OpEx Solutions

'There is nothing so useless as doing efficiently
that which should not be done at all'.

—Peter F. Drucker.

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The Second Weakest Link

by J. Bennett Foster, P.E., CAP 

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Many organizations in the U.S. have implemented operational excellence methodologies, but only a few have claimed sustained success beyond a three-year period. American manufacturing organizations tried implementing Lean manufacturing in the 1990s — based on Toyota’s success — but American productivity remained stagnant. A few other operational excellence systems were also initiated around the same time: Theory of Constraints, Six Sigma, … However, Lean became more popular than the others because its simplicity was so attractive.

Lean is focused on waste reduction through small and continuous experimental improvements without emphasizing knowledge of core science, basic statistics, or a holistic view of the enterprise. Six Sigma, on the other hand, focused on waste reduction through variation reduction, making processes more capable (which reduced waste), and  reaching decisions based on data and statistical analysis. Nonetheless, Six Sigma was not as appealing because it required a background in statistics – and entailed laborious (but necessary!) data gathering.

When Edwards Deming was asked, “How exactly do you hope to achieve improved U.S. productivity along with improved quality of our manufactured goods?”, he responded “By using statistical methods to improve quality”.*

Statistical analysis helps to zero in and stabilize a production process and method that meets customer requirements. It also helps to eliminate waste, locate problems, and measure progress.

Experimentation without a good design of experiments and process knowledge (characteristics of Lean), is really only “tweaking”. Tweaking by its very nature:

  • Has a low success rate
  • Induces instability and constant change
  • Can be confounded by even small changes in acceptable product specifications

Statistics and analytics (operations research) complement recognized operational excellence methodologies. While lack of “Standard Work” is the weakest link in operational excellence, the second weakest link is not using the statistical and analytical tools currently available to business. More than fifty  years ago, American organizations largely ignored Deming — until Japan showed the way. Today, they largely ignore analytics and make limited use of statistics.

Key benefits of using statists and analytics include:

  • Doing many of the required experiments on paper or computer rather than on physical systems
  • Developing robust systems that can handle variation and meet commitments —  with minimum cost
  • Aiming toward an optimal (not just better) solution — and reducing the time to get there
  • Recognizing the impact of individual changes on the total process or supply system

While American organizations may have lost fifty years of potential progress when they first ignored Deming, the important question now is how to move forward:

  1. To structure the organization to correctly identify problems and apply the tools and talents to solve those problems
  2. To employ approaches and techniques that go beyond point solutions to look at optimizing the overall business
  3. To deal with the important variability issues that we see in all phases of operations: suppliers,  production, sales, and distribution
  4. To provide the managerial and technical skills to succeed in all of the above

*'Made in Japan' Is No Joke Now, Thanks to Edwards Deming: His New Problem Is 'Made in U.S.A.'; By Clare Crawford-Mason
"People Magazine Online"  Posted on September 8, 1980 at 12:00pm EDT


 

 Execute to Succeed

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“The best plans of mice and men often go awry.”

“To a Mouse” — Robert Burns

Every year organizations go through the process of preparing a strategic plan that, optimistically, will drive the group forward to great success and triumph over competitors. Realistically, many of these plans are never accomplished. Why?

The focus of the December 9th CenTex OpEx Consortium Leader Strategy Session, Strategy Execution Planning for 2017 addressed this very common issue. The 3-hour session brought together leaders from multiple organizations to reflect and share positive practices and contemplate on lessons learned and possible practices that might move the strategic plan towards execution in 2017.

Experience and tactics shared by the group included:

  • A strategic plan that integrates past to future initiatives
  • Timely execution planning aligned with available resources
  • Put into place a governance structure to ensure execution

It is interesting to note that CenTex OpEx Consortium member organizations’ execution seems to be improving year-over-year; however, the one salient obstacle to most plans are significant changes beyond the control of those charged with execution.

Incorporating these provisions into an organization will facilitate a well-executed strategic plan that will lead to success and less upheaval in 2017. 

 

 
 

OpEx Solutions is an organization that helps identify strategic areas for improvement and provides effective high-value, low-cost solutions, training, and project management to drive significant productivity improvement through the use of operational excellence tools and systems in most manufacturing and service industries.


With a variety of offerings to choose from, we're confident of working with your organization to find and define your own way through:

  • Executive Coaching
  • World-class Training
  • Dedicated Workshops
  • Knowledge Network
  • Project Management

If you have any questions or comments, please feel free to contact us.

Find out more About Us, then look at our Stategy to make your possibilities a reality.

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For free email business advice, send your questions, comments or ideas to mnazareth@opexsolutions.org. For issues that are of particular interest to the the community, we may publish (with your permission) your questions along with our answers on this web site.

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OpEx Solutions is a Project Management Institute Registered Education Provider

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OpEx Solutions' PMI Registered Education Provider ID Number is 3510.

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