and safety risks to employees and regulations, capital re-investment necessity, and supplier developed nuances that you have no knowledge regarding processes. This would carry a higher percentage factor that would be applied to insourced costs.

Finally, create a contingency plan for each part number. Do not assume that the current supplier will provide products expeditiously if you fail in your re-shoring efforts. You must create a sound contingency plan as this effort is not an easy one. You may also want to review your business strategy for a “Made in America” product line and a “Global Product” line. Many initiatives are in place to promote re-shoring efforts and customers may be willing to pay a premium for the “Made in America “line. There is so many intricacies in these decisions that they should be low risk, well analyzed, and be part of an overall vision and plan for your company.

Plan Ahead and Succeed

It is the time to set next year’s goals and expectations. You should not wait until the first of the year arrives and attempt to set the plan and goals for new year. We all have completed our pro forma for next year and estimated our EBITs, but have we created our strategic plans that will yield double digit growth? Estimating the financials for the upcoming year will not suffice and allow success. Below is a short list of initiatives that we should look at for the upcoming year.

1. Set your goals for cost of poor quality. Understand how you are going to measure it. Are you going to include the rework, the loss of productivity due to poor quality, customer returns and investigation costs, and repair costs? Whatever you measure in the upcoming year, assure that you show a reduction and have projects with milestones established to begin in January. Do not set yourself up for the next year by having a bad first quarter and chasing the year’s goals to recover those costs. Make your goal a reflection of projects you will manage and not a wish list. Spell out the plan’s expectations month by month with start dates, cost realization dates, project completion dates, and determine who the leader is for each project. Set your report out dates for the next year and schedule the team’s calendars to assure that teams know when they are going to review projects with the executive team.

2. Create a process improvement team and set expectations. You should know where your efficiency losses are and establish which ones you are going to tackle and the order and timeframe for those projects. Set a reasonable amount of tasks. Many businesses will create a wish list that is too large for the staffing. Scheduling too many tasks for your workforce can only lead to frustration, fractured efforts, and a disengaged workforce. Strategically assign those tasks, determine reasonable expectations, and set a detailed review schedule for the plan’s events on a regular basis. Become involved as a leader because your workforce will prioritize their efforts by the attention and involvement your leadership displays in the upcoming year.

3. Assure that you have an active environmental health and safety plan to improve the safety and ergonomics of your operation. Remember, people want to be treated fairly and they will engage more if you are concerned for their well-being. Strive to improve the ergonomics in the workplace. Recordable and lost time injuries are bad for a business’s reputation and finances, but they also can disengage a workforce quickly. Care about your employees and make it a passion to evolve the workplace to a safer environment. Embrace their concerns as you would your family members. They are your livelihood. If you do not have a methodology to collect the employee’s risks, hold a “stand-down” for four hours to collect ideas from employees. Take those ideas, Pareto them by risk to employees and aggressively burn them down. Assure the plan attacks these on a monthly basis. Form subcommittees to address these ideas. Everyone in the organization can take ownership of a task as safety is everyone’s job.

4. Train your employees early and on a repetitive regular schedule. You should have already met with your employees and determined their training needs. Now you must schedule a plan to deliver on those internal and external needs. Do not leave this as a human resource task. It is a leadership responsibility that our reports are enriching themselves each year. You may want to look at your most unproductive weeks in the previous years and declare them training weeks. This allows you to write off the week from deliveries and profit based on poor historical performance. Typically, the first week of the year, the week of July 4th and Labor Day week are poor performers as the previous quarter has just ended and people include additional vacation days to long weekends. Put training into this week and declare the week as a non-production week. Planning this activity allows customer commits to be maintained by overproduction in prior weeks and planned delivery commits pushed out of these weeks where possible.
5. Create production start plans that are visual and observable to all employees. Plan on Gemba walks daily and review these start plans. These plans are critical to success. If you start on time, you will finish on time. Don’t leave the plan’s execution to the planners and materials department to manage. All directly involved employees must understand the plan, discuss it daily at Gemba walks, and assure that procurement, operations, quality, and the materials department understands when the production starts for every job. This is critical for mixed model production. This plan is should not be in a notebook but must be displayed on some visual system that all employees can monitor. The more visuals you have in your company, the more self-managed it becomes.

Remember that strategic planning will assure 2016 will be better than 2015. Don’t wait until the year begins to invoke the plan as you will have an overly burden the last two quarters of the year. If you have not already shared your vision and plan with the entire organization, do it early in the year

The Revitalization of Manufacturing in America

The secret to revitalizing manufacturing in America is not a single approach nor is it simple. Globalization of manufacturing and the politics of the 1990’s convinced America we were going to become a service industry. That is only generating lower technical positions at lower wages. We currently speak of bringing back manufacturing into America but we need to realize the status of manufacturing and how to get it back.

The largest obstacle is recapitalization. When manufacturing went global, American companies sold off their capital. We have empty warehouses where companies were in the 1980’s. First, we need to figure out a way to re-capitalize factories. Equipment is not inexpensive and the only offsets that can encourage American manufacturing is profitability or a cost advantage. While we expect business to have intrinsic values, stockholders expect large returns on investments which limits spending. Any capital that you cannot recover in three to five years will quickly be eliminated

Secondly, our technical schools are staffed with people that manufactured products twenty years ago. In the last decade, technology in manufacturing has changed dramatically and what they are teaching is irrelevant to today’s industries. We need to upgrade technical educators. Our tech schools are behind in technology and our educators are out of touch with the newest industrial engineering designs. Our children are taught the simple theories in manufacturing design and we relish the Toyota Way. But the market is changing from waste elimination to increased optimization. Anyone can teach high volume manufacturing techniques but this has become a made to order, customized product world that we live. We need to upgrade our students in the techniques to create profitable low volume mixed model manufacturing. The 1980’s taught us that automation is not the answer to everything. There is a time an situation for that investment but in reality a skilled workforce is more versatile than robots. We created computer programs that have standard work, but we never want to take the time to standardize manual labor. This takes time and cannot be accomplished at a computer and a desk.

