1. A Voyage Beyond the Horizon and Back Houshower 07/01/99, i A
Voyage Beyond the Horizon and Back The Heartland Refinerys
Continuous Improvement Story A Learning History Exploration of
Continuous Improvement Efforts At the Heartland Refinery January
1995 to August 1, 1998 Written by Hans Houshower, Ph.D Learning
History Team Judy Gilbert, Team Leader, Heartland Refinery Hans
Houshower, Ph.D Cultural Anthropology Art Kleiner, Editorial
Consultant, Reflection Learning Associates Paul Monus, Global Oil
George Roth, MIT Sloan School of Management Argerie Vasilakes,
Global Oil
2. A Voyage Beyond the Horizon and Back Houshower 07/01/99, ii
Its a damn tough life full of toil and strife we whalermen undergo,
And we dont give a damn when the gale is done how hard the winds
did blow, Cause were homeward bound from the Arctic Ground with a
good ship taut and free, And we wont give a damn when we drink our
rum with the girls of Old Maui Rollin Down to Old Maui, a
traditional Sea Chanty Wooden ships on the water Very free and
easy, You know thats the way its supposed to be, Silver people on
the shoreline, let us be, Talkin bout very free and easy Wooden
Ships, by Crosby, Stills & Nash
3. A Voyage Beyond the Horizon and Back Houshower 07/01/99, iii
Contents Introduction: The Sailors Journey Toward Proactive
Manufacturing (iv) by Refinery Manager North American Oil The
Learning History Approach (v) Cast of Characters (vii) Timeline:
Notable Events at Heartland Refinery, 1993-98 (ix) Prologue: The
Heartland Refinery, Queen of the Fleet (p. 1) Chapter 1: The
Heartland Refinery Sails A New Ship Reengineering and the Roots of
Continuous Improvement (p. 2) Chapter 2: The Sailors Learned to
Sail the Seven Seas (p. 6) 2.1 Everyone Went Back to Sailing School
(p. 7) 2.2 The Crew Practiced Sailing on Dry Land (p. 10) 2.3 The
Ship Sailed Beneath One Banner, Dont Just Fix It, Improve It! (p.
16) 2.4 The Ships Officers Steered a New Course the Continuous
Improvement Forum (p. 23) 2.5 The Officers and Crew Practiced
Essential SkillsThey Listened and Communicated (p. 28) Chapter 3:
Everyone Got Onboard and Sailed TogetherCommitment Was Crucial For
Success (p. 32) 3.1 Everyone Onboard Took Risks with New Behaviors
(p. 33) 3.2 The Ships Officers Demonstrated Seriousness of Purpose
(p.36) 3.3 The Crew Discovered that Teamwork Requires Shared
Commitment (p. 40) Chapter 4: The Crew Sailed Successfully through
Stormy Seas (p. 43) 4.1 External Forces Created Rough Weather,
Uncertainty and Disappointment (p.44) 4.2 The Sailors Discovered a
Reservoir of Capacity and Sailed for the Horizon (p.48) Chapter 5:
A Voyage beyond the Horizon and BackShared Lessons from the Journey
(p. 53) 5.1 The Sailors Achieved Bottom Line Results But It Was
More Difficult to Impact the Wider Organization (p.54) 5.2 The Crew
Discovered an Essential Ingredient for SuccessTotal Employee
Involvement (p.57) Epilogue: The Sailors Journey toward Continuous
Improvement (p. 63) Organizational Charts Heartland Refinery (p.
