Post on 15-Jan-2016
Overcoming barriers to successful implementation
Case Study
Pat Kennelly
General Manager, Customer Service
Dimpco
“Change”
The process by which the future invades our lives
Toffler
Change in context• The last 50,000 years = 800 lifetimes
– 650 of those lifetimes spent in caves– Writing for the last 70– Printing for the last 6– Electricity for the last 2– Computers for the last ½
“The world today is as different from the world in which I was born as that world was from Ceaser’s”
Boulding
First Snag• Lean and change are synonymous…..
• In order to understand implementation you first need to understand 3 things:– Why– What – How
Today’s agenda• Context of Lean change initiatives
– Why– (What) – How
• Barriers / Issues• Methods
• Keenan– Background– Early days– Recent developments– The future
Theory
Practice
Why Lean – part oneMNC’s
• HQ dictat• Competition within group• Customer requirements
SME (typical reasons)
• Improve efficiency• Eliminate Waste
2nd Snag: Pitch it like this and your lean initiative will be dead before it leaves the ground.
Change FailuresHBS Study on change programs
– >30% had little effect on bottom line– 40% of IT projects abandoned– <30% of BPR are successful
• Iceberg model1 is a useful way of thinking
about the change process
In other words – we’re talking about
a journey….Overt
TechnologyStrategySystemsStructure
1: Source: IMI Handbook of Management Pg 330
UnconsciousPower Trust
History of changeNorms / Culture
CovertManagement style
Team-workWork Practices
Participation
The continuum of Resistance to Change2
Acceptance
Indifference
Passive Resistance
Active resistance
EnthusiasticCo-operationCo-op under pressure from mgtAcceptancePassive resignationIndifferenceApathyDoing only what is orderedNon learningProtestsWorking to ruleDoing as little as possibleSlowing downPersonal withdrawalCommitting errorsSpoilageDeliberate sabotage
2: AS Judson, Changing Behaviour in Organizations: Minimizing Resistance to Change 1991
p48
10 Leading reasons for resistance 3
• Individual predisposition towards change• Fear of unknown• Climate of mistrust• Fear of failure• Loss of Status• Peer pressure• Disrupt cultural traditions or group relationships• Personality conflicts• Lack of tact / poor timing• Non re-inforcing reward systems
Is the resistance Rational or Emotional / Specific or GeneralEmotional implies “perception” – is personal, hard to understand and cannot be overcome with rational solutions
3: Kreitner & Kinicki. Organisational Behaviour. p671
Methods to reduce resistance• Books written on the subject• Numerous “techniques”
– Lewin (Unfreeze / Change / Freeze)– Lewin (Force field analysis)– Kotter (8 Steps)– Morgan (15%)
• 2 Bottom lines….– What are the organisational drivers– Organisation needs to be ready
Organisational DriversMost successful change initiatives are
founded on:
• Crisis• A drive for common progress
(something in it for everyone)
It is the second one that builds the virtuous circle of CI change
Readiness…..Source : Ray McEvoy…..
D x V x C > RDissatisfaction with
the Status Quo
Vision of what some “future state” might be
Clarity of the first few steps
Resistance to change
Richard Keenan & Co. Ltd
Founded: 1979 Borris Co Carlow
Richard Keenan & Co. Ltd
Core Purpose
To make a real difference for farmers
Vision
To become the unique world force in innovative machine based system solutions for farmers
Richard Keenan & Co. Ltd Today…
• Corporate headquarters and global manufacturing base is in Borris, Co. Carlow
• > €40m T/O
• 85% Export
• 170 people in Ireland
• 70 people overseas – including Australia, US, Germany, France & UK
• 15,000 customers in 40 countries
Largest manufacturer in Europe
2nd largest in the world
A 25 year journey
Early Steps – Key Drivers
• BSE - 1996• The need for a clear Vision / Strategy• Market change• Management Focus• A need for Cost Reduction and Better Product• A drive towards more Value added for Customer• Live or Die !!
