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Want to leverage business improvement across multiple sites?

By Dennis Keay Businesses that operate from multiple sites often overlook great improvement opportunities. That’s true whether they’re a private business with a profit motive, or a government institution. It’s true of manufacturers, hospitals, local and state government departments, and service-based companies.  I know, I’ve observed it first-hand while doing work for each of these sectors. It’s even true between departments in large multi-department organisations operating from a single site. In my experience, the main cause, to put it bluntly, is ignorance!  Sounds harsh, but it’s not meant to be. It’s just a matter of ‘we don’t know what we don’t know’ and ‘out of sight, out of mind’. If we don’t know we’re missing out on something, then obviously we won’t be looking for it.
We only do what we know, and so to do better we need to know better!
It manifests itself in various ways, including one or more of the following:
  1. The lack of a well-structured and well-coordinated cross-site (or cross-department) approach to improvement;
  2. Relatively poor cross-site (or cross-department) communication / knowledge sharing;and/or
  3. An approach that doesn’t adequately encourage input from the various sites or departments, and doesn’t leverage the knowledge and experience available from those sites/departments.
There are usually hidden ‘structural’ barriers to contend with as well, that relate to human behaviour and the reward systems that drive it. You’ve probably heard the phrase ‘What gets measured gets done’. You could equally say ‘What gets rewarded gets done’. Here are some examples:
  • ‘Firefighters’ in business often get hero status when they make quick decisions and save the day. They get rewarded with promotions. You could argue that the un-sung hero, who prevents fires in the first place is more valuable and should get promoted, though may simply go unnoticed. So, the organisation develops a culture of reaction rather than prevention;
  • Inappropriate or conflicting metrics drive conflict and waste. If your Salesperson receives a commission-based salary proportional to the amount of product sold, then he will try to sell as much as possible. But if this is greater than your production capacity then the Production Manager will be under pressure to produce more…whether or not that is in her control. If she has little or no responsibility for Quality (because, in this particular business that’s the Quality Manager’s responsibility), then she may be reluctant to slow production down in order to improve quality. There’s a knock-on effect, potentially including increased warranty costs, customer dissatisfaction, and damage to reputation of the business.Similarly, if different business sites are encouraged to compete with each other to see which site performs best, and that site is praised and rewarded for its performance, why then would they feel inclined to share their ‘secrets’ with others in their network?  That lack of sharing is an opportunity lost and an opportunity cost for the business as a whole.

Some Remedies

So far, I haven’t told you how to remedy the situation. I could tell you about the tools and:-
  • How we’ve helped large multi-state, multi-site manufacturers effectively deploy improvements gained at one site across the business;
  • How we’ve helped improve inter-departmental communication and cooperation through value-stream mapping activities to create some fantastic wins within one department which has been shared and implemented in other departments to create similar wins.
All true! But…the secret is NOT to focus on the tools. You’ve got to focus on the people and what motivates them and encourage true teamwork. It’s a psychological game! Focus on the culture you want to develop within your business and the behaviours that you want your people to exhibit, then make sure you encourage and reward those behaviours. Getting the metrics right is one of the fundamental steps, and one of the more difficult steps. One element of this is to make senior leadership’s rewards based on overall business performance, not just meeting their department’s targets. For example, the Production Manager’s reward (or lack thereof) can be partly dependent on Quality performance and preventive Maintenance effectiveness. As I said, what gets measured gets done, and we only do what we know, and so to do better we need to know better!  That means we have to keep learning. If you’d like to learn more about our experience in this area, and how we might be able to share some of that with you to improve your business, just reach out and contact us, we’re more than happy to oblige.