65)
4. A Voyage Beyond the Horizon and Back Houshower 07/01/99, iv
INTRODUCTION: The Sailors Journey Toward Proactive Manufacturing By
Refinery Manager North American Oil In late 1994, Heartland
Refinery employees began a journey toward Proactive Manufacturing,
using the tools provided by [Outside Consultant]s Manufacturing
Game and Peter Senges model of the Learning Organization. Heartland
Refinery had been recently re-engineered into a complex matrix team
structure and was in chaos, due to lack of focus, clear vision and
understanding of the behaviors needed to unite the teams. During
1995, employees developed their own roadmap and action plans in an
effort to attain best-in-class performance in all aspects critical
to refinery operation. Their goal was to improve the bottom line
and to develop the behavioral attributes of a learning
organization. Dont just fix it, improve it! became the slogan and
guide for all activities. The Manufacturing Game workshops spawned
over 100 ad-hoc cross-functional teams to address specific
identified opportunities, or other opportunities if the teams so
chose. Employees volunteered to serve as program facilitators and
as members of a Continuous Improvement Forum that was established
to encourage proactivity and provide support and resources to the
action teams. A clear vision was developed and shared among all
employees, and a passion for improvement through proactive
behaviors became universal. This passion carried the Refinery
through a three-year period of uncertainty during an unsuccessful
attempt to sell, and finally a decision to close Heartland
Refinery. Astonishingly, improvements continued unabated and were a
major factor in the ultimate, last minute sale of the Refinery.
Improvements occurred in safety, environmental performance,
reliability, unit rates and yields, and hydrocarbon loss.
Significant results included an over $0.75 per bbl improvement in
the bottom line. Other sites within Global Oil and externally are
pursuing improvements through Proactive Manufacturing and the
learning organization approach. In order to facilitate success at
these other sites, Heartland Refinery commissioned a Learning
History of the Heartland experience to determine what behaviors,
approaches, styles, programs and activities contributed, in a
positive or negative way, to the overall successful result of the
Heartland experiment. Learning Histories were used successfully at
Heartland in the past several years to determine why certain action
teams worked well and produced outstanding results, as well as to
determine what was on the minds and in the hearts of employees who
were directly involved. Learning Histories go far beyond a post
audit review of a project, digging more deeply into the motivation
and passion of those involved in the endeavor. It is our belief
that these insights will significantly assist others to achieve
outstanding improvements more expeditiously.
5. A Voyage Beyond the Horizon and Back Houshower 07/01/99, v
The Learning History Approach The Goal of the Learning History The
learning history is designed to spark constructive conversation by
presenting first- hand interview and review comments on the same
page and in two columns. Interview comments are drawn from
confidential interviews with participants from many parts of the
organization. All persons interviewed have opportunities to review
their quotes for accuracy. The goal is to present multiple
perspectives on the notable events, including strengths and
weaknesses, of a change effort. There is a great deal of blank
space on each page. You are encouraged to note your reactions in
empty spaces and margins. Those reactions will support discussion
of the issues raised by the learning history. In fact, such
additional conversations are the goal. The document is intended to
serve as a tool for learning in your organization. The Two-Column
Format or Jointly Told Tale Material running across the width of
the full page, like this text, provides the context, introduction
and background for each part of the story. In the left-hand column,
you will see commentary and key questions from the learning
historians. Question: Is there a connection between 100% attendance
and learning? The right-hand column contains the primary narrative.
You will see each paragraph in the right-hand column credited to a
particular individual, who tells his or her part of the story, like
this: [Refinery Management Team Member]: I wanted to get all the
people to go. I think we probably achieved 99%. This included
co-ops, administrative assistants and all the people that we
invited from the outside. That was a big plus that I didnt realize
in the beginning would be that good. qq Sidebars Occasional boxed
passages, across the page and with smaller type, contain
explanations that expand on issues raised in the right hand column,
but that would otherwise slow the narrative. For instance, sidebar
passages might describe a site-specific business practice, or a
particular event that turned out to be significant. Also, refer to
sidebars for answers to questions about details in the main text.
There are no rules for reading the two column learning history.
Different individuals read segments in different orders. By making
your own choices, and discussing your responses with colleagues,
you will best serve your own learning and that of your
organization.
6. A Voyage Beyond the Horizon and Back Houshower 07/01/99, vi
Learning Histories at the Heartland Refinery In fall 1995, the
Heartland Refinery assembled a team to explore the potential of
learning histories as a tool for enhancing improvement efforts. The
team included two members of the Heartland management team and an
outside consultant with a Ph.D. and professional experience in
social science research and writing. The team participated in a
learning history seminar offered by the MIT Center for
Organizational Learning and developed a learning history project
that focused on the success of a refinery action team. Based on the
successful outcome of the initial project, the Learning History
team has conducted three additional learning histories, including
the present project. The Heartland Refinery Continuous Improvement
Forum has used the learning histories to identify critical success
factors on the path to continuous improvement. The CI Forum has
then integrated the lessons learned into employee learning in an
effort to transfer learning to other teams at the refinery.
