NINE HABITS OF HIGHLY EFFECTIVE CONTINUOUS IMPROVEMENT TEAMS

Driving Continuous Improvement and Enabling Operational Excellence

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.................................................................................................................................................................. 2 HABIT 5: SELECTIVELY INVOLVE OPERATORS IN THE DATA COLLECTION ............... 1 HABIT 4: USE AUTOMATED KPI-BASED METRICS ................................................................................................................................................................................................................................................................................................................. 1 HABIT 3: DEFINE FOCUSED AND ACHIEVABLE GOALS ................................................ © 2012 Page i .................................. 5 TERMS AND CONDITIONS OF USE ................. 1 HABIT 2: ASSEMBLE CROSS-FUNCTIONAL IMPROVEMENT TEAMS ....................................................... 4 HABIT 9: BENCHMARK WITH OTHERS IN YOUR INDUSTRY ............................... 4 ABOUT PARSEC ........................................................................................................................... 6 Nine Habits of Highly Effective Continuous Improvement Teams All print and electronic rights are the property of Parsec Automation Corp..................................................... 3 HABIT 7: RECOMMEND AND IMPLEMENT CHANGES THAT DELIVER SUSTAINABLE PRODUCTION IMPROVEMENT 3 HABIT 8: CONSIDER INCENTIVE PROGRAMS TO INCREASE MOTIVATION .............................. 2 HABIT 6: ROOT CAUSE ANALYSIS OF THE PRODUCTION LOSSES ......TABLE OF CONTENTS HABIT 1: DON’T FALL INTO THE “HIGH EFFICIENCIES” TRAP .................................

For example. However. improvement goals. systems. we have compiled our Nine Habits of Highly Effective Continuous Improvement Teams to help you get started. engineering. consistent. yet realistic. © 2012 Page 1 . Habit 2: Assemble Cross-Functional Improvement Teams There is no doubt that operations.Continuous improvement is a journey. Oftentimes these metrics do not consider Availability Losses such as changeover. This is a missing ingredient in many continuous improvement programs today. or maintenance departments can each assemble a continuous improvement team that produces results. not a destination. Habit 3: Define Focused and Achievable Goals You do not have to tackle the entire factory at once. quality assurance. sanitation. they are considered an unavoidable but necessary cost of doing business. These teams regularly meet to discuss issues and opportunities. you could consider OEE as a proven metric for productivity improvement: it measures inefficiencies related not only to equipment but also consumables. thereby minimizing any negative effects that the change might have on another department. Six Sigma. manufacturers exponentially receive more value when the continuous improvement team members are from cross-functional disciplines. and personnel in one comprehensive metric. using these same metrics on the factory floor may be hiding areas for improvement. and real measurement. lines. results in significant business value. however. Instead. It is more than a set of steps to follow—it is a culture that. Habit 1: Don’t Fall into the “High Efficiencies” Trap This may sound contrary to the popular opinion. This way the members of the team agree on the solutions to the issues before they are implemented. infrastructure. In order to improve efficiency. Businesses inherently want to see high efficiency numbers reported for their annual reports. You can begin with those areas. or disciplines that will result in the most dramatic improvement in overall productivity. or preventative maintenance in the calculation. But where do you start? Here. Management wants to increase Nine Habits of Highly Effective Continuous Improvement Teams All print and electronic rights are the property of Parsec Automation Corp. production. and recommend solutions. but you may be stifling your continuous improvement team with the metrics you are using. when embraced by the entire company. you have to measure it correctly without avoiding the factors that would make the numbers look bad! You have to adopt a methodology that provides unbiased. It is paramount to have a clear understanding of the current performance level so you can set challenging. Consider a system that is currently running at 30 percent OEE. You can do this by evaluating ways to improve the constraint or ways to reduce production losses on the most profitable products. prioritize them. and OEE yields results that are too valuable to ignore. Effective use of programs such as Lean Manufacturing.

For example. analyzing. clip-board and stopwatch) allows you to only capture some of your production loss events.. Consider the value of one OEE percentage-point improvement to your company. Performance. and starvation due to bad planning. © 2012 Page 2 . this may not be reasonable in that time frame. and eliminate the root causes of inefficiency. One of the most overlooked areas for improvements highlighted by the OEE metric is Availability Losses. or reduce production time. Depending on the industry. Using a manual production event monitoring system (e. Habit 4: Use Automated KPI-Based Metrics Providing your line-of-business managers and operators with real-time and accurate information about performance is crucial to their effectiveness.5 percent. it’s an achievable goal that would result in a significant return on investment. Manufacturers that have migrated to automated systems have discovered that there were many more loss events than previously captured by their manual techniques. Performance by 3 from 66 percent. the above manufacturer may consider improving Availability by 5 points from 50 percent. While challenging. and Quality by 0. state of current assets. sanitation. so they institute a 10 percentage-point improvement goal for the year. preventative maintenance. Nine Habits of Highly Effective Continuous Improvement Teams All print and electronic rights are the property of Parsec Automation Corp. their main task is operating the line rather than collecting detailed performance information (i.5 from 97 percent. The significantly enhanced and consistent information about the various production loss events will lead to the identification of areas for improvement. Armed with the right information at the right time. Habit 5: Selectively Involve Operators in the Data Collection The line operators have the firsthand look at what is occurring on their equipment and can provide valuable insight in identifying and reporting efficiency losses. However.. This is an area that yields rapid rewards for many manufacturers through the systematic review of the automated event monitoring and analysis. resources. by over 15. and reporting the right KPIs. and infrastructure. By analyzing the root causes of these loss events. It must be understood that improving OEE from 30. and Quality) based on the starting point. team members can effectively respond to events that affect performance. A better way is to set specific goals for each of the OEE Components (Availability. changeovers. Achieving these goals would improve OEE by 5 percent and provide the ability to either increase the output. to 40 percent is the equivalent of asking production to increase output by one-third in a year. you will find effective ways to correct and minimize them.e. Some ripe-for-the-picking opportunities include operator training. Many manufacturers using real-time performance management software have improved OEE consistently and significantly by collecting.OEE.g.

