PLANT AUDIT CHECKLIS

Background

Plant managers spend a significant amount of their time "walking the floor" and auditing their plants. However, the efficienc
that process-owner audits are effective. In contrast, 48% think that customer-audits are extremely effective. To pass their c
focus from mere compliance audits towards performance audits.

Use

The plant manager audit checklist has been developed together with clients of the Operations Leadership Exchange to he
audit their factories and focus on performance improvements. It will help navigate customer or regulatory audits much mor
will investigate.
Clients can use this tool as a checklist during their factory floor visit, and also as part of their management system to track

Instructions
The Plant Manager Audit Checklist is grouped into five main categories:

People Cost and Process Excellence Delivery and Flexibility

Culture Quality, Health and Safety

For each factory floor visit, Plant Managers should focus on one aspect in detail and use the diagnostic questions in the m
diagnostic question should be graded by checking the appropriate button on the right. The tool summarizes the assessme
improvement through a traffic light system. Based on your assessment a suggested action plan is automatically generated

Improvement and Action Plan

Diagnostic questions in italics highlight attributes external auditors tend to place particular emphasis on:
Hosting External Auditors
Although the Audit Checklist is designed to support your plant getting ready for an external audit, the final tab in this workb
preparation for the external audit.

External Audit Checklist

Feedback and Support

This tool has been developed together with the Board’s membership and is expected to adapt and evolve while members u
Please contact the Exchange at OLEx@executiveboard.com.
 AUDIT CHECKLIST

Background

eir plants. However, the efficiency of those audits has been questioned, only 20% of executives think
tremely effective. To pass their customer audits first-time round, plant managers should shift their

Use

ons Leadership Exchange to help plant managers "look through their customer's eyes" when they
er or regulatory audits much more smoothly by proactively addressing the issues that external auditors

eir management system to track performance, improvements and corrective actions.

nstructions

Delivery and Flexibility

he diagnostic questions in the middle section to assess the current performance of their factory. Each
tool summarizes the assessments and highlights the areas of good performance and the areas for
plan is automatically generated which links to Exchange resources.

emphasis on:

l audit, the final tab in this workbook aids as a one stop reference guide you want to use in the final

dapt and evolve while members use it. If you have direct feedback on this tool, we would welcome it.

Attribute
1. Recruiting:
Manufacturing deploys
recruitment practices that
establish a clear and strong
employment brand.
2. Employee Skill Sets:
Plant management regularly
reviews staff competencies and
adjusts them to reflect the
requirements of the factory
3. Team Management and
Coaching:
Manufacturing managers feel
ownership for coaching and
developing their staff
4. Employee Development:
Plant management provides its The performance evaluation is regularly updated to match the needs of the business or organization.
staff with opportunities to
develop leadership
competencies and tactical skills. is developing on areas identified in the evaluation.
Assessment
Sub-Standard
Acceptable
Very Good
Diagnostic Question
Superior
Weak
N/A
Plant leadership is able to clearly communicate the value of a career in the manufacturing function within
and beyond the plant.
Plant leadership builds strong relations with the schools and local training centers from which they seek to
hire.
Plant leadership is clear about the elements of the employment value proposition (EVP) at the plant that
impact recruiting the most.
  Plant leadership follows through in implementing the most important elements of the EVP at the plant.
Plant leadership knows a high-potential employee at the plant when they see one.
We have clear and actionable development plans in place for high-potentials.
We are successful at weeding out underperformers from the plant when needed.
   ASSESSMENT SCORE Needs Improvement
  Plant management identifies competencies or skills needed for various manufacturing roles.
Competency matrices are kept updated to reflect the changing nature of jobs.
  Plantmanagement together with the HR business partner conducts a competency gap analysis to identify
additional skills that need to be encouraged.
The plant has cross-training programs in place to enhance the number and types of skills of our
employees to make them more flexible in the workplace.
We have detailed job descriptions for all positions that clearly identify the skills we seek in the candidates
we employ and hire.
We regularly refresh our job descriptions to keep abreast of changes in the nature of the jobs.
Plant management keeps records for and on high performers and feed this information to the HR
business partner.
We identify our core experts, and we have the correct mix of experts to perform well.
  ASSESSMENT SCORE Needs Improvement
The plant has a strong team management in place.
Our managers ensure their teams are well aligned with everyone on the same agenda, mutually
supportive, and pursuing complementary goals.
Our managers/shift leaders recognize the importance of coaching and development.
Our managers/shift leaders focus on coaching and development.
We have a high level of team spirit in manufacturing.
We have an organizational chart clearly identifying everyone in manufacturing.
   ASSESSMENT SCORE Needs Improvement
Plant employees have a clear sense of their performance expectations.
  We have a robust evaluation system in place that includes face-to-face discussions regarding
performance and career development.
The frequency of formal performance evaluation discussions is appropriate (at least once or twice per
year).
  The performance evaluations are backed up by a formal development plan to ensure that each employee
The plant has a strong bench of future leaders to rise and succeed in more critical positions.
  Wehave an effective rotational program in place to foster skill transfer and employee development
across different positions in the plant.
The rotation program effective in the eyes of employees participating in the program.
ASSESSMENT SCORE Needs Improvement
Introduction Improvement and Action Plan Culture
 Attribute

