Do you want a process improvement plan for your factory, in order to improve quality, reduce cost, and deliver on time? And are you wondering, ‘is there a step-by-step approach?'
Yes, there is! In fact, there are a number of approaches – with the most popular ones being based on the Plan-Do-Check-Act (PDCA) cycle and the Define-Measure-Analyze-Improve-Control (DMAIC) sequence. In this article, we’ll explain how to use a framework that we like to use that is mostly derived from Toyota’s practical problem-solving process, which contains 14 underlying principles summarized into these four points:
- Maintain a long-term philosophy
- Having the right process will help produce the right results
- Add value to your organization by developing people
- Continuously solve root problems to drive both organizational learning and operational improvement
5 Steps to Creating Your Factory's Process Improvement Plan
1. Clarify your goals
This might sound obvious, but we have seen many factory owners order an impressive piece of machinery, only to realize that it doesn’t serve their purpose at all. Sometimes, they may pay very little for overtime and end up losing operators, when their goal is to increase capacity. Not smart!
The most common goals you can set for your factory are:
A great goal was ‘before this decade is over, landing a man on the moon and bringing him back safely to the earth’ (see video on YouTube). Obviously, you don’t need to be so ambitious, but be somewhat specific.
2. Collect and analyze data
Do you choose priorities based on 'gut feeling'? A lot of people do. While it might be fine in some case, relying on gut feeling alone increases the risk of focusing on the wrong things. For example:
- You want to increase capacity. You think you need to improve the equipment uptime. But, in reality, what is constraining your capacity are your assembly, testing, & packing activities!
- You want to improve quality. You think adding a few inspectors will do the trick. But 70% of the defects on your finished products come from a process after which no re-work is possible (the parts have to be scrapped). Your process improvement plan should target that process!
That's why it is important to look at actual data about your factory performance, before making a decision. But before you can do that, you will need to create a data collection process. The most common sources of data in a factory are:
- Quality inspection reports (including those from your incoming QC team, and so on)
- Corrective action plans, or 8Ds, requested from customers
- Equipment stoppage records
- Productivity data (i.e. number of labor hours per unit)
- Utility consumption data
- Suggestions for re-engineering, for example from a consulting firm like CMC
- Shipping records (estimated ETD vs. real ETD)
- Past project management records (plan vs. real, for example in Microsoft Project)
- Safety incident records
It's possible you may be inundated with data, so you will need to pick which data you need to properly analyze the situation. Is there one big problem preventing you from reaching your goal? Or is it 2 or 3 smaller problems? Is it wiser to tackle one problem at a time?
3. Get down to the root cause(s) of the few main issues
Once you have your finger on an issue, go down to its root cause(s). We often see pseudo-root causes such as “operator made a mistake,” which call for pseudo-solutions such as “retrain the operators”. Don’t fall into that trap.
You can’t build a process improvement plan without digging deeper into what caused the mistake in the first place. Is it related to the number of hours the operators are working? The tools they have at their disposal? Any issues within the production process?
Again, let’s look at an example:
Do you have many rejects in production?
- Point of cause #1: some suppliers ship bad products.
- Point of cause #2: some parts pass incoming inspection but should be rejected.
Let’s get down to the root causes of point of cause: 1. Some suppliers ship bad products because they can’t and won’t meet the tolerances; and because the supplier's selection process does not include a verification of their capabilities and does not ask them to commit to respecting certain tolerances.
4. Set targets for improvement goals
Before you write a plan, you need to know how far and how fast you want to go. Let’s take a look at an example:
- If you want to increase productivity by 6% every year, you can focus on a number of small changes in the layout and the tools. You can also train the local leaders to work in a certain way, improve the internal logistics system, and you will have time to see how your plan works and therefore iterate as needed.
- If you want to increase productivity by 40% in 6 months, you probably can’t act at the margin (around the existing processes). You will need to re-think the way operations are planned and executed from the ground up, and you may need to redesign the product. The engineering effort and the capital expense necessary to reach that target will probably be much higher.
5. Plan for counter-measures to the primary root cause(s)
Many people tend to skip the other process improvement steps and go directly to this one. By now, you should understand why it is a mistake:
- The plan should address the major root cause(s). Otherwise, the improvement won’t move the needle and won’t ‘stick’ in the long run.
- You need to involve people. Let them agree on the causes and the root causes and then the counter-measures will often be logical. Hopefully, you have people’s buy-in and there is less resistance.
- You need improvement target(s) in order to know how fast and how far you need to go.
Once you have a plan, obviously, it needs to be implemented. Regular updates are necessary and give way to course corrections. ‘Plans are useless, but planning is indispensable,’ the saying goes. Don’t become too attached to a specific plan. Let it evolve naturally and revisit your plans regularly!
Do you have any questions about setting up a process improvement plan in your factory?
Please leave a comment below. We'd love to hear from you!