Situation Summary

Automotive Manufacturing Operation has two plants 1 mile apart operating as one company. Spending was out of control, resulting in high budget variance. Production efficiencies were low, and poor quality systems resulted in high PPM returns. Team leaders and supervisors were inconsistent in enforcing policies and in the way they treated employees. The annual employee survey indicated morale was marginal.

Approach

Initial assessment of the situation consisted of spending four days in the facilities. During this time, Design Management spoke with employees at all levels of the organization. Observations were made of the plants' daily operations and activities for the purpose of identifying employee issues, assessing what was going well for the organization and identifying improvement opportunities in production processes and employee development.

Plan

Implementation plan called for involvement of all 460 employees to create a sense of renewal, with a new energy level and expectations for the employees and management. This plan ran parallel with the plant manager’s 18-month operational plan. Plan established a new company vision and mission to focus management and employees on controlling costs, improving operational performance and enhancing the work plan environment through improved communications. Training consisted of employee awareness training, manager and supervisor interpersonal and management skills, and team building for all levels. There was an emphasis on continuous improvement involving all employees to improve throughput and reduce internal and external rejects.

Results

• Within a 7-month period the plant had a bottom line cost savings of more than $700,000.
• Customer rejects dropped from 190 to less than 30 PPM.
• Reduced plant personnel by 94 employees.
• Streamlined operations through continuous improvement and plant re-layout.
• Involvement of all employees reflected a 2.5 positive shift in the annual employee attitude survey.
• Plants became a benchmark operation for other divisions within the company.
• Plant was recognized by Saturn as a most improved supplier.
• Design Management continued relationship with the company in other divisions.
  

Organizational Change and Performance Management Case

Situation Summary

Industrial Plant has been in operation for over 30 years. It has changed ownership several times and includes a period of time in which it was unionized. The majority of the supervisory staff and department heads have been employed solely with the company. Discipline in methods and procedures had deteriorated over time, resulting in an organization that relied on prior experience and knowledge for problem solving. Documentation of processes was very limited. Plant equipment had no planned preventive maintenance. Plant had no information sharing or problem solving meetings. Supervisor training was minimal consisting only of on-the-job-training. Over the years weak supervisors taught new supervisors, resulting in marginal people skills. Plant experienced high production employee turnover. Throughput had consistently declined for the past six years.

The plant plans to move from $50 million in sales to $100 million over the next five years. The CEO recognizes the need for change to accomplish this challenge.

Approach

The primary focus was to create a significant behavioral change in the production and support staff supervisors. The training emphasis was on taking initiative and making continuous improvements. The situation was assessed by scheduling in-depth interviews with each supervisor to discuss perceptions of plant issues and challenges, administering a self-assessment of current supervisory skills and evaluating the changes that were needed to improve plant performances and position the organization for future growth. The assessment of the situation also included discussions with VP Manufacturing, HR Manager and conducting an individual DiSC behavioral profile on each supervisor.

Plan

In order to accomplish long-term and sustained behavioral change, Design Management implemented a plan aimed at the growth and development of each supervisor as a team member and as an individual. Parallel with the supervisory skills training and development, Design Management identified numerous improvement action items. The implementation of these action items was two fold: to allow each supervisor to utilize the knowledge and skills gained in the training classes and to begin the process of continuous improvement in the manufacturing operations.

Results

• After one month of classroom training and personal coaching plant performances began to turn around.
• Several impact study teams have improved production in bottleneck operations by 10 to 115%.
• Supervisors have become more proactive in identifying improvement opportunities.
• Closer relationship has developed between plant engineering and production.
• Backlog on key operation has been reduced.
• Significant improvements in communications have occurred throughout the plant.
• Supervision involvement in new hire process has reduced turnover in several departments.