My first Management job was on the Manufacturing floor on 3rd shift. It was company policy … anyone’s first Management job was in Manufacturing. The principle was sound: to really understand how the business operated you needed to be at the very core of what it did, which in this case was Manufacturing. Only then could you really learn the business and how to work with people.
So as I started a new job further along in my career, with responsibility for Distribution Centres around the world, I knew that I was not going to learn what I needed to know from behind a desk looking at Powerpoint slides with pictures and statistics. I needed to go to each and every facility and learn about the operation right from the floor.
I spent the next 2-3 months on the road. For my direct reports this pace was unprecedented and I went to locations that no other Executive had been to. While at the facilities I didn’t want to do the “Tourist” tour. I wanted to spend time doing an in depth tour of the entire facility, literally walking through every operation, meeting the people and understanding each process, the metrics, the organization, the products and the customers.
Only then would I have the basic understanding and credibility necessary to define the strategy we needed going forward. This was the start of what we soon named “Global Process Excellence”.
Having completed this whirlwind study of, and immersion in, all of the Global facilities I came away with 2 overarching observations.
First and foremost, we had a lot of incredibly smart employees. They knew their own operations very well. They were dedicated. Certainly they were highly customer responsive. They had a lot of great ideas. And they wanted to learn and help improve the business.
Second, and most concerning, each of the Distribution Centres had generally been run as islands. While there were Regions (the Americas, Europe, and Asia) each of the facilities had been run on their own for many years. Even though the processes that govern the operations were the same (everyone has to receive goods for instance) over time they had all customized their processes, their IT systems and their organization in some unique way.
This point is key! In a Distribution Centre every facility has to perform the same basic processes. Every one has to receive product, they most likely have to put that product on warehouse shelves, they need to cycle count those goods, they need to pull that product off the shelves, they need to process those goods in some fashion, they need to pack the product, and they need to ship it.
At its core all of these processes are the same. Yet in this company there were over 20 facilities and for each of these processes there were as many as 20 different ways of doing the exact same thing.
The result was that over time we had added a lot of extra cost in customization, we were not running any single operation as productively and cost efficiently as possible, business controls were managed differently, there was no benchmarking, and customers who had business in multiple facilities had a different experience everywhere they went. Most importantly we were underutilizing the tremendous talent we had in our people.
At the same time there were clear environmental factors to be addressed:
- There was a clear requirement to improve our profitability.
- We needed to respond to customer expectations for increased value and a consistent, exceptional customer experience in all Distribution Centres.
- We needed to lean out the operations and improve our productivity
- We needed to create Best In Class capabilities
- The company needed us to enable profitable growth on the back of an enhanced Operating model, capacity and capabilities
- And we needed to leverage the tremendous experience and expertise that resided within our employees.
All of these environmental factors formed our Call To Action (See Blog Post The Call To Action … Where It All Begins). I knew that everyone at all levels of the Company could relate to one or more, if not all, of these catalysts for change.
The Game Changing Framework
In order to define the framework for a strategy to tackle this I needed to consider both the Environmental forces at play as well as the Global nature of the change that needed to be made.
To truly make a Game Changing Transformation we needed to drive improvement across the entire Operation at the same time. This meant that we would need to tackle all of the processes that govern the way a Distribution Centre operates every day and everywhere. Global Game Changing Transformation of this magnitude requires taking a Holistic approach (see Blog Post Inventory Turnover Breakthrough (Part 1) … Go Back To The Basics!) and that is how we defined the processes we would focus on:
We also needed to create a Name for the transformation we were going to begin. (See Blog Post The Name Is The Game … Naming Your Project Will Rally Everyone To Your Cause!). This Name had to be something that would become the Brand that the entire Global Operations and Supply Chain team would rally around. I decided to keep it simple. I would need everyone at every level to easily understand and embrace what we were going to accomplish. After some deliberation I decided to call this Game Changing Transformation effort “Global Process Excellence”.
With the catalysts for change defined, with the scope and approach established, and with the initiative now named and branded as Global Process Excellence, we had to define how we were going to engage our employees to join us in this effort, and how we were going to create a new culture that embraced this transformation.
The Global Process Excellence journey had begun!
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