This is what is meant by “selective” involvement. they enter the issues and suggestions into a database. yet effective involvement will be more readily accepted and used. Consensus is achieved before changes are implemented. Remember. which are then reviewed during the weekly meeting. Typical process automation alarm systems are often ignored. During the week. These methods are very effective because they keep the teams focused on those priority issues that will yield the most valuable results. When you use a real-time performance management system that selectively involves the operator. But how do you do this? Some companies have weekly meetings for their cross-functional improvement teams.recording/acknowledging/categorizing events and performing root-cause analysis) during production. Many manufacturers have realized significant percentage-point improvements for this very reason. continuous improvement effort is just that: CONTINUOUS! Nine Habits of Highly Effective Continuous Improvement Teams All print and electronic rights are the property of Parsec Automation Corp. or perhaps caused by running out of needed parts/supplies? To be able to analyze and understand the root causes of your production losses. © 2012 Page 3 . Others have developed Intranet sites where they record the issues that they would like the Continuous Improvement Team to address. your continuous improvement team must have timely access to accurate reports and analysis that are typically only available from a real-time performance management system. Once changes are made. and that you value the positive role operators may play in its success. and establish a consensus before implementing changes in order to improve your chances of success. and help devise solutions to eliminate them. prioritize the issues to be addressed. Continuous improvement teams MUST have the ability to non-intrusively ask their operators for the vital information that will help to improve or eliminate production losses. it is important to continually measure the performance to confirm that the changes resulted in a sustainable improvement. it shows that you are serious about your continuous improvement program. Habit 7: Recommend and Implement Changes That Deliver Sustainable Production Improvement You must use cross-functional teams to analyze the root causes of production losses. Habit 6: Root Cause Analysis of the Production Losses Your critical production system is down. Do you know the real reason? Is it caused by an upstream or downstream event? Is it due to a machine failure. The in-depth analysis and the availability of various reports make it possible to both quickly and effectively identify the root causes of loss events. but a system that requires minimal.

For example. It is important to know where you stand. monitor. But how well have you really done if everyone else in the race is running a sub 4-minute mile? Parsec offers annual industry specific symposiums that allow executives to present their successes. companies have told Parsec that their operators were motivated by a bonus for achieving a significant reduction in a routine availability loss. but it may be unreasonable for the pharmaceutical industry due to its complex regulations and constraints. Put together a cross-functional team. use accurate. Get to know what would motivate your team. and how valuable it has been to learn about what others in the industry were doing. By applying these Nine Habits of Highly Effective Continuous Improvement Teams. It’s nothing short of amazing! You can be creative with the incentives. and you will take your continuous improvement program to new heights…guaranteed! Nine Habits of Highly Effective Continuous Improvement Teams All print and electronic rights are the property of Parsec Automation Corp. Some companies hold parties or have their managers cook lunch for them. or have a team outing when they achieve their goals. implement. Habit 9: Benchmark with Others in Your Industry What are the efficiency metrics for others in your industry? How do you compare to world-class OEE in your industry? How many companies are running at world class? What are truly worldclass companies doing to achieve and maintain their success? Is the textbook world-class OEE of 85 percent achievable in your industry? For example. they do not always have to be monetary. In many instances. if you are running in a track race and you improve your time from a previous personal best of 5.5 minutes per mile to 5 minutes. and control your corrective solutions. For example. We regularly witness significant reduction in productivity losses when the operators embrace a productivity-centric culture that rewards them for their efforts to improve their performance. and participate in roundtable discussions about relevant industry topics. discuss their continuous improvement journeys. you have done very well. © 2012 Page 4 . You may be surprised.Habit 8: Consider Incentive Programs to Increase Motivation Your people are the key to your improvement speed. you will lay a solid foundation for success. By using proven methods. Attending this type of benchmarking event for your industry is of great value. your continuous improvement program will yield significant results for your company. real-time performance information to support these teams. They have commented how they have gone from skeptics to believers in real-time performance management and metrics such as OEE. The attendees have the opportunity to network with each other and take away practical ideas that can readily be employed. textbook OEE may be achievable for the food and beverage industry. it is advisable to establish metrics-based incentive programs that will help motivate your employees and team members to achieve measurable and sustainable performance improvement.

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