For operational Sustainability

Dany Beaudoin has written an article on his interpretation of the Global State of Operational Excellence Survey Report - Critical Challenges & Future Trends - 2018/2019.  Click here to download the full Survey Report 2018/19.  

The Most Comprehensive Study of Critical Challenges and Future Trends within Operational Excellence

With nearly 1000 respondents, 37 insightful questions, detailed analysis & insights from 40 industry thought leaders, and the BTOES Insights executive team, this 130 page report is recognised as the most comprehensive study of critical challenges and future trends within Operational Excellence, and is considered a key resource for the industry. Areas covered include:

• The Critical Operational Excellence Challenges faced by executives.

• The Current Scope of Operational Excellence.

• How is Operational Excellence success measured?

• Key Findings & Roadblocks.

• What are executives focusing on over the next 12-18 months?

• What have been the greatest developments?

• What are the key drivers pushing change in Operational Excellence?

• Industry Perspectives.

• Small, Medium & Large Corporation Perspectives.

• Detail Analysis & Insights from BTOES Insights Executive Team.

• Detailed Analysis & Insights from 40 Industry Thought Leaders.

• Analysis of key themes, including Cultural Transformation, Customer Delight, Sustaining an Operational Excellence program, Need for end-to-end Business Transformation, Keeping up with new technologies/impact of digitalization and Leadership Buy-in & Understanding.

 

 

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For operational Sustainability 

The limits of continuous improvement as a driver of change and process optimization are increasingly being observed in industry. The six-sigma, lean and 5S methodologies can all bring benefits, but the sustainability of the actions implemented is a constant challenge. It is not unusual that an action plan resulting from a continuous improvement project is not completed, especially when improvements are observed following the implementation of the first initiatives. Gains are also short-lived because the projects are often not supported by the daily operation. Click here to read the full Survey Report 2018/19. 

 

Many people think that the advent of the Internet of Things and Industry 4.0 will create, with the new technological approach they can provide, a second wind in continuous improvement. However, nothing will be solved if the same tactic is adopted. Indeed, continuous improvement projects are often identified and solved without making any changes in the daily management of the company. This is the main challenge for companies: rather than making only improvements to specific processes, companies have to start a culture change to support the continuous improvement initiatives. Click here to read more Articles on The Global State of Operational Excellence: Critical Challenges & Future Trends - Research Report 2018/19.

 

 

The challenge of cultural change:

Many survey respondents have highlighted the challenge of the needed cultural change for operational excellence realization. Culture is defined amongst other things as "the way of doing things". This should be the starting point for implementing an operational excellence program.

Therefore, the first operational excellence project that must be implemented in a company is the review of the architecture of the organization's management system. This step may seem trivial, but it is rarely done. In standardized operational control programs, when they exist, most management systems are detailed for first-level managers and operators. However, their effectiveness is seldom measured. Too often, management system end results are measured, but there is no evaluation of the effectiveness and performance of the management system itself. Audits are often used for this purpose, but the conclusions are rapidly oriented to the end results rather than the way things are done.

 

For higher level managers, some activities exist, but they are frequently not formal. The lack of a formal management system structure may be partly to blame for the lack in sustaining improvements. Opportunities for management to perform high impact activities are also reduced when there is no formal management system in place. In addition, this is one of the main reasons for which companies have a hard time realizing and sustaining the gains of their continuous improvement initiatives.

 

 

What is a management system?

Often, the management system is confused with the management process. It is very important to distinguish the two. For example, Figure 1 presents a basic process of maintenance management. As illustrated, the process shows the steps for conducting a maintenance activity. Eventually, we could identify in more details each step. For example, we could list the following elements: the substeps, the parts and tools required, the labor required, the duration of the work, etc. This is the mechanics of the organization. This aspect of the business is often well defined, but this is not enough  to ensure the success of the organization.

Figure 1 : Basic maintenance process

 

The management system defines how the organization will ensure that the process is completed in accordance to the original objectives.

These activities are not necessarily part of the process itself, which is why they are not put in the foreground, or even forgotten, when implementing the process. Figure 2 shows a basic management system for the higher maintenance process shown.

 

 

 

Figure 2 : Basic maintenance management system

 

As illustrated, the management system involves all hierarchical levels and each of them have specific activities. Here are a few things that need to be included in a management system in order to generate a culture change:

 

Measurement system: We do not control what we do not measure.

Role and responsibility: As with the process, management roles and responsibilities must be specified.

Management meetings: The meetings must be defined with an agenda, the preparation of each participants and the follow-up measures.

Audits: Audits must validate compliance with the process, but also the expected attitude of the different actors.

Recognition: Employee compensation must include a portion of performance against management system compliance.

 

This list is certainly not exhaustive, but it illustrates the idea sought by the management system.

When well defined and well implemented the management system is very effective in maintaining processes and defining opportunities for improvement. Again, it is important that the system be defined for all hierarchical levels.

 

 

A good management system will identify process performance gaps, short-term fixes and recurring issues.

These can be supported by the organization's continuous improvement program. It will therefore become easy to follow up the projects. Also, improvement activities should lead to activities that are connected to the management system. In the same way, when one wants to make important changes to the corporate culture, it has to be done through the management system. This will be more efficient than expecting to see the culture change by having some incremental change to the process.

 

 

Conclusion:

It is difficult to ensure the success of a continuous improvement program. Projects tend to lose momentum and improvements are difficult to maintain over time. One of the main problems is the lack of a management system to which they can be linked. To be successful at implementing a culture change or simply maintaining the gains of a continuous improvement program, companies must ensure that their management system is in place and regularly revised.