Continuous Improvement -- What Does Enterprise Excellence Look Like?

July 13, 2007
To get an idea of how good your facility is, start by asking: Would you buy products from your own plant?

Many manufacturing executives today don't know what enterprise excellence really means. Their lives are so busy just keeping up with things day-to-day that they don't have the time or opportunity to take a hard look at their business. They don't get outside their own four walls to see what the rest of the world is doing, so they don't know what world-class companies look like. Fortunately, however, there are numerous ways to get some clues as to what enterprise excellence looks like, and they all begin by examining your own facilities.

An introspective look at your business can often be very revealing and can help direct your continuous improvement efforts at things that will really impact the success of your business. Here are some simple questions you should ask:

  • Would you buy products from your own plant? Does your sales force invite customers to visit your plant as one of their best sales tools?
  • Do you track on-time delivery by your customers' requested date? Is it posted for all to see?
  • What percentage of your sales is from products that didn't exist three years ago?
  • Is there a place for everything and everything in its place?
  • Are your employees safe working in your plant? Would you let your kids work there?
  • Can you and your operators tell from visual signals around the plant how well it's performing?
  • Is your production scheduling based on customer demand or ERP-driven sales forecasts (which are either lucky or wrong)?
  • Do your operators know what to do next without waiting for work orders or instructions?
  • Do they waste time looking for materials or are they supplied to point of use, on time?
  • Are suppliers scheduled by purchasing based on ERP or operations with Kanban tools?
  • Can you make every product every day by using small batch sizes and quick change-over so you can respond immediately to customer demand?
  • Do you measure inventory turns for raw, WIP and finished goods? How do your metrics compare to your industry's best-in-class?
  • Have you done a value-stream analysis to determine what portion of your total lead time is value added? Do you track this regularly and post it?
  • Are you involving your direct labor operators in improvement projects and problem solving? Are you training them for this?
  • Are you rightsizing and maintaining your equipment rather than spending capital on equipment that you don't have the volume to fully utilize?
  • Do you keep things simple and have no more than three to five key metrics for people to work on?
  • Is there a visible effort to use common processes, components and tooling whenever possible?
  • Do you have a supplier development program in place to involve them early on in new-product development?
  • Are joint company/supplier teams working to take real cost out of your supply chains?
  • Is your quality system focused on the customer needs or adherence to specifications?
  • Who handles customer quality complaints -- your factory operators or customer service?
  • Do you have a continuous-improvement culture in place with defined goals?

A quick story: In my past life, I bought precision stainless steel stampings from a small, highly profitable operation in rural Kentucky. They asked themselves some of these questions and ended up with a plant that sold itself. Their production floor had banks of high-speed stamping machines with high intensity overhead lighting and a white tile floor that you could eat off of. There were no drip pans under the machines and no oil on the floor. They paid attention to the details and their plant was their best sales tool. We bought from them, not because of price but because they were the best in their industry.

By the way, this was 30 years ago... so the more things change, the more they stay the same.

Ralph Keller is president of the Association for Manufacturing Excellence, an organization dedicated to cultivating understanding, analysis and exchange of productivity methods and their successful application in the pursuit of excellence. He has been an operations practitioner for the past 35 years.

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