7. A Voyage Beyond the Horizon and Back Houshower 07/01/99, vii
CAST OF CHARACTERS Titles & Positions Refinery Manager Refinery
Maintenance Manager Refinery Management Team Member Refinery Change
Manager Refinery Engineer Refinery Maintenance Supervisor Refinery
Operations Supervisor Refinery Training Supervisor Refinery
Operator Union Officer Global Oil Manager (Global Oil manager at a
facility other than Heartland Refinery) Global Oil Senior Manager
(Global Oil Senior Management Team) Outside Consultant The
Interview GroupAn Organizational Cross-Section The Heartland
Refinerys Continuous Improvement Story was written to capture the
learning and key success factors which led to breakthrough
productivity improvements from 1995 to 1998 at Heartland Refinery.
The CI Forum was established to develop a path and ongoing support
for the continuous improvement efforts of the refinery. Included in
the approximately 35-member Forum were the refinery management team
and a broad cross-section of salaried employees. To provide a
representative sense of the transformation at Heartland Refinery,
we talked with a variety of people associated with the refinery
from across Global Oil including senior Global Oil managers,
refinery management, salaried employees, and hourly workers. We
also talked with people not associated directly with Heartland
Refinery but familiar with the improvements and bottom line
results. This included members of management at other Global Oil
sites and outside consultants. To assure a degree of
confidentiality to the people involved, we have identified people
only by their title or role. By identifying people in this way, we
draw attention away from the characters as personalities and help
reduce the biases that people take on if they think they know who
is speaking. We focus instead on the universal roles,
responsibility and relationships that people have in relation to
the improvement efforts. We have also used titles to replace names
mentioned by others in their interviews. Persons whose quotes are
included are identified by the most obvious connection with the
Heartland Refinery improvements. For example, Heartland Refinery
people are identified as Refinery Management Team Member,
Maintenance Worker, Process Operator, Maintenance Supervisor, and
Process Supervisor. We also interviewed people outside Heartland
Refinery who were members of Global Oil management at other
locations but were closely aware of Heartlands improvement efforts.
Some people interviewed for this
8. A Voyage Beyond the Horizon and Back Houshower 07/01/99,
viii Learning History held senior management positions within
Global Oil at its U.S. and world headquarters and had a particular
responsibility or relationship with Heartland Refinery. Still
others quoted were outsiders involved in the improvement efforts.
The forty people who were interviewed make up the voices that tell
the story of Heartland Refinerys Continuous Improvement program. As
the Continuous Improvement program was developed and implemented,
Global Oil made a decision to divest the Heartland Refinery through
a sale. Sales efforts in 1996 were unsuccessful and at the end of
the year, Global Oil determined to close the plant by the end of
1998. These decisions did not deter the Continuous Improvement
efforts but did change the organizational structure. Ultimately,
Heartlands remarkable productivity improvements in the face of
considerable adversity caught the attention of North American Oil
who purchased the plant in August 1998. North American Oil and
Global Oil have both stated publicly that the sale occurred largely
because the improvements Heartland had accomplished added
considerably to the value of the refinery. To help the reader
understand the timeframe and where people fit into the
organization, a timeline and pre- and post-sale organization charts
are included as appendices.
