"The Conversation You're Not Having"

MELBOURNE, VICTORIA, 9 APRIL 2015

Good evening everybody, and thank you for taking the time to come and hear me speak. My talk this evening is about “the conversation you’re not having” and why this really matters when creating a superior performance culture.

My name is Shoni Even-Chaim and I am the founder of a software company called Operations Feedback Systems, also known as OFS.

I started OFS because I really don’t like waste. I believe that eliminating waste, whether it be a waste of time, material, energy, or any waste at all really, is in everybody’s interest. OFS is now in it’s 8th year and the mission of the company is “to build technology that helps all manufacturers make what they make better, more efficiently, with less waste and of course, more profits”.

For just a moment, let me put “less waste” into context for you, the way I understand it. When an OFS customer increases real output by over 30%, using the same people and equipment… I see one new factory for every three, without the need to build that factory. That is what I call real waste saving.

So, what exactly does OFS do? Primarily, we design software that facilitates ongoing continuous improvement, by engaging operations in maximising efficiency and minimising waste. Of course, our software measures productivity and all sorts of useful KPIs, like OEE and many others. This sort of data is critical, and absolutely helps to make useful decisions.

However, the most important function that our software performs is to facilitate engagement between operators and management, sparking a series of conversations focussed on efficiency.

Why have we chose to focus our technology on operators? Because we believe operators are at the very centre of manufacturing, where the entire supply chain must come together at precisely the right time, with the right quality tooling and materials, running on machinery and equipment that works exactly as intended. Servicing the needs of operators well is directly aligned with the best interests of the whole business.

The businesses that understand this put their operators at the centre of continuous improvement initiatives and go on to create superior performance cultures.

I am going to talk about 5 insights that describe some of the most common opportunities for maximising engagement between operators and management. I will also tell some stories as I explain these insights, and I would like to point out that I have chosen these specific stories because they are all real-world, exemplary stories. By “exemplary”, I mean that these stories illustrate themes that we see recurring time and time again across our entire customer base.

Insight #1: The language of targets

One of the interesting things that we do when we start working with any new client is to evaluate the quality and currency of manufacturing targets. A kind of benchmarking, so to speak. What we are interested in is how targets are set, are they easily understood by those responsible for meeting them and most importantly, are the targets actually achievable.

We ask questions like what is a record shift? What is the best day or best month on this machine? When was the last record set and who achieved it?

The answers to these sorts of questions give an indication of how targets are practically applied. We very rarely get very satisfactory answers to these questions, leading me to believe that is a misalignment between how these targets are set and how they are expected to be achieved.

How targets are expressed and communicated has a significant impact on engaging operators to try to reach or better a target.

A business might set an overall target needed to meet budget of 10,000 units per hour, every hour, all year long. But, it only takes a few jobs where 10,000 units is impossible to discredit these targets altogether.

So, who has this target been set for, and what is intended to motivate?

A more effective target, now with some aspiration, and in the language of an operator, might be “Your personal best for this job is 6,230 units per hour, and you have run it 3 times before. BUT: Last week, 3 others managed to beat you and ran it at 7,350 units per hour”.

The insight is that targets must be expressed in such a way to be intuitively understood and embraced by the people expected to meet them. Good targets are respected, attainable, aspirational and meaningful. Well here’s a hint: If an operator or supervisor doesn’t know the target, it’s none of these things.

Imagine for a moment, an operating environment using meaningful targets that everybody understands. I have a true story that illustrates this, in a PET plant targeting a record breaking 1m units in a shift. The magic number was on display, along with where the shift stood against this target, in real time. One day, with about an hour or two left, the crew realised they could achieve this target, and began to work in a more focused way. For the last few hours of the shift, operators picked out what looked to be faulty preforms before they hit the blow moulders, skewed bottles were removed from the conveyors before causing jams. They hit the target, producing 1m bottles for the first time ever, and the crew was jubilant.

Now here’s the amazing part... How long before the record was broken? Well, the very next shift got word of what was possible and set a new record there and then. 1m bottles per shift is now considered normal, and this is the kind of impact meaningful targets can have on engaging operators!

Insight #2: BIG DATA = small person

Big data is a buzz word today and it’s easy enough to believe that collecting every single piece of data possible must end up creating useful outcomes.

Here is a story of how we see too much data interfering with engagement. We recently completed a project with a business that had sophisticated data systems, capturing over one million data points every minute. There was really no data shortage in this business. Actually, having so much data ended up reducing engagement. The reason why is obvious in hindsight.  Data alone does not give any answers without analysis, and it stands to reason that the more data collected, the more data analysis needs to take place.

Because there is so much data, and it is all being collected automatically, there is no ‘author’ - meaning no ownership and the impact is actually fewer conversations and significantly less engagement.

The best use of data is to support conversations with facts, rather than being relied upon as a third party trying to spark a conversation in the first place. The insight is that relying on automatic data collection over the opinions of the people in the process diminishes any ownership along with operator engagement.

This plant, with 1m+ data points every minute managed to add 50% real production output by re-engaging operators directly in contributing their opinions and ideas. The data then became useful in supporting these ideas, rather than generating them. This shift to engagement is directly responsible for the successful outcome.

Most confronting of all, is when all this data manages to miss what’s most important.

