Developing new products and introducing the industrial production processes to support them is highly complex, especially when you’re at the limits of manufacturing technology. Increasing market demand only raises the pressure further, since each and every product manufactured can be sold. Also, demand for new product types was growing very fast. It appeared a toxic combination.
We had already worked with this business unit to solve its manufacturing problems and enable it to become a more reliable supplier, now the management team asked us back in to help them improve their innovation reliability and reduce their time-to-market for new products.
The situation in the innovation-to-market department was complex. There was strong demand for additional product types and the market was shifting from B2B to B2C, which meant a shift in product requirements. On top of that, additional resources were required to address problems in production, and the department was constantly hiring additional new product development resources. Competition was growing, so speed was of the utmost importance, and the improvement targets were extremely high.
APPROACH
Our analysis, which we conducted in close cooperation with the client, revealed three main problem areas:
1. Portfolio management
The innovation portfolio was too big, its content was inconsistent and the priorities were regularly changing. This situation had developed because of poor business and operations planning and, as a consequence, poor technology and product roadmap planning.
2. Resource management
a. The organisation had created a self-inflicted resource bottleneck. The problem was caused by trying to manage too many portfolio projects at the same time and by allocating too many projects to limited resources. The result was plummeting productivity.
b. The constant inflow of new hires was creating a skills issue. There was no time to train them, and knowledge was not readily accessible for the new hires because very little had been documented.
3. Project management of innovation projects
A project management process had been defined for only 2 out of 5 project categories. And because of time pressures, people were cutting corners in projects and tollgate discipline was poor. This behaviour was creating rework and thus project delays. Project quality was suffering, and this in turn was causing production problems and an increase in customer complaints.
We worked with the client to set clear goals to increase innovation output by reducing time-to-market and improving project reliability. The time-to-market target was a reduction from an average of 23 months to just 9 months. We set an aggressive 6-month timetable for achieving these goals and formed joint teams to drive the changes. Because the three main problem areas were very much interdependent and the lead time was short, we ran four workstreams in parallel: (1) single project management, (2) portfolio management, (3) business planning and roadmapping, and (4) knowledge capture and design rules. We selected six pilot projects to introduce the new ways of working and deliver actual results.
We set up a project governance structure, including a review team, a project team and several workstream teams, and established milestone deliverables. We used a combination of “waterfall” and “agile” approaches to get things done.
THE IMPLEMENTATION
Performance improvement programmes must carefully balance human and technical aspects if they are to deliver significant, sustainable results. A critical aspect for sustainability is the development of a deep local ownership of the solutions to the problems. Therefore, we approached the challenge by ensuring the solutions were found by a process of co-creation right from the start.
The developers just didn’t have any time to spare, but speed was essential, so we started by slashing the volume of projects in the portfolio. Next, we set priorities and reduced the number of projects allocated to the developers. This was a tough process as there were many invested interests. However, this reconfirmed the analysis finding that the business had to get its strategic and operational planning right.
During the project we identified five different project categories, ranging from large, complex innovation projects down to factory support (crash actions). For each category, we designed and implemented project process maps, which included the project management methodology with team meetings, tollgate reviews, tollgate criteria, along with tools relevant at each stage in the project.
We designed and implemented a portfolio management process and system with clear roles and responsibilities, set up review teams for various project categories, established criteria to allow / refuse projects into the portfolio and encouraged an attitude of “killing” projects as early as possible to eliminate waste and maintain a manageable portfolio. We also designed a process for allocating resources.
In parallel, we implemented five different business planning and roadmap processes, including a technology roadmap, a product roadmap and an application roadmap. To support the development of knowledge and skills, we established a process to capture and document learnings from all projects, regardless of whether they had been successful, unsuccessful or ditched.
The results were impressive. Time-to-market dropped from 23 weeks to 11 weeks within 6 months, with plans in place to meet the target level of 9 weeks. Equally important, the results were sustainable because the root causes had been identified and eliminated, and the solutions locked into the Performance Management Systems (PMSs) developed during the project. The PMSs also included key performance indicators to give managers and employees ready access to the quantifiable information needed to make fact-based decisions, both as teams and individually, and to take pro-active and predictive action.