The Keenan System
Keenan Competitiveness• Market position based on machine
capability integrated with knowledge
• More than simply production efficiency
Initial focus was WCB – not just WCM
Mechanism• Key Consultants –
– John Sprouster– Enterprise Ireland
• Waste reduction
• Management structure and processes
• Redefined the Keenan differentiation
• Relationship building
Key Initial Concepts
• WCM– Teams– Process
control– Automation– Flow
• WCB– Sales process
– Costs
– Procurement
– Warranty
Quality
Key production steps• New production line• Kan Ban System for material control• Teams for each main assembly area• People within each team responsible for
– Health & Safety– Kan Ban– Right First Time / ISO– Housekeeping– Consumables
Key steps (cont’d)
• KPI’s (Key Performance Indicators)– Weekly Production Targets– Accident Reporting / Risk Assessment– Right First Time Reporting– Suggestion Scheme– Absenteeism
Tangible results (early wins)
• Snapshot of an interim (1999) report– 19 separate
“metrics”• Benefits clear from
an early stage
Objective Target Result
Increase productivity 10% 11%
Reduce total cost of procurement
£75% of target achieved
Central overhead 10% 8.4%
More recent developmentsBrought to focus by some key strategic drivers
Make in house:
Material Cost: €16.14
Outsource (E.Europe)
Total Cost: €19
including delivery….
• Competitiveness within Ireland
• Capacity constraints in the factory
• Increase competitiveness– Outsource lower value added activity– Keep key competencies in house– Move towards “high value add” production– Improve layout– Increase Capital investment – Modify machine design to improve efficiency– Build further innovation capability
Production Strategy
Capability Development
• 4 Engineers• 2 Draftsmen• 3 Technicians• (66% dept. degree qualified)
Keenan Engineering• Dedicated engineering building
– €0.5 million investment– Foundation for future growth
• 4 staff in Production and Engineering recently became lean green belts
Example 1• Paddles
– New cell designed and built (group input)– Part specific tooling designed and made in house– New materials allowed design change with lower cost
& weight, but higher strength– Capital team built cell, tested process and trained
teams
• Time to manufacture reduced by >50%• Part cannot be bought in cheaper than can be
made in house
Example 2• Chassis Cell
– Most of the product complexity is in the chassis area
– More than 1000 permutations of chassis, wheel, tyre…
– Historically built in 2 plants, with lots of material movement
– Not suitable for outsourcing
Chassis Cell - results• New cell in a single location
• Part specific tooling designed and made in house (reversible jigs & draggers)
• Increased capacity
• Staff count reduced from 9 to 7 (-22%)
• No movement of material
New cell during construction
Common Themes• Change credibility built up during late 90’s
• Allowed more aggressive changes in the last couple of years
• In house skill with jigs and tooling
• Combined benefits– Easier working conditions– Better productivity– Redeployment of staff
ResultsKeenan Production per Year
0200400600800
1000120014001600
1997 1998 1999 2000 2001 2002 2003 2004
Year
Un
its
Production
Hours per Machine
0
50
100
150
200
250
1997 1998 1999 2000 2001 2002 2003 2004
Year
Ho
urs
Adjusted Hours
Hours to manufacture reduced by 66% since 1997
The Future
• Develop the Keenan Manufacturing System– Single assembly plant– Mixed model value stream– Double production capacity (30 min takt time)
• Drivers– Current facility is capacity constrained– Future EPA requirements needs state of art painting– Current 2 plant layout not optimum efficiency
Single Assembly Plant Layout –
Summary• Keenan continue to thrive and prosper in a
global business – based in an economy that has been written off from a manufacturing perspective
• That they do so, is not just testimony to the product offering, but is a measure of, and just reward for the skill and innovation necessary to keep the product competitive
• It can be done….
Better Farming - Better FoodBetter Farming - Better Food