Employee Engagement,
Retention and Recognition:
Plant management recognizes
and rewards employees, who
demonstrate desired behavior,
retains high-performers while
managing out low-performers.

Internal Alignment:
The plant is well aligned with other
functions and the corporate center
in matters of strategic and tactical
importance.

Core Values:
Manufacturing makes decisions
that reflect a core set of values,
including ethics, environmental,
health, and safety standards.

Upward/Downward
Communication Channels:
Manufacturing provides channels
for both upward and downward
communication and uses these
channels to ensure alignment
within the manufacturing team.
Upward/Downward
Communication Channels:
Manufacturing provides channels
for both upward and downward
communication and uses these
channels to ensure alignment
within the manufacturing team.

People
 CULTURE

Assessm

Sub-Standard
Diagnostic Question

Plant leadership regularly assesses and evaluates employee engagement.

Our employee turnover is commensurate with the industry average.

We have compensation plans that are designed to reward our best performers for their work.

Our employee incentives are connected to the achievement of the plant goals.
We find meaningful ways to recognize and celebrate significant events and achievements at the plant
level.

We align our rewards to the monetary and nonmonetary attributes our employees consider important.

ASSESSMENT SCORE Acceptab

We are in step with our internal business partners (i.e., R&D, HR, Engineering, and Finance) and
corporate manufacturing leadership and are effective in working together.
We work to serve the overall business in a cooperative way and are not hunkered down in our functional
silos.
We share best-practices with other plants within the manufacturing network and adopt best-practices
from other plants.
ASSESSMENT SCORE Good

Our culture features a strong work ethic with the recognition that life outside of work is also important.

We have a clearly worded and widely shared code of ethics and conduct that is reviewed annually.

We operate with a climate that expects open and honest communication.

We treat all people with respect and provide a welcoming, comfortable work environment.

ASSESSMENT SCORE Good

We have clear communication channels that allow our teams to remain on the same page.

We have mechanisms to ensure that junior team members can make their voices heard.
Our management and control structure (i.e., corporate manufacturing support functions or regional
manufacturing organization) works effectively and serves the needs of the plant.

Sobering news can be responsibly delivered in the plant without fear of retribution, and we do not shoot
messengers.
ASSESSMENT SCORE Needs Improv

People Improvement and Action Plan Cost and Process Excellence

 Weak

Acceptable

Very Good

Good
Good
Acceptable
Assessment
Superior

N/A
 Needs Improvement

ellence
 COST AND PROCESS EXCELLENCE
COST AND PROCESS EXCELLENCE

Attribute

Production Improvement
Techniques:
Manufacturing has adopted
production improvement techniques
(i.e. Lean, Six Sigma, Kaizen) to
improve it’s processes

Production Cost Optimization:

Plant management effectively
controls equipment, material, facility
and inventory costs to improve plant
performance

Waste Identification and

Reduction:
The plant follows an effective
methodology to identify all waste and
continuously minimizes it.
Reduction:
The plant follows an effective
methodology to identify all waste and
continuously minimizes it.

