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Manufacturing Management Training

World Class Performance 


PART II. 


The Need for World Class Performance

In examining the critical trends that shape our strategies in running a manufacturing business, six key changes are occurring:

1. Suppliers have lost control of the parameters of the business relationship with customers.

2. New products are evolutionary versus revolutionary and are copied readily by competition.

3. There is a need for more custom products that have a shorter product life cycle to meet the exact needs of the customer.

4. The strategies of downsizing are being used to reduce the costs of doing business.

5. Direct labor rates are becoming a non-issue.

6. Companies cannot afford to automate their way to prosperity and must think their way to prosperity.

By applying the world class manufacturing strategy, manu­facturing firms will be able to proactively attack the changes and profit short-term and long-term from the efficiencies and cultural changes that occur with the imple­mentation of world class elements.

Truly, if business decisions are logical, the number one priority for all manufacturing firms should be to become a world class company. The difficulty has been to develop this fervor on behalf of senior management, hence this presentation and paper.

In numerous companies from various industries, the re­sults of world class manufacturing projects have been astronomical. In companies changing the way they operate their businesses and supporting this new way of doing business by using the appropriate technology, the return on investment exceeds 250% and the monetary impact is millions of dollars.

Combine this proven success with the previously outlined immediate need of customers for higher quality, lower price, smaller orders, and more frequent deliveries, and it becomes obvious that achieving world class is mandatory to survive.

The basic fact is that if manufacturing companies do not improve significantly in the very near future they may not have the opportunity. This is evident in many industries. The '90s recession has many scenarios in which one com­pany grows and prospers and others in the same industry struggle, and losing profitability and market share. Some die.

The fault lies in the application of World Class manufactur­ing principles to our business or, more accurately, the misapplication of World Class manufacturing. The failure to achieve significant business improvement through ap­plication of World Class manufacturing principles rests squarely on the shoulders of senior managers. The fact that most of us have struggled mightily to improve our business, and failed, should not be taken as a personal affront. Most senior and middle managers work harder and longer each week than the factory workers. We have a genuine desire and motivation to succeed and to see our operation succeed.

Understanding the Root Causes of Project Problems

In examining the root causes of project problems, the following are present:

• Ego and inability to look at yourself and find fault

• Technology trap—trying to buy Manufacturing Excel­lence with technology, and/or downsizing as the solu­tion

• Inability to manage change

• Unclear vision of project scope and steps to success and benefits

• Not knowing or having a clear vision of better way to run the business

World Class Manufacturing Menu

• Ego and inability to look at yourself and find fault

There is a need for a management team to understand the powerful psychological factors that affect a project. People continually justify their performance, their department performance, and their company performance. It is self-preservation in many companies to do so. Finding fault in performance or challenging the givens is paramount to asking your boss for a pink slip. What often times happens is we blame poor performance on others, using a foxhole management style, or not having the tools to be successful. In their minds the economy is the reason. The lack of information is the culprit: The software is old, and of course, if we buy a new CNC machining center, everything will be okay. Sure! Simply put, it takes an extremely strong management team to look at themselves and its

management of the company and acknowledge the need for significant improvement. Looking at themselves is threat­ening and when they look, they might not like what they see. To feel better, they rationalize performance and egos run rampart. What even intensifies this reaction is that they instituted the current management policy and proce­dures and the justification is personal. Each senior man­agement team member has a stake in the status quo. These issues must be addressed in the project approval stage or else they will fight continually to institute the changes required.

To be Continued


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