Closing the “Last Mile” of Efficiency

Performance Management holds different priorities for corporate management and plant-level stakeholders. Corporate stakeholders tend to emphasize technologies that provide visibility so they care more about the “I” as in Manufacturing “Information” Systems. In contrast, plant-level stakeholders tend to emphasize technologies that provide control so they care about the “E” as in Manufacturing “Execution” Systems (MES) capabilities. These two perspectives converge when both stakeholders realize the need for an integrated approach to tackle the “last mile of efficiency.”

What we have observed is that the vast majority of companies have put in place good practices. Although many of these practices are largely manual or paper-based, they have made progress in their efforts to reduce waste. But these paper-based processes often “hit a wall” when they reach the 90% mark on the three “OEE pillars” because losses at this point often result in “micro-stoppages” that are akin to profits “bleeding by a thousand paper cuts.” Two core challenges must be addressed: Knowing (seeing events in context) and Acting (to recover in a timely manner.)

When companies approach this “last mile” threshold, it changes how they view the scope of the solution because they realize visibility (even if it is real-time) isn’t enough – real-time control is equally important to enable real-time KPI management via a closed-loop process. Specifically, work process integration becomes critical to empower front-line workers to “fix problems at the source” as illustrated below:

We have found that there is “maturity” journey that companies go on in order to achieve efficiency.  We developed the following framework as our internal assessment – it is meant to give an idea of where a company could be in their evolution.

Too often companies are not align on where they are relative to systems, culture, and alignment between the different aspects of the company.

Performance Management Maturity Model

As we have stated many times Operational Excellence is not a project it is journey, and we have found having a framework built on experience as the best way set up the path for companies.

Where do you fit in this maturity road.