Cleanliness and Housekeeping:

The plant shows a high level of
cleanliness and order.

Performance Management:
Plant management measures and
and improves all aspects of the
plants performance

Culture
 COST AND PROCESS EXCELLENCE
COST AND PROCESS EXCELLENCE

Diagnostic Question

Our operators know what production improvement technique the plant is using.

Our operators own the improvement projects at the front-line.

We have a good balance between classroom training and hands-on utilization support.

 We have fully standardized manufacturing processes in our plant.

 We share best practices across different production lines in the plant.

We accurately measure the returns from our continuous improvement projects.

  We have a continuous improvement mindset in our plant.

ASSESSMENT SCORE
We effectively deploy capital to reduce equipment related costs (i.e., through preventative
maintenance or reinvesting in new machinery).

We effectively control the material costs associated with production through value stream mapping.

 We effectively deploy capital to improve the reliability of the plant facilities.

We manage inventory levels to control the associated costs without facing production stoppages or out-of-
stock issues.

We have a well-defined production cost reduction plan that plant employees follow.

Front-line operators have a good understanding of the associated production costs of the products on their
line.

We have a single method to visualize production costs or losses (i.e. cost of quality, etc.).

ASSESSMENT SCORE
We test materials first to determine whether they can be used in current manufacturing processes.

We return obsolete materials to suppliers.

We segregate waste streams.

  We store packaging and other raw material to protect from weather.

We re-use off-spec material.

Our operators understand the seven wastes (defects, waiting, processing, motion, overproduction,
inventory and transportation).
Our value stream mapping includes supporting processes (like administration, HR, finance).

ASSESSMENT SCORE
We have a factory floor cleaning schedule which employees adhere to.
We use 5S principles (Sort, Set in Order, Shine, Standardize, Sustain) throughout the whole plant,
including offices.

Each work area is clean and organized.

Walkways and stairways kept free of obstructions.

Refusing bins are not overflowing.

Materials are stored neatly and not hanging off the edges of storage shelves.

There is a high level of cleanliness on the factory floor.

Cleaning equipment is easily accessible.

We standardize cleaning products used and are trying to reduce their usage (i.e. by using high pressure
sprays or pressurized air).
We have different collection points for recyclable waste.

ASSESSMENT SCORE

We regularly measure metrics that show performance versus stated commitments.

Our KPIs are presented in a timely manner, in a usable format, and broken out to meet the needs of each
user? For example: Our data is formatted graphically and numerically to show actual results, trends, etc
and our data is automatically gathered and integrated into our systems to avoid substantial manual labor.

Our scorecard or measurement system provide us with leading indicators into potential problems.

Our KPIs align with and help us manage performance against our overall strategy.

We benchmark our results with internal partners and industry data.

ASSESSMENT SCORE

Culture Improvement Action Plan Quality, Health and Safety

 Sub-Standard

Weak

Acceptable

Very Good

Superior

Assessment

Needs Improvement
Needs Improvement
N/A
 Needs Improvement

Needs Improvement

Needs Improvement

and Safety
 Attribute

Employee Health and Safety:

Manufacturing actively strives to
exceed employee safety and
health regulations.

Safety Training:
Plant employees receives timely
and targeted training on
regulations and systems.
Safety Training:
Plant employees receives timely
and targeted training on
regulations and systems.

Regulatory Compliance:
The plant successfully ensures
and surpasses compliance with
relevant regulations and
company or business partner
policies.

Quality Management:
Plant management recognizes
and rewards employees, who
demonstrate desired behavior,
retains high-performers while
managing out low-performers

Customer Satisfaction:
Manufacturing produces quality
products that satisfy its
customers.
Environmental Impact
Reduction:
Manufacturing has a plan to
reduce its environmental impact
due to production processes.

Cost and Process Excellence

 QUALITY, HEALTH AND SAFETY

Diagnostic Question

All our first aid kits accessible, visible and well stocked.

We have eyewash stations available and are the bottles filled adequately.
We have written lockout/tag out programs in place and are those procedures followed when conducting
maintenance and repairs on machinery.
We have an up to date inspection log noting service and maintenance kept on machinery.