Finally, the millennium generation, if given a choice, want desk jobs. They do not want to work in factories as society had trained them to view these occupations as subservient. We need to change our culture. Many manufacturing positions pay better than a college education. It takes less money to educate a skill or trade and everything people learn is pertinent to their trade. We need to observe what society currently endears and respect the trades as much as we do the over educated. This requires a culture change that can be led by politicians and society. We need to embrace those in the trades and create a work place that is significantly similar to the clean environment of an office.

So how do we accomplish these tasks? Here are a few examples.

Create more tax free manufacturing zones

Create tax credits for capital investment

Remove the taxes on exports

Tax the imports based on what those countries tax the US

Add a tax on the imports from countries that show no civic responsibility for the environment

Add a tax on the imports from countries that violate civil rights

Stop regulating the education market and insisting that people obtain advanced education degrees for the trades. They are not necessary and serve no value

States should insist that investment in trades education is given the same funding as academia

Create industrial centers of excellence schooling that honors a voucher system

Start educating our students in the economic advantages of having a trade

Government should recognize and embrace technical excellence with national awards

Create work environments that are worker friendly factories which are clean and ergonomic

Create a government funded board that assists company startups in manufacturing

Re-educate educators and create a qualification testing that equates to a teacher certificate in the trades

Create a tax break for those entering the manufacturing field

Give unused federal lands to the initiation of industrial facilities.

America can revitalize the manufacturing sector but first we need to understand the deficits and real struggles that are involved in its re-establishment. We can accomplish this task, but first we need to create an environment that makes manufacturing in America a financial advantage. IF we want manufacturing to grow , let’s embrace and respect those that are participating in this field.

Lean Practices in the Service Industry

Building a work cell can be confusing and difficult for someone with limited experience. Lets first define a work cell.  It can be a manufacturing cell, a service cell or a retail cell.  Most of what is described in academia is the manufacturing cell.  The rational is that most of academia knows how to invoke the theories of lean manufacturing and the standardization of work.  For the purpose of this article, I will describe some of the well know attributes and theories and how they apply to the service arena.  Lets take an example in the restaurant business.  The work cell can be defined as the person that greets the customer, the taking of an order, and the production of food and the closing of the event.

The hostess commonly looks at a map where table are circled and they determined what is open for seating. They may casually look at server’s load but very little efforts are placed in efficient deployments.  Events that will improve efficiency are the size of the groups seating, the time that the previous party was seated, and finally an estimate on the time term of each seating.  Let me explain the subjective rating in more detail.  If the restaurant is a group of football fans declared by their jerseys, one could assume that in a sports bar or restaurant the term of the seating will be lengthier.  This is opposition to those with a very young child that will probably get restless with too long of a stay.

You can observe how the proper placement of people can result in efficiency. The object of a restaurant process is to turn tables, balance server workload and provide good service.  Assure that a server has a balance of long stay, regular stay and short stay tables.  No one should be sat within the server’s realm within a less than fifteen minute time period.  A server should have a balance of small, medium and large parties. A simple coding of patrons seating with colored markers an erasable sheet will suffice.  The coding does not need to be exact but proper seating will allow maximum seating efficiency.  A simple program can be written for a facility having the logic automated.  This software would ask three questions and place the customers at the tables they will receive the best service.

The taking of the order should be simplified. Most menus are standard and there always can be a preprinted menu list where a server can check off an item and options.  Table orders should always be taken in a specific order, clockwise or counterclockwise, and should always start from a specific point, such as left seat nearest server first.  This allows zero error for interpretation of the order and allows anyone to deliver the food.  In a perfect work every server would have an electronic pad to directly input the order to the kitchen.  However, the cost of implanting this could be more than a facility could afford.

The processing of food should be standardized in some manner so that appetizers do not show up at the same time as the meal or after the meal. In addition, an order should be completed at the same time for a table so that all customers receive product simultaneously.  Order processing can be divided into class of food, processing time, food segmentation etc.  The primary goal is to assure that there is standard work that assures food is delivered for an order at the same time without judgmental interventions. Standard work can be created in some fashion by the preparers of the food and the serving staff.  One of the key initiatives for this effort is the regrouping of the team on a regular timeframe to assure that all staff can contribute to any standard work changes.  Visual systems can be employed to assure that the standard work is consistent and handoffs can occur without continuous verbal communications.

Finally, a series will determine how the food gets delivered to the customer. The delivery should be able to be completed by anyone in the staff as the orders were consistent and systemic to a seating chart.  There are many other details that need to be defined and explained, but the purpose of this paper was to describe how value stream analysis, work cell and flow analysis, and standard work definition can be completed for any industry to improve its efficiency.  Always believe in continuous improvement and hold regular reviews where operators of the cell may give their inputs and receive improved operational methodologies.

About Frank

A seasoned professional manager with proven excellence in aerospace manufacturing. Frank Rzeznikiewicz is a reputable leader in efficiency analysis, lean manufacturing quality system creation and employee engagement. Frank believe that leading an organization forward you need to assure that there are a few concepts that are at the forefront of your business. The first and most important is the safety and well being of your employees. Everyone has the right to return from work in the same condition they arrived. Secondly, you must assure employees that you lead by example with the highest of ethical standards. Employees follow by example and they need to witness an ethical leader and one that demonstrates the highest standards in his/her actions. Finally, you must be true to your word and always communicate with employees honestly. Lead by example and not by words.


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