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As capital project development has become increasingly structured and formulaic--to enable scalability and consistency--many projects have become devoid of the entrepreneurial thinking and behavior required to minimize costs and maximize returns.
To break out of this formulaic trance and unleash the creative potential of their organizations, capital project leaders must enable their employees to consider creative alternatives in design and execution, and critically examine opportunities to improve based on their merits.
Think about the most valuable challenges your organization is facing. These are the really tough, messy problems that keep you up at night. If they weren’t so difficult, you most likely would have already solved them! What if it turned out that these problems were not complex, but instead were all surprisingly easy to solve? How would you approach the problems differently?
While more NPV is better (all else being equal) this calculation is only meaningful relative to the cost of acquiring the operation in the first place or the price for which it could be sold. So in this article (Part 2 of 3) we have segmented the landscape into four quadrants each with a distinct ownership philosophy and set of implications for operational improvement...
The ongoing price war between Amazon, Walmart, and other consumer goods retailers is great for the consumer, but tough for the Consumer Packaged Goods (CPG) industry. If you are a CPG company, you have already spent the past few decades constantly pushing prices down. And yet the price war will demand even more savings from you in the years to come. There are some more obvious places to look for these savings, as well as a hidden one that you might not initially consider, and which may hold the greatest promise. Let’s go through all the options together, as more opportunities on your plate will give you more options to respond.
Congress is considering using a Border Adjustment Tax to increase the financial incentives to produce goods in the United States. If successful, demand would significantly increase for US-made products.. Most US manufacturers would likely benefit in some way over the long term, but some would win much more than others. The biggest winners will be those that are able to find and utilize excess capacity in their existing operations.
If you are an investor, where should you look to find those manufacturers who are best positioned to tap into excess capacity and become the biggest winners?
Our info grahic displays the various stages of maturity for a Management Operating System. Knowing where you lie on the curve is the first step in furthering your improvement capabilities. Each category lays out four characteristics that will help you assess where your organization lies on the curve. Once you know where you are on the curve and what lies ahead, you can begin to create a plan for how to shift to the right on the diagram.
Congress is considering using a Border Adjustment Tax to increase the financial incentives to produce goods in the United States. If successful, demand for US-made products will increase significantly. Most US manufacturers would likely benefit in some way over the long term, but some would win much more than others. The biggest winners will be those that are able to find and utilize excess capacity in their existing operations.
If you are a manufacturer, how do you find this excess capacity?
For irregular manufacturing processes, inspiring productivity through performance measurement can be very difficult because a single, meaningful unit of output is much more challenging to devise. As the combination of production activities constantly changes, no consistent baseline emerges against which improvements can be measured. As such, the full creative potential of workers may be left untapped. How can leaders in irregular manufacturing create comprehensive and meaningful metrics to track progress?
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As capital project development has become increasingly structured and formulaic--to enable scalability and consistency--many projects have become devoid of the entrepreneurial thinking and behavior required to minimize costs and maximize returns.
To break out of this formulaic trance and unleash the creative potential of their organizations, capital project leaders must enable their employees to consider creative alternatives in design and execution, and critically examine opportunities to improve based on their merits.
Think about the most valuable challenges your organization is facing. These are the really tough, messy problems that keep you up at night. If they weren’t so difficult, you most likely would have already solved them! What if it turned out that these problems were not complex, but instead were all surprisingly easy to solve? How would you approach the problems differently?
While more NPV is better (all else being equal) this calculation is only meaningful relative to the cost of acquiring the operation in the first place or the price for which it could be sold. So in this article (Part 2 of 3) we have segmented the landscape into four quadrants each with a distinct ownership philosophy and set of implications for operational improvement...
The ongoing price war between Amazon, Walmart, and other consumer goods retailers is great for the consumer, but tough for the Consumer Packaged Goods (CPG) industry. If you are a CPG company, you have already spent the past few decades constantly pushing prices down. And yet the price war will demand even more savings from you in the years to come. There are some more obvious places to look for these savings, as well as a hidden one that you might not initially consider, and which may hold the greatest promise. Let’s go through all the options together, as more opportunities on your plate will give you more options to respond.
Congress is considering using a Border Adjustment Tax to increase the financial incentives to produce goods in the United States. If successful, demand would significantly increase for US-made products.. Most US manufacturers would likely benefit in some way over the long term, but some would win much more than others. The biggest winners will be those that are able to find and utilize excess capacity in their existing operations.
If you are an investor, where should you look to find those manufacturers who are best positioned to tap into excess capacity and become the biggest winners?
Our info grahic displays the various stages of maturity for a Management Operating System. Knowing where you lie on the curve is the first step in furthering your improvement capabilities. Each category lays out four characteristics that will help you assess where your organization lies on the curve. Once you know where you are on the curve and what lies ahead, you can begin to create a plan for how to shift to the right on the diagram.
Congress is considering using a Border Adjustment Tax to increase the financial incentives to produce goods in the United States. If successful, demand for US-made products will increase significantly. Most US manufacturers would likely benefit in some way over the long term, but some would win much more than others. The biggest winners will be those that are able to find and utilize excess capacity in their existing operations.
If you are a manufacturer, how do you find this excess capacity?
For irregular manufacturing processes, inspiring productivity through performance measurement can be very difficult because a single, meaningful unit of output is much more challenging to devise. As the combination of production activities constantly changes, no consistent baseline emerges against which improvements can be measured. As such, the full creative potential of workers may be left untapped. How can leaders in irregular manufacturing create comprehensive and meaningful metrics to track progress?
