Operational Practices, the associated activities, then impact on Roles provides the path towards Operational Excellence Design

Again the last 2 weeks in the USA speaking with customers the question of how they move forward towards 2020 where do we start. Too often I see people start from the easy place that of technologies and products, vs really understanding where they want to be in 2020/25. How will their run their plants, and operational practices across sites and supply chain at all levels is key. Once you know the operational processes you can determine the operational activities and effect on the roles in the company at that time, this will lead to the required solutions.

Companies have invested and executed on the tradition alignment in a plant across process systems, and business systems such as SAP, leveraging such guidelines as ISA 95. With the drive towards more and more agility and rapid deployment of products to markets, these alignments are key, but the other area of critical concern is the operational workplace. With the rapid agility, comes more alignment, and more complexity, combined with key / rapid decisions to be made, the operational team, and operational workspace will be critical. Combine this with the facts that over 10000 experienced baby boomers are retiring each week, and this rate is expected to continue for seventeen years, and that by 2020 the 42 workforce is expected to made up 42+%  

So where do you start when planning to design a system  What concerned me was the throwing of technologies around like cloud, wireless, and mobile, and looking for how, instead of stepping back and looking at what are they trying to achieve, and then applying technologies to that plan.

It is important to note that, in both cases, their automation layer is mature and well established and that their business side is also well thought through and well on the way to being established on the second generation business system.

Again the opportunity of significant improvement and gain in operational efficiency is at the operational layer across multiple facilities. Again the role of people and enabling decisions in real-time are key but not just decisions but a consistency in action in the operational control loop.

The question of where to start came up, and through the discussion the opportunity of stepping back and taking a look at the roles that an operational plant will require from the roles in 2020 to execute. These roles could be on site or off site, through the concept of the “flexible operational team”. Define the role, the day in the life of that role taking into account location, what decisions and actions that role is responsible for and who and what he will interact with through the day. Yes, switch into a “Facebook” thinking of friends, but friends maybe people, (other experts) Assets, Processes, even products. Once this map of a decisions and responsibilities during the day is defined, this drives what information, systems and people this role must interact with in a day. It will also determine what operational procedures (Operational Activities) the role will potentially engage.

This role map is key as now you have a starting point, as to driving consistency in a dynamically changing workforce. Combining these role map, composed of “operational activities” associated with the role, where the activity has the required notification, information, actions, community of expertise etc. and architectural landscape so these “operational activities” can compliment existing systems.

The architectural landscape should define the layers on top of existing systems, in a neutral way, where these operational activities (model driven approach) will reside, these could be local or remote hosting but will require clear governance and require models to defined in an environment that enables constant evolution of the practices but process experts locally and centrally as a “crowd development”, with governance control.

This focus on a role or set of key roles allows the company to focus on how the operational plant will run in 2020 and the key decisions that required, and start applying these now in an architecture that lives with the current systems, but starts to drive consistency and faster decisions across that same role over multiple plants. Notice I have not talked technologies, my assumption on mobile and cloud that the architecture is set up so these activities will be able to execute independently of the device, so the adoption of what devices are used on a plant are relative to plant and support they get, key is the devices no matter if desktop or mobile or web should be suited to efficiency of the role execution.

The clear opportunity is the linking of smart/ intelligent assets to people, and optimized process, and this is the essence of distributed industrial systems of the future on which “Internet of things’ / “Industrial internet” and the “third Industrial Revolution” are based. Key not getting overwhelmed with technology (it is here) it is the “job” or operational improvement that is the opportunity, and how to achieve this. A good starting point is understanding and achieving consistency in the key roles in the future vs the dynamically evolving workforce.

Time to remove manual processes, paper from Food and Beverage! How do we address regulations, at a cost effective level.

Last week I visited 2 Food and Beverage sites in the last week, and I am continued to be surprised by the amount of manual processes and paper trails that still exist. This is for set up of runs, quality, regulation, and process improvements.

To achieve a “positive release” of the product, there are many paper documents filled out across the production line that make up the production record for the run. This process has been running for years, often the data is captured on clip boards and then in some case re-entered into requirements of the business applications. All of this leaves significant room for error, but most of all it leaves limited room for agility of production.