We have all points of operation, points of contact and other moving parts and wiring adequately guarded.

We have appropriate personal protection equipment (PPE) available and it is worn when operating
machinery (i.e. eye, respiratory, hearing protection, etc.).
Our employees do not wear jewelry or loose fitting clothing while operating machinery.

All machinery is properly grounded.

Machines with “hot surfaces” or "high voltage" are appropriately labeled.

We have adequate lighting in the work area and space between work stations.

We mark places of accidents and incidents to warn operators.

We have corrective actions/preventative action plans in place to avoid the re-occurrence of incidents.

We regularly review safety procedures and perform root cause analyses of near misses.

ASSESSMENT SCORE

Employees receive training in the usage of the required personal protective equipment (PPE) provided.

Employees receive training on the chemicals/hazardous materials they work with or may be exposed to as
part of their job duties.
We establish internal safety policies that not only meet official guidelines set forth by regulatory bodies but
also exceed them.
We have processes that enable us to consistently follow our and our customer's policies on safety and
health standards.
Our facilities and operating practices are in step with required security measures (where applicable) and
terrorist threat realities.
We conduct comprehensive training in areas that include but are not limited to the following: hazmat, drug
and alcohol abuse, equipment operation (i.e., forklift), fire safety (i.e., drills), equal employment practices,
ethics in the workplace including conflict of interest and confidentiality, occupational safety and health
administration (OSHA), company policies and procedures, in-house emergency response teams (i.e., first
aid, CPR, and related courses).
ASSESSMENT SCORE

We have documented, rehearsed disaster plans in place. A few central protocols may include the following:
responsible parties are trained in the disaster plan and completely understand all aspects of it, emergency
notification list in place with backups, local managers know when to notify senior management, how to deal
with the media, etc., alternative facilities (warehouse, office, etc.) are identified for use in case of major fire,
storm, labor dispute.
The plant is recognized for its knowledge of governmental regulations, company policy, and similar
matters.
Our employees are expected to and rewarded for doing things in a compliant manner, even if it is difficult
or inconvenient.
We use independent parties to perform unannounced inspections and audits of activities (e.g., sanitation
and safety).
Our plant works with regulators and law makers to alert them to matters of importance to their constituents
and our business.
ASSESSMENT SCORE

The plant has a documented quality management system which is regularly used.
The quality management system clearly defines responsibility and authority and is revised at least every 12
months.
The quality management system provides means for the finished product to be traced back to the
production and quality control records at the manufacturing facility.
The quality management system includes a production flowchart or a description of production methods,
describing the process by which the product is manufactured.
The quality management system contains a product description, specifications, assembly drawings and
manufacturing tolerances.
The quality management system provides for means to determine the monitoring and measurements to be
undertaken, and the monitoring and measuring devises needed to provide evidence of product conformity
to predetermined requirements.
The plant identifies adequate measuring and test equipment, where necessary, to ensure valid results and
measurement and records are maintained.
The organization has a process to assure the timely review, distribution and implementation of all customer
engineering standards/specifications and changes based on a customer-required schedule.
ASSESSMENT SCORE

We have a structured corrective action/preventative action defined and use it for all customer complaints.

The plant employees care about the company’s customers. We are passionate about ensuring our
customers have a positive experience in any transaction with our company.

Plant management uses customer feedback to evaluate employee's performance.

We are considered a preferred supplier by our customers.

We use service failures as a means to build customer loyalty by quickly addressing the service failure and
taking steps to prevent future occurrences.
Our plant consistently delights our customers by producing/delivering their order on time and complete,
right first time.
ASSESSMENT SCORE
 We identify waste exchange programs in the local area or other opportunities to share wastes with other
companies.
We use material-handling/recycling equipment (e.g. balers, shredders or compactors).
We identify other opportunities for waste to be segregated and put to beneficial use: put unwanted
materials and equipment in an area where staff can take them home or donate to schools, charities etc.
We have switch-off programs for lights and equipment while not in use.

We install sensors to turn-off or power-down lights and equipment when not in use.

