Srinivas Rao K
I meet this team from a big Indian Tyre Manufacturing Company every month. I am helping this team to improve their Leadership Qualities. They are making very good progress. One of the members of this team is a Body Builder!! He is devoting a lot of time to exercising, lifting weights, running and so on. He is an absolutely fit guy!! He is real motivation to everyone around him.
But, I should say that this is an exception than rule among Employees of Indian Manufacturing. Even among youngsters, the percentage of people who are actively taking care of their health is very small. In any group of employees, I have not seen more than 20% who exercise regularly. Most of these people who exercise are just walking. May be 1% or 2% probably go to the Gym.
In any company it is the Mid to Senior Level Employees who take important decisions that affect more people in the Company, and these are the Leaders who give a Direction to the whole Company. I have seen that in most of the Companies this Leadership Team is not very healthy physically!! Again, there are always exceptions. There are some Leaders who are avid Marathon runners! Some Leaders who play sports and go to Gym regularly. But, as I said before this category is Very Very small!
Leaders need to be healthy Physically, Mentally, Emotionally and Spiritually. These are the Four types of Energies that are available to all of us. Many of us may not be aware of the four types of Energies.
What are the ill effects of ‘Unhealthy / Not very healthy Leadership / Employee Team’??
Handling Pressures: Today the Business environment is becoming more volatile than ever. The teams need to be contributing actively. The pressures are increasing continuously. The suicide of VG Siddhartha of Coffee Day is a case in point. I do not know about his Physical health at the time of Suicide. But, from what I read in the News Papers it is very clear that he was under tremendous stress mentally. Continuously working on Mental health could have helped him?
Growth Orientation: A Team that is healthy physically and mentally will be much more Growth oriented than a team that is not very healthy. Many Companies have the problem of their Employees not pushing for improvements. The Employees are quite busy in the routine and do not look at improvements at all. Taking care of Physical and Mental Health will help in enhancing the Capacity of the individual to handle more and look for improvement possibilities.
Execution capability: A Team of unhealthy Employees cannot be very good at Execution. They will keep missing the targets frequently and there will be generally frustration around. As the Targets are being missed, the Company will keep revising the targets downwards. This adds to the generally despondent environment around.
Productivity will suffer:The People Productivity will be an obvious victim. The team will not have much of inclination for working on improving Productivity as they will be feeling that they are already stretched a lot.
There can be many more ill effects of ‘Not very healthy’ Employees.
How to promote Wellness in a Company?
There are many ways in promoting the Wellness of Employees. I am capturing some of them below. I have been fortunate to be part of many such initiatives. Hence these are Initiatives that are working in Companies. Not theory.
You can start various initiatives to promote wellness in your Company:
a. Conduct a Yoga course. Repeat it every year. Encourage more and more employees to participate and learn.
b. Yoga weekly practice. Have a Wellness Centre in your company and encourage your employees to get together to practice Yoga and Meditation periodically.
c. Zumba Practiceweekly
d. Promote Sportsthroughout the year. Encourage employees to take leadership for individual Sports like Cricket, Basketball and so on.
e. Encourage your Employees to participate in Marathons. Encourage a Core group.
f. Encourage your employees to Walk at work every dayas part of their work. Let the office / Factory be designed accordingly. Eg. Let there be a walk involved for getting coffee / food etc.
g. Have an App for Health monitoringand motivate employees to Volunteer to get on to it.
h. Organize for ‘Health Talks’ on various Health related topics by Physicians.
i. Organize for ‘Healthy food habits’Consultation.
j. Promote Employees learning Meditationand practice it regularly.
k. Conduct a Course on ‘Mental health’and encourage employees to join it. Many Yoga institutes conduct this type of Courses.
l. Encourage employees to participate in Social Initiatives. This gives them Spiritual Energy.
m. Give help to Employees who need Counsellingfor problems at work or for problems at Home.
There can be many more initiatives.
It is important to encourage employees to take lead in the above Initiatives voluntarily. Wellness cannot be promoted by the Company unilaterally. It gains energy if you can find a group of Volunteers who will run many of these initiatives.
Company can be supportive to these Groups.
Use of Technology
Technology can be used for promoting the Health concept in a very active manner. One way is to have your own App for your Company. You may collaborate with any of the Health Apps that are already there and customize the app for your Company needs.
You can link the Medical tests of employees that you may be doing annually to the Health Apps and encourage the employees to address the Health issues proactively.
Wide variety of Initiatives
Companies should introduce many initiatives in this area. Employees may have their own priorities in the area of Health. Everyone may not be interested in the same initiative. Some may be interested in Yoga. While some others may be interested in Zumba. Similarly their interests in Sports also may vary. A Company should have a Target of engaging 100% of employees thru one Health initiative or the other.
What can be the Metrics for the Health of Employees?
It is very important to measure your efforts towards the Health of employees. There can be two types Metrics.
a) Process Metrics
b) Result Metrics
You need to measure the Process by which you are trying to promote the Health of Employees.
- Number of Participants in each of the Initiative.
- Regularity of Participation.
- Number of Initiatives introduced vs Initiatives Successful
- Number of activities planned vs executed in each of the Initiatives.
- Number of Volunteers in this area.
Results can be measured in a few different ways.
- Number of Employees in Good health.
- Number of Employees who improved their Health.
- Number of KPIs of employees in which there is improvement
Each company can devise their own way of measurement. But, measurement is important to ensure you know where you are going with the initiative.
Many companies do not have this type of focus on Health. Their reasons would be that they do not have time for this. But, if you are able to encourage a group of employees to take lead, then the Collective effort of the employees can push this focus forward.
Do you have focus on your Employees’ health?
All of us who worked in a few companies in our respective careers and those like me who had the wonderful opportunity to work with many Companies as a Business Coach would have observed that some Companies had a very good Working Culture whereas many Companies did not have such a great working Culture.
We generally say the Culture of the Company is good and may be recollect that this company had the practice of ‘Town hall meeting’ or ‘Annual Sports meet’ and so on.
Let us look at what a Good Work Culture is and how do we develop it in a conscious manner in a company.
I remember a definition of ‘Culture’. ‘Culture is the way we do things around here’.
So, a Work Culture personifies the way you run your Company. To understand this better, let us look at the case of any of the Religions that we practice. Each Religion has its Rituals / Festivals that are celebrated by the Practitioners of the Religion. These Rituals / Festivals survived for Centuries. In the Geographical locations where these Rituals / Festivals are followed rigorously, the Religion flourished. According to the Rituals / Festivals the Culture of that Religion developed. In the Same Religion, there may be different Rituals / Festivals in different Geographical Locations. So, the Culture in the same Religion in different areas may be slightly / vastly different. While the Governing Doctrine is same, the Culture may be different based on the Practices / Rituals / Festivals in that region.
But, the Practices / Rituals / Festivals play a very big role in sustaining a Religion. All the Religions have been sustaining for Centuries!
Now, if you want to develop and maintain a Good working Culture in your Company, you should be able to define your ‘Good Work Culture’. This may depend on the Values that your Company Practices and the way you want to contribute to the Society through your Company’s work.
It is good to start right at the top and be clear about the type of Work Culture that you want to build. But if you are not very clear about this overall objective, then you can look at some universal ‘Good to have’ Objectives.
Some examples are as follows:
01. Performance Focus: Competent Employees / Vendor Partners would definitely be very happy to work in an environment where good Performance is recognized and encouraged.
02. Professional Improvement: Again, the Employees / Vendor Partners would like to have a culture of Company encouraging / giving opportunities to the employees / Good Vendors to Learn continuously.
03. Wellness: Employees would love to work in a Company where their Wellness is given a good importance.
04. Customer Orientation: A Company where good Customer Orientation is there (Both internal and external Customer) would progress well.
05. Contribution to the Society: All Stake holders would be happy if the Company is seen as contributing to the goodness of the Society at large.
06. Process focus: Company may give importance to ‘How’ the Goals are being pursued in the Company and not just the Goals themselves.
This way a Company may have some overall Objectives that are not just monetary objectives but means to achieve the Business Goals of a Company in a consistent manner.
Why should companies pay attention to Culture?
People are the foundation for any Company. All the Stake holders are important. But it is ultimately the Stake holders who are making / breaking the company.
Even if a Company is not building a Working Culture deliberately, a Work Culture gets developed on the basis of how things get done in the company.
A Good / Bad Culture would develop without your active participation. If you want to develop a good culture based on your Company’s values, then it is better for you to participate in that process and try your best to influence it. If you do not control it, it will be left to the Dominant personalities in your Company who would anyway influence the way the work gets done in your Company.
If you are not controlling the Culture in the Company, then the Work Culture can keep changing as the Leaders in the Company change. This is the reason we keep hearing ‘It was an exciting place till 2 years back when ‘xyz’ was in charge’.
How do we build the Working Culture in a Company?
As we discussed earlier, the Company’s Work Culture is sum of its ‘ways of getting things done’.
One needs to introduce some specific Practices in the company that work towards the Objectives that have been set.
Let us discuss with reference to the Six Objectives of Work Culture that we earlier discussed.
a) Performance Culture: Some of the Practices that may be adapted to establish this culture are:
a. Having Measurable KPIs for every employee.
b. Having Transparent link between KPI score and Ratings. This should be visible to all employees.
c. Having clear rules for Promoting Employees.
d. Having practice of giving Objective Feedback by all Supervisors to their teams.
e. Celebrating Performance at the Micro Level. Leaders in the Company can have practice of giving small mementos to encourage Small but significant progress towards Goals.
f. Celebrating Good Ideas towards Work Objectives.