Throughout the implementation, a balanced combination of human and technical aspects drove the successes, and solutions were added to the PMS to support sustainability. By creating and communicating the right culture from the very start, we helped the client establish and communicate roles and responsibilities for employees at all levels. As the project progressed, employees began to see the value of their own contributions and to understand how their own performance influenced that of others, both within their discipline and beyond. As this understanding grew, a culture of accountability and collaboration evolved. Clear goals were communicated in a common language that everyone could understand, and employees embraced the new systems, processes and ways of working as their own.
CHALLENGE
Faced with rapidly ever tougher global competition, customer demands and cost pressures, the management team of this manufacturing and technology licensing company needed to increase both the effectiveness and efficiency of its innovation/R&D process in order to secure future market opportunities. The challenge was to increase the success rate of innovation projects and to cut the time from product concept to market introduction by half.
The company had a central R&D department, but there were also people working on innovation in the various plants across Europe. The people in the plants were closest to the customer and were working mainly on applications, whereas those in the central R&D department were doing ‘blue-sky’ development.
APPROACH
We began by working together with the client’s European business team, the R&D hub and a representation of process engineers from the various plants throughout Europe to analyse the “as is” situation. Three main issues were identified:
The customer release process was problematic because samples did not meet customer requirements, and this had created the perception of the company being an unreliable supplier for its customers.
The increased number of additives being used was creating in-house manufacturability issues and additional complexity both in the plants and in the supply chain.
Instability in the innovation/R&D portfolio contributed to an increasing time-to-market.
However, the definition and management of product platforms was strong, as was the skills level
throughout the innovation/R&D organisation. Therefore, there were some solid elements we could build on.
We worked as a joint team with the European business team, the R&D hub and process engineers from the plants to identify the root causes of problems, establish key levers to turn the situation around, and set clear and challenging targets. We set up a project governance structure, including a review team, a project team and various workstream teams, and established milestone deliverables. We used a combination of “waterfall” and “agile” project approaches to get things done. We selected nine pilot projects to introduce the new ways of working and deliver actual results.
THE IMPLEMENTATION
Performance improvement programmes must carefully balance human and technical aspects if they are to deliver significant, sustainable results. A critical aspect for sustainability is the development of a deep local ownership of the solutions to the problems. Therefore, we approached the challenge by ensuring the solutions were developed by a process of co-creation right from the start.
We worked on three workstreams in parallel:
Integrated strategic and operational planning
We started to break down organisational silos by bringing people together from the business team, the R&D hub and the plants in a series of workshops to craft an integrated strategic and operational planning process and to create a management and reporting structure. This meant that when technology and product roadmaps were generated they were better aligned with the market requirements and timelines. This prevented the development of applications and platforms becoming intertwined.
Transparent portfolio management
We achieved greater transparency and alignment through broadening the employees’ skill base and developing the use of existing IT tools. This meant that employees were better able to deal with uncertainty and to understand investment alternatives when “go–no go” decisions were being taken at stage gates along the innovation process. The development of effective behaviours in the project teams and around these tollgates was paramount throughout the implementation.
design rules and complexity
The principle of product platforms/product families was well understood and adhered to; however, new applications were not being managed well. A variety of additives was being used to achieve the same properties, and this was creating more and more complexity both in manufacturing and in the supply chain. In addition, rules such as design for manufacture were not tightly managed. In one case the company’s client was deeply impressed by the time-to-market of the new product they required, and the properties were spot on. However, the problem was that manufacturing the new product caused the production output to drop by 30%.
We ensured that the design rules were more explicitly defined, documented and accessible for everyone. We also introduced clear accountabilities and responsibilities to tighten the process for releasing additives and managing their variety.
The “as is” situation at the start of our joint project provided a good basis to build on. Many of the elements of world-class innovation management were already in place. The performance improvement was due mainly to an improved organisational alignment (and integration), more effective behaviours and, in particular, a more disciplined use of tools and methods.
