2016 the turning point in the Operational Work Transformation!!

Will this statement stand true to the operational execution world we live in, probably only time will tell, but based on the trends I outlined at the end of 2015, and looking forward I believe 2016 provides the opportunity.

By the way, welcome to 2016 may it be an exciting and productive year!

The holiday break it provides a time to reflect and discuss, and in one conversation my last blog was raised and really “how much transformation was happening?” Initially, I thought it was a comment against the trend we are seeing with the “Operational Transformation”, but this was a friend working in a major food manufacturing company. His comment was actually the momentum of change is well underway, and happening at increasing pace.

There were 4 areas that he felt his business and associated industry where trying grapple with to stay ahead:

1/ Agility of effective, valued productsand brands to the market (which he stated was regional, eg specific tastes of similar products changed by region and so your go to markets, packaging, etc. His example was around cheese how the tastes in say Mexico for cheese are totally different to Australia, and then Italy. This leads the increased importance of regional new products vs global new products, and effective speed and cost of innovation, execution and introduction.. So the challenge of “new product Innovation” and then “New Product Introduction” and delivering it to the market at the correct margin to be competitive in timely manner is a whole focus. His comment was this is the core competitive advantage that his company identifies, and must keep driving while dealing with the other transformations happening.    

2/ Operational Workforce transformation: He agrees with me that too much focus has been on the “aging workforce issue” and that most of HR and Operational teams have missed the bigger transformation, and that is the one of new generation work methods and transformation in workspace that goes with it. He felt like his company woke up to this mid way thru last year when they could not just not fill positions, but are having significant challenges in retaining talent, not within the company but in roles. He felt like initially people thought that would just get a transition to a new workforce yes younger of different experience. But they had not realized that way in which people will work, think, interact, and gain satisfaction will also change.

3/ “Planet Awareness, Image”: this one was an interesting discussion, as he raised it as a real strategy for evolving the brand of the company to been seen as proactive to the environment, to attract further “feeling satisfaction” of customers. He also stated that government regulation, and increasing costs of disposing of waste, and energy costs also are now seen a significant bottom line costs, and must be managed more efficiently. But during this discussion, it was also clear that the perception of being “proactive to the environment” in use of energy, carbon footprint, environment etc was also a key strategy for attractive talent to work in the company.

4/ Transparency across the total product value chain, “end to end”. This strategy was about tractability and making sure they happy with brand all the way to customer, but also about cost as they were “outsourcing” increasing amounts of the value chain. But this did not mean they lost responsibility for product while in “outsourced manufacturing partners” execution. The transparency across the supply chain enables increased flexibility and lower costs through inventory reduction.

These 4 strategies are combined with the current strategies to increase plant performance utilization and lower cost of materials through waste /loss reduction.

When you sit back and look at these strategies a constant set of pillars came up in the Operational Solution approach:

·       Everyone having access to information and knowledge no matter their state or location, this means internet becomes a part of the solution backbone.

·       Cyber Security is very much top of mind, both in strategy to secure,  manage, to contain cost and risk.

·       Data validation/ and contextualization, if transparency and faster decisions are required how do you gain consistent information across different sites. \

·       Delivering a new “operational Workspace/ experience” that has embedded knowledge that does not get stale, and enables imitative learning for a dynamic and collaborative workforce.

As the night conversation went on it was clear that the 4 strategies was really about changing the way in which the company manages and executes operational work, no matter how big or small. But becoming in control of not just the planned product work, but the day to day, minute to minute work at the different levels of the operational loop.

Based on the trends of 2015, this long conversation, I wonder if we will see 2015 as the year people recognized that needed to rethink how they handling “Operational Work”. With 2016 becoming the year where momentum continues to grow on projects turning to programs, that span plants, and value chain and an increasing amount of companies put teams, strategies and programs in place to evolve their operations to transform the way handle “operational Work”!

You might ask what about “big data” and the “internet of things” but these are technologies that will be part of the enabling system for a  new operational solution.

Clear KPIs for Measuring “Smart Plant/ Factory” Success is Key, Again Operations, Humans are Difference in this 4th Industrial Revolution

I seem to have been involved in Smart Fields, Smart Facilities, etc for years, and a lot of the discussion and thought leadership was around information, and more intelligent devices. But many have had limited success, until now, why is because many “smart” strategies did not cover all the bases.

During last week a colleague and I had a number of workshop sessions around forward strategy, reviewing specifically what is different this time round with smart, looking at the “Operational Transformation” event we seeing unfold, what is different and core this time! It was very clear, but so was the significant discontinuity in the market.

When we talk Smart concepts too often, the discussions goes quickly to the “smart/ intelligent” devices, and data and information, with the hype around the “Internet of Things” this continues. But when you really get down to what people are trying to achieve is decisions faster, and flexibility / agility through awareness and operational transparency.  

Yes the real impact here of this Operational Transformation is not just that devices are becoming smarter, “self aware” but the need to gain consistency in operations, and reduce errors. There is significant discontinuity happen in the market, as the logical way to eliminate the errors is through experienced workforce. As we all know that actually the workforce in 5 years will dramatically be less experienced than the workforce of yesterday or today.

The diagram below shows the experienced workforce  today is responsible for most of the unscheduled shutdowns.

So the outlook in the next 5 years is grim as we move to the in experienced workforce, unless our systems and operational processes change that is why “smart xxx” is real.

The major outcomes of the drive towards “smart factories, airports, fields etc” is to embed the operational experience, and self awareness in the Smart Devices” and “Smart Processes” .

Too often we do not have clear goals, but it was interesting to see a leading coming define very clear goals constantly to monitor the direction, and success of this "journey". 

Below is their goals:

Key drive is for zero human, equipment and process shutdowns and errors; this drives towards a significant embedding of process and automation on process and analysis to predict situations so that planned / controlled actions can take place limiting unnecessary shutdowns.

Key is the recognition that number of experts that are going to be available due to new generational work-space is going to be limited, and it is key to dramatically reduce the dependency on these experts by 90%. Another shift is to Global centers of excellence that must have access to timely information in context and trusted to interact with the local teams.

100% optimization of Feed/ Energy/ and Product usually plant have 1 maybe two of these tuned , but not 100% optimized, but this is not as simple as it looks when Feed stocks vary, Products instruction is increasing and Energy is totally variable, but the company has recognized to minimize impact of variability is optimization.   Also the knowledge of the system must be embedded, so the system is intuitive and self aware, enabling operational workers to rotate while maintaining consistency in operations and process.

Intelligent Alarms, and awareness will have to natural, so state / condition pattern analysis the move to the “to be” state is key. Many companies have significant programs in play now for transforming their current alarm structure to enable rapid, intuitive awareness of where that “pin” is in the haystack of alarms, and events.

As the plant becomes more intelligent and able to operate, key decisions and follow through actions in a timely manner are fundamental. This will not be one person; it will be a set of actions, and decisions across a team. So the operational system will be designed with collaboration in mind, the natural ability to guide, have built in operational process, natural documentation of actions, and passing of actions to the next person. Key will be the ability to “Resolve Operational Tasks” through tracking and an operational work system within the system, optimizing the human assets as much as the physical assets and processes.