There can be many more innovative ideas.
b) Professional Improvement: You can promote many practices towards this Objective. Some of them are as follows:
a. Having periodic Technical Paper presentations and inviting IIT / International University Professors who are experts on your Company’s Technology area.
b. Sponsoring the higher studies of Employees.
c. Promoting study of your Technology area.
d. Promoting the learning of Formal Technical Problem-Solving methodologies.
e. Promoting Discussion forums on HR, Finance, Supply Chain related topics along with local companies.
f. Improving the Skills of Employees with focused training.
This is definitely not an exhaustive list.
c) Wellness: Promoting Wellness can be done thru a variety of means. Some of them are as follows:
a. Conducting lectures by Doctors / Yoga Experts to address Physical / Mental / Emotional and Spiritual Health.
b. Conducting Health Camps
c. Weekly Wellness camps where Yoga / Zumba etc are practiced.
d. Health monitoring of Employees
e. Recognizing Role models in the area of Physical fitness
What is critical is to do these activities continuously and not as one time activity. Employees adapt these practices at their own speed.
d) Customer orientation: There are several practices that can help you move towards this objective:
a. Taking periodic feedback / Score from Internal Customers.
b. Internal Customers to have a say in the Performance evaluation of Internal Suppliers.
c. Recognizing Best Internal Suppliers by Internal Customers.
d. Publishing Great Customer service stories in the Company.
e. Inviting Senior Executives from other companies to tell Stories about Customer orientation.
Truly this area has enormous potential for innovation in promoting Customer orientation.
e) Contribution to Society: This is an area that you can use to activate the fourth Energy – Spiritual Energy of every Human (After Physical, Mental and Emotional Energies). Very powerful one. Some of the Practices that you can think of are:
a. Encouraging employees to form a group that contributes money, physical effort for Societal Causes of their choice.
b. Channeling the Company’s CSR efforts thru Employee groups.
c. Encouraging Stake holder Groups to participate in Public relief activities.
d. Helping the people in immediate surroundings of the Company.
Stake holders participating in these activities will have enormous satisfaction and they will be able to realize their higher energy.
f) Process Focus: It is very important to let a Process Culture prevail in your Company. Don’t focus on the Results always. Encourage your Stake holders to follow the process and have faith that the results will come. Some practices that can help you are:
a. Have a defined way of pursuing Goals in your Company that prescribes a good Process.
b. Measure the performance of a Stake Holder with Process Measures along with Results Measures. Having only Result Measures will push the Stake holders to somehow achieve results.
c. Promoting a ‘way of working’ in every sphere of the Company like New Product Development, Quality Process, Problem solving etc.
d. Reward People / Functions excelling in Process.
You can do the above and you can do more. Each company should find its’ own mix of Activities / Practices / Rituals / Celebrations that promote the Culture that you want in your Company.
But you SHOULD participate in the building of the Work Culture in your Company. Leaving the Culture building to a few strong personalities in your company that too accidentally is very Dangerous.
Catalyst: Volunteerism can be a Catalyst for Culture Building in a Company. Encouraging Employees to promote the activities that they can personally relate to can be very productive in furthering the Culture. Human beings can generate a lot of Positive energy when they connect to an activity where their heart lies. A Company should encourage this. The Positive energy they generate can be quite contagious!! Eg. Someone who is passionate about Social work should promote the Societal angle in your Company. You would be surprised to see how many of your Employees are interested in Social causes. I know many Youngsters earning just Rs 10,000 per month. But contributing to a Social cause every month!
Build the Work Culture in your Company Actively !!
Every Manufacturing Company always has Cost Reduction Agenda. While they try to improve their Product Design using Frugal Design principles, they always have Cost reduction agenda in the Product too.
The Business situation is becoming tougher and tougher for companies. The Topline and Bottom line Growth cannot be taken for granted! It has to be earned in the hard manner.
Automotive industry is going thru some tough phase. The Industry may get fragmented due to Electric Vehicles coming in. It is no longer left to a few Big companies. Few more Bigger companies like Apple, Google are entering this space. Some smaller / new Players are also entering the fray.
Manufacturing Companies across the world are trying to become more efficient using Industry 4.0 elements. The struggle to become more efficient is continuous for Manufacturing Companies.
Much like Individuals developing capabilities to do more things, Companies also need to develop Capabilities in their Companies. These Capabilities may be built around a few Practices in the Company.
Every Company needs to develop the Capability of ‘Continuous Cost Reduction’ on active basis.
I have seen many companies who get substantial Cost Reduction when they start it off for the first time. But after one /two years, the effort tapers off. They say it is no longer possible! I don’t think the Cost Reduction possibilities will dry up. The ideas to access new Possibilities may dry up.
I would like to highlight some Best Practices that can ensure Continuous Cost Reduction in a Company. Companies need to pick up a few or all of these elements and formulate their own Process. Following are some important elements in this process.
01. Cost Reduction Target: Every Company needs to have a Challenging Target for Cost reduction every Year. This Target may be there at the Company level in terms of Profitability improvement. This would be naturally broken down in to Targets for reduction of various expenses and will flow down to Various Functions in the Company. Some of the Cost Reduction Projects may be led by Cross Functional Teams. It is important to involve ALL functions in Cost Reduction effort. It should not be left to few Functions only.
02. Price Recovery: Companies need to have great focus on recovering the escalation of Expenses from Market. If there is a Raw Material price increase, if there is Power tariff increase, if you have given increments to your team, it is ideal if you can recover from the Market. The Market may comprise of individual Big Customers as well as After Market where you are addressing a bigger Market. Every Company would have its’ own constraints to recover full amount of Cost Escalation from the Market. The Competition and Customer Power will not simply allow this to happen. But still every Company needs to have a good mechanism to capture the Cost escalation and throw up information to Sales & Marketing to recover the higher Cost from the Market. Many a times a Good Software support is needed for highlighting the escalation of Costs and how much of it is being recovered from Market. This information has to be available. After this the Company will take a call as to how much it can recover from Customers and how much it cannot. I have seen many companies who simply do not know how much the Costs have gone up and how much is recovered. Resultantly they do not have control on their Profitability.
03. Cost Reduction as a KPI: Every Senior person in the Company needs to have Cost Reduction as a KPI and he has to deploy the Measures to achieve the Cost reduction to his teams. This KPI should have a reasonable weightage so that everyone takes it seriously.
04. Cost Reduction Projects: Every HOD should identify Projects to an extent of 150% of the Target that he is given. Companies may have a Guide line that at any point of time each HOD should have Projects for next 6-8 months. The Projects should have detailed Plans. This is essential to ensure the Projects are practical. Companies create some simple formats to have these details and have a sign off from all Stake holders that it is doable.
05. Brainstorming sessions: Every Company needs to have a structure for Brain Storming sessions to identify Cost Reduction Projects. Many of the Subjects may require a Cross Functional Participation. So, each HOD should work out a schedule for Brainstorming Sessions. Each Brain Storming session should have:
a. A Target for Value of Cost Reduction Projects that need to be identified in the session.
b. Advance information to Participants to come prepared.
c. Analysis of data to be sent to the Participants that will help them to understand the Cost Structure of the Product / Part.
d. Involve Supplier Partners as appropriate.
06. Involving SMEs: Every Company needs to have a hierarchy of Cost Reduction methods. While the Buyers would be pushing for Volume discounts, there should be some effort in challenging bigger things in the Company. May be Design of the Product may be redone to cut the costs by 1/3rdor the Dealer Model may be challenged in some areas to sell directly to the Customers. Every Company should have their own share of these Big Bang ideas and they may decide to involve some Subject Matter Experts (SMEs) from outside. These Brain storming sessions may be conducted with some notice and may carry on for a few sessions. Involving outside agencies like IITs / Technical Universities across the world in this effort is a good idea. These efforts will ensure that the Cost reduction effort will continuously happen in a company and it will not dry up after couple of years.
07. Involving Supplier Partners: The Cost Reduction has to be driven along with the Supplier Partners. Companies that want to take the ‘full benefit of a Supplier’s effort’ will not get much cooperation from the Suppliers. The Company needs to behave in a mature manner and look at the Medium-term benefit. Supplier Partners should be supported by the Company by training them, exposing them to new practices in technology and process. Companies who invest in to this will reap the Benefits from this type of philosophy.
08. Training of the Teams: If a company wants to do some serious Cost reduction, then it should identify the Competencies that its’ staff need to have and Train them to develop these competencies. Some examples of Competencies that are required are:
a. Ability to understand the Cost Sheets.
b. Product knowledge
c. Manufacturing Process Knowledge
d. Lean Principles
e. VA / VE
f. Frugal Engineering
It would be good to develop E-Learning material on these topics and keep training the Team members continuously. Training and Re-Training is needed in this area.
09. Involvement of All Employees: There should be processes in the Company to involve all employees in the effort of identifying ideas for Cost reduction. It would be good to develop a Mobil app for this and encourage all employees to keep contributing on a continuous basis. This type of Ideas Database can help a Company to maintain a Continuous flow of ideas and Cost Reduction.
