Getting to the Root of the Problem: How one company used visual scheduling to increase on-time delivery

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Getting to the Root of the Problem: How one company used visual scheduling to increase on-time delivery

by Katherine Hunter on Thursday, December 20, 2012 2:40 PM

The Situation

Survival in a shrinking industry requires being efficient, economical, and responsive to customers. With a product lead-time of two to three days from receipt of order, the client, a leading paper converting company, was struggling to meet their customer deliveries.

The company had already restructured in an attempt to reduce overhead but was once again on the verge of bankruptcy. The firm’s smaller local manufacturing plants had been combined into larger regional plants. In an attempt to reduce overhead, order processing and customer service had been centralized.

The regional operations were under pressure to integrate the remaining staff and equipment from the closed plants, meet customer demand, and reduce inventory. In effect, the sites were being asked to do more with less and get better results.

The Challenge

The company’s west coast operations had done a good job integrating the staff from the site with which they had merged. There was, however, still talk of how things previously had been done better at that closed site. Without an agreement on standard operating procedures, well-intentioned staff members often found themselves working at cross-purposes. The consolidated operation was struggling with shortages in inventory and tooling, lower production, late deliveries, and fire-fighting.

Management at the site had initially thought the source of the problems resided on the shop floor and had identified improvements needed to respond to market changes in the product mix. While changeover and throughput were problems, the attempt to concentrate solely upon the factory floor turned into the manufacturing equivalent of a game of “Whack-A-Mole.” Problems were popping up everywhere and the staff, willing to do whatever it took to get the job done, frantically “whacked down” one problem after another in a never ending cycle. Problems that were “fixed” one day seemed to be un-fixed the next. Despite heroic efforts, morale was falling as late orders kept increasing.

How We Helped

Our investigation revealed two concurrent and linked problems. First, the time it took to change the machine setup for new jobs was excessive and, second, there was an increased volume of changeovers resulting from shortages of material/tooling, “rush” jobs, and improper machine allocations. Additional delays occurred when the skilled labor required was pulled away to address “hotter” problems. This combination created lots activity but not a lot of production.

The first step that Empowered Performance took was to establish a reliable communication network that could effectively track and monitor the production process. The keys to successful communication are:

Building trust within the organization so that the real problems could be voiced without blame, and
Fostering a sense of curiosity about the source of the problem.

By enlisting the whole of the organization in monitoring the process, trends began to emerge. One key trend stood out: the factory was consistently unable to deliver to the production plan because production control was unable to deliver a plan that the factory could execute.

In order to gain clarity, a visual scheduling system was established that allowed open and honest communication between demand, as established through production control, and production in the factory.

Solution

The visual scheduling system created transparency throughout the organization as everyone, from executives to operators, were trained to understand, update, and extrapolate from the data. The knowledge of what was expected for each day, by shift and machine, gave the factory, maintenance, and production control each the opportunity to negotiate the adjustments in scheduling, manpower, and machine availability that was needed to gain agreement, ownership, and accountability on the daily schedule.

Because the schedule was fixed for 48 hours of production, and posted for a minimum of two weeks, inventory shortages and tooling problems lessened almost immediately. Daily firefights due to shortages on the floor became nonexistent. Input from the factory workers was valued and acted upon resulting in a greater sense of ownership and pride in the process. Visual scheduling made problems immediately visible. Because everyone understood how the process worked, problems resulting from deviations to the agreed upon protocol became obvious. Positive peer pressure developed for everyone to deliver on what was agreed to. No longer was accountability owed simply to management; employees became accountable to each other. Stress in the organization decreased, production and job satisfaction increased, and within two months on-time delivery increased from 70% to 99%.

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Katherine Hunter

Katherine has completed three advanced degrees in human behavior including a doctorate in Transformational Psychology. She is passionate about transformation: transformation of business, company culture and individuals. Katherine believes that the success of an organization is directly proportional to the passion of the individuals to make a difference and works with clients to leverage teamwork and collaboration as key components of sustainable performance.