During discussions, the increased requirements for satisfying regulations set down by government or retailers. One customer talked about new significant requirements coming from the “all important” RETAILERS, who own the “shelf space." Does this mean more paper, and how do you educate the operational staff and gain consistency?

Take this combine it with the other big business challengers in F & B:

·         Increased Variety of Products on lines, increased NPI (New Product Introduction)

·         Increased velocity of production

·         Driving of these costs down.

·         Increased regulation requirements.

Combine this with the changing workforce which I have talked about at length. Too deal with these challenger's business would ideally require a stable, experience workforce, but the opposite is now happening.

A foundational requirement is that the manual process / paper processes are replaced with “Managed Operational Processes” that are electronic and enable enter data once have a model driven workflow for “self-learning” of the process. This allows monitoring of the process, and improvement/ tuning of the process. Most of all it removes delays in capturing of data, while allowing workforce transition across activities.    

The technology is mature in Operational Process Modeling, and the shift to an electronic process, is real, it is key for F & B across the world to remove as fast as possible manual operational process!

Confusion Over Standards: Limits or Basis for Innovation?

One of the nice things of this time of year the meeting workload drops, providing the opportunity to do some much needed catch up of reading. An article that sparked some interesting thoughts and is related to a lot of the principles of work and activities. It is worth a read on Toyota’s approach to management of standards around the fundamentals of operational procedures.

http://m.industryweek.com/blog/confusion-over-standards-limits-or-basis-innovation

As discussed at length this year there are a couple of key approaches that will effect industrial operational design:

·         That design needs to move away from interfaces to actually design around activities/ Work; these can be executed through any interface hosted on any device.

·         The other trend is to move to manage / planned work, a knowledge worker moves from a “fire fighting” mode to a 70+ % planned work in a day, which increases safety, and consistent process execution through operational process stands combined with significant cost reductions due reductions in the planned time.

These two trends or approaches will grow in adoption in 2014/ 15 as it is the only practical way to deal with the changing dynamic nature of the workplace and rotating workforce.

The structure outlined below by Jim Laker used at Toyota is a good basis for the how to lay out standards in procedures vs the actual operation instruction. But another key cornerstone of this is knowledge management, with 10000 baby boomers retiring a week in the US, and this rate is expected to sustain for the next 17 years, the requirement for skill vs the talent pool will be offset. So the operational systems must incorporate shared knowledge, crowd sourced and managed to maintain the value. Many of the operational procedures and best practices must be captured over the next 5 years, companies must put a maintainable knowledge management  system, and culture in place, and as you can see in this diagram that standard procedures, operational safety and environment procedures, and practices form the basis for the transition to planned work, and activity based systems.

When you think of standards you think of “handcuffs” on design and therefore innovation, but this is not a logical thought process. How do you enable operational innovation which is based on operational best practices, provides the foundational platform on consistent execution to enable innovation and movement forward. The need to capture operational innovation by taking the best operators and knowledge workers based on years of practices, capture their operational practices within a system so that new less experienced users to adopt the proven practice. Is this a one off NO, this is the continuous process of improvement which will provide the edge for companies to agile.

As you sit down for the Christmas pudding and we look forward to 2014, there is much opportunity and change ahead of us, and these articles provide solid food for thought.

Have a great festive season, and see you in the new year.  

Accountability Theme Growing in the Industrial Sector!

As the adoption of Flexible Integerated Operational Teams grow, the need to share/pass the execution of work items between team members becomes a requirement. Along with this is the growing theme of "accountability" in the industrial sector at all levels. The challenge with today's social media even email is you copy everyone, so they are all aware, but even this is changing as you need to address the owner of the next action in the "to" address, making it very clear and “accountable”.

Now apply this to operational teams, where the system generates an alarm the owner is the operator on duty, with the responsibility to acknowledge but how does he take action add this to work item list, that will be followed up and resolved:

·         By right clicking he generates a work item, the system prompts which person this is going to or group e.g.| maintenance, process etc, and the work flow will inform that person or group who "accepts ownership" and now they start executing. Already through that work items life time we have had two owners.

·         Now part way through this work item, the shift changes, and the work item appears on the shift handover report, and the new person on the next shift takes ownership of the total outstanding work items, so we have a third owner.

