Milestone and millstone of a local factory

This local conglomerate has invited some experts to challenge their policies and practices in the hope of perfecting them. Thanks to its factory director Nestor (not his real name). Two weeks ago, he invited me to visit his Batangas plant to showcase their “operational excellence” program which he started three years ago.

The last four visitors gave their unconditional thumbs-up. Nestor was unhappy as he suspects they’re only being professionally polite. He wants criticisms more than compliments. He can’t be blamed. The CEO kept on drilling him to do more.

“You can get water out of a dry towel,” he was told.

For the past year, he logged an average of 23 percent improved productivity, reduced defects by 16 percent, eliminated waste by nine percent and shortened the cycle time of two important products to 60 seconds from usual three minutes. All these resulted in at least one-million-dollar opportunities for the first year of its implementation alone.

However, these were overshadowed by their 18 percent attrition rate. Also, they don’t have a record on their workers’ skills inventory. No accident or safety record as well. Not even a hint on how they’re resolving boss-subordinate conflicts. Trigger-happy critics would conclude that Nestor is a slave driver even in the absence of an objective basis.

Not me. When I asked the result of their recent morale satisfaction survey, Nestor can’t remember, except to say it’s the job of human resources. “How about your absenteeism and tardiness rate?” I asked. Nestor claims it’s negligible. “How negligible? I pressed on until he meekly admitted – “that will be my assignment.”

That’s comical. If you’re parading all your milestones complete with specific figures, then why can’t you put it side-by-side with the issues that you’ve been experiencing? If that’s happening, then it’s a treacherous practice. English writer and philosopher Aldous Leonard Huxley (1894-1963) said: “Facts do not cease to exist because they are ignored.”

Seven examples

Motivational speakers often tell us: “Don’t dwell on the negative.” We’re not. My interest is to give them a balanced view of their current situation. We’d like to understand the whole story without getting stuck in negativity. There’s no exception to this. If a factory director like Nestor says something about “exception,” cover your ears and run.

Maybe, he’s hiding something, hoping against hope that it could be forgotten soon. So, let’s give Nestor the benefit of the doubt until he comes out with official facts and figures vetted by the CEO. In the meantime, I’m listing down here seven positive examples and the proof of their compliance with “operational excellence.”

Visitor reception. Registration with security was a breeze. The guards know I had an appointment as my name and photo are plastered in all monitors from all over the place. In less than two minutes, Nestor came in with his management team. They showered me with warm smiles inside an executive board room complete with coffee, snacks, water and a bagful of complimentary baseball cap, t-shirt and product samples.

Safety, health and environment. 5S good housekeeping was apparent. The plant was clean, orderly, with plenty of colorful posters promoting how to become environment-conscious. It was well-lighted. The air gave no hint of any chemical smell. The noise level was down to almost zero. Waste water is used to clean the toilet. Comfort rooms were impeccably fragrant and spotless as if you’re inside Singapore’s airport.

Visual control system. There were universal visual directions like color-coded signages, including 55-inch monitors clearly guiding visitors and employees. Tools and handheld equipment are on a display at the shop floor accessible to all. There were at least ten decades-old machines that were properly maintained with data containing its purchase date, repair details and maintenance schedule.

Space and flow management. Equipment, materials and work-in-process were near each other to save on space. Tools were hung for easy access by the worker in his work station. Supplies were moved just-in-time every 21 minutes by a dedicated cyclist-worker wheeling in plastic containers inside the 4,000 square meter plant. This prevents the workers from moving around to secure the supplies.

Team dynamism. When asked about their takt time and daily production goal, all workers and team leaders chorused a uniform figure. If one is absent or tardy, the team is ready to respond as if there’s no issue at all except for a five-minute delay. Everyone knows how to make an adjustment because they know what they’re doing with the factory’s multi-skilling program.

Product defect showcase. Actual samples of defects are displayed in tables in common areas, including the cafeteria. Detailed information about its specifications, the cost and its annual adverse effect on profitability and sustainability. The showcase included the efforts being done by quality circles with the use of pokayoke (error-proofing) and stop-gap measures.

Complexity management. They have a robust standard operating procedure that they review as soon as they detect abnormalities. If that happens, an ad hoc quality circle composed of the line leaders and their workers are mandated to evaluate the problem with a combination of fishbone diagram, why-why analysis, and other problem-solving tools.

They’re inviting me for a second round of talk. Are they going to pay me for identifying their inadequacies? Drumroll, please.

Rey Elbo is a quality and productivity improvement enthusiast. For free insights, share your story with him on Facebook or LinkedIn or email [email protected] or via https://reyelbo.com