Of course, there are a range of useful multi-project-management IT tools that can enhance visibility and enable more effective project portfolio management; however, the challenge here is to foster the behavioural change and teamwork that is required to build on the IT capability and not to rely solely on the IT tool to change the way people work.
Innovation, in contrast to health, safety and environmental management, demands risk-taking. DuPont’s Robert A Cooper sums up the requirement neatly: “Don’t manage the risk of failure. Manage the cost of failure.” Achieving this goal does not mean avoiding failure; it means failing clearly and early. To facilitate this behaviour, we developed a clearly defined and staged project management process with tollgates and explicit tollgate criteria. In fact, processes were designed for various project categories. “Go–no go” decisions could now be made based on facts. The development of effective behaviours in the innovation project teams and around these tollgates was paramount throughout the implementation.
CHALLENGE
A container terminal reached the limits of its capacity due to a further increase in the number of units to be processed. The terminal also had to become more attractive for ships to dock by faster loading and unloading for shorter waiting times. Furthermore, container ships are getting bigger, increasing complexity and time pressure at the terminal.
The assignment was to increase efficiency to make more inbound and outbound truck movements possible and to shorten ship waiting times.
APPROACH
Based on data from the ERP system regarding plan and actual over a representative period, the current working method of the terminal was reconstructed in our Planning Platform. The actual operation was visualised and animated, allowing the movements of each individual container to be tracked from position to position. The reconstruction was validated and further fine-tuned in a highly interactive process with the client.
Subsequently, with our Planning Platform, the current operational performance of the terminal was determined based on jointly identified Key Performance Indicators (KPIs), such as the mooring time per barge, the number of crane movements in/out and the number of truck movements in/out. Subsequently, a simulation of an optimised operation was performed using the exact same dataset and boundary conditions. The comparison of the KPIs of the current and optimised operations immediately gave a clear picture of the improvement potential.
In close collaboration with the client, the plan for a number of containers was then optimised step-by-step until the total was finally optimised. After each step, the improvement was measured against the identified KPIs.
CHALLENGE
The company had an history of growth and earning good margins. However, for quite some time growth slowed down, margins were declining, some key customers started to leave and the number of new product introductions had declined.
The Management Team wanted to turn the business around, had sharpened the vision and crafted a new strategy. Axisto was asked to support deployment of the strategy
APPROACH
Together with the Management Team it was decided to use Hoshin Policy Deployment to structure the deployment of the strategy. The process kicked off with a two-day workshop with the company’s Top30.
After sharing and discussing the vision and strategy, the ‘how to deliver it’ was explored in break-out sessions. The two days generated not only a clear sense of direction and alignment, but also a more connected and energised Top30 community.
In a series of follow-on worksessions involving more people objectives and targets were sense-checked. And the deployment was completed down to concrete break-through projects.
CHALLENGE
A supplier of consumables to the aluminium-smelting industry had been struggling with high-cost pressures and its ability to make product at a commercially viable price. It had taken drastic action by slashing costs across the organisation and cutting deep in the CAPEX budget.
Unfortunately, this left the company unable to respond effectively to a significant increase in demand. Operational problems multiplied, delivery performance fell and clients became nervous.
APPROACH
The key to improving production reliability was restoring the equipment reliability. We started with two parallel actions. One action focussed on reassessing the critical equipment and restoring it to a sufficient ‘base condition’.
The second action focussed on implementing an effective ‘short interval control’. This involved fostering a productive cooperation between production and maintenance, developing more effective behaviours in planning & scheduling and work execution, installing a fitting meeting & reporting structure and ensuring an effective break down notification and elimination process.
From the basis that was created by these two parallel actions, we to develop the level of professionalism that was required: In behaviours, methods & tools, communication, quality of the maintenance master plan and craftsmanship.
CHALLENGE
The owner had previously managed the company with a high level of entrepreneurship and energy, but with little attention to processes and organisational issues. On the surface the company appeared successful, but it lacked a solid foundation.
Some of the issues: decreasing on-time delivery (OTD), multiple product quality issues, low customer satisfaction and a declining profit margin.
APPROACH
A new top management team was already addressing the factory layout to optimise flow and enhance housekeeping. Axisto was invited in to improve production control and to develop a more professional middle management team.