10. Motivational means: Companies need to be liberal in rewarding the Employees for implementing great Projects. The practice that Facebook / WhatsApp etc. follow in this regard is a good example. Facebook rewards anyone who finds a bug in a handsome manner. Due to this incentive, there are always lots of committed hackers who are searching for a bug in Facebook. This is a win /win situation.
11. Spend time every day: All important Functions that are involved in Cost reduction should set up a War room for Cost reduction and ask the Teams to meet EVERY DAY for 45 minutes to push the Cost reduction Projects. Teams have to meet every day to ensure focus on the Cost reduction. This is a very important practice, if you want Cost Reduction to gain focus in your Company. The War room should have all the Parts, facilities to strip down the parts / products.
12. Bench marking: It would be good to encourage a practice of Bench marking the Products / Parts / Processes across the world. Every company can learn from others if the companies are open to let others in. It can’t happen with competitors. But, you can learn from Customers and Suppliers. Many companies get the Parts / Products and conduct a Strip Down Analysis to gain more insights.
13. Continuous activity: Cost reduction has to be looked at as a perennial activity in a Company. It has to go beyond the Annual Target. There should be Quarterly Target and the activity has to go beyond a Financial year as the Company may want to have Projects ready and identified for next 6 months.
14. Metrics: The Cost Reduction should have Lag and Lead indicators. While Department wise and Companywide target may be the Lag indicators, Practices like Brain Storming sessions, Daily War room meetings, Benchmarking, Strip down analysis etc. can be the Lead Indicators. It is very important to monitor the health of the Process of the Cost reduction.
15. Cost Council: It is good to formulate a Cost Council in the Company with senior people in it. This Council should set Bench marks with the Competition and Market for Price, Costs. This Council should formulate ideas for achieving Cost Competitiveness on a continuous basis. This Cost Council should be there at all levels in the Organization with its members conducting reviews at all levels. The CEO or Finance Head can become the leader for this Council.
There can be more ideas.
Individually the above ideas may be in practice in many companies. But what is needed is to put them together and formulate them in to a Competency for the Company. It will become a Competency for the Company if the individual elements are practiced regularly and a good result is coming regularly. Cost Competitiveness is very important for every Company. By putting together your own way of managing the Cost Reduction in your Company and practicing it continuously, you develop it in to a Competency for the Company.
Is Cost Reduction a strong Competency of your Organization?
The Naughty Baby Bear!
I remember a story told by one of my ex-colleagues.
An R&D Engineer was walking in a Forest. The R&D Engineer was carrying a young Bear which was very naughty, and the R&D Engineer was struggling to keep it in his hands as it was scratching him all over the body! The R&D Engineer could not keep it down as it may escape, and his Boss would take him to task. He came across a Colleague who happens to be a Production Engineer in the same company. R&D Engineer called him out and asked him to hold the Bear while he would go to attend to a nature call. The poor Production Engineer could see that the young Bear was very naughty. But he believed his colleague that he would come back and took the naughty Bear in to his hands. The R&D Engineer dashed off never to come back! The Production Engineer was left to struggle with the Naughty Bear!!
My Ex-Colleague was telling me that this is the way New Product hand over happens in Companies!! You can easily understand that this guy was from Manufacturing side!!
Looking at my experience in dealing with about 40 Companies, I think this is fairly accurate description. No one to be blamed. Neither the R&D Engineer who has to deal with many a Naughty Bear nor the Production Engineer who is not equipped to handle untrained young Naughty Bears.
Simply the system is not there to handle these problems.
Handing over of New Products: A Process that is simply non-existent in many Companies!!
Indian Manufacturing Companies are handling several New Products compared to a decade back. There are more Car Models / Two-wheeler Models / Truck models / Capital Machinery models / Hand phone models / New Foods in the market than ever. Customers are having more choice than ever. All this choice made possible by Millions of Engineers across the Country who are working in Factories producing these New Products.
There are some companies that manage the New Products in a very systematic manner. In most of the cases, these belong to the Automotive industry where the New Product development process has matured more than other Industries. But, even in the Automotive industry I have seen companies that have no or minimal process in the area of ‘Handing over the New Products’ to Production.
We notice several scenarios in Companies regarding New Product Handovers.
01. Customer wants it yesterday: There are situations when the Customer would be sitting in the Company to get the New Product developed. The Company has to respond as the Customer has this urgency. Typically following would happen in such a situation:
a. Product may be developed with Adhoc processes everywhere. May be temporary tooling is used. No manufacturing process is defined. Trials are done right in front of the Customer.
b. Customer closes his eyes to several process violations.
c. The Customer team and the Supplier company team together cooks up a lot of documentation.
d. The Customer tests the Product in a great hurry. Only if very big issues are there, the reworks are done.
e. The Production team has to handle high volumes very quickly in this situation.
f. The Supplier Company would take several short cuts, spends much more money than warranted to meet up with Customer demand.
g. No one even talks about the high Rework / Losses in the Value stream.
h. Everyone is simply focused on the Quantity going out.
i. The whole process is highly inefficient. But, the high Volumes may cover up the losses in most of the Cases.
j. No one would seriously address the situation as the Customer is happy he got what he wanted and Supplier is happy a high Volume Product had been introduced.
k. Production team gets used to ‘handling the mess’.
l. Very often the Process is left in this ‘High Loss’ situation till one day when Customer wakes up and starts tightening up the whole process. Usually this happens when the QA Head changes at the Customer end!!
m. The Supplier would start having high losses due to sudden tightening up of Quality standards. He has no defenses as the ‘unwritten acceptance’ of deviations to Quality standards cannot be quoted.
02. Customer wants it but is not sure when: When there is no urgency for the New Product, the Supplier would push the New Product to the Customer. He would have got it developed in the Company at normal pace. But, the handing over to Production does not happen properly as there is no Schedule from Customer. Usually following types of issues are faced in companies:
a. Production refuses to take charge of the Product as the agreed number of Pilot batches are not done.
b. If even this process of doing Pilot Batches is not there in the Company, then the New Product becomes OLD just by passing of time.
c. When the Customer finally gives schedule for the New Product, no one knows the issues with the Product. Sometimes the New Product Development team would have left the company!
d. The Product would hit the Shop floor and all hell breaks loose.
e. The Product would have Quality problems at every stage.
f. The Manufacturing process is not defined properly as enough number of Products were not produced.
g. The intricate details of Process control / CTQ parameters were never identified.
h. Now, the Company starts learning about the New Product afresh!!
i. The Customer would have several Bad Batches before he can get acceptable Quality and acceptable Quantity.
03. The Normal Course(?!): In all normal Product Development Cases, most of the Companies deal with issues regarding the Quality and Quantity. The Root causes may be lying in following areas:
i. Voice of Customer would not have been collected meticulously. This results in multiple iterations of the Development.
ii. Manufacturing Process is not defined clearly. No one from Manufacturing participates in the Product Development.
iii. The Product Development is handled only by a bunch of R&D Engineers.
iv. The Development team would not have got the Manufacturing facilities to produce the number of Products required to establish the process.
v. Suppliers do not show interest in the new products as the volume is low and it would affect their Bulk supplies!
vi. When the volumes pick up, the Suppliers would start giving bad quality products or the Quantity simply does not take off!
This way, the New Product handing over to Production gets in to serious trouble in most of the Companies.
Most of the Indian Companies are developing more New Products than ever. I would suggest a Solution that I saw working in many companies that I have been involved in. There can be several other solutions. But I believe this can be a solution for situations where you are looking at New Product Development in a big way for sustained periods of time.
Organization for New Product Development
Technology / Product Development / Product Productionising: Companies need to have separate organization for continuously developing the Product Technology to the next level, they also need to have a team for Developing the Products with existing technology and then they need to have a team for Productionising the Products.
Having these three teams would help in giving importance to all three major activities. Otherwise one of these would be a victim to the limited resources that a company would have. A company that is having sustained New Product Development pressure should invest in to this Organization structure.
Full time Organization for Productionising: Now looking at the subject that we are currently dealing with, I would recommend a full-time team for Productionising the New Products.
Normally Productionising the New Products is handled by Part time Production / Quality / Procurement team that never have time for the New Products. They are always busy, and they never give as much time as is needed for the New Product development.
It would be good to get people from following functions and put them in to one ‘Productionisation function’:
- Manufacturing Engineering
- After Sales Service
The members from these Functions should be rotated every 2-3 years. This would ensure that these members retain their Functional Point of view and will not become R&D Engineers in disguise!
There should be a Leader for this Function who should be from one of the above Functions and not from R&D.
This team should physically sit along with R&D Team.
The Leader of this team should report to the R&D Head. Hence the Productionising is taken up broadly by the R&D. But with the support of a FULL TIME team.
Administrative control and Functional Control: When you put together a Productionisation organization with all the functions mentioned above, one needs to recognize the importance of Functional Knowledge / Processes in each of the functions mentioned above. The Functional Leaders should keep giving the Functional Leadership to the People in the Productionisation organisation. If the Quality Engineers in the Productionisation organisation are disowned by the Quality Head, then the same problems will be carried forward as they are in the current situation.
The Quality Head has to define the Systems and procedures for a Quality function while receiving new Products. This has to be followed by the team in the Productionisation team and the Mother function should keep conducting audits to check this situation.
Same is the case for all other functional people in the Productionisation team.