·         Now having completed 3 sub actions in that work item, the current owner, needs have a production department validate the test, so again the work item is reassigned to "production" and ownership stays with the maintenance team, until a particular person in "production" accepts. There is a clear passing and ownership, and accountability of work item.

·         So as, actions and records are captured the full trail to the work item resolution, including time to execute the work item and the action step times are logged and understood.

 

Is this new the answer is "no" plants must have a process for this today, usually paper and knowledge, but as the teams become more dynamic, the paper procedures need to come embedded in the system for consistent execution. Regulation from the market and governments require responsibility to be taken, and when actions are being executed remotely, and workers have more responsibility and work items, the chance of dropping (bot following up and resolving) work items grows.

The leading companies want their strategic targets effecting the targets/ KPIs of all the roles at different levels to be aligned so that as tuning of the strategy happens all people workers accept the change and start executing to that evolved strategy. This is different to a KPI system it is about aligning actions and targets downwards with transformation to local context.

Also leading companies are looking at the operational "day in the life" of their workers and finding two major items:

1/ increasing inconsistency in operational procedure execution from plant to plant, shift to shift, as the workforce transitions and people tenure in a role or location reduces.

2/ that only Approx 35% of work items executed by people on the plant floor are planned at the beginning of a day, the rest are ad hoc from "fire drill" plant actions.

 

Both of these factors have a dramatic effect on:

·         safety

·         regularity compliance

·         efficiency and costs, due to variation in procedure execution time and response action.

·         agility to react to changes in the market.

 

By embedding procedures companies can realize many Operational Goals in controlling their operations such as:

·         Alignment of strategy to all roles activities and targets as they can linked and transformed

·         Consistency in operational procedure execution, combined with the ability tune procedures as they can now monitor how long steps in work items take and improve them.

·          Awareness of outstanding work items, clear ownership providing the ability to increase the planned work in a workers day, so increased efficiency, less chance of safety incidents.

 

In the next week, I will introduce the concepts of operational work management, as a new trend to enable the above.

As plants transform to flexible Integrated Operational teams accountability, ownership, and awareness of outstanding work will become foundational.

Reality of Operational Control through Information, Action and Governance.

Speaking this week with 4 executive vice presidents from different process companies, interestingly that the operational consistency and human factor dominated their concerns. Not the " ageing workforce" factor, these executives are located in South east Asia, where age of the workforce is not a significant factor, but the real challenge of the next operational generation is already becoming apparent, that of " rotating " roles.  The discussion, centered around the requirement for consistency of operation, to enable continuity in safe and optimized production environments. You may ask aren't they concerned about the process control, optimization,  YES, but they realize that it is not about controlling the process it is about optimizing production which requires stable process control, but the key is consistency of operation.

The only way to achieve consistency of operation across production sites and teams, is by embedding process standards that enable alignment of business strategy with action at all levels.

The Real Time Performance Management is more than KPIS and dashboards as so people claim it to be, including:

1/ The correct targets and feedback information for the role and worker in the time, format that reflects his focus.

2/ Alignment of these  targets with the business strategy in real time, propergated to all levels of operations to reflect the strategy

3/ Associated activities and processes that will enable consistent response and action to situations.

4/ Embedded processes in the system to enable consistency of action as workers rotate through roles

 

The rotating worker refers to the growing trend of people staying in a role or location for shorter periods. Example one company stated that they have seen the length of workers in a role or location go from 5 years in 2001, to the tenure now at 8 months. This is a drastic change in anyone's books, but on investigation the other significant change in this company was that the workers in the roles had gone from " baby boomer" to " Gen y" their percentage of late “Gen x” or “Gen y” in the operational workspace was over 40%.

While I believe this to be extreme at this stage, but the clear indicators of what we can expect as we approach 2020 is that 42% of the workforce will be Gen Y. Job tenure will average 2.4 years, but now you add locations and evolution of people within a company, the assumption of experience can not be assumed.

As the executives discussed the need is for alignment across their operations, this means sites, plants, and teams while increasing the empowerment of the worker to make decisions in the now.

 

The example above is an embedded operational process, relative a deviation from a KPI that will guide the workers through the desired process, this independent  the user and worker. So instead of just having information, now a work process is built into the system.

The consistency of the answers and focus on the human factor, and enabling users in the dynamic human market was interesting, a clear indicator that this dyanamic role will be natural paradigm in the future.