A Border Adjustment Tax (BAT) in any proposed new United States tax code has the potential to create significant winners and losers in a rapidly-changing domestic manufacturing market. Its proponents claim that the border adjustment tax will help rebuild US manufacturing--and hopefully the jobs that go with it--by creating pricing incentives to build products in (and export from) the US rather than import them.
How can a manufacturing business get the most out of a Border Adjustment Tax, and who will the biggest winners be?
Integrated mine planning consumes tremendous amounts of organizational resources and management attention. Yet the resulting plans often fail to provide complete confidence that the ore body is being extracted optimally.
By creating a Mine Plan Radar for your operation you will have a clear, visual representation of the alternatives in front of you, allowing you to simplify a complex reality and provide confidence in your operational plans and allocation of capital.
When you help businesses to solve their operations challenges for a living, you experience all the highs and lows of organizational problem solving culture. For a sampling of the lows, check out our playful tongue-in-cheek infographic below. To learn more about finding the simple, elegant solutions hidden within your operations, join one of our Stop Guessing Workshops.
When we’re brought into an organization to help it solve a hard problem, we’re often introduced to the situation like this: “Oh, the solution to this one is easy: we just need to build a whole new second well — or plant — or warehouse.” Then comes the next part of that statement: “And good luck getting capital approval for that.” The translation, to us, is that the people we’re talking to already know this problem can’t be solved, and so we’re either going to have to live with it, or throw a lot of money at it.
Some years ago I worked on a big problem in a food manufacturing plant. Fifty heat exchanger units, used to heat and sterilize a liquid food product, were prone to leaking through a mechanical seal that allowed them to rotate...
(Originally published by Harvard Business Review)
As consultants, we once helped a manufacturing plant director discover how we could save $20 million from his costs in the coming year. His response? “I don’t want $20 million. I only need $3 million to meet my objectives. Why would I contribute more than that?”...
You have probably found yourself in this meeting before - the emergency, all-hands-on-deck sit in scheduled to solve the new, big problem. It could be about people, customers, sales, a technical or quality issue--it doesn’t matter. Your group spends the first 10 minutes excitedly proposing solutions to the problem. These solutions are great, creative ideas that have sprung to mind.
The term ‘benchmark’ originates from surveyors marking a stone to act as a consistent reference point for where to place their equipment with each visit to a site. In life and work we now use benchmarks all the time as consistent reference points to measure performance against...
Earlier this year, Justin Trudeau and the federal Liberal government announced their intention to implement a Canada wide Carbon tax in the coming years, to the tune of $50/tonne at its peak. The reaction to this announcement was mixed, with recognizable names on either side of the debate.
“There’s no such thing as a stupid question”. You have probably heard that sentence before, maybe from a teacher or professor, encouraging you to raise your hand and participate in class. The concept of asking “stupid questions” doesn’t always resonate outside of the classroom.
A waste reduction team I recently worked on achieved 160% of its annualized savings goal yet saw the largest problem reoccur one morning six weeks later. The problem, a product spacing issue, caused a significant percentage of the product to be wasted, but on the other side of the plant from the solution.
20 years ago continuous improvement (or CI) was but a blip on the management radar compared to the pillar of operations lore that it represents today. Most industrial and manufacturing organizations have since adopted some form of CI and, in parallel, the professional services marketplace for all things CI (training, certification, direct facilitation, organizational development, etc.) has ballooned, stratified and, in many domains, commoditized.
In today’s manufacturing world we’ve become focused on collecting and analyzing data - creating pivot charts and paretos, moving data into buckets, rearranging so that it can tell us how our process is performing. Although good for initial prioritization, taking this analysis too far can get us into trouble because it distracts us from getting on the floor and starting the actual problem solving needed to improve.
After both players have made their second move in a chess game there are over 72 thousand possible positions the game could be in. After 3 moves there are 9 million. After 4 moves, 318 million and so on.
On August 5, 2010, a mine collapsed in Chile’s Atacama Desert, trapping 33 miners more than 2,000 feet underground. Nineteen days later, as rescue crews grew desperate, a 24-year-old field engineer named Igor Proestakis decided to travel to the site with what he hoped was a breakthrough idea: using a particular drilling technology, called cluster hammers, to cut through the collapsed rock.
Most manufacturing and industrial businesses are not solving their toughest problems because common problem solving tools are ineffective at addressing the hardest, most technical problems. By attempting to solve challenging technical problems with ineffective tools organizations create beliefs that hard problems are “impossible” to resolve instead of bringing in the necessary tools and horsepower to overcome them.
Those who have been following know that 2015 has not been a good year for commodity markets. As of August, nearly all hard and soft commodities have dropped in value since January 1, other than a few outliers like canola and cocoa. Perhaps most significantly, oil is trading near a 6-year low, down 50% from just a year ago
It has now been 20 years since John Kotter first published his trendsetting article on leading change entitled: “Why Transformation Efforts Fail”. Since then it has served as the prevailing roadmap to help organizations devise and execute big changes to improve their performance. Among Kotter’s 8 steps we have found that the need to “Plan For and Create Short-Term Wins”, tucked away at number 6, is frequently being neglected and at great peril to these change efforts.
European share of chemical production has been steadily decreasing, but there are opportunities to be more competitive. The global chemical industry is a more competitive marketplace than ever before. For European manufacturers the high cost of feedstock and energy prices in relation to the US, and high labour, capital, and SG&A costs in relation to China and other low-cost producers create significant headwinds.