The R&D Head should let this Matrix structure work. If he becomes too possessive of the team, then we would not be having a proper solution to our problems!
Manufacturing facilities: Next problem that many companies deal with is, the availability of Manufacturing facilities for Initial Production.
The Production of New Products can never be at the full speed straight away. There will be some amount of Capacity loss. This is reality and we need to face it. Companies have to decide whether exclusive facilities can be given for Initial Production of New Products or it can be done in the regular Production facilities. Both strategies can be made to work with proper Systems. A Company can chose its’ solution depending on its own situation.
But it has to take a decision. Indecisive behavior of Management in this area can put it back by a few years in New Product Development.
Functions of the Productionisation team: This team would handle following types of activities to ensure smooth handing over of the New Products.
- Voice of Customer collection: As full-time team is there from several functions; the VOC collection would be much more effective with everyone’s point of view coming in.
- Participating actively in the Product Development: As the Productionisation team is full time, they would be participating in the Development actively. This would ensure better attention to DFM / DFA (Designed for manufacturing / Assembly).
- Receiving the Product from Proto Team: The Productionisation team should be very careful and use Check lists to see that Product they are receiving from Proto Team is acceptable to them. Each team has to own up what they need to own up. Right questions have to be asked at the right time.
- Material Planning: The Material planning and availability would improve as the Materials person is sitting within this team.
- Production activity: The Initial Production would be much more effective as the Production people are handling it and issues that are coming out are quickly being attended to by the R&D Engineers. As both Teams have same Boss, the interactions become easy.
- Quality Planning: The Quality Plan preparation can be handled by the Manufacturing Engineering team and Quality team in a seamless manner as they are sitting together.
- Hand over: When the required numbers are produced, the Productionisation team will hand over to the Regular Production with whom they can communicate better as they are one team.
Program Manager: In addition to the structure above, a Program Manager role would help in putting focus right from VOC to Delivery to the Customer. Each Program Manager may handle ‘x’ number of Projects.
This type of Organizational Structure level Solution can work very well for Indian Manufacturing Companies. This can ensure that the New Product Development and handing over to the Manufacturing is given its’ due importance. Especially when more New Products are coming in to Production, if this type of Organizational Structure level solution is not put in place, the Company would be inviting a lot of trouble in terms of unstable Production and unprofitable New Products!
How well are you addressing New Product Productionisation in your Organisation?
For any Manufacturing Company, the Problem Solving is an important Business Process. The Company needs to give it a high priority and treat it as such. There needs to be specific Structure to handle this important Business Process.
Very few Companies in Indian Manufacturing treat this as an important process. If they do not give this importance, there would be a big adverse effect on the ability of the Company to progress. They would have serious problems with the Customers. There would be suffering on a daily basis for all concerned. This is a major reason for the tensions and stress in every Company. But still Companies are not able to put their finger on this issue and address it squarely.
Let me try and list down the issues that a Company needs to do to address Problem Solving in a systematic manner.
01. Capture all the Problems in a Company:Most of the Companies have records for the Customer Complaints / Rejections and Supplier Quality. They record this in a systematic manner. But they need to do this for Internal Quality Problems too. Usually there will be a bunch of phenomena that keep repeating in the Internal Process. They should record these Phenomena and count each one of them as another problem to solve. It is best if all the Problems so captured get in to ONE Problem Solving Software.
02. Problem Solvers: Every Company should identify Problem Solvers from across the Functions in the Company. In many Indian Manufacturing Companies, the Quality Function plays a major role in Problem solving followed by the R&D Function and Production Function. But it is required for a Company to involve Engineers from Materials, Process Engineering, Plant Maintenance also to be involved in the Problem Solving. The Company should identify the Engineers and designate them as ‘Problem Solving Ninjas’.
03. Develop the Ninjas: There has to be specific Development Plan for the Problem-Solving Ninjas. I covered their Development in a separate article earlier on 10/2/2019. You need to Grade the Ninjas in to Leaders and Members of the Teams. The Leaders would lead a Problem-Solving effort whereas the Members can become members in the Problem-Solving Team.
04. Decide the Problem-Solving Capacity of the Organization: Decide how many problems can each Leader handle at a time. This would decide the Collective capacity of the Organization to solve Problems. A Company needs to boost this up as needed from time to time.
05. Allot the Problems: The Problems that are captured in the ‘Problem Solving Software’ of the Organization needs to be allotted to the Problem-Solving Ninjas by the Software on the basis of a Logic. This would ensure that ALL the Problems are parked with one group or the Other.
06. Problem Solving Methodology: Each Company needs to adapt a Problem-Solving methodology that it prefers. It can adapt a Standard methodology like 8D or formulate its’ own methodology with Best Practices.
07. War Room: Every Company needs to have a War Room for Problem Solving. This is the Room that will host two types of meetings. One is a Review by Management. Second type is the Team meetings of the Teams. Normally a Schedule is kept for each team and every team would meet as per the schedule.
08. Meet Daily: If you want the Problem solving to improve in your Company, then every Team has to meet EVERY DAY for at least 45 minutes. If the teams do not meet and then you expect the Problems to get solved, it is not a reasonable expectation. The Team should meet every day and then solve the Problems. They need to spend as much time as is needed on the Shop-floor for Problem-Solving. This is a Primary requirement.
09. Measures of Problem Solving: How do you measure the success of Problem Solving in your Company? There can be two types of Measures. Process Measures and Result Measures. Result Measures are very clear. That would include your Customer Rejections / Complaints, Supplier Quality, In-Process Quality etc. The Process Measures would include the following:
a. Daily Meeting schedule adherence.
b. On Time Activity. Number of Activities planned vs done on a daily basis.
c. On Time Problem Solving. When each 8D is supposed to be closed and when it was closed.
d. Quality of Problem Solving. The 8D Check List score calculated by the team and certified by the Coach.
e. Repetitive Problems: If the Quality of Problems is good, the problems will not come back.
10. Problem Solving Coach: It would be very much required to have a Problem-Solving Coach who would help the teams to improve the Measures of Problem Solving.
11. Certifying the Problem Solvers: It would be useful to Certify the Problem solvers on the basis of their Knowledge, Skill and Results. The Certification should also lead to Rewards for the Problem Solvers. This would take care of Motivation of the Problem Solvers.
12. Approving Solutions: Company should authorize a few Senior people who would Certify the Solutions being implemented. This would ensure that the Collective wisdom of the Company is at work in Problem-Solving.
13. Use Technology to train the Ninjas: The Experience of the Senior People in the Company should be translated in to ‘Standard Check Lists’ for all known and repetitive problems. Using these Check lists E-Learning programs can be developed to train the Ninjas. For every known Problem, the Program would teach the standard steps that need to be taken to move towards the Solution. This would reduce the time taken to solve the Problem. This is a good way of using the Collective Experience that is available in the Company.
14. Managing the Knowledge Base: The Problem Solving in a Company can create enormous amount of Knowledge on Products of the Company and the Process of the Company. This knowledge needs to be captured in a Knowledge Data base and this Data Base can be used for:
a. Learning from Mistakes in Design/Process
b. Going back to the Solution in case the Problem reappears.
15. Problem Solving Conferences: The Company can think of conducting Problem Solving Conferences where the Problem Solvers from across the Company would converge and present the Technical papers about various issues in the Company and Best Problem Solvers may be rewarded. Usually the Company would invite Technical experts to this Conference to help teams to learn something more.
This way, the Manufacturing Companies can look at addressing Problem Solving as a special Discipline that cuts across Functions and look at developing this Competency in the Organization.
How well are you addressing Problem Solving in your Company?
We have been discussing about preparing for the advent of Industry 4.0 and how Indian Manufacturing Companies can prepare for the inevitable. We discussed how various Functions in a company can get ready for Ind 4.0 situation.
In this article, let us discuss about the Leader of the ‘Future Factory’. What are the Capabilities that a Leader of Future Factory needs to display?
A Future Factory will be characterized by the following:
- Definitely a Less Manpower environment.
- Highly Automated set up.
- Much higher Manufacturing Technology.
- Much higher Capacity in each Factory due to the automated set up.
What are the Competencies required for a Leader of this type of Factory?
I would say, he requires the following Six Competencies:
01. Analytical Capability: The Leader of Future Factory will have to be very comfortable with Data. He should be able to make sense of the Data and should be ready to use Data Analytics to make sense of the happenings around him/her and take actions. The typical situations that require him to show this capability can be as follows:
a. The Online Quality System in the Factory is throwing up a lot of Data about the Process status. The Analytics Software is showing a number of Patterns of Data. The Software is continuously learning (AI) and showing new meanings from the old Data. The Data analysis of last Six months just showed a Pattern that can be a Solution to the Biggest Customer Complaint that the company is having. The Quality Team has to be supported in understanding this data as it is the first time a new sense is being made from the old data.
b. The Zero Break down record in the Factory has to be maintained by managing the various Sub-systems in each of the Machines in the Factory. The Data from monitoring the Temperature, Vibration of various parts of the Machine has to be made sense of and Predictive Maintenance has to be improved.
c. The Software that the New Product Development team is using is throwing up lot of Analytics that can be used to Learn from the Development and apply learnings to the future products.
d. The Problem-Solving Software that is helping the Engineers to solve the Problems is capturing lot of interesting Data. This data has to be used to draw lessons for New Products.
e. Finally, SAP is being used more effectively. The Cost Data is getting generated as per each Activity. This data has to be analyzed to identify Wastes and eliminate them.
