Can OEE be Used to Reduce Operating Cost?

OEE or Overall Equipment Effectiveness measures manufacturing performance against perfection. It is regarded as the global benchmark for managing and improving manufacturing efficiency. Any deviation from perfection drives up operating cost. OEE looks at three different losses and multiplies them across to assess total losses. Those losses are:

Availability – This is a measure of downtime (both planned and unplanned)

Throughput – This measures rate loss against the theoretical maximum run rate

Yield – This measures the amount of efficiency lost due to quality issues

Each of these factors has a cost impact. There are measurable financial and other costs associated with having people at work, the lights on, and machines operating. Anytime these things are happening and you aren’t producing at theoretical maximum levels, you are suffering efficiency and financial losses. Most factories are operating at or below 60% OEE but have no idea. Additionally, most factories do not measure productivity, and many who do, use methods that exclude significant losses such as changeover times, start-ups, throughput loss and many others. Again, anytime you have people on the clock and product yet to be made, anything less than the theoretical max output is a loss…for whatever reason – controllable or uncontrollable. At the end of the day, all aspects of running your business are controllable; the only real question is: are you willing to do what it takes to “fix” something that is perceived as “uncontrollable”. I’ve worked with manufacturers who, for years, wrote off “bad raw material” as uncontrollable but have never talked with the supplier about fixing the problem or investigated sourcing with other suppliers. In almost all cases, uncontrollable is synonymous for “we don’t want to deal with it”.

The Logic

For a factory with a direct operating cost of $10M annually and an OEE of 60%, the total efficiency losses are 40%. Therefore 40% of the direct operating costs are also losses, or $4M in this case. At 100% efficiency, the operating cost would be $6M.

World-class execution is 85% OEE, which equates to a direct operating cost of $8.5M in the example above. For the same factory, there is a $2.5M savings opportunity for improving from 60% to 85% OEE. What would you do with an extra $2.5M dollars per year? Expand production? Pay bonuses? Acquire a new business? Buy a small yacht and sail around the world?

Achieving 85% OEE is challenging but attainable for the vast majority of manufacturers. Click the link below to receive a free report on how much savings opportunity you might have based on your direct operating costs and efficiency performance:

My Total Savings Opportunity

If you don’t know your OEE, we can get you up in going on Impruver in less than a month. It will help you track OEE by product, line, shift, team, and even individual. It’s a great tool for highlighting exactly where to focus improvement efforts. For the sake of the tool mentioned in the above link, input 60% as a reference point and see what you get for a savings opportunity if you’re unsure of your current OEE.

 

 

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The 8 Lean Wastes and Their Potentially Disastrous Effects – Inventory

Inventory – any materials or other resources stored or staged until demanded. In this series titled “The 8 Lean Wastes and Their Potentially Disastrous Effects”, we examine case studies for when companies, government organizations, or entire industries have allowed a specific type of waste to escalate to a disastrous effect. In this post, we review the waste of Inventory to understand what causes it, how to see it, and how to eliminate it. Lean.org defines inventory as “materials (and information) present along a value stream between processing steps.”

Jump to:

The 8 Wastes and Their Potentially Disastrous Effects:

Defects | Overproduction | Waiting | Non-utilized Talent & Ideas | Transportation | Inventory | MotionExcessive Processing

Case Study:

In 2007, Toyota issued a massive recall that affected 9 Billion vehicles worldwide. The recall was triggered by several reports of gas pedals “sticking” and causing unintended acceleration. At the time of the incident, dealerships across the US were holding substantial amounts of inventory, which could not be sold until they were all serviced to minimize the risk of further unintended acceleration issues. A study was conducted to estimate the losses associated with all of this inventory that was placed on “hold”, which revealed that dealerships were losing the staggering amount of $2.5 Billion per month in combined income.