9. A Voyage Beyond the Horizon and Back Houshower 07/01/99, ix
Timeline: Notable Events at Heartland Refinery, 1993 1998 1993-94
Reengineering 1994 Pilot Manufacturing Game sessions 1995 All
Heartland Refinery employees participate in Manufacturing Game
Cross-functional Action Teams launched Dont Just Fix It, Improve
It! program implemented Continuous Improvement (CI) Forum
established CI Forum develops roadmap (7 critical elements and 2
& 5 year goals) 1-11-1996 Global Oil announces intent to sell
Heartland Refinery 1996 New communications processes implemented
(e.g. E-mail digest, Info Bulletins) 11-8-1996 Global Oil announces
plans to close Heartland Refinery 1997 Enhanced Gainsharing program
implemented Heartland Integrated Complex plan announced 6-12-1998
Global Oil announces placement of all refinery employees 7-1-1998
Global Oil announces sale of Heartland to North American Oil qq
Heartland Refinery Established and Achieved Breakthrough Targets
Cash Margin Enhancement: 1997 vs. 1994 (dollar/bbl crude @ 1995
basis) Higher Reliability 0.08 Hydrocarbon Loss 0.27 Process
Optimization 0.22 Crude Delivery & Quality Costs 0.05 Energy
Efficiency 0.06 Cost Savings Initiatives 0.09 Total Cash Margin
Enhancements $0.77
10. A Voyage Beyond the Horizon and Back Houshower 07/01/99, 1
Prologue: The Heartland Refinery, Queen of the Fleet In 1885, Oil
was discovered near Heartland, Midwest State and, almost overnight,
an agricultural town of 4,000 was transformed into a manufacturing
and railroad center. Oil wells dominated the landscape and
entrepreneurs began shipping barrels by rail. Heartland grew
rapidly into a city with five Class One railroads and one of the
Midwests first urban electrification and electric street railway
system. The Heartland oil boom soon caught the attention of a
well-known oil baron who built a refinery there in 1886. The
Heartland Refinery would become a standard bearer among U.S. oil
refineries and support the growth of Heartland into a major
transportation-manufacturing center. Major Heartland industries
have included the Heartland Locomotive Works, the Midwest State
Steel Foundry and a Major International Aerospace Division plant.
The Famous Auto Companys Heartland Plant and the United States
Traction Weapon Plant are still active. Heartlands reputation for
oil refining and manufacturing grew throughout the first half of
the twentieth century and Heartlands workforce contributed mightily
to the re-supply and replacement of World War II equipment and
armament. By 1945, Heartland was a small city of 50,000 and the
Heartland Refinery provided fuel for transportation and aerospace
industries and for a communitys identity where fully two-thirds of
local workers were employed in transportation-related industries.
The Heartland Locomotive Works ceased production in 1951, signaling
the decline of the rail transportation era and the beginning of
Heartlands post-war transition from industrial Superpower to rust
belt town. Heartland Refinery continued to operate twenty-four
hours per day, even as industrial neighbors closed or reduced
production to marginal levels. The Heartland Refinery was Benchmark
Oils Queen of the Fleet, throughout the 1950s and 1960s with a
substantial impact on the local economy in jobs, net value and
associated business. Heartlands survival amidst the industrial
decline of the post-war era accentuated this status. Even so,
Heartland Refinery could not remain isolated from the growth of a
global economy and multi- national ownership. In 1987, Global Oil
purchased Benchmark Oil. Heartland Refinery soon realized that she
was no longer Queen and that forces in the international oil
business and the global economy would now play an important role in
determining business decisions at Heartland. Beginning in 1992,
Global Oil folded the Heartland and Metropolitan refineries into an
Midwest State System, that consolidated corporate control in Major
City, Midwest State. In addition, in 1993, the Midwest State system
introduced a reengineering plan for the Heartland and Metropolitan
refineries in an effort to reduce costs and maximize production.
Reengineering represented a major change in the way the refinery
would conduct business with a significant impact on personnel,
including dislocation and downsizing. In addition, reengineering at
the Heartland Refinery is where the Heartland continuous
improvement story begins.