There can be myriad more ways in which the Data will be generated and will have to be interpreted.
The Factory Leader does not have to do all this job herself. But, She should be able to give Leadership to her Team to adapt this point of view.
02. System Builder: The Leader of the Future Factory has to be a great System Builder. Wherever he sees a Problem, he has to look at a System solution for it. If he Looks at solving the Problem for today, then the whole System can be short circuited by this problem and the Desired result will not be forthcoming.
Eg. In a Highly Automated Factory, the output from Dust Collector is Designed to be collected by a Pneumatic System and taken to a Dust Storage system. Now, when the Pneumatic System Breaks down due to Dust contaminating all the Seals / O rings in the system, the Factory has to look to alternative System that can withstand the Dust. If temporary solutions are looked at or if the Pneumatic system is kept idle and the factory goes back to manual collection of Dust, then very soon the Manpower will creep in and the inefficiencies will go up.
The Leader has to look at building a System around everything. He should be looking at Killing problems once and for all.
Eg. An Automated System is giving a problem handling some specific parts of the Company. While it is suitable to 75% of the parts of the Company, it is giving trouble handling 25% of the parts of the Company. The efficiency of the system is pulled down. Immediate Solution is needed for this problem. The Company set up a team to solve this problem while not reducing the efficiency of the whole System. Along with this, the Leader has to ensure that the Company learns from this experience and the next Factory has to take care of this problem from word go. The Design team also has to learn from this Process incident and ensure the future New Products are Designed to take care of this manufacturing aspect. The Leader has to ensure this at a total system level.
While these Qualities are required even in a less automated environment, the costs of not doing it are very high and can be lethal in an Automated / Ind 4.0 environment.
03. Avid Learner: The Leader of a future Factory has to Learn on her Feet. This can be a great challenge! The Learning is not just for her. She has to ensure the Learning is there at Organization level.
In the Future Factory, there will be a lot of Data just about everything. There will be Data Analytics team in the Factory and they will be throwing up a lot of Data and Interpretations.
The Leader has to encourage the Team to Learn from this Data. Otherwise there is no use of this Data.
Other than this Learning within the Factory, She also has to Learn from the outside world. She has to understand how the Customer is progressing in his Business and keep shaping up the factory to suit the Customer.
Eg. Customer’s Data Analytics may show that Demand for a particular product may be going up 3 months from now. The Factory Leader has to take this information, deal with it and also ensure that the Sales team is continuously picking up these cues from the Customer and help her shape the factory to suit it.
The Learning also has to cover the Ind 4.0 elements. The Factories across the World would be having new learnings from same elements almost on a daily basis. The Leader has to learn from the information available on the Public domain and she has to participate in suitable events like Technical Symposiums to keep learning from the environment.
Paid Factory Tours, Supplier Seminars, Industrial Exhibitions, Industry association events can be some sources for new Learnings.
Every Leader has to organize her own combination of events that will give her chance to pick up learnings from the relevant environment around her.
04. Integrator: This role can be part of ‘System Builder’ Role. But, as it is a very important function of a Future Leader, this is being discussed separately.
A Future Leader should be able to look at a Quality Problem and link it to the Machine, Manufacturing Process, Maintenance Practices, Improvement required in Design of the Product, the improvement required in designing the next Machine and how the factory has to work in future to avoid this Problem.
This is a very critical ability and not easy to master. It is not required that the Leader should be expert across the Board in all Functions. But, he should be able to see the linkages clearly.
The Future Factory would be working as one unit. The differentiation between one Function and the Other will disappear to a large extent. An Engineer would be required to have expertise across Functional areas as they exist today.
A Leader should be able to mold such Engineers!!
05. Team Developer: Factory of Future will be such that it will work as a unit or fail as a unit. Working partially will be difficult due to its connected / automated nature. One system depends on the other. So, if one System is not working it will affect the other.
The Team work and working as a unit are required much more than the non-automated environment.
The information between the various areas of the Factory has to flow seamlessly and the whole team has to deliver the result together.
Eg. The Shop Engineer (Who will handle Production, Quality, Maintenance) at each stage of Manufacturing has to interact with the Engineers at other stages and also interact with the Data Analytics Engineers (Who will be the new breed in every Factory) to make sense of the Factory performance and take actions on a daily basis.
The Leader of the Factory should develop his Team for a smooth daily interaction and ensure they work as a team.
06. Frugal Engineer: In the environment of highly automated factories, the difference between your Company and a Company in USA/Europe can totally be blurred as both the Companies will be having equally automated factories (may be same supplier of equipment too).
What can be the key differentiator for an Indian Company? If the Leader is a Frugal Engineer, he can help the company not to throw Big money at the Machinery. Spend just as much as is needed. Design the Product with just enough meat and don’t give away more than needed (Russian Designs are clearly out of fashion). If your Company can either make do with 75% of the Automation as in USA and give same output or if you are able to take 25% more output from the same Machinery as in USA, then you can have a leverage over other world Manufacturers.
In Future Factories, your competitor is not just the company in NOIDA. You will have to compete with the one in Detroit too.
India is having a very high number of Engineers. Not many Countries can match us in this. The Leader of Future Factory should be able to use the capabilities of these Engineers to differentiate ourselves from the rest of the world in efficiency and money for each Rupee of investment.
These are some of the Capabilities for the Leader of a Future Factory! There can be more. Some or all of the above look like they are needed today too.
01. Many Leaders of Today Factories do not have these Capabilities. India is very big and we have too few Leaders with these Capabilities.
02. There is a subtle difference in the same Capability that is needed for tomorrow. I am sure you will notice in the above discussion.
Are you a Leader for the Future Factory?
While Indian Manufacturing Companies are trying to implement Ind 4.0 solutions, one more area that is begging for attention is ‘Production Planning’. The issues with Production Planning are more in Companies that are Assembly oriented where several Parts are needed to make one Assembly.
Automotive Vehicle Manufacturers manage their Inventories very well (?). But, this is more due to their usage of their ‘Volume Muscle Power’ and not due to Excellent Planning. Most of the Component Manufacturers suffer the consequences. Still, the Inventory Management in Automotive Industry is much better than the other industries like for example Capital equipment industry. But, even in Automotive Parts industry the Production Planning problems are quite severe in many Component manufacturing companies.
The Problems that happen are as follows:
- Production does not happen as per plan.
- Shop floor assembles whatever Product for which material is available!
- The Plan is changed several times.
- The Production Capacity is lost on a daily basis or Inventories of unwanted Products piles up as the Shop floor produces something to keep the Workforce Busy!!
There are several reasons for the Production Losses. Some of them are as follows:
- Material Shortages. This is by far the biggest reason for the Production plan changes.
- Break down of equipment.
- People related losses – Absenteeism / Shortage of People.
Material Shortages: Every Company in the Country is looking to improve their Top line. It does not make sense to say that Suppliers are failing on Deliveries. In most of the cases that I have investigated, the problem lies with the Company and not the suppliers. The Production Schedule is changed so many times that the Suppliers have given up on the Original Production schedule of the Company and they wait for the frantic calls of the Buyers to plan their Production! Once a change is made in the Production schedule, it will have a cascading effect on many Materials and therefore Suppliers.
Breakdown of Equipment: As I discussed in one of my earlier Articles, the basic Preventive Maintenance is not being done in many companies. They have to pull up their efforts in this area.
People related losses: The People Policy of Companies is to blame here. Many companies are simply using the ‘Temporary manpower’ concept beyond its’ due. The way the companies are dealing with the People element is giving rise to absolute lack of commitment on the part of the employee force. This is resulting in high Absenteeism and Attrition.
Forecasting: In these companies there is constant fight between Production and Sales on the issue of Forecasting. Sales say they can’t forecast what the Customer wants and Production and Materials say this is the reason for Production Planning Problems. Usually it ends up in dead lock. Many companies have given up on resolving this issue.
Some of the Consequences of this situation are:
High Inventories: Most of the companies that are having the Production Planning Problems are having high Inventories of Raw Materials, WIP and Finished Goods. While they are having Shortages of some materials, in anticipation of higher Production they get many more materials and pile them up.
Losing top line: These Companies also lose at least 10-15% of their Top line every year due to the mis match of their Production and Demand.
Lift your Game in Production Planning
Companies need to understand that there is no Silver Bullet for such problems. Every Company has to find their own solution. But, they can adapt some Best practices.
Forecasting: To address the issue of ‘not being able to forecast the demand of customer’, companies can form a ‘Production Steering Team’ that will have members from Sales, Materials, Production, Quality and so on. This team should meet every week with some agenda. The agenda will have two broad parts:
a) Reviewing the here and now issues with reference to Supplies from Suppliers and Supplies to Customers.
b) They should also review the Forecasting process, look at the Forecasting accuracy for each Customer and see how to address the problems of forecasting with reference to each Customer.
Many Company teams end up doing only (a) above. Looking at Forecasting as a process and improving its’ accuracy is not addressed objectively. When we become aware of the problem and start addressing the reasons for not being able to know the Demand of the Customer, we will be able to solve majority of the problems. I have seen companies improving significantly on Forecasting accuracy once they approach it systematically.
I know some companies who have graduated to understanding the Demand using some Data models and avoiding Forecasting inaccuracies.