Corrective Action:

In response to this issue, Toyota conducted an investigation to identify the root cause of the unintended acceleration and concluded that the configuration between the floor mat and the gas pedal was defective. They also began to experiment with an alternative supply chain model with the Toyota Scion where a base unit would be built to about 70% at the factory, then buyers would be allowed to customize how the vehicle would be finished. Finally, the base unit would be shipped to the buyer’s local dealer to complete the final manufacturing steps; a process known as Late-Stage Customization. This kept inventory low for the Scion at the dealerships and allowed consumers more control over the features and functionality that would be included with their vehicle. Unfortunately, the Scion did not perform well in the market; however, I don’t think the supply chain model was the problem. It simply isn’t a very good looking car.

Interesting Fact:

Even though Toyota distributes vehicles all over the world, the only reports of unintended acceleration came from the United States. Also, there was never a definitive conclusion for a mechanical failure that was causing the problem. However, once the floor mat / gas pedal configuration was changed, no further issues were reported.

For more details on this case study, check out the 24/7 Wall Street article at the following link:

http://247wallst.com/autos/2010/01/29/toyota-dealers-face-2-5-billion-monthly-loss/

This case study exposes one of the many major problems with building and carrying inventory. Building inventory has the same issue issue as batching, which is a form of inventory in itself. When there is a quality defect that needs to be contained, many times the entire batch needs to be recalled and investigated due to limited granularity in traceability.  This requires the manufacturer to cast a wide net instead of being able to pinpoint the specific units that are affected by the defect.

Another major issue with carrying inventory is that it enables poor manufacturing execution and erodes operational discipline. Part of the equation for determining how much inventory you need is how unreliably your factory performs. In other words, being unreliable means you need to maintain higher inventories to meet service expectations. The path of least resistance is to build inventory as opposed to addressing your factory’s reliability issues. A little trick to kicking off a lean implementation is to cut your finished inventory gradually and challenge your teams to maintain service levels with lower inventory stocks. This will require improving factory reliability and becoming more lean in the process. Finally, inventory hurts your factory’s lead time on special order and rush items. This is because orders often need to wait in inventory buffers in between process steps before the next value-added step can be completed.

Impruver also helps you see waste from inventory, which often manifests itself in the form of unreliability. In Impruver, unreliability shows up as downtime, rate, and yield losses. By addressing these issues, you can increase plant reliability and subsequently reduce safety stocks. When inventory is reduced, working capital is freed up to be invested in other more important matters. Impruver also allows you to quickly estimate the savings to be gained in just one click by driving out efficiency losses. This powerful functionality is made available to everyone from the shop-floor up to be used for justifying continuous improvement ideas.

 

Copyright © Calvin L Williams blog at calvinlwilliams.com [2015]. Unauthorized use and/or duplication of this material without express and written permission from this blog’s author and/or owner is strictly prohibited. Excerpts and links may be used, provided that full and clear credit is given to Calvin L Williams with appropriate and specific direction to the original content.

How to Do a Stress Free Lean Implementation

Manuficient - Top Performers

Lean is said to be the “Machine that Changed the World,” which a fantastic book written by Jim Womack, Dan Jones and Daniel Roos. According to Wikipedia, “Lean manufacturing or lean production, often simply “lean“, is a systematic method for the elimination of waste (“Muda“) within a manufacturing system.” We are now learning that Lean has applicability across far more industries than just manufacturing such as healthcare, finance, education, and many others. However, implementing lean has been a major challenge for business leaders across all sectors, including manufacturing. A study released by McKinsey stated that “70% of Continuous Improvement initiatives fail”. This is a striking statistic considering how popular Lean and other Continuous Improvement initiatives are.

If you go into any of those factories where Lean has failed (and even some where it has succeeded), you’ll quickly find that it generally leaves a bad taste in people’s mouths. Be it because some companies have gutted workforces and administrative jobs under the guise of Lean or that people had to give up things that they held sacred in the name of cutting waste…many people harbor a disdain for Lean. How did an initiative designed to improve product and process quality turn into such a reviled and despised creature?