11. A Voyage Beyond the Horizon and Back Houshower 07/01/99, 2
Chapter One The Heartland Refinery Sails A New Ship Reengineering
and the Roots of Continuous Improvement Reengineering is the first
word people mention when they talk about notable events in
Heartlands continuous improvement structure. Reengineering was
tough. It involved radical change in the organization of work, job
loss or dislocation and even chWesternges to personal identity. But
nearly everyone acknowledges that reengineering prepared the way
for significant improvement by implementing a new organizational
structure suited to teamwork and increased area and individual
responsibility for decision making and responsibility. q
Reengineering of the Midwest State Refining System in 1993, under
the guidance of a reengineering consultant, restructured the
Heartland and Metropolitan refinery organizations. All job titles
were changed and no one was assured that either they or their job
would continue at the refinery. The management team selected
employees for the positions on the new organization chart. Not
everyone received a job offer and many people lost their jobs at
the plant. Everyone had a new title and new reporting
responsibilities. q The Site Manager became responsible only for
operations (Producing Salable Product). Reporting to him were the
Shift Team Managers who oversaw day-to-day process operations. The
most significant change was the addition of Area Team Leaders and
Area Teams. Maintenance workers were no longer assigned to a
Maintenance Supervisor, but to an Area Team Leader. These teams
were responsible for keeping the plant running. The creation of
Area Teams necessitated regular meetings of representatives from
process, maintenance and other functional departments. qq
Maintenance Supervisors, Maintenance Engineers and
Reliability/Inspection Engineers had dotted- line relationships
with the Area Teams. Maintenance, Human Resources,
Health/Safety/Environment and Commercial Managers were responsible
for two sites and reported to the Manager of the Midwest State
System. Like it or not, reengineering provided a structure for
change. [Refinery Maintenance Manager]: Reengineering contributed
the infrastructure that allowed us to accomplish many things that
we did. Mainly, the way it allowed us to tear down departmental
walls and develop formal area teams. We also took engineers and put
them on area teams. They became our improvement drivers and that
really helped facilitate improvements.
12. A Voyage Beyond the Horizon and Back Houshower 07/01/99, 3
[Refinery Management Team Member]: The reengineering vision was
pretty accurate. Basically, the concept of an asset team approach
was correct, but to launch those teams, you needed improvement.
[Refinery Management Team Member]: Reengineering gave us an
organizational structure that was more functional to meet the needs
of this business. It was more in tune with a team-based process and
information sharing. It created teams [Refinery Maintenance
Supervisor]: On the positive side, it brought people together in
teams, brought operations much closer to maintenance and introduced
the idea of everyone working together to solve a problem. [Refinery
Operations Supervisor]: The reengineering process helped us go into
cross-functional teams and made people more at ease about working
together. And affected everyone. [Refinery Maintenance Supervisor]:
It made everybody change a little because there werent any craft
bosses anymore. If they came to me, I had to say, I dont know
anything about that, do what you think is best. [Union Officer]: I
think its significant that the union agreed to participate in
programs as early as 1988and we caught a lot of flak too. But the
local recognized that we had to start working with the company to
make changes to achieve the same ends. Reengineering Emphasized
leadership [Global Oil Manager]: If a person was a stronger manager
than leader, they were in trouble because they didnt have anything
to fall back on. However, it was good for leaders because they are
more innovative. What really surfaced is, who is a leader and who
is a manager. And autonomy, [Refinery Training Supervisor]:
Reengineering created some ownership in areas, but it took years
for individuals to understand that this is my pump and I am
responsible for its operation. Management did let guys decide which
jobs should be two-man jobs because there were fewer people and if
they needed extra help. These were early steps up the knowledge
ladder.
13. A Voyage Beyond the Horizon and Back Houshower 07/01/99, 4
Including significant Financial authority. [Refinery Management
Team Member]: One of the good things that came out of reengineering
was that front-line guys got more financial authority and along
with that came responsibility. When somebody says, You four guys
have $2 million dollars of improvement money to spend on what you
think makes sense, that is a whole different ball game. That is a
lot of trust and you dont want to goof. [Refinery Training
Supervisor]: Reengineering freed up money. I had a budget of close
to $1 million. I financed all the Manufacturing Game sessions with
this money. [Refinery Management Team Member]: Global Oil was
really struggling to find a good process, but has been notorious
for not being patient when things dont happen right away. Yet we
stuck with this one. We had a manager who was in position for an
extended period who stuck with it. However, a new structure Without
new behaviors Was simply not enough. [Refinery Manager]: We
received the reengineered organization and were told to put it into
place, but we didnt understand what that meant. It wasnt too long
until we began to see that we had something that was good in terms
of structure, teams and integration, but that we didnt have the
behaviors in place to understand how to optimize it. Workers did
not understand The need for change, [Union Officer]: Unfortunately,
management often doesnt understand what they already have. For
example, our union had allowed them to take two machinists and put
them in a condition monitoring program, full-time. That was the
problem with reengineering if you have a car that is running good,
you give it a tune-up or change a part, you dont rebuild the
engine. Especially when Reengineering Removed expertise From many
areas [Refinery Maintenance Supervisor]: In 1988, we began
rebuilding our reliability efforts and decided we needed more
involvement from machinistswe trained the first machinists as
condition monitoring technicians. Unfortunately, reengineering came
along and broke up the expertise that we had established in the
maintenance department.
