TO ACHIEVE WCP REQUIRES THAT AN ORGANIZATION ACHIEVE PROFIT-DRIVEN PROCESS RELIABILITY THROUGH CONTINUOUSLY EXECUTING AND IMPROVING IN ALL SYSTEMS. A HOLISTIC APPROACH OR PLAN MUST INCLUDE A FOCUSED BLEND OF PEOPLE, TECHNOLOGY, AND PROCESS IMPROVEMENT INITIATIVES.
Many companies have embarked on an asset management or continuous improvement journey but have fallen short of achieving world class and high cultural performance; never realizing or sustaining the full potential of competitive advantage. Historically, strategy execution of innovation for new processes and product programs will generate 3X the organic revenue growth in future years, while also sending positive signals to the marketplace that the company is executing breakthrough operational excellence technologies that will drive sustainable business profitability.
In my 35+ years of global consulting experience with Fortune 500 companies, I have observed these organizations commonly thrive on heroic reactive actions to get business operational failures back on track. They failed to answer, “Could proactive measures have prevented those failures and elevated the business operation to a higher level of operational execution excellence?” In many cases, proactive measures would have created a measurable benefit, yet it went unrealized for many.
To agree on common terminology we’ll turn to Wikipedia and The Business Dictionary to define several key terms as follows:
- Excellence is defined as a talent or quality which is unusually good and so surpasses ordinary standards. It is also an aimed for a standard of performance.
- Execution quite literally means the carrying into effect of a prior policy or decision resulting in some level of performance.
- Operational execution is a suite of manufacturing systems designed to execute operations tasks intended to address strategies, such as production, maintenance or inventory tracking. Manufacturing execution systems (MES) are a subset of an operations execution system, as they are typically concerned with executing tasks within just the production line. Other systems which might be included within an OES might include warehouse management system (WMS), supply chain management systems (SCM) or computerized maintenance.
- Strategy can be intended or can emerge as a pattern of activity as the organization adapts to its environment or competition to achieve its mission. It involves activities such as strategic planning and strategic thinking to achieve business sustainability.
- Business Sustainability takes the concepts from sustainable management and synthesizes them with the leadership concepts of safety, operations, maintenance, engineering and business management. For example, the practices of a business should be sustainable if they wish to stay in businesses, because if the business is unsustainable, then by the definition of sustainability they will cease to be able to be in competition.
A simpler definition of sustainability is a call to action (CTA), a task in progress or journey. To be realistic and achievable involves a political process; clear definitions and vision must govern the common goals and values that are understood by all to achieve the desired levels of sustained profitability.
Finally, The Business Dictionary defines profitability as the state or condition of yielding profit or gain. It is often measured by price to earnings ratio, and the issue becomes how well it is sustained over longer periods of time.
How Will You Know When You Get There?
So how do you know when you have achieved the desired level of execution excellence? Is it gut-feel-as-you-go? Or, do you have other less subjective and equally effective ways of knowing when you have gotten there? Maybe a better question is, have you ever achieved your desired level of execution excellence? If you answer no, perhaps after reading this article, you will have better insight, and we can work together and connect to help you determine and align and execute your measurable strategy to sustainable profits.
If growth is dependent on strategy execution, how can a business proactively deliver the growth if they are not effectively measuring the organizational excellence in leadership agreement and execution of the strategy?
Desired sustainability strategies abound for employing existing resources optimally so that a responsible and beneficial balance can be achieved over the longer term. Within a business context, economic sustainability involves using the many assets of the company efficiently to allow it to continue functioning profitably over longer periods of time.
You Can’t Know If You Don’t Measure
How can you know any of the above if you are not effectively measuring them? Traditional six-sigma efforts use statistical tools (most often the bell-shaped Gaussian distribution) to help find root causes of problems, and the six-sigma efforts provide mile-marker metrics. Since most production output data is not bell shaped data, we need a more advanced tool to help define the problem-solving indicators.
Weibull analysis of daily production output (using skewed Weibull distributions) helps quantify problems in three loss opportunities and offer a system for corrective action:
- Quantify and show the business reliability of the production process
- Measure the losses due primarily to facility and equipment issues (special cause)
- Measure the losses from process and human planning problems (common cause)
- Analyze the size of the hidden operations with suggestions for as corrective action commonly thru a corrective action system, (FRACAS) – Failure Analysis and Corrective Action System
We have developed a unique execution key performance indicator (KPI) derived from the results utilizing these advanced statistical methods of production output. These results all go on one side of one sheet of paper in graphical format, and they also form mile-markers for the business. This KPI moves across the continuum states of excellence from reactive-preventive-predictive-proactive based from the level of leadership focus and intensity of driving improvements.
Reliability Learnings Forever
We introduce Profit-Driven Process Reliability, based on the teachings and findings of the work of the late H. Paul Barringer. Paul would always say that the biggest opportunity for improvement is a management problem thereby leaving a lot of money on the table. We clearly understand that collectively leadership can be focused to help a business quantify baseline execution excellence and define an advancement strategy to higher levels of execution excellence and sustained profitability. To Learn More About Barringer Workshops Click Here.