In conducting and studying many examples of Lean implementations I’ve determined that three key ingredients are needed for success. Those ingredients are:

  1. Technical Expertise. Lean isn’t that hard to learn but somebody needs to know what they’re doing in the beginning at least. This could be an inside or outside person or group. Eventually, everyone needs a strong lean competency and it needs to become a requirement for staying with the company or getting promoted
  2. Commitment. Leaders need to visibly show their commitment and make decision consistent with a Lean culture.
  3. Motivation. If the people at the top or bottom don’t want to do it – it won’t happen. A Lean implementation requires substantial changes in behaviors, the slaughter of sacred cows, and debilitating power struggles. It’s not easy for anybody.

In all reality, the last item trumps the previous two. Let’s face it, people will eventually do what they’re motivated to do as long as management gets the heck out of the way. Do you really need an engineering degree to do 5S or make a few changes to reduce waste and inefficiency? The answer is no. So …the easy way to implement Lean is by pairing the implementation with things people are motivated to do such as:

  • Look good in front of their bosses and peers
  • Get recognized for a job well done
  • Compete and win
  • Have input on the way things are done
  • Prove themselves by getting results
  • Be judged fairly
  • Help others
  • Be a valued contributor to the business
  • Remain gainfully employed
  • …the list goes on and on.

So, to implement Lean, you need to motivate people to eliminate waste and be more efficienct; then give them the tools and support to do what they will be super-motivated to do. To do this, follow these steps:

Step 1Implement OEE. This will tell you and everyone else exactly how much efficiency loss you have, what types of losses you have, and where the biggest opportunities for improvement exist, etc. OEE will serve as your scoreboard for how good everybody actually and undoubtably is. It also puts everyone on the same playing field in terms of measuring productivity. [Week 1 – 8 but continue tracking perpetually]

Step 2Start highlighting success stories for people doing things better. Share Personal Records, Record Breaking Weeks for the team, Best-Practices, Top Performers for the Day or Week, and so on. This will create a culture that feels like winning…and send a message that winning means getting better, which means…increasing efficiencies. All of a sudden, getting better is starting to feel “good” and perhaps even “fun and exciting”. [Week 6 – 15 but continue into perpetuity]

Step 3Provide a continuous stream of tools and techniques for getting better. Teach people root cause analysis, value stream mapping, SMED, kaizen events and anything else they are clamoring to know by this point in the process. You should also consider taking engineers, managers, and key personnel to other factories who have a really good Lean program so they can benchmark ideas. These factories love to show off the great work they’ve done to implement what a vast majority of companies struggle with. [Week 10 on]

That’s it. Pretty easy right? Well there are always varying levels of depth and complexity of tools that can be applied but you can cross those bridges when you get to them. It’s important to follow these three steps in sequence and allow time for each step to take hold in the organization. Most companies try to implement lean by doing step 3 and then step 1 or they just start of with a massive cutting of headcount. Implementing OEE is not as easy as this article makes it sound and neither are the other 2 steps. Fortunately there’s a tool that virtually automates the first 2 (and most difficult) steps called the Factory Operating System (fOS) at www.factoryoperatingsystem.com. This is the best tool out there for implementing Lean or any other Continuous Improvement initiative. In this system, calculating and tracking OEE requires less than a minute per production run to input data and it spits out OEE by line, shift, person, team, product, timeframe, or any other way you want to slice it. It also highlights top performers, record breaking weeks, personal records, and other success stories across your operations chain of command. It’s super-powerful and it’s free, which makes it really great!

Implementing Lean can be a great step toward reducing operating costs, increasing capacity, reducing lead time, improving product quality among many other wonderful things. Don’t make the mistakes most companies make by failing to motivate your people before slamming them with tools, jargon, and complex ideas that will just scare them away. Let the motivation come first, then they will be a) creating their own tools and b) asking you for more tools and techniques to get their systems to operate more efficiently. This way you create a demand for Lean instead of pushing it on people and creating a painful experience for everyone that probably won’t even sustain results. A manufacturing efficiency expert such as those at Manuficient can help you to implement Lean in a non-abrasive way that systematically encourages your people to do better everyday.

fOS Lead Capture2PPM Lead Capture2

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Copyright © Calvin L Williams blog at calvinlwilliams.com [2015]. Unauthorized use and/or duplication of this material without express and written permission from this blog’s author and/or owner is strictly prohibited. Excerpts and links may be used, provided that full and clear credit is given to Calvin L Williams with appropriate and specific direction to the original content.