We worked closely with the middle managers in Production, Work Preparation and S&OP to better align departments and improve their performance.
A more effective ‘short interval control’ was introduced to drive daily and weekly performance to KPI targets. Management and team leaders focussed more on First Time Right quality, and communication between departments was improved. In addition, some team leaders were assigned to other departments to ensure a better fit.
CHALLENGE
The success rates of Turn Arounds (TAs) within a global oil and chemical company have continued to deteriorate over the years in terms of safety, time and budget overruns.
The last TA in the Netherlands had been difficult and had delivered, among other things, a number of people suffering from burnout.
Axisto was invited to help to turn the tide and to support the TA team to make this TA an international showcase.
APPROACH
Together with all key people we developed a crisp and clear vision on ‘The Best Ever Turn Around’. It was built on their collective knowledge and experience.
In a coordinated process the vision was shared with next levels of the organisation. It was carefully explained and everyone was invited to contribute. This resulted in a vision that was owned by everyone involved, including the contractors.
The vision was combined with a simple but effective performance board as part of the overall visual management approach. Together with some light-touch coaching on-the-job, this resulted in a great teamwork not seen before in previous TAs.
Both production plants are back in operation and the results are impressive. The final evaluation showed additional improvement opportunities in Preparation and dealing with the schedule during execution. Good input for an even better next TA!
CHALLENGE
All current shift supervisors were due to retire within the next 10 years.
Their successors needed to be able to manage their teams in a modern way, focussing on inclusiveness, ownership, good discipline, openness and continuous development.
Furthermore, they had to be able to cope with the ever-increasing digitisation of their workplace.
APPROACH
Our client had come to the conclusion that the current lead operators could not progress to become the “new breed” of shift supervisors. Incidentally, most of them didn’t want that either.
However, working with HR, we developed an approach and a process to begin working with the first group of eight trainees.
The approach is based on the 70-20-10 principle: 70% development through practical assignments, 20% on-the-job coaching and 10% classroom training.
Currently, we are half-way the programme and both the trainees themselves and the site leadership is very enthousiast about the impact
We are look forward to the remainder of the programme. The programme is being codified and documented along the way for a future rollout to the next group of operators.
CHALLENGE
The site had created an appealing vision, and its realisation was seen as crucial for the site’s long-term viability.
However, a year and a half later, little had been achieved and the management team had lost control.
Axisto was hired to help put the realisation of the vision back on track and prevent it from derailing again.
APPROACH
The existing vision and strategic drivers had been relevant and appealing. However, the translation of the vision into strategic goals and targets had been missing. Furthermore, the composition of the Site Management Team (SMT) had changed considerably over the past year.
The first step was to allow a careful onboarding of the new site management team (SMT) members and to strengthen relationships within the SMT. Next, the first step of the Hoshin Policy Deployment process was done, setting level 0 strategy and targets. In a series of consecutive sessions next organisation levels were involved until the shop floor was reached. We followed the ‘catch ball’ process carefully.
Now, threequarters of the year onwards the results are what the SMT was looking for.
CHALLENGE
An automotive OEM had experienced a major shift in demand towards new types of product. Demand for established products declined dramatically.
The company reacted to these changes by shifting production to low cost countries. In the remaining high-cost site productivity improvement for direct labour was consistently being addressed, but little attention was paid to the indirect labour. Thus the situation became out of balance, and Axisto was invited to explore indirect cost-cutting opportunities
APPROACH
There are two basic ways to approach cost cutting: targeted and zero-based. As our client was facing major, and quite disruptive, change, they needed a comprehensive approach. Our Zero-Based Alignment (ZBA) provides the better way to radically redesign the cost structure of a business, and this was the chosen approach.
Together with the client team, we turned their deep understanding of the market into a sharp new vision and aimed high with a cost reduction target of € 10 million. After sufficiently understanding the current activities and cost structure, we designed an ideal state from a blank sheet of paper; fully aligned with the vision. Activities were consolidated, the organisation was delayered and built along the end-to-end process. Even after applying the practical boundaries and business risks, the vast majority of the ideal-state design survived the final approval.
