During this time of the year, when many people are winding down and looking forward to a well-deserved end-of-year break, most company executives are busy planning and reviewing the next year’s budget. One of the budget elements that these executives, most notably in manufacturing organisations, need to consider is the cost and expected return from a CI programme.
Executives are driven by short-term results that drive cost-cutting approaches to most improvement initiatives. These are real and necessary. Common and understandable concerns prior to investing in such initiatives are whether the proclaimed benefits are realisable, and whether these benefits outweigh the investment.
Despite the vast amount of knowledge gleaned from the management practices and techniques of the likes of Toyota and General Electric, many enterprises still fail to achieve the bottom line of increasing income, lowering expenses, and maximising profit in the short term. Therefore, a CI programme must be selected carefully.
Align continuous improvement with strategic objectives
Given the fact that the world of continuous improvement is crowded with heaps of new and existing concepts, executives still have difficulty selecting the ‘right’ approach. Some executives who have already started with particular improvement initiatives are still not fully convinced that they have chosen the right one. And sometimes, as a result of different opinions, organisations end up with more than one approach being taken at the same time.
For example, in one paper and packaging group, half of the group’s companies are implementing TQM (Total Quality Management) while the other half are focusing their efforts on TPM (Total Productive Maintenance). While these parallel programmes may well be ‘right’, the key point is to select the continuous improvement initiatives that align with business strategy and drive the requisite process improvement. Read the blog An integrative route to business transformation for some useful advice on creating a balanced, integrated framework for combining separate initiatives into a coherent overall programme.
1. Define a meaningful set of performance indicators and other value chain imperatives that need to be built into the business improvement system.
2. Identify your requirements. Picking the right solution involves more than just picking the right methodology.
3. Evaluate your organisation’s ability to implement and sustain a continuous improvement culture.
4. Plan your timeline. Identify the steps you’ll want to take to get where you want to go.
5. Assemble an executive team to choose and manage the improvement solution. Cover both bases by getting sign-off from all stakeholders on goals, requirements, capability building, etc. Operations and the primary users of the solution, such as the supply chain functions, should drive the decision.
6. Ask vendors tough questions. Make sure they actually show they have what they say they have in terms of best practice integration across multiple platforms and long-term, sustainable performance.
7. Talk to references and verify case studies. Don’t forget to ask about technical and non-technical factors:
- What were the quick wins after the implementation of short-term projects?
- How much training and additional services were required?
- To what extent were teams helped to deal with change?
8. Make a decision. This is the most critical step of all. Select the CI vendor that can best help you attain the goals you set at the start of the procurement process. The main objective of this phase is to minimise human emotion and political positioning in order to arrive at a decision that is in the best interest of the organisation.
9. Get started. Assess your best practice maturity and formulate an appropriate change management strategy. Use these change methodology checklists to determine the best way forward and then draw up a road map of your best practice implementation journey.
10. Review, optimise and improve. Here’s an overview of how to approach this phase:
- Invest in the requisite training and resources you need to be successful
- Build internal capability to ensure that your improvement solution is not an intervention, but ‘the way we do work’
- After 3-6 months, do a check-up and consider re-engaging with your vendor’s services
- Engage with your vendor’s best practice community to learn and share best practices – suggest ideas for new features or functionality enhancements while you’re at it
- Celebrate the early wins
Finally, when launching or adjusting a continuous improvement programme, aim to make an impact quickly for credibility and momentum. Pick your battles and don’t try to tackle all objectives at once. Always use strategic objectives as the litmus test for deciding if something should be done and how it should be done.
DOWNLOAD The Definitive Guide to Integrative Improvement to learn more about the new approach to continuous improvement and how it can deliver superior results for your organisation.
|The TRACC framework helps organisations build standardised and integrated good practice and performance capacity across their Plan, Source, Make and Deliver functions. Simultaneously it accelerates their collaboration and alignment capacity to build world class end-to-end value chains, enabling the organisation itself to become the ultimate source of sustainable competitive advantage.|