How to Implement OEE in One Day

Manuficient - Excellence Compass

OEE (or Overall Equipment Effectiveness) is the ultimate tool for measuring and eliminating process waste. Wikipedia defines it as “a hierarchy of metrics developed by Seiichi Nakajima[1] in the 1960s to evaluate how effectively a manufacturing operation is utilized.” OEE combined with rigorous process improvement efforts can drive significant cost savings, reduce stress of daily operations, and increase manufacturing capacity. Simply put, you’re not doing Continuous Improvement or Lean if you’re not using OEE. The metric itself is taken by multiplying Availability (%) x Rate Attainment (%) x Yield Attainment (%).

To implement OEE effectively, you need to track each of these indicators on a continuous basis and perform the OEE calculation for a line, shift, factory, or entire manufacturing network on the interval that you see fit. Here are a few steps to implement OEE:

  1. Capture the % Availability. This is the efficiency lost while the line is not in operation (but the labor force is on the clock). Create a spreadsheet that allows line operators to input the time it takes to start up the line (from clock-in to steady state). Also capture other planned downtimes such as changeovers and shutdown times. Finally, capture each unplanned downtime loss as well.
  2. Capture the % Yield Attainment. This is a measure of the efficiency lost due to producing sub-par quality product. This calculation is done simply by taking the total good units produced divided by the total units produced.
  3. Capture % Rate Attainment. This is essentially the efficiency lost while running less than the maximum possible run rate. To capture this this, develop maximum theoretical run rates for each product on each production line. This should be done by an Industrial Engineer or trained professional. If you don’t have one on staff, you can contract someone to do it or use what I call the maximum empirically demonstrated rate, which is the fastest rate the line has demonstrated in it’s history for the given product. From there, track your total throughput and divide by your theoretical max rate to get your % total losses. Then subtract out % Availability and % Yield Losses. The remaining losses are rate losses.

Then multiply the three indicators across and the result is your OEE, which is a measure of perfection. 100% OEE represents zero efficiency losses. Once you have began tracking these metrics on an ongoing basis, you can aggregate this data to calculate your OEE anytime you want. The more frequently you can report this information, the more actionable the metric is for you. You certainly don’t want to wait weeks or months to find out there is a serious problem; but daily reporting is usually sufficient. Reporting by shift is even better.

With all of that said, the best way I’ve seen to implement OEE is a tool called Impruver at www.impruver.com. It’s the best free tool out there and it calculates and reports OEE for you by product, line, shift, and even team or individual team members. You could simply have your operators enter each production run into the system and the tool does the rest. It takes less than a minute to enter a production run. It even sets your theoretical max rates for you based on your best demonstrated rate. Then it updates the standard automatically when a run is entered that exceeds the previously established rate. In other words, you don’t have to set or update production standards – the tool does it all for you. It’s great!

 

OEE is the benchmark for measuring factory performance and can be used across all industries to highlight areas that can be made more efficient. It’s a metric that can be used to drive substantial cost savings along with targeted process improvements.

Copyright © Calvin L Williams blog at calvinlwilliams.com [2015]. Unauthorized use and/or duplication of this material without express and written permission from this blog’s author and/or owner is strictly prohibited. Excerpts and links may be used, provided that full and clear credit is given to Calvin L Williams with appropriate and specific direction to the original content.

The Politics of Performance: The Relationship Between Results & Rhetoric in Business

Manuficient - Chess Piece

There is an interesting mix of performance and politics present in any group of people who share resources and work together. Performance can be viewed as any activity needed to help the organization to achieve its goals. If it’s a basketball team, performance can be viewed as either scoring points or stopping the other team from doing so. I like sports analogies when discussing performance because it’s one of the most objective ways to measure results. In sports, it’s difficult to deny that Michael Jordan scored a ton of points, which greatly contributed to his team winning a lot of games.