We install meters (electricity or water) on high use equipment or specific work areas to monitor
consumptions.
ASSESSMENT SCORE

Cost and Process Excellence Improvement and Action Plan Delivery and Flexibility
 Sub-Standard

Weak

Acceptable

Very Good

Superior

Assessment

Needs Improvement
N/A
Needs Improvement

Good

Needs Improvement

Needs Improvement
Needs Improvement
 Attribute

New Product Introduction:

From the time product development
freezes the design of a new product,
Manufacturing is effective at bringing
it to the market quickly.

Changeover Management:
The production lines are able to
produce multiple products with limited
downtime due to changeovers.

Cross-Functional Collaboration:
Production, planning, technical and
engineering departments closely
collaborate to improve overall plant
performance.
Cross-Functional Collaboration:
Production, planning, technical and
engineering departments closely
collaborate to improve overall plant
performance.

Agility and Flexibility:

Manufacturing ensures that the
production process is flexible enough
to account for sudden changes in
business conditions (i.e. demand or
specification changes)

Quality, Health and Safety

 DELIVERY AND FLEXIBILITY

Assessm

Sub-Standard
Diagnostic Question

The plant collaborates with the design function(s) in the early stages of product development to improve
the manufacturability of a product.
The plant invests in new technology at the production level to drive ongoing competitiveness.

We have an effective handover process from engineering to production including ramp up plans.

Our operators understand the production process well enough to make process adjustments in the ramp-
up phase of a new product.

Our process measurement systems capture the right data to improve the new product introduction process.

We have a "Go-to" person in the research&development/engineering department.

Our production lines have enough time dedicated to new product introductions.
ASSESSMENT SCORE Needs Impro
We have changeover procedures for product changes available at the production line.

The production lines maintain a flexible capacity (the ability to meet an unplanned 20% upswing in demand
without deterioration in lead times) so that they can quickly ramp up production volume when needed.

Changeover times are measured and monitored to identify improvement opportunities.

The raw material stocks at the production line are minimized/depleted prior to a product changeover.

The operators log all changeover related issues in the shift logs.

Our production planning system allow for fast change over.

ASSESSMENT SCORE Needs Impro

The plant collaborates with other departments or the corporate functions to satisfy its forecasted demand.

We explicitly ensure that manufacturing’s plans are aligned with the plans of the other functions (for
example supply chain, sales, logistics).
The different functions in our plant (planning, production, quality, etc.) know their interdependencies and
meet regularly to align initiatives.
 We use effective tools to assign and track cross-functional accountabilities and responsibilities of projects
(i.e. using an X-matrix or RACI cards).
ASSESSMENT SCORE Needs Impro
We have contingencies for unanticipated swings in demand.

We have clear processes in place to respond rapidly to changes in business conditions.

We fulfill last-minute customer requests by having a flexible planning and production network.

We have a cycle-time improvement process that covers a broad range and holds people accountable for
finishing productivity projects.
Our employee's daily activities are aligned with the overall plant goals.

Our contracts with suppliers and sub-contractors flexible enough to allow for short-term changes.

We invest in equipment/machinery that increases our production flexibility.

ASSESSMENT SCORE Needs Impro

Quality, Health and Safety Introduction Improvement and Action Plan

 Assessment
Acceptable

Very Good

Superior
Weak

N/A

Action Step

###
###

###

###

###

###

###
Needs Improvement ###

###

###

###

###

###

###
Needs Improvement ###

###

###

###
 ###
Needs Improvement ###

###

###

###

###

###

###

###
Needs Improvement ###
 IMPROVEMENT ACTION PLAN

After auditing your plant, you should take decisive actions to improve underperforming areas. This sheet summarizes
prior assessment and suggests Board resources to help you with improvements.

PEOPLE

Recommended Action Steps

Understand critical manufacturing employee attraction drivers

Approach the local or regional government to promote a career in manufacturing

at local schools/universities

Speak with your HR business partner to understand the company's EVP

Check your leadership team actions against the drivers of employee

engagement

Review and understand your company’s high-potential framework

Provide clear career paths beyond the plant for high-potential employees

Work with your HR business partner to understand and communicate

performance expectations

Build a competency matrix highlighting job requirements and staff competencies.