14. A Voyage Beyond the Horizon and Back Houshower 07/01/99, 5
And created confusion And anger around, Who was in charge?
[Refinery Maintenance Worker]: I didnt have an instrument shop boss
who was an instrument person. If I ran into a problem I couldnt
solve, I had no supervisor to go to. Or, if I needed something or
more training, I had no champion. q Question: It looks like
reengineering was handed down to the Midwest State System without
specific guidelines for implementation. Was this a weakness, in
that it meant every facility would handle it differently? On the
other hand, was it an opportunity, for the same reason? Question:
How much of the problem was in perception of how the new
organizational structure was supposed to work versus lack of
acceptance (not believing the structure would work)? [Refinery
Training Supervisor]: People were very hostile and confused. They
did not like reengineering. I didnt like it. Everybody was trying
to figure out what their role was. We took all the craft
supervisors away and told the workers that they were
self-empowered. They didnt want all that responsibility. Rapid
turnover in plant managers did not help. [Union Officer]: Prior to
[Refinery Manager], we went through a fair number of plant managers
and their theories and thoughts. Quite frankly, there was confusion
as to whom we were really following. [Union Officer]: I dont know
whether it was Global Oil or all corporations, but they seemed to
really get caught up in consultantsthey were all over and you kept
bringing them in until they told you what you wanted to hear. . .of
course, the programs they implemented had about a two year life
expectancy because they were changing plant managers, process
managers and maintenance managers at the same rate. Labor relations
Were strained [Refinery Management Team Member]: Coming out of
reengineering, this was a very difficult and delicate period for
labor relations. The union didnt want to talk with us because they
assumed that anything we were going to do was going to eliminate
jobs. And many people Felt lost. [Outside Consultant]: People
really seemed to be struggling like hell. Someone might say, I got
this title, Resource Allocator, and I dont know what the hell that
means, but I think it might be like what the foreman used to do.
Peoples statements indicated that they had completely lost their
identity.
15. A Voyage Beyond the Horizon and Back Houshower 07/01/99, 6
qq Question: What avenues are needed to express employee concerns
in a major structural change effort like reengineering? [Refinery
Change Manager]: Things were in disarray. Nobody was taking
ownership, not even senior management. At one stage during
reengineering, one senior manager wasnt willing to buy a house. In
fact, the Heartland Continuous improvement Story began when
employee morale was lowest. qq Question: What set of conditions is
necessary to provide the initial impetus for change? [Global Oil
Senior Manager]: By 1993, it was clear that the reengineering
process lowered costs, but did not engage the folks in what the
refinery really needed to do. Certainly, morale was low as a result
of layoffs. The Heartland continuous improvement story begins in
1994/95 when [Refinery Manager] and his team decided to do things
differently. Chapter Two: The Sailors Learned to Sail the Seven
Seas A successful sailing journey is a complex endeavor, fraught
with the peril of uncontrollable weather and events. At the
Heartland Refinery, the pieces for a successful journey came
together at about the same time: (1.0) A new organizational
structure based on reengineering (2.1) Participation by almost
everyone in the organization (2.2) Insights and skills from the
Manufacturing Game (2.3) A simple-to-implement program for
improving manufacturing (2.4) An understandable roadmap for success
provided by the Continuous Improvement Forum (2.5) And broader and
deeper communications Significant results were achieved from the
refinerys investment in its people and manufacturing
processes.
