As a follow-up to the five-part series on metrics I wrote a few months ago, I feel the need to put a cap on it with this article. Plant after plant, year after year, I continue to see metrics being missed, over a period of time, without aggressive counter measures being taken to right the ship. It’s another failure of leadership. The too often missing piece of metrics management is this: failure to hold ourselves and our people accountable.
By this time, I hope you’ve installed the proper metrics, i.e., metrics that tell the truth about factory performance; reports that are as close to real time as possible; and report formats that are actionable on all five critical measurements: safety, quality, delivery, productivity and inventory. If those are not yet in place, return to Go and do not collect $200 dollars.
If these are in place, then it’s time to MAKE THE NUMBERS! It’s time to execute the plan. And that means accountability from top to bottom. Too often there is a breakdown, up and down the organization structure, on holding responsible people accountable. The blame game and finger pointing inevitably start non-productive time waste in meetings and excuses around the staff table. Yes, boss, we’re behind on our productivity targets but…..or because…..or you don’t understand. Enough! What’s wrong with this picture?
I would argue that people who genuinely understand accountability neither give nor accept excuses. My expectations of the plant managers I led over a long career were simply this: “Plant Managers’ are accountable for what happens and fails to happen on their watch 24/7/365.” Of course, this starts with the commitments made by the board, the C-suite and down through the entire structure to the shop floor supervisors and support groups. I’ll focus from the SVP/VP of Operations/Manufacturing to the shop floor.
A few years ago, I was hired to mentor a young plant manager who was perceived to be a high potential leader of the future for this multibillion-dollar company. (They were wrong.) In the staff meeting which I was attending for the first time, his staff began the metrics performance report. The review yielded zero accountability by anyone in the room. For example, the productivity metric was badly missed the first two months of the year. It was mid-March and no data had been shared that would change the course. March was going to be a similarly large miss.
I quickly extrapolated the two-month miss and projected it for the full year. If the current performance continued all year they would miss their plan by over $1 million. I asked what the key issues were and what the path was to recover and still make the plan for the year. I got blank stares around the staff table. The plant manager said, “I don’t believe in projecting two months to 12 months and drawing any conclusions from that.” My response: “OK, then let’s look at your data showing root causes, corrective action plans, your monthly projection of the newly forecasted results. Only then will we have any confidence that the necessary actions are in place to still MAKE THE NUMBERS.” The response: Dead silence and lots of fidgeting.
Accountability means that leaders will instinctively, immediately respond when they see barriers getting in the way of their committed performance. They will be relentless in getting the necessary data analysis, operator inputs, relevant support group inputs/help, to find a path back to the numbers that have been committed to by the entire team. They will go over, under, around or through whatever obstacles are in the way to make things happen. They will keep their boss informed regularly and draw on higher level help if necessary to get back on track. If they ultimately fail, it will be because they just ran out of time, not that they gave up in February or March or any other month.
Leaders who hold themselves accountable are the best leaders. And this applies from the CEO to the first line supervisor. In between these levels, each leader must hold the next level down accountable. For example, the SVP of operations would likely report manufacturing performance with the corporate leadership team on a quarterly basis if all is well. If a plant (or group of plants) is at risk, the SVP might be reporting on those running behind on a monthly basis to track the effectiveness of the recovery plan and to solicit other senior level help if necessary. This will continue until a satisfactory recovery plan is in place and being executed. In my days of 25 to 30 plants, those that were accountable and performing would see me once a year. I’d stop by and say thank you as we did our walk around the plant and take the plant leadership team to dinner—recognition for being accountable and making the numbers. Those that were behind plan would see me once a quarter and their VP of manufacturing was there monthly or more as the situation required.
In addition to reporting and communicating on a regular schedule, we should make sure the daily follow up is in place at the operator/machine/supervisor level. Supervisor should have a very disciplined standard work process to support their need for good data and interactions amongst the team to make the numbers. Too often companies report weekly and the actual report is shared the following Monday or Tuesday. Not helpful. Second worst is to report daily after the fact. In both cases the metrics are historical. There’s nothing we can do to change this history. If we’re going to make today, then we must make it every hour 24 times. If we are to make the week, we have to make it for 24 hours five times. If we are to impact performance improvement, we must do it in real time on the shop floor.
Finally, let’s not forget the soft infrastructure that should be in place at the first of every year to reinforce the accountability throughout the year. These things not only incentivize the performance of leadership, but they create the necessary alignment by all functions to assist as required to MAKE THE NUMBERS. Always remember to put teeth into these corporate processes:
- Personal and business/facility objectives that are directly linked to making the business plan numbers corporately. For example, if you add up all of the productivity budgets in each location, the total should equal the productivity number included in the corporate plan plus whatever the staff functions contribute.
- Clear accountability, top to bottom, for each leader at each level who is the primary owner for each tactical item.
- Holistic thinking by all to assist cross functionally, as necessary, to MAKE THE NUMBERS. Functional silos are not tolerated. Collaboration and teamwork are required.
- Regular and relentless follow up with subordinates to ensure deliverables are on plan or better and that any that are not are on a path to recovery. Don’t forget to ask how you can help if they need resources, help with priority setting or whatever.
- Design monetary incentive programs that reward the best achievers and penalize the worst, including non-participation depending on the size of the miss.
- Always remember that shareholders don’t care what the excuses are and company leaders shouldn’t either. The only thing that matters on this metric is achieving the agreed upon results. Companies that have a track record of doing that, with outstanding processes, will be very successful and their people—all of them—will be properly recognized for their part in making it happen.
“Football is a great deal like life in that it teaches that work, sacrifice, perseverance, competitive drive, selflessness and respect for authority is the price that each and every one of us must pay to achieve any goal that is worthwhile.” -- Vince Lombardi, NFL Hall of Fame coach, Green Bay Packers, 1959-67
Larry Fast is founder and president of Pathways to Manufacturing Excellence and a veteran of 35 years in the wire and cable industry. He is the author of The 12 Principles of Manufacturing Excellence: A Leader's Guide to Achieving and Sustaining Excellence.