It is also good to consider implementing the Supply Chain Management Concepts. Different people handling Procurement, Production Planning, Production, Sales/Customer Management adds up to the problems. The difference in Demand Planning at several stages in the company result in high Inventories and shortage of Materials for Production.
Combining Procurement, Production Planning, Sales / Customer demand Planning, Dispatches in to one function of Supply Chain Management can help in avoiding the differences in the Demand Planning at various stages.
Supplier Engagement: Companies have to work out their own Supplier Engagement models.
Companies need to engage with Suppliers on a regular basis and not just when there are problems. Suppliers also have to be given a safety net that if they plan their Production on the basis of Schedules from Customer and if really the Demand does not happen, the Customer will take care of the Suppliers. They may compensate the Inventory Carrying costs and so on. Please note that a good relationship with Suppliers will pay off on the long term. Many companies are focusing on the short term and trying to make money at the expense of Suppliers. Obviously this will not work and it is not working. Companies can measure the effectiveness of their Supplier Engagement model with the number of shortages that they are having on the shop floor.
Even after a very good Supplier Engagement, there may still be residual problems with some suppliers. These needs to be addressed systematically by categorizing the suppliers in to Red / Yellow / Green suppliers on the basis of the shortages they are contributing. The Reds have to be dealt with by the Procurement team in a time bound manner.
I have seen that this type of focused approach pays significant dividends to the Companies.
People Related issues: Companies need to work out a People Policy in a practical manner. They should have a hard look at their ‘Cheap Labor Policies’ and see whether it is Worthwhile to have such Policies. Every Company should have a sizeable Permanent Work force and they should learn how to manage the ambitions of the Work force. This is the only Solution. Unfortunately, the practice of avoiding Permanence to the Workmen has become a practice. The People on the Shop floor are treated as Dispensable commodity. No wonder that they are also treating Companies as Dispensable! I think the Companies are losing out on Shop floor efficiency / Quality in a big way due to this.
The Cost of ‘Cheap labor / Voice less labor’ practices is being felt in Quality losses, Productivity losses, Customer market share losses by the Indian Manufacturing Companies.
This is not the right practice and we need to have a good proportion of Shop floor employees as permanent. We also need to have ‘Self-Managed Teams’ concept on the shop floor so that the Permanent workmen can manage the smaller proportion of Temporary Labor.
Other Losses: There may be a few other losses that are affecting the Production on a daily basis. These needs to be attended to head on. Companies should stop dodging these issues and they stop behaving as if there are no problems. One example of such a problem is the ‘Fettling’ issue in Foundries. Every foundry loses a significant part of their Top line due to the Fettling issue and still they don’t solve it for decades together. I am happy to note a small percentage of companies who are trying to bring in Robots in this area and solving a very sticky problem of Foundries.
How to leverage Ind 4.0?
Once these Basic issues are resolved, Companies have opportunities to leverage on Ind 4.0 elements to further improve.
The Consumption pattern across Industries is becoming more transparent. Using this data, Companies can understand the Demand Patterns more clearly and be better prepared for the Upswing / Downswing of the Demand.
Companies today cannot leverage on such tools. This is like collecting and understanding the Quality Data much more before you really apply a tool like ‘Design of Experiments’.
The Planning of various resources within the company can undergo a big change. A Machine shop today has lot of Queuing / Waiting problems on a daily basis. Using a SCADA or a Customized Planning solution, the Machine Planning alignment can be improved much more. The main issue in a Machine shop is not Planning alone. When something changes, how do you Re-plan is the issue. This can be addressed by an AI powered Software that keeps learning from its’ experiences and Planning the Machine loading in a Dynamic manner.
Ind 4.0 has many uses in SCM. Monitoring the performance of your Fleet of trucks, Converting your Traditional Kanban in to E-Kanban and many other opportunities are there.
We need a Breakthrough: I notice that many companies are still in the ‘Denial’ status. Companies need to have a longer period outlook and aim at improving before it is too late.
As part of my work, I meet some very senior Consultants across India. I was there at Delhi, NCR Region recently and was exchanging ideas with some very Senior People in the Industry. Each of these people would have touched about 50-75 Companies each. The status across India with reference to Efficiency / Systems is the same. Probably 5% of the Companies may be doing well to continuously improve. Rest are not in good shape. The companies can be classified in to three categories on the basis of their Intent to Improve:
01. Leading the charge: Companies that are aware of Improvement possibilities and those that are striving to improve continuously. This may be roughly 5% of the Indian Manufacturing Companies.
02. Aware but ‘No will’: Companies that are aware that they are not in good position with reference to efficiency and Systems. They have started feeling the heat due to the Low efficiency. The improvement started in a very slow manner. These Companies keep going forward and sometimes sliding back again. This category may be about 15-20% of the Companies that we see.
03. Blissfully unaware: Rest are blissfully unaware of the improvement that they can make. They keep thinking that nothing more is possible and they are doing just about everything. The Knowledge in the Company gets limited due to this attitude at the top. This consists of about 75% of the Companies in India.
The above numbers may not be accurate. But, I am sure they are in the region of being reasonably accurate.
Let us complete the last week’s article. We will have to cover Four more elements that I have identified last week.
04. Who is owning the Quality?
Current Condition: Most of the Companies still have the Quality function handling Quality Control job and struggling to make it to Quality Assurance.
In every company there would be areas that require immediate controls due to the problems that may be there and areas that are relatively stable and are ready for Quality Assurance approach. Both can co-exist. We only have to ensure that the QA works on Assurance all the time and if a Control approach is needed in some areas, that should be done by the Production team.
Every company undoubtedly have a strain on the Bottom line and they try to control the Costs. The Quality Function also would have its’ targets to cut the people. Most of the time the people who are there in the Function do only the Control function and there is no one to lead the Assurance function. The Quality Function in most of the Companies are structured to do the Assurance function. But, they keep doing only the ‘Control’ function and Other Functions like Production, Engineering, Materials etc are simply not participating in the Quality Function.
Lift the Game: The Companies have to ensure that the Quality is owned by all Functions. A Layered Audit approach has to be adapted. The Quality parameters have to be audited by the Engineers across Production / Quality / Engineering / Materials etc. The Layered audit has to be driven by the QA Function. Following the audit, continuous improvements have to be carried out in every area. This should become a way of life.
Each Function has to own the parameters that can be naturally taken care by them. Machine related parameters should be controlled by the Maintenance Function. The Audit also has to be done by people at ALL levels. Right from Plant Head, Functional Heads every Staff member has to be involved in the Audit.
I have seen that once everyone in the Manufacturing Plant starts participating in the Process audit, they start exuding a lot of Confidence. I have seen Engineers responding to Customer Audits in a confident manner. The Process genuinely improves. If those who are responsible for the Shop efficiency are not familiar with the Process on the shop, how can it Improve?
How to use the Ind 4.0 elements: Once the Quality Control Is being owned by everyone, the Quality Assurance can focus on the Assurance element. The Plant Team would be aware of and Confident of the Quality Process in the Plant.
In the area of Quality Control the Machines can be used more intelligently. Many Assembly lines that are being used by Indian Companies have capabilities that can be used to monitor Quality.
The Ind 4.0 elements can be used for Assurance function too. Eg. For No Fault Forward.
- Using Handhelds and making the Quality Data online as explained in the previous article.
- QA team should learn Big Data Analytics to make sense of the Data that would be generated once the Quality Data is made online.
- Using Analytics the Process has to be understood at a Micro Level.
- As we understand the Process at a Micro Level, we strive to control it at a Micro Level.
05. Response to Customer
Current Condition: Response to Customers is needed at least in two situations. When dealing with a New Product and when servicing him with existing Products.
In most of the Companies the New Product Development is not in a good shape. The Product does not get done in time and when the Product is ready the Quality may not suit the Customer. There would be a number of iterations in the Development and the Companies do not seem to improve on this in a systematic manner. Every company needs a good New Product Development System. Again probably only about 5-10% of the Companies may have this system.
While servicing the customer with the existing Products, Company has to deal with Quality Problems reported and the Customer Audit findings that they have to answer. On both these counts, the Companies have miles to go. The Customer Audits are still approached with a huge effort before the audit or total disregard.
Lift the Game: The Response to Customer can be improved in both these areas.
A New Product Development systemhas to be put in place with clear KPIs. The KPIs have to be reviewed in Design and Management Reviews. The Cross Functional Teamconcept has to be driven hard in this area in the Company. Without Cross Functional approach the Company cannot improve the New Product Development. The Employees involved have to be treated as a team and their skills have to be improved continuously. Basics like usage of Design Check Lists and Recording Learnings from Projects have to be implemented.
The Problem Solvinghas to be improved in the Company as discussed earlier. This can help the Company to improve the Quality Significantly.
How to use the Ind 4.0 elements: Usage of Additive Manufacturingfor Proto Development is something Companies are trying out with some good success.
Companies can create Libraries of their Product Development learnings and use Artificial Intelligence to learn from their experiences and improve their Future productswith their Learnings.
The Knowledge Bank from Problem solvingin a Company can also be input for the Design of the New Products.
Using E-Learning and VR for Trainingthe new Engineers that come in to the New Product Development System is something that is very much feasible for all companies. This can save a lot of time for Senior people who spend a good amount of their time training the New comers and guiding them. E-Learning can help you to save on the Senior People time which is a scarce resource.