Update competency matrixes with your HR business partners at least yearly.

Identify competency gaps and develop training plant to close gaps.

Establish a cross-skilling program to train employees in multiple jobs.

Review job descriptions for new and current positions and clearly link to actual
activities.

CULTURE

Recommended Action Steps

Establish proper communication within and between teams at the plant.

Put frameworks in place to allow all team members across all levels in the
hierarchy to voice their opinions.
Review the organizational structure with the corporate center and suggest
adjustments to improve your plant's performance.
Carefully listen to plant employees to identify red flags of communication
breakdown.

#N/A
#N/A

#N/A

#N/A

#N/A

COST AND PROCESS EXCELLENCE

Recommended Action Steps

Ensure that the leadership team speaks the same language with frontline
employees (i.e. call it Lean at all times) to avoid "just another initiative" fatigue
and misunderstanding.
Allow operators the freedom to own their projects and give them decision
making frameworks and budget.
Tailor training on operational excellence programs towards the audience, one
training does not fit all.
Standardize manufacturing processes as much as possible, taking global
standards into account.
Display best practices per production line and encourage "copy with pride"
behavior.
Use tangible metrics like cost of poor quality or line productivity to measure the
success of improvement projects.
Walk the floor to understand obstacles towards mindset change and relate
continuous improvement to the employee's direct work environment.
Deploy preventative maintenance techniques to improve return on capital of
plant's machinery

Use value stream mapping techniques to identify cost drivers.

Allocate sufficient capital to plant maintenance initiatives.

Identify hidden-inventory costs and understand the cost-service trade-off.

QUALITY, HEALTH AND SAFETY

Recommended Action Steps

Ensure that PPE is available at the point of use and encourage utilization.

Amend you policies to include jewelry and lose clothing prohibitions.

Provide adequate lighting and space between workstations.

Put CAPA plans in place to prevent accidents and incidents.

Review your safety procedures at least bi-yearly and analyze all incidents to
eliminate root causes.
Train all employees in the proper use of PPE.

Regularly train employees on handling of hazardous materials.

Review your internal safety procedures in comparison to regulatory

requirements and update if necessary.
Check your customer's safety requirements and perform a gap analysis with
your internal standards.

Review your plant's security measures and update if necessary.

Check your employee's training records on hazmat, equipment operation,

OSHA, etc. and provide refresher training if necessary.

Ensure utilization and adoption of your quality management system.

DELIVERY AND FLEXIBILITY

Recommended Action Steps

Work with the engineering and design functions to improve the manufacturability
of new/changed products.

Invest your capital in technology that provides competitive advantage.

Ensure effective handover processes from engineering to production to reduce

ramp up time.
Train operators on the production process, so they understand how to make
minor adjustments.
Discuss with you engineering and design function which metrics to capture to
improve the new product introduction process.

Engage with a Go-To person in the Engineering or R&D department.

Review how much time production lines dedicate to new product introductions.

Provide change over standard operating procedures for all changeovers at the
production line.

ensure that production lines can accommodate for sudden changes in demand.

Measure changeover times to identify improvements.

Ensure that material stocks at the line are depleted before product changeovers.

Provide space in the shift logs for operators to report changeover related issues.
MPROVEMENT ACTION PLAN

improve underperforming areas. This sheet summarizes the recommended action steps based on your
with improvements.

PEOPLE

Relevant OLEx Resources Owner

Rebuilding Manufacturing as a Destination Career

The Manufacturing Playbook - Talent Management Section

The Untapped Resource

Building the Leadership Bench in Manufacturing

CULTURE

Relevant OLEx Resources Owner

Strategic Plan Accelerator

COST AND PROCESS EXCELLENCE

Relevant OLEx Resources Owner

Manage for Excellence

Cost Management Resource Center

The Manufacturing Playbook - Operational Excellence Section

Manage for Excellence - Lessons Learnt from Plant Tour

QUALITY, HEALTH AND SAFETY

Relevant OLEx Resources Owner

Severity Potential–Based Safety Assessment (Pilkington)

Deploying Behavior Based Safety Programs

The True Demand for Quality

Whirlpool's Loyalty-Driven Alignment

 Reducing Manufacturing's Carbon Footprint

DELIVERY AND FLEXIBILITY

Relevant OLEx Resources Owner

The Manufacturing Playbook - Value Chain Integration Section

Kimberley Clark's Small Project Decision Framework

Sara Lee's Cross-Functional Decision Protocols

Respond to Change More Quickly

Operations Leadership Exchange

 HOSTING EXTERNAL AUDITORS

Customers and regulators visit your plant's on a regular basis. To prepare for those audits and to help you understand wha
summarizes the key focus areas for your customer's audit directors, quality executives and procurement executives.

