This is the 8th and penultimate part of our "9 Steps to Successful Plant Relocation". If you'd like to view other posts in the series, the links are available on this post’s right side menu (desktop) or at the end (mobile).
The factory has moved, production is running, and customers are receiving their purchases, so what’s left to do in a successful relocation? The post-project review, also known as the ‘post-mortem’ or an After-Action Review (AAR).
The AAR is a simple but powerful tool to help you review the relocation, validate the targets set for the project, and record lessons learned for future relocations and manufacturing improvements.
Did The Relocation Actually Happen?
This is an easy question to answer if there was no change in scope. If planning was done very thoroughly, there should be no surprises. However, answering that question alone will not provide a good understanding and does not benefit your organization in the long run. There will likely be other relocations or new factories built and the valuable lessons learned can save your organization considerable time, money, and headaches.
While every factory and factory relocation is different, there are a handful of broad questions that apply to all projects that should be reviewed.
Before we dive deeper into the four key questions, understand that most answers should have two considerations: what your team can control and what it cannot. Look for solutions with controllable parts to prevent a similar thing from happening again and find ways to avoid or manage situations out of your control. The difference between the two is not always clear, so think carefully.
Four Questions To Validate The Success Of Your Plan
AARs are learning-focused discussions that help organizations discover what to do differently. Rather than waiting until the end of a long project to evaluate how well the new factory is functioning, AARs incorporate continuous improvement right from the start.
For example, when conducting a factory-wide analysis or improving your manufacturing processes, you can run an AAR after producing the first 100 units instead of finishing the entire run.
Let’s take a look at the four questions in detail:
1. Was The New Factory Ready For Production Launch In Time?
Time is usually every business’s most valuable asset. You can raise more money, allocate new resources but never buy back the lost time. Thorough planning, which includes considerations for contingency and risks, will provide a reasonable time estimate for completing a project. The way to measure your time estimates against the time used is by questioning your plan with below, considering what you can and cannot control:
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- Did you reach your milestones on time? Why or why not?
- Did a supplier fail to move a necessary piece of equipment on time? We often see companies missing production deadlines due to supplier issues.
- Was there an environmental or political disaster? For example, only a few companies could manage during the current COVID-19 outbreak. Similarly, investors in Myanmar underestimated the potential for a coup.
2. Was The Factory On Budget and On Time?
Time is money so it is rare that a factory that is not ready on time is on budget. However, it is possible to be on time and still over budget.
For example, if the organization decided to change the plan mid-way through the project, the targets needed an update, and there is usually a cost associated with that. This is not a situation you can control, but noting down the factors that caused the change in plan, can limit the damage caused next time.
You cannot control the price of necessary commodities or the incoming costs of the new location. With sound research and analysis, it is possible to foresee these issues and make adjustments accordingly.
3. Were Your Initial Relocation Assumptions Validated Through the Move?
When you decide to move your factory to another location, you made a set of assumptions. You took into account the advantages of moving, the need to move, the expenses incurred etc.
This is the time to validate all of the assumptions you made at the beginning.
For example, did the new location provide the benefits of lower labor costs or closeness to customers you thought?
One of our clients moved to a new location for lower labor costs and better environmental regulations but they were further from the suppliers and staff turnover was higher.
4. Were There Unexpected Positive Changes?
Unexpected events are not all problems to be tackled. Some can be overwhelmingly positive. For example, market demand increases during the move requiring expanded capacity beyond the initial projections.
Your planning team could discover a more efficient method of organization, a piece of equipment that reduces operating costs, or an unforeseen supply chain advantage in your location such as a tax break on locally sourced commodities. Tracking positive developments allows you to analyze the root cause and find ways to repeat and amplify the success.
After the successful completion of a project, companies often want to move on and not take the time to conduct post-project validation. Resist that temptation. If well managed and organized, validation can provide solutions that will help your company be even more profitable and competitive.
The Bottom Line
The entire AAR process requires commitment but making your after-action review a priority will prevent you from repeating mistakes and allow you to take advantage of any improvements.
If you’ve completed the relocation already and not run an AAR yet now is the time! Assemble your project team to discuss the four main questions mentioned above, and delegate the workload in order to craft a clear, detailed, and shareable report that you can take action on.
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