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Why Manufacturing Change Management Fails (even with the best consultants)

October 23, 2020

 by Renaud Anjoran

Factory executive and engineer inspecting warehouse

We have all heard of lean transformations that failed miserably.

By some accounts, the majority of them end in failure and when consultants are involved, many assume it is completely the consultants' fault. However, this isn't always the case.

These are the most common complaints we hear about lean consultants:

  • They didn’t tailor their approach to the company’s situation;
  • They didn’t succeed in engaging the workforce behind a strong change initiative;
  • They forgot to put in place new management systems to ensure the new processes stick over time, etc.

While it can be challenging to find a consulting firm that is right for your organization, there is another very common reason that companies overlook when pointing fingers for transformation failures:

their own management doing a terrible job of preparing, and accompanying & supporting the change.

The #1 Reason Change Management Fails in Factories:
Lack of Buy-In Across the Organization

Blog Image - Why Manufacturing Change Management Fails (even with the best consultants)

To get buy-in from both management and your employees, you need to make sure:

  1. They are given sufficient information about the company’s context, challenges, and priorities;
  2. They are provided enough training to understand the information they are given OR that the information is distilled in a way all employees can understand;
  3. They feel heard and were given the right amount of attention; and
  4. Their input was actually taken into consideration.

It sounds simple, but most managers don’t do this well, if at all. As a result, their people resist new initiatives and sometimes completely ignore them. Some people call the 4 steps I outlined above “Fair Process”.

Studies show that when managers practice process fairness, their employees respond in ways that bolster the organization’s bottom line both directly and indirectly. Process fairness is more likely to generate support for a new strategy, for instance, and to foster a culture that promotes innovation. What’s more, it costs little financially to implement.

Joel Brockner, Professor of Business at Columbia Business School
"Why It's So Hard to Be Fair" via Harvard Business Review

7 common myths about manufacturing management presentation

Two Opposite Examples of Manufacturing Change Management

I reflected on two past projects that struck us, at the time, by how different the employees’ responses were to our suggestions.

Example 1: With Organizational Buy-In

In a well-run multinational company that hired us for the first time 5 years ago, management made a lot of right choices:

  • A team composed of people from all departments was formed.
  • The necessity for change (e.g. undercutting on price by local competitors, loss of business…) was well-communicated.
  • That team’s members were tasked with providing information to the consultants. They had to free up a certain number of hours for that.
  • Two consulting firms were retained for the diagnosis and for making an action plan & a proposal, and the team got to vote for the consulting firm they thought was most likely to get good results.
  • The success of the project was one of the KPIs impacting the team members’ bonus.
  • The factory’s management was involved and spent the time to ‘check in’ regularly on important topics. That was very apparent to all parties.
A lot of time was spent building a great project plan, with the involvement of some team members and management. There was an official kick-off meeting, and there was monthly communication on the status of the project all throughout the plant for the duration of the project.

As a result, the project went well, despite difficulties and strong resistance from a few support groups, and exceeded the targets. Consultants were seen as a source of great guidance, and were invited back to help with several other plants within the same group.

Example 2: Without Organizational Buy-In

In another multinational company that hired us at about the same time, we saw a very different situation:

  • The top manager on the site was working only on what interested him (sales & marketing). He did not check in to see progress.
  • The project champion was the CFO, who knew change was absolutely necessary. But the team members did not agree that they had to change their processes. There was no shared understanding of the situation.
  • The project was announced in a kick-off meeting, and the client wanted us to study the situation after that. In effect, management said “we decided to do this” and did not allow for a period of open discussion.

From the very start, people were closed off, shared as little information as they could, and spent as little effort as they could. It became clear pretty early on that the project would not be a success.

Final Thoughts

What are the main differences between these two examples? Management involvement, and employees' buy-in.

When there are too many organizational barriers to overcome, even the best consultants will struggle to introduce new initiatives and reach your goals. Consultants need proper organizational support to do their best work and bring about long-term, effective changes.

22 Signs Of Good Factory Management in China eBook

Topics: Manufacturing Consulting

Renaud Anjoran

Renaud Anjoran

15 years experience in China.
Partner, China Manufacturing Consultants.
Worked with hundreds of factories in China.
Certifications: ASQ CQE & CRE; ISO 9001 & 14001 lead auditor.
Author of well-read blog, Quality Inspection Tips.

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