The managing directors office – Monday morning plant meeting – the MD is passionate: “We never get our products delivered on time – our suppliers suck – its affecting our customer performance badly– we need to get them in and really lay it on heavy– either improve of we’ll get someone else”. A supplier conference is hastily arranged, the executives make their impassioned plea and monitor results over the next few weeks. What happens amazes them.
Nothing changes!
The suppliers were called back to be given their marching orders – one of the suppliers executives stands up “you know what – the thing is we really want to do great business – but as a customer – you suck – you cause us and yourselves – so many problems which affect delivery performance – if you addressed some of these things performance would improve significantly. Do you actually understand what some of the problems are?”
That last question underpinned the whole issue – the company did not understand what was causing the delivery problems – it merely looked at its supply chain and placed the blame with them. On closer inspection it found issues with its own engineering drawings, Quality processes, goods receiving bottlenecks and ordering mechanisms that accounted for 70% of the delays with its material supply.
Ok so this is a fictitious example – but if you consider any business problem it can be very easy to jump to the wrong conclusion and waste time and effort attempting to fix the issue but focusing on the wrong thing.
Unfortunately too many of us sometimes forget the key first step in the improvement process– understand the issue and investigate the root cause(s).
In our example we see a company that’s having problems getting its materials delivered on time – but lets be honest – this could be the result of a multitude of factors not just the apparently obvious external ones.
So what could the company in our example have done differently? Techniques such as DMAIC utilize a methodology behind improvement – while acronyms and methodologies can be frightening to some really its just common sense laid out in a series of structured steps:
• Understand the objective – What are we trying to achieve – in our example we want 100% of our deliveries to be on-time (in your own business you may want to ascertain if the objective is realistic).
• Capture data that informs us about what’s happening – in this example its about capturing supplier delivery data – we can calculate a delivery schedule adherence ratio and use this to understand the performance gap
• Pareto the results – Understand the trends that the data is telling us – we may have 1000’s of suppliers – are they all late? Who’s the worst offender?
• 5 Why’s /8D’s– once we know where to start we can start to use techniques to determine a root cause for the problem – with these defined we can again produce a Pareto showing us where the biggest issues lay which begins to provide a route to improvement.
• Improve – with our root causes identified we can launch some initiatives to instigate change – any changes we adopt MUST focus on our root causes and we must understand how these will be influenced (don’t hit and hope!)
• Check up and refine – With our improvement activity embedded we want to check back on results to see if the desired change has been achieved – we may wish to further refine our process with this information
• Sustain – with our new process now embedded we will ensure that we have the necessary processes and monitoring to sustain the improvement
Business improvement methods can go under many different names and guises – “Plan do check act (PDCA)”, DMAIC, etc but really its about knowing the underlying trend – what’s causing it and what changes can be made to the process to alter the results. Businesses will get far more traction within their improvement projects from following these steps. In fact creating a culture of trend analysis and root cause investigation is probably one of the key attributes to develop in your staff as this will not only facilitate a culture of performance but also develop the toolset that will help you bridge between objectives and results.