06. Machine Condition
Current Condition: The Machine Maintenance was discussed in detail in one of my earlier articles. I do not intend to repeat it in this article. But, let us discuss a bit more about Machines with reference to the Quality of Process / Product.
The Machines used for Manufacturing do have big role in deciding the Quality of the Process and the Product. These Machines will have to be maintained with this fact as the background
The Preventive Maintenance in many companies today is not having much Direct link to the Quality of the Process / Product. This is worried about only by the Quality team or sometimes by the Production team. The Maintenance team is not really focusing on the Quality of the Product unless the Manufacturing is stopped due to bad quality. Improving the Machine condition to improve the Quality is not very widely practiced in Indian Manufacturing.
Lift the Game: The Process Capabilities have to be used to manage and Improve the Process. The Machine condition has to be directly linked to the Process Capability. Maintenance team should play an appropriate role in improving the Process Capability. Improving Process Capability may have elements other than Machine. Here, the discussion is limited only to the Machine.
The Traditional Plant Maintenance team has to participate in the ‘Layered Audit’. They will have Check lists that are centred around Machine condition and its’ linkage to Quality.
Many of the Indian Companies are going for Automated machines and Automated Plants. In such a situation the roles of the Maintenance Engineer ,Quality Engineer and Production Engineer gets clubbed in to one. The Engineer who is managing the Automated Plant needs to worry about all three elements.
How to use the Ind 4.0 elements: Today technology exists for collecting a lot of Data from the machine and Monitoring the performance of the Machine at a micro level.
If a Cutter on a Machine tool is becoming blunt, traditionally the Operator would change the Cutter only when it starts producing rejections OR he will change it when he produces a certain number of components that may work or may not work. Now, I have seen some companies put Vibration Sensors on the Tool holder and then measure the Vibration. When the Vibration increases, then they know the Cutter has to be changed. This helps in preventing Bad Quality.
Using similar technology, it is possible to make Digital Twins of every critical machine. This would help Prevent Bad Quality.
There are several more ways in which the Ind 4.0 elements can be used. Using Vision Camera Technology to prevent a wrong Operation by the Operator at the Assembly line.
07. Work Culture: Work Culture gets impacted by all the elements that have been discussed in this article.
Current Condition: Currently the Work Culture in the Shop floor needs a lot of improvement. It is characterised by the following:
- The Engineers hardly do any Engineering related work. All of them do Admin work in terms of chasing for Material from Stores/ Purchase or chasing for People from various agencies. They hardly have time to do any other improvement work.
- While the most Value Adding work is happening in the Shop floor, the focus of the whole company is not on the Shop floor. The Production Supervisors / Managers would be running around to catch the glimpse of the HR Manager for People related issues, Chase the Quality Head for Quality related issues, Chase the Materials head for material that has not come and so on.
Lift the Game: The whole company has to be reoriented to support the Shop floor. Production team has to use Andon signals to indicate the problem that is there on the shop floor and Senior Management should reorient the Respective team to come to shop floor and solve the Problem. The Production team should be engaged in doing Kaizens that will help in Better Quality and Quantity.
How to use the Ind 4.0 elements:
Handheld technology can be used to guide the Engineers in their work. The Routine should be driven by the App on the Handheld.
The Inefficiencies have to be monitored on line, analysed and Prevented. Again, in this case the Manufacturing Engineer should learn about Data Analytics.
Seize the moment: The Indian Manufacturing Companies are under pressure to improve their Top and Bottom Lines.
They need to seize the moment and Lift their game in preparation to the Ind 4.0. The ROI on investment in to Ind 4.0 can be improved if the returns from ‘Lifting the game’ are added to the kitty. For ‘Lifting the Game’ we don’t need much Technology. We need a lot of Will Power and some Vision.
Several Indian Companies are aspiring to use Industry 4.0 elements and they are trying to get the tag of ‘We too are implementing Industry 4.0’. But, as I was mentioning in the last few Articles, we are simply not ready. May be a small percentage of companies are truly there. But, most of the Companies are just not anywhere near to using Ind 4.0.
We have examined the Plant Maintenance area last week.
Let us look at Quality Assurance this time.
Indian Manufacturing Companies are supplying World over and we are generally capable of achieving any level of Quality if we put our efforts in to it. I know Companies that supply to the Best Companies in the World. Usually these MNCs take complex parts from India. As they find Indian Companies accommodating and willing to learn.
But, most of these MNCs also would have experienced that Indian Companies take quite a bit of time to ‘get in to the groove’ or ‘take off’ in supplies. Then, they also have a problem of giving ‘Good Quality consistently’. By the time the Customer heaves a sigh of relief that the Supplies have finally taken over, they will have a rude shock of getting a Batch of Parts that are totally off the Specs. They may notice something going wrong ‘terribly’. This usually shakes the confidence of the Customer.
I have seen that the Companies in India suffer, suffer the Customer and if the Relationship wades through all this and survives, the supplies may really settle down. But, a few hiccups here and there keep happening. The Customer would have accepted it and keep debiting huge costs to the Supplier.
Many Companies in India may find that the ‘Lucrative Business’ that they found in the Western world slowly starts losing money! Many companies would have slowly exited the Business. Very few would fight hard and improve themselves. The Companies that don’t learn, keep having the same experience being repeated with various Customers.
Now, many of these Companies are trying to join the Bandwagon of Ind 4.0. They can’t succeed unless they Re-engineer their processes totally.
Let us look at a few Micro areas within Quality Assurance. We will discuss the Current condition and how they can Lift their Game in preparation for using Ind 4.0 elements.
We will look at the following Micro areas in Quality Assurance:
o Quality Plan Adherence
o Quality Problem Solving
o Employee knowledge and Skills
o Who is owning the Quality?
o Response to Customer
o Machine Condition
o Work Culture
01. Quality Plan Adherence
Current Condition: I have seen that the Quality Plan Adherence in many companies is not in good shape. How much Percentage would you score if you check each line against the Quality Plan that YOU have worked out? My experience is that the adherence ranges from around 30% to 70% when checked actually on the ground.
Those of you who are not able to agree to this should actually go to the lines and check it. If you are really at 90-95%, then you are a minority in the Indian Manufacturing. Congratulations! Keep improving from there!
Why is the Adherence so low in many companies?
Some reasons that I observed are:
a) Does not recognise change: The Quality Plan would not have been updated for changes that are happening on the ground. Resultantly, it becomes a Dumb Document.
b) Impractical load of work: The Inspectors / Operators who are supposed to carry out the Quality checks are loaded very heavily with the work and I found in a few companies that if they have to do all the checks that are prescribed in the Quality Plan, they have to be available for at least 12 hours instead of the 8 hours for which they are available. No one cares about this. Operators simply can’t keep up with the work. They don’t check many of the Parameters. Everyone in the Company would know it and ignore it.
c) Simply ignored: There are many Quality Checks that can be done. But, they are simply ignored. If you ask the concerned employees, they would immediately start doing them.
Lift the Game: The Quality Plans have to be revamped. Recognise what is happening on the Ground. Work out a Layered approach for implementing the Quality Plan. Involve many more people in the implementation of the Quality Plan. Every one working in the Factory should participate in the Quality Plan implementation. Right from Factory Head to the Operator handling the Machine.
The Quality Plan implementation has to be audited by the Quality Team on a daily basis. Some companies have implemented this Layered audit approach in a very nice manner. The results are wonderful. When the Engineers involved control the process on a daily basis, their knowledge improves and they become very confident. I have seen that these Engineers are able to face up to Customers in a much better manner.
How to use Ind 4.0 : Now, we have a very well developed Hand Held Technology available. This along with the connectivity that we have makes it amenable to take the Quality Plan usage online. You can think of having a Mobile Software that will help you monitor the Quality parameters on line. You can trigger Quality check points to various people in the organization in the spirit of the Layered Audit that we spoke about earlier. The Quality Plan monitoring may interact with Bar code technology / Photographs / Video abilities in an intelligent manner to monitor the Process closely.
Once you go on line, you generate enormous amount of Quality data. This needs to be analysed by a full time Manufacturing Data Analytics team.
If you have standardized each workstation properly in the Process, then you can look at using Vision Technology to monitor the movements of the Operator and try to control the Quality at the root.
There are many things that can be done using Technology once you get your Basics in place.
02. Quality Problem Solving
Current Condition: The Quality of Problem Solving in Companies leaves much to be desired. The Problem is at various levels.
a) Not many people are involved in Problem Solving.
b) People involved do not have good Knowledge and Skills.
c) While Management wants Quality to improve, they do not invest in to improving these Skills.
Lift the Game: Formulate a Big group of Engineers in the Company who are ‘Problem Solving Ninjas’ of the Company. Invest in to Training them and developing the Group.
Create a War room and encourage the teams to meet every day for at least 45 minutes to actually solve the problems, for technical discussions etc.
Build a Good Problem Solving Methodology over a period with continuous improvements.
How to use Ind 4.0 elements: Once you have the Problem Solving Methodology working well manually, you can automate it with a Mobile Based Software that will control the Problem Solving across the Organization.
You can use the Video technology to capture the Learning from each Problem that is solved and have a Knowledge Management System in the Company that can be used for Training as well as learning from Past mistakes. Coupled with Artificial intelligence and a good methodology of indexing the Solutions, you may be able to even input the learnings in to your Design process.