In most other businesses, performance can be viewed as activity that contributes to productivity or sales, a safer work environment, better quality product or service, or any other of the organization’s performance goals. Since these things are rarely, if ever, achieved in a vacuum, it’s not so evident who deserves credit for what aspect of success or failure. This is especially true in the absence of high-fidelity data down to the blocking and tackling level, which is often not practical for most businesses – outside of professional sports of course. Usually, everyone involved played a role in either creating success or causing failure. Who’s to say that what one person did was so much more significant that what the next person did to improve performance? Sure, this guy is in here 16 hours per day but who can say that he is productive for even one minute per day? Likewise, this other lady comes late and leaves early every day but who’s to say that her contribution didn’t accounted for 99% of the outstanding results?

In the absence of granular data and a thorough / objective evaluation of people’s actions and the impact thereof, their contributions are typically measured by one thing – other people’s perception of their performance. And perceptions are shaped by…you guessed it – politics.

Politics often have little to do with actual performance. It determines who gets access to resources, promotions, bonuses, fired, blamed, their way in a disagreement, and sometimes even life and death. Politics is about jockeying for power or control over resources; and exists as a result of scarcity. Scarcity can come in many forms such as financial, credit / credibility, titles, authority, privileges, promotions, etc. One of the rules of politics is – what gets repeated becomes reality; if not immediately, then eventually if it’s repeated enough and by enough people. This is why professional politicians develop “talking points” so that the same themes get repeated and ultimately accepted as truth. Unfortunately, politics can enable people with terrible performance to win and people with outstanding performance to lose. When this happens (as it does more often than you would think) the entire organization loses. The reality is that the poorest performers tend to get really good at politics for the sake of their own survival. Superstar performers are rarely good at politics since they believe the world is generally fair and their results will speak for themselves. However, whenever good results are produced, there are always a few over-ambitious and under-performing sharks waiting for the opportunity to take more than their share of the credit. Likewise, whenever teams do fail, these same people have toolbox full of techniques to deflect blame to someone else.

It can be annoying that we have to play the politics game; especially if you’re no good at it. However, it’s one of those things that will either propel your business to success or accelerate it’s failure. As business leaders, we tend to talk about performance as if politics doesn’t exist. But oh it does – and it has everything to do with how the business performs. But what is the right mix of politics and performance?

Internal politics is never value added but may be necessary. The ultimate goal of politics is to influence people’s decisions in one way or another and to shift / sustain power. There is a certain amount of value-added work that must be done in order for the business to achieve it’s objectives. Leadership should always look to minimize the amount of political behavior and maximize the amount of value-added activity. To do this, there must be a fair way to measure progress against equally challenging targets. Then grant power to those making the strongest strides toward achieving those targets. Thus, adverse political behavior should not be rewarded as it only begets more political behavior. However, when actual high-performance is adequately rewarded, it encourages stronger performances across the board.

The following leadership characteristics encourage adverse political behavior:

  • Favoritism
  • Gossip
  • Being aloof; unaware of people’s actual contributions
  • Incompetence; not understanding the value of people’s work
  • Granting unequal access to face-time, coaching, and mentorship
  • Creating or failing to eliminate scarcity of resources or recognition
  • Failing to acknowledge strong contributions or distribute recognition fairly
  • Punishing productive or progressive behaviors (even if they fail)
  • Accepting gossip as fact without sufficient investigation
  • Promoting based on political prowess as opposed to verified performance
  • Failing to recognize people’s (or your own) prejudice when considering a point of view
  • Failing to hold people accountable adverse political behavior

On the other hand, the inverse of these behaviors promote strong performance and help keep adverse political behavior to a minimum.