Every sensor in the world won’t capture the times when custom pallets are unavailable, or the tooling is faulty, or the board has edge problems. Operators diagnose these events easily and, the very act of reporting them, especially to an audience willing to listen, creates “buy in”. Buy-in is very important, as it leads to interest and ownership over the problem by operators and management.

Insight #3: Our operators won’t tell us anything…

I hear this one so often. It always seems to come from middle level or senior management and there are a few variations on the theme, like “it’s all up to the guys out there to tell us things”, or sometimes, in this day and age the excuse could be that  “our operators don’t know how to use computers” and even that “our workforce doesn’t speak english”.

We’ve worked directly with tens of thousands of operators. In every case, the operators have always communicated and the statement that operators have nothing to say is entirely false. In fact, OFS offer money back guarantees, because that’s how confident we are when installing our software that operators will be communicating more than ever before.

The reality is that we are far less confident in management’s ability to listen.

The insight here is that when told by management that “our operators won’t communicate” is really that there is a culture of “we don’t know how to listen”. Indeed, management seems to be a bottleneck to continuous improvement, far more often than operators are.

I have a great story to tell on this topic about a business that had a workforce that was originally described as having a low skills base, poor language skills, very hierarchical and non-communicative, all those things we so often hear about why operators aren’t able to contribute to any meaningful engagement.

Nonetheless, we managed to get an OFS pilot project installed on a critical line. Our software by design is very visual, glowing and shining like a video game, beckoning for some attention. So, shortly after turning it on, but before any training took place, operators came up and couldn’t help but interact with the system. Others saw this happening and were also curious and followed the example. Quickly, no-one wanted to be left behind and within a fortnight management had more feedback than ever before. Of course, this feedback was also supported by facts.

Later, management celebrated the success, describing the phenomenon as such: “within a couple of weeks, we managed to increase the intelligence of the entire workforce”. To round out the story, within 6 months and a full deployment across dozens of sites, uptime has more than doubled. The knowledge to achieve this outcome was always there, but the channels between operators and management we’re completely blocked and need to be opened for real communication to flow.

Insight #4: More than 50% of all stops in all industries are in what we call “services”.

Whilst this may not come as a surprise to anyone, we still see a real culture of ‘blame the operator’, even if the cause is outside the control of operators. Most of the stops are not caused by operators at all, but rather by faults in the services needed by operators.

Services include primary and secondary materials, tooling, utilities, maintenance, QA, supervisory and the like. The early achievable wins that OFS always tries to facilitate is in optimising services to operators. We see this as analogous to optimising the supply chain.

A great example of this is engaging operators in improving setup and changeover times. The worst kind of changeover is the one that needs to be done more than once. I call this a “missed setup”, because it always creates additional work in progress and sometimes an unhappy customer as well.

Setting up a machine to run a job, then stopping in the middle, only to do it over again later is in nobody’s interest, least of all the operators!

Waging war on missed setups, with operators leading the charge in measuring why a job can’t be completed, before it is setup, whether due to not enough material, tooling issues or any other service related reason, is always going to be successful.

So here’s the insight: The real surprise about services is that once empowered, operators are the best custodians to facilitate improvement to service quality. That’s because operators benefit the most from having these services.

We always see fantastic engagement when operators are asked to help improve the quality of the functions meant to service the process. Furthermore, the journey of asking operators to help improve services is also a journey that must improve operators too.

Insight #5: Let operations measure management.

The tools that OFS give manufacturing businesses are frequently bought by customers wanting to measure their operators.  The reality is that the best results come about when management realise that they are actually giving operators tools to measure management.

If you remember anything from this talk, remember this, because it is the most important insight that we have to offer.

Great businesses understand that measuring inputs leads to improved outputs. But the key to measuring inputs is that it is like holding up a mirror of reflection. Because management are responsible for inputs, giving operators tools to measure inputs is always going to confront management. A natural management reaction is to avoid the confrontation - which is why we believe so many managers say “our operators won’t tell us anything”.

The job of an operator is actually easiest when the supply chain is working perfectly, because the hard work starts when any element of the supply chain fails. For example, It is almost impossible to stack a pallet full of bottles by hand (try balancing 8,000 plastic bottles on top of one another!), or clearing a jam from a machine, or printing with poor quality plates.

Asking operators to measure when the supply chain fails, when the inputs to the process are below expectation is very powerful and will always succeed for this reason.

About the Packaging Council of Australia (PCA) : (www.pca.org.au)The Packaging Council of Australia is a national association of raw material suppliers, packaging manufacturers, packaging users, retailers and packaging designers/consultants. The PCA is the peak national association for companies in the packaging supply chain. Our office is located in South Melbourne, Victoria. Our staff of three is focused on the national and international issues of direct interest and concern to our members.

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The OFS vision is for all manufactured products to be better made, with less effort and less waste. OFS software is widely used across dozens of different industries to increase manufacturing efficiencies and manufacturing profits.

About OFS: (www.ofsystems.com)OFS is an Australian company specialising in productivity and efficiency improvement software (OEE software) for global manufacturing industries. Tens of thousands of operators are using OFS technologies in dozens of industries. Customers of OFS include: Kraft/Cadbury, Coca-Cola Amatil, Electrolux, AstraZeneca, Heinz, Orora, Dulux Group, Unilever, Food Plastics Co, PACT Group, Labelmakers, Visy Industries, Murray Goulburn, Tatura, Sanitarium, HB Fuller, Standard Can and NCI.

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