You can let your Design process continuously learn from the Problem Solving Process in the Company.
03. Employee Knowledge and Skills
Current Condition: The Companies that give importance to Knowledge and Skills are very few in Indian Manufacturing. Even those companies that are focused on Training are not having laser like focus on Skills with a relation to Results.
The Employees in all areas of the Company keep doing several important works like right from Design of Product to facing the Customer without proper Knowledge of the Products / Processes of the Company.
Indian Companies are still recruiting people without a measure of whether they are needed and why they are needed.
The link between the progress of an Employee in a Company and the Knowledge & Skills that they have is very blurred.
Lift the Game: Companies need to define the Functional and Leadership Skills that the employees need to have. I would recommend a Leadership Model be built for every company based on their own Business scenario and the Values that they want their Employees to espouse.
While the definition of what all is needed can be put in place, every company needs to prioritise the skills that they want to focus on for this year based on the Business priorities.
They need to Train the employees on a regular basis rather than some spurts of Training.
How to use Ind 4.0 elements: Once the Skills are defined, Priorities are decided and Training has started, the Company can look at optimising on the Ind 4.0 elements.
The company can adapt a Blended Training approach where the Face to Face training on short modules is combined with Micro Learning modules using E-Learning.
The Company can get on to a Cloud based ‘LMS’ (Learning Management System) and use it to drive Learning across the organization.
Employees can be Certified for their learning, implementing Projects and getting results by an outside agency.
Using these elements the Company can bring Skills and Learning in to the centre of the way they do the Business.
With this focus, the Employees can certainly deliver more towards lifting the Top line and Bottom line.
We will examine a few more elements about ‘Lifting the Game in Quality Assurance’ in the article next week.
Have you started revamping your Quality System? Small changes won’t do! You need to rediscover yourself !!
Across the world, the Manufacturing Companies are leveraging Industry 4.0 to become more efficient and to deliver more to the Customers. Indian Manufacturing Companies have a long way to go. I heard a Multi-National Company say that they are in Industry 2.0 or 2.5 in India while their Global operations are going strongly towards Industry 4.0. This is the status of many Indian Manufacturing Companies.
To become receptive to Industry 4.0, Indian Manufacturing needs to lift their game in several areas. Majority of Indian Manufacturing seems to be stuck with traditional methods of working. Whether it is handling Quality or Maintenance or Industrial Engineering etc.
Some of the Companies are finding the need to change and adapting better methods. But, still majority of the Companies are still in a very ‘Lazy State’. It is not just about the Staff and their knowledge. It is about the perspective of the Management itself.
The Companies from Automotive Industry in India are in slightly better positioned as far as the Systems are concerned. But, even in this industry I observe that only about 25-30% of the Companies are having Good practices. 70% of Automotive and Auto Ancillary Companies are still working inefficiently.
In the next few Posts, I would like to discuss about a few areas in which the Indian Manufacturing Companies have to lift their game so that they can get ready for the Fourth Industrial Revolution!!
Let us talk about Maintenance of Plant & Machineryin this Post.
For ease of discussion, we will address two types of Situations.
I. Where the Traditional Machinery forms majority of the Machines in a company: Most of the Indian Manufacturing Companies have Traditional Machines with least amount of Automation.
The Maintenance that happens in many of the Companies is only ‘Breakdown Maintenance’. The whole Maintenance team would be attending to Breakdowns.
The Companies are dealing with:
- Multiple Breakdowns of the same machinery.
- Serious Production losses.
- Preventive Maintenance not happening regularly. (Production does not release the machines for PM!)
- Companies replacing the Machines in frustration and when pushed by the Customer!
- The Spares required are not stocked in many companies. In some companies you have Costly spares that are rusting. You never have something what you want.
Mindset of Maintenance Team in these companies: The Maintenance Team are busy chasing the Breakdowns. They are ready to burst if you just tap them on the shoulder!! They are frustrated with the Multiple Break downs. A good number of them are not ready to listen to any ‘Different approach’ as they are ‘suffering’. Their Bosses are ‘scared to touch’ them as the Basics may suffer!! The Bosses keep humoring the Maintenance team much less challenging them to get to new level!!
Lift the Game
I suggest following steps to lift the Game in Maintenance of the Traditional Plant & Machinery.
01. Strengthen the Maintenance team: If Breakdowns are too many and Maintenance team is under frustration, you can look at strengthening the Maintenance team by a) Training them b) Adding some Young Engineers to the team. Please do not fuss over this. You will more than recover your investment.
Differentiate: Even while having Break downs in a Factory, there will be at least 50% of your Machinery that is simply not having any Breaking down! These are ‘Zero Breakdown’ Machines. This may be due to your pattern of usage or may be these machines are built with generous Specs!! The Machines that have Zero Breakdowns have to be dealt differently. The approach has to be more Proactive to keep them as Zero Breakdown machines for a longer time.
If you don’t differentiate, you would be waiting for them to Break down and only then you will do something! Does not sound alright. Isn’t it?
02. Improving the machines: A proper Study of the Break down data for the last one year will help you understand why Breakdowns are happening and what you need to do to reduce them. The Corrective actions would involve things like a) Taking a few machines for major repairs b) Training users for handling the machines in a better manner c) Training the Maintenance team to reduce MTTR.
The approach here should be that of a Project approach. The Worst 10 machines should get out of the ‘Worst’ List in 4 months’ time! You need to rev up your Engine to get out of a big Pot hole that you got yourself in to!!
03. Lift the Perspective of your Team: You need to Train your Team and take them to companies where the Maintenance Practices are at the next level. This will help them to know about the next level of Maintenance Practices. Otherwise, they may not simply know the possibilities!!
04. Introduce Predictive Maintenance practices: Introduce Predictive Maintenance for machines that do not have Breakdowns. Many companies have belief that they should deal with the Break downs and then finally go on to the Better Maintenance Practices! It is not needed to wait! When you Train your team and take them to Bench Mark companies, the urge to get to the next level will start.
05. Have Targets for progress: Motivate the team and set targets for Reducing Breakdowns as well as expanding the Predictive Maintenance! Please ensure your team continuously visits companies that are doing better on Maintenance. Whether in India or outside!! Seeing is believing!!
II. Where you are dealing with Automated Factories: Many Indian Companies have introduced Automated Machines. Some Companies have set up Plants that are predominantly automated.
The Companies that have some Automated Machines or one/two Totally Automated Plants deal with issues like this:
- In many Cases, the Breakdowns are higher than the Manual machines!
- The Plant is not giving designed output. Sometimes the output is 60-70% of the Standard output!
- There are higher Quality Problems in these Automated machines.
- The Maintenance practices recommended by the Manufacturer of the Machine / Plant are not followed as they are ‘too costly’.
- The Maintenance team is not fully conversant with the Machine/Plant.
This status is not universal. There may be some Companies who are doing well in Automated Plants. But, a great majority of Indian Manufacturing is not in good shape.
Mindset of the Maintenance Team: The Maintenance team is still in awe of the Automated machine. They approach it in the traditional manner i.e Wait till it Breaks down and then attend to it. But, as this is an Automated machine with high output, the losses are higher! The Maintenance team finds out many short cuts with which they can manage the machine. Read it as ‘By passing most of the controls on the Automated machines’.
We keep approaching the Modern Machine with Traditional Mindset. The mis match can not give good result!
Lift the Game
01. Train the Team / Introduce young blood: You need to train your team immediately in Modern Maintenance practices. It would be very useful to introduce Fresh Engineers in to the System and give them bigger role in the Modern Maintenance. They don’t have ‘Experience’. So the acceptance is much easier.
02. Work on the System: In a highly Automated Environment the thin line between Maintenance Engineers and Production Engineers should be wiped out. Both skills are needed in the same Engineer. The Engineer should look at the machine as something that he has to maintain as per some Guidelines. Earlier he only had to ‘push’ the people in the less automated environment to get Production. Now, he has to deal with some disciplined way of maintaining the Machine. His attitude has to become more disciplined!
03. Use the Machine features: Most of the Automated Machines have a number of features that can be used to Maintain the machine. Collaborate with the Machine Manufacturer and use all these facilities.
There can be a number of outputs in the PLC that you can use for a Visual Management of the Machine.
The Predictive Maintenance can be introduced with a combination of Man and Machine.
04. Beats in the Shop: The Engineers should have a ‘Beat’ (Or Route) just like a Sales person in the field. During this ‘Beat’ the Engineer should check various features of the Automated Plant and ensure things are working as they should. The work of the Engineers should comprise of several ‘Beats’.
In a Traditional environment the work of the Engineer is predominantly dealing with the People.
05. Understand the Machine deeply: The Automation and the Automated Machine/Plant has to be understood deeply. How the machine works and what are the indications of the Machine asking for attention.
A Lot of Data has to be collected and the patterns have to be understood.
06. Digital Twins: When you understand your Machine / Plant, then you can take the help of the Industry 4.0 elements and take it to the next level of making a Digital Twin of the Machine. Then, you can predict failures and prevent them much more effectively.
The approaches can differ from company to company. But, some of the fundamentals will remain same for everyone.
We need to find a way to lift our game and graduate to Industry 4.0.
Will your Company rediscover itself during this Industrial Revolution OR are you going to miss it out totally?