Political behavior can also be beneficial. The truth is that we are all the same; breathe the same air and bleed the same blood. We can accomplish a lot as individuals but a lot more by working together. The process of determining who will lead the group is done through politics. The better job we do of gathering and assessing people’s quality and quantity of contributions, the better results we get when we assign power to someone. We also need to assess our leaders’ capacity for respect for others and ability to get results through people. Unfortunately, by not having adequate systems in place, it’s difficult to truly size up someone’s contributions; and often use other people’s perceptions to make these pivotal decisions instead. What’s the solution? Be systematic. Continuous Improvement assumes you have a system in place to improve. Without a system (or standard) for assigning power to people, you have nothing to perfect. Once you have something, you can effectively assess each success or failure on its own merit and use that information to engineer a more perfect system over time.

One example of a great system for assessing true performance is the Factory Operating System (fOS). It helps to evaluate the members within the manufacturing operations chain of command based on the same metric. The metric is based on the principle of OEE (Overall Equipment Effectiveness) but improved so that it can measure the performance of people, assets, and entire systems. OEE is regarded as the benchmark for measuring performance against perfection and assessing the gap to World-Class execution, or 85% OEE. The fOS calculates the performance of shop floor operators, managers, and executives alike. It considers the performance of the leader to be an aggregate of their direct reports’ performance, which ties everyone in the chain of command up to the CEO to the execution on the shop floor, which is where value is created for the customer.

 

 

Why Downtime is so Deadly in Manufacturing

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Downtime is the ultimate disruption in productivity. It not only limits how much can be produced in a day, it also drains the energy and morale of your production teams. When you look at downtime, you have to consider the time that the machine spent down – and the loss in rate while approaching shutdown and starting back up. You can calculate your total labor cost per hour and easily add up what it cost your business for every hour of accumulated downtime. These are the more apparent costs of downtime. However, there are more destructive and insidious factors of downtime that are not as apparent. These are more around the subconscious and reactionary measures that are taken as a result of poor machine uptime and reliability.

The ultimate costs of poor reliability are poor customer service and high operating costs. There are several visible indicators of “out of control” downtime and poor reliability: Finished Inventory, Dis-jointed Processes, and Production Capacity Imbalance.

Finished goods inventory build-up

In a perfect world, factories would not carry finished goods inventory. In this case, when a customer places an order, the factory would quickly produce what is needed from start to finish and then ship within the customer’s expected delivery window. This would lead to a significant cost savings in itself in the form of reduced finished goods obsolescence, reduced administrative costs for forecasting, reduced finished goods damage, reduced finished goods management or handling costs, reduced finished goods storage space and many others. The reason that companies build finished goods inventory is because they don’t trust that their production systems can deliver “on-demand”. This is largely due to unpredictable downtime.

Dis-jointed processes and a lack of continuous flow

Manufacturers often try to “shield” a reliable process from an unreliable process by disconnecting process steps. By doing this, the reliable process can continue to produce while the unreliable process struggles to sustain flow. Subsequently, work-in-progress (WIP) inventory begins to build up after the reliable process as it waits for the unreliable one to get its act together. This WIP is essentially what I like to call “cash sitting on the floor.” It’s almost like a savings account that accrues no interest – only depreciation, and sometimes to the point of complete obsolescence. The value of the WIP is money that the business can’t use for more productive purposes, such as equipment upgrades, product marketing, or even employee bonuses. It also reduces the lead time, or the time required for an order to be processed from start to finish. Finally, it increases operating costs caused by additional material handling, staging, and storage. This is primarily caused by unplanned and unexpected downtime.

Un-level process capacities

When one process experiences more downtime, we tend to seek ways to increase the maximum speed, or line rate, through those processes through engineering efforts. This allows us to consume the huge stockpile of WIP that tends to accumulate whenever we can get these unreliable processes to run. When we increase the capacity through a process step, we incur extra labor, technology, and engineering cost; all this instead of fixing the real problem, which is to eliminate the downtime. Often times, we run these processes at unstainable rates trying to get “caught up” and end up doing further damage – resulting in more unreliability.

Why not take the time to understand the areas that are experiencing the most downtime and attack them head on. It may be best to start with the bottleneck process and then spread up and downstream from there. In the end, you want highly reliable and balanced capacities across all processes. At that point, your true lead time becomes predictable. This allows you to re-connect your production processes, establish true continuous flow, and start cutting back on your finished goods inventories.