Focus Area
(i.e. we identify core experts and have the right mix of experts)
We identify our core experts, and we have the correct mix of experts to perform well.

The plant has a strong team management in place.

We have an organizational chart clearly identifying everyone in manufacturing.

We work to serve the overall business in a cooperative way and are not hunkered down
in our functional silos.
We share best-practices with other plants within the manufacturing network and adopt
best-practices from other plants.
We have a clearly worded and widely shared code of ethics and conduct that is reviewed
annually.
We have fully standardized manufacturing processes in our plant.
We share best practices across different production lines in the plant.

We have a continuous improvement mindset in our plant.

We effectively control the material costs associated with production through value stream
mapping.
We effectively deploy capital to improve the reliability of the plant facilities.
We have a well-defined production cost reduction plan that plant employees follow.
We segregate waste streams.
There is a high level of cleanliness on the factory floor.

We regularly measure metrics that show performance versus stated commitments.

Our KPIs are presented in a timely manner, in a usable format, and broken out to meet
the needs of each user? For example: Our data is formatted graphically and numerically
to show actual results, trends, etc and our data is automatically gathered and integrated
into our systems to avoid substantial manual labor.

We regularly review safety procedures and perform root cause analyses of near misses.

We establish internal safety policies that not only meet official guidelines set forth by
regulatory bodies but also exceed them.
We have processes that enable us to consistently follow our and our customer's policies
on safety and health standards.
We have documented, rehearsed disaster plans in place. A few central protocols may
include the following: responsible parties are trained in the disaster plan and completely
understand all aspects of it, emergency notification list in place with backups, local
managers know when to notify senior management, how to deal with the media, etc.,
alternative facilities (warehouse, office, etc.) are identified for use in case of major fire,
storm, labor dispute.
Our employees are expected to and rewarded for doing things in a compliant manner,
even if it is difficult or inconvenient.
We use independent parties to perform unannounced inspections and audits of activities
(e.g., sanitation and safety).
The plant has a documented quality management system which is regularly used.
The quality management system clearly defines responsibility and authority and is
revised at least every 12 months.
The quality management system provides means for the finished product to be traced
back to the production and quality control records at the manufacturing facility.
The quality management system contains a product description, specifications, assembly
drawings and manufacturing tolerances.
The plant identifies adequate measuring and test equipment, where necessary, to ensure
valid results and measurement and records are maintained.
The organization has a process to assure the timely review, distribution and
implementation of all customer engineering standards/specifications and changes based
on a customer-required schedule.
We have a structured corrective action/preventative action defined and use it for all
customer complaints.

The plant employees care about the company’s customers. We are passionate about
ensuring our customers have a positive experience in any transaction with our company.

We use service failures as a means to build customer loyalty by quickly addressing the
service failure and taking steps to prevent future occurrences.
The plant invests in new technology at the production level to drive ongoing
competitiveness.
Our operators understand the production process well enough to make process
adjustments in the ramp-up phase of a new product.
The production lines maintain a flexible capacity (the ability to meet an unplanned 20%
upswing in demand without deterioration in lead times) so that they can quickly ramp up
production volume when needed.
We use effective tools to assign and track cross-functional accountabilities and
responsibilities of projects (i.e. using an X-matrix or RACI cards).

Introduction Operations Leadership Exchan

XTERNAL AUDITORS

those audits and to help you understand what your customers are looking for, the below list
ecutives and procurement executives.

Plant Example
(i.e. prepare flowchart with experts, their expertise level and working area)
Operations Leadership Exchange