Operational excellence is vital to a manufacturer's financial health -- and not only because of cost and quality improvements. Operational excellence creates the space for innovation and creativity to blossom. By tackling operations improvements with a systematic regimen of identifying and solving organizational problems, day-to-day incremental innovation emerges and resources are freed up to pursue breakthrough innovations. In the 1990s, Milliken & Co., a multinational group of textile and chemical companies, envisioned operational excellence, institutionalized within the organization, as the delivery system for improved performance and innovative products and services.
Since the 1980s, Milliken leaders have questioned the conventional wisdom that climbing is the hardest part of any journey, deciding instead that climbing is the most valuable experience of the journey. As a result, Milliken prepared to climb, step by step, and launched 125 separate corporate initiatives focused on people, process and business excellence. The company measured anything that could make it stronger -- safety, customer satisfaction, on-time delivery, quality and product development.
"Reviewing leading or lagging indicators was always done with one part patience and two parts determination," says Vice President Craig Long. "We had the tolerance to explore how to improve and the excitement to do it."
Milliken customized the Toyota Production System to its own culture and operations (the Milliken Performance System) and applied the scientific method to new initiatives, examining and experimenting with ways to improve even the smallest aspects of its business. Where new techniques worked, they were shared; where results lagged, experiments began again -- plan, do, check, adjust (PDCA). Soon, the company saw aggregate positive trends, the first steps on a journey that would result in a host of innovations and improvements.
Milliken, a thriving organization with more than 100 years of manufacturing expertise, now operates with the energy, urgency and clarity of purpose found in start-up companies. Company leaders believe Milliken's blend of disciplined design, purposeful creativity, innovative spirit and experience allows it to win in the face of four brutal truths that often derail organization improvements, preventing innovation and sustainable excellence.
Brutal Truth No. 1:The majority of performance-improvement programs fail.
Successful improvement requires a strong organizational commitment and culture around learning. There is tremendous value in organizations adopting the healthy self-image of a perennial student -- inoculating them against what David Garvin of the Harvard Business School calls the "not-invented-here syndrome."
Although Milliken was a market leader, metrics gathered during the 1980s and early 1990s indicated the need for a daily management system. The company looked for outside expertise -- specifically, to Japan -- to map the way forward, seeking to adopt process controls outlined by W. Edwards Deming. At the time, Japan was a world leader in sustainable business modeling. Milliken was privileged to learn from companies that had been in business 100 years or more, and that had begun to set the pace for industrial excellence. More than 100 management employees made four exploratory trips to visit leaders of Japan' s best companies -- Ricoh, NEC, Nissan, Toshiba, Dynic and others -- to learn and adopt performance systems. Those trips started an organizational journey that would last a decade and cost millions of dollars.
Milliken had built a system, a foundation, for improvement that could be sustained.
Brutal Truth No. 2:Organizations will founder unless they cultivate the trusting environment needed to perform honest self-analysis.
A learning organization both applauds success and learns from failures. For Milliken, learning from mistakes is an integral part of the discovery process. Milliken rejects traditional, pessimistic manufacturing beliefs: e.g., There will always be yield loss; accidents are to be expected; and not every customer can be fully satisfied. Instead, quality leaders adopted zero-based thinking as a countermeasure against these paradigms. In each case, the Milliken objective is zero -- period. To get there, Milliken relies upon a holistic systematic approach -- the Milliken Performance System (MPS). As part of MPS, a 10-step focused improvement (FI) process locks into place actions that prevent recurrences. FI processes help to replicate improvements wherever they are transferable.
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| Laurie Haughey: "Milliken embraced the saying that 'no problem is a problem' and encouraged its workers to expose problems and search for root causes." |
"In 2001 we were working on one type of machine to reduce its minor stops to zero," says Steve Meyer, Milliken's director of client engagement. "This machine was suffering 13 breakdowns a month, so we organized a breakdown elimination team. A log was kept on the model machine to record the reasons for each stop, right down to the zone where the stop occurred." The team realized a 90% reduction on breakdowns when it identified and implemented five countermeasures, added the countermeasures to the process-management process, and developed one-point lessons (highly focused training documents that address a specific learning) to prevent recurrence. "Conducting five-why analysis keeps our eyes open to creatively handling problems like this one," Meyer adds. Five-why analysis broke through the superficial explanations for breakdowns and drove down to root causes.
Long cites the importance of value-stream mapping, which helps companies identify eight forms of manufacturing waste. "Much of our manufacturing involves material going through multiple plants and processes," Long says. "Our first value-stream map involved three plants where we applied seven scheduling points." Milliken applied lean principles and value-stream mapping to improve management of changeovers, level schedules and implement standard work. "We realized a 42% reduction in cycle time and went from seven scheduling points down to two. Applying this company-wide over the past 12 months, our lean pillar work has improved cycle times 48% and working capital has improved more than 20%."
Keeping everyone's eyes open for opportunities to improve is a constant at Milliken. As a reminder, Milliken MPS leaders received Daruma dolls as gifts from their Japanese manufacturing hosts; by custom, the recipient of a Daruma doll draws or paints one eye of the doll when setting a goal, and the other eye only after the goal has been reached. "We learned to sharpen our eyes during our trips to Japan," Long adds. " We've applied this throughout our global operations for several years now, and the results are gratifying."
Milliken embraced the saying that "no problem is a problem" and encouraged its workers to expose problems and search for root causes.