Copyright © Calvin L Williams blog at calvinlwilliams.com [2015]. Unauthorized use and/or duplication of this material without express and written permission from this blog’s author and/or owner is strictly prohibited. Excerpts and links may be used, provided that full and clear credit is given to Calvin L Williams with appropriate and specific direction to the original content.

Continuous Improvement in HR Part 1 – Training; the Key to Sustainment

Manuficient - Knowledge Key

Training and People Development – The linchpin that holds any Continuous Improvement initiative together. People development is at the heart of factory performance. In fact, survey after survey has shown that a lack of workforce development is one of the greatest impediments to driving a CI culture. You can get a pretty clear picture of an organization’s agility by taking a close look at their training and knowledge management systems. When a company decides to undergo a transformation such as implementing Lean or other form of CI, they are committing to a period of substantial change in the way business is being done. This impacts individuals on all levels in the organization. Many companies believe that implementing CI is as simple as hiring a Lean expert or doing a few improvement events per year. What they don’t realize is that a CI implementation demands that everyone adopt a new set of behaviors – meaning letting go of old habits and picking up some new ones. Sometimes KPI’s, performance reviews, and coaching alone aren’t enough to get people to relinquish deeply entrenched habits. Those old habits are what kill sustainment of any initiative. If you probe deep enough, you’ll find that one of the biggest reasons for resistance to change is that people don’t believe that they, their peers, or their managers have the discipline to change. The role of the training and people development function is to close this gap, especially during a CI implementation.

In many organizations, training is simply having someone sit through a presentation and sign-off that they’ve been trained. Some go as far as to give a test or quiz at the end of the presentation to validate that learning actually did take place. Modern adult learning techniques encourage incorporating activities to engage learners, mainly to keep them from completely tuning out. But a vast majority of training programs stop there. What happens when the employee goes out on the plant floor and gets back to work? What happens when that employee gets stressed or is under pressure to hit production numbers for the day? How much of the material learned in the classroom is retained after 6 months or a year. Training, and even further, workforce development goes far beyond a classroom activity. If an employee is not performing the new / desired behavior on the job as if it is second nature, they have not been trained. Similar to a boxer or basketball player who trains for months on end before the big fight or game. The training includes learning the sport but also conditioning the mind and body to execute the desired behaviors unconsciously. Best in class training programs do provide classroom time but include auditing,continuous coaching, and corrective action until the desired behavior is ingrained. Only when the employee executes the desired behavior on a consistent basis without deviation have they been trained.

The speed at which an organization can truly “train” their human assets, the more agile the organization is. Agility is a measure of how efficiently an organization can change from one state to another. Agility is critical for a transformation at the magnitude of CI implementation. An effective training program needs to incorporate 1) Standards Development, 2) Knowledge Transfer, 3) Validation of Learning, and 4) Change Management. Items 1 – 3 are fairly common but the 4th is actually pretty rare. Change Management is the piece that requires ensuring that employees have incorporated the new behavior after they’ve returned to their work area. In many organizations, the first question people ask when someone makes a mistake is – “have they been trained?” And even though the sign-off sheet confirms that they sat through the class, they were often never really trained. In other words, the desired behaviors were never fully ingrained into their work patterns. As a change agent, you owe it to the workforce to ensure that they are actually trained, which can be verified by sampling work patterns from time to time and verifying that they match the documented standard procedure. This should be a shared responsibility with the immediate supervisor. Even better if you can foster an environment where all employees provide coaching or other corrective action to all other employees whenever deviations occur. This is trademark of how a high performance team truly works. This creates a foundation for true leaders to emerge – being those who can not only help to engineer a more perfect production system, but also lead the way on developing a more agile workforce.

Copyright © Calvin L Williams blog at calvinlwilliams.com [2015]. Unauthorized use and/or duplication of this material without express and written permission from this blog’s author and/or owner is strictly prohibited. Excerpts and links may be used, provided that full and clear credit is given to Calvin L Williams with appropriate and specific direction to the original content.

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