16. A Voyage Beyond the Horizon and Back Houshower 07/01/99, 7
Chapter Two: The Sailors Learned to Sail the Seven Seas 2.1
Everyone Went Back to Sailing School Virtually everyone remembers
mandatory attendance for all employees at the Manufacturing Game
workshops as a notable event. The Manufacturing Game was first
introduced at the Heartland Refinery in mid-1994 when [Outside
Consultant], the games creator, was facilitating several sessions
at Global Oils Heartland Chemical plant. A reliability specialist
sold the maintenance training manager for Heartland Refinery on the
potential in the program and authorized two pilot sessions in mid
1994. Success from these early workshop sold senior refinery
management on scheduling sessions for all employees. Not everyone
was ready to experiment with a new approach or change behavior, and
they were not required to participate. However, all were required
to attend the Manufacturing Game workshop, to observe and witness
the active involvement of coworkers and the Plant Manager who
participated in every session. The result was a high level of
shared experience and vision at an early stage in the improvement
effort.
17. A Voyage Beyond the Horizon and Back Houshower 07/01/99, 8
Virtually everyone attended The Manufacturing Game [Refinery
Training Supervisor]: I wanted to get all the people to go. I think
we probably achieved 99%. This included co-ops, administrative
assistants and all the people that we invited from the outside.
That was a big plus that I didnt realize in the beginning would be
that good. And received The same opportunity to get onboard.
[Refinery Maintenance Supervisor]: The Manufacturing Game was a big
part of our improvement across the facility because all people in
the refinery had an opportunity to go through this program and get
onboard with the same ideas, for example: Dont Just Fix It, Improve
It. These ideas started really grabbing hold and we soon started
seeing benefits. Even when They disagreed on the games value
[Refinery Engineer]: The game was not important except that it
brought everyone together. We could have played Monopoly. The issue
was how you were going to discuss, deal with problems and
communicate. Everyone understood They were building a foundation
for performance. [Global Oil Manager]: The whole idea of the
Manufacturing Game and the clear rallying point, Dont Just Fix It,
Improve It, were the foundation the house of performance was built
on. Everybody in the refinery was behind this and it provided a
basis to guide direct actions. qq How does making attendance
mandatory affect peoples ability to learn? Were there other options
available to management at that time, or was coercion the only
option at that time? Do assets seeking to use the Manufacturing
Game have to achieve 100% attendance at a workshop by everyone?
[Global Oil Manager]: By making attendance mandatory they sent the
message, this is important. But they didnt try to force
participation. If you chose to watch for awhile, that was fine, but
you got to witness involvement and saw that that this could be
beneficial. [Global Oil Manager]: What really interested me was the
mandate for all employees. Usually the Manufacturing Game turns
into an optional participation for most people, but at Heartland it
was actually mandatedand what was critical was that [Refinery
Manager] and [Refinery Maintenance Manager] participated in every
session.
18. A Voyage Beyond the Horizon and Back Houshower 07/01/99, 9
The senior manager Participated in every session. [Global Oil
Manager]: [Refinery Manager] made it mandatory and [Refinery
Manager] participated heavily which motivated other managers. He
developed quite a few champions and set up the Continuous
Improvement Forum (CIF) where he could participate at a higher
level and continue to promote progress. [Global Oil Manager]: Its
really important that the manager with the most at stake be there
to support this. If its my business and Im telling all my employees
they have to be at a session, I should be there. [Refinery Manager]
and [Refinery Maintenance Manager] managed to do itthat was a big
key. And helped Transform a game Into a shared vision [Refinery
Training Supervisor]: [Midwest State System Manager] coined the
term proactive manufacturing. He saw it as a whole plant concept. A
lot of people want to do the game to save money in maintenance, but
thats not going to do it. Its not about maintenance. Its everybody
working together and sharing. for how to run a refinery. q Is
senior management participation the key to creating receptivity? q
How clear must the vision and sense of core purpose for the asset
be? q What form does the articulation of the vision and core
purpose need to be? A flag? Pictures? Statements only? [Refinery
Change Manager]: The big ticket was getting a common vision of
where we wanted to go, pulling together and having some ownership.
We had to run the refinery like it was ours.
19. A Voyage Beyond the Horizon and Back Houshower 07/01/99, 10
Chapter Two: The Sailors Learned to Sail the Seven Seas 2.2 The
Crew Practiced Sailing on Dry Land The Manufacturing Game was a
packaged workshop for improving manufacturing performance that was
first implemented in mid-1994. By the end of 1995, nearly every
refinery employee had participated in a game session. Not everyone
agrees about the positive impact of the game, or about its learning
outcomes. Hourly workers in particular talk about the games focus
on principles they already understood and practiced. However,
nearly everyone interviewed acknowledged some personal impact of
the experience and included it as a noticeable event in Heartlands
continuous improvement story. Heartland implemented The
Manufacturing Game to address a specific need for proactive
maintenance. [Refinery Maintenance Manager]: I will be perfectly
honest with you. One of the objectives I gave my department was
that I wanted us to move toward proactive maintenance, but having
been away from maintenance for a few years, I was at a loss to give
them specific instructions. And about that time Chemicals invited
me to come over and play this proactive manufacturing game. Of
course, being a manager, I was too sophisticated to play a game, so
I sent two of our maintenance specialists. They came back and said,
Youre a genius thats exactly what we should do. So I scurried over
to the next session to find out what I was so smart about. Thats
how we got started. But the game helped everyone Think about
systems (at their personal point of impact), [Refinery Management
Team Member]: The Manufacturing Game got everybody thinking. If Joe
Blow is over here yanking something, it might affect whoever is on
the other end of the line. It got you thinking, OK, if we look at
this as a holistic thing, then maybe we can fix it better.
20. A Voyage Beyond the Horizon and Back Houshower 07/01/99, 11
qq Question: Must individuals personally experience learning for
The Game to be effective? qq What were the things workers had been
saying that hadnt yet been appreciated and incorporated by the site
into decision making rules and policy? Who said what to whom? Does
this imply an inability to listen on the part of management? What
prevented workers views from being heard and acted on? [Refinery
Maintenance Supervisor]: The Manufacturing Game focused attention
on how important the storehouse was. If you needed parts and
couldnt get them or if you stored too much, it was all in the game.
And just like the butane story, it showed what the workers were
already saying was important. You have to have certain items in
stores to keep the place running. See what team effort Could
accomplish, Question: Is it vital for people to play unfamiliar
roles, to get new insight? In the game? In the plant? [Refinery
Operations Supervisor]: The game was a tangible way for people to
see that a team effort workedthat is, learning to see what other
people in the refinery do, putting the most knowledgeable people
together to work on something and giving them adequate resources.
Experience other persons Responsibilities, [Global Oil Manager]:
The game allows you to see that there are a number of different
factors that go into improved reliability, especially when
everybody gets to play a different role. Challenge their own
Assumptions, Question: How much impact did the Game / workshop have
on peoples capacity, awareness, and action from a systems thinking
or holistic perspective? [Refinery Change Manager]: We had a
thirty-year maintenance supervisor who was regarded by everybody as
a good supervisor. He said, Before I played the game, I think I
used to know what maintenance was. I really didnt. He was saying
that he didnt see the interdependence with operations and time
delays. And he didnt see the financial consequences of his work on
business operations. [Outside Consultant]: The Manufacturing Game
put people in a position where they couldnt fall into their old
habits, so they learned. For example, more than one person told me,
What I learned out of this is that Im not a team player. And
understand Defect elimination [Refinery Management Team Member]:
The game allowed people to actually see what we meant by
eliminating defects in a non-threatening environment.
21. A Voyage Beyond the Horizon and Back Houshower 07/01/99, 12
[Refinery Management Team Member]: The game showed you in graphic
form that if you dont take time to plan work and do it right, you
will just keep getting more bugs. It taught you to allocate
resources and eliminate defects. Without realizing They were
learning. [Refinery Change Manager]: The game offers you a picture
of what might be, I can save a lot of money on maintenance.
Everybody always says, I already knew that. I think they dont
notice the workshop and thats OK. Its a magical experience in some
ways. People go in disillusioned and cynical and come out wanting
to help. q Question: It looks like learning is not always fully
appreciated in the moment, but when the experience is shared, it
gives everyone something to build on. Is this true? [Refinery
Maintenance Supervisor]: There was a lot of griping about it, but
everyone got something out of it, even though they didnt realize
it. Playing the game certainly made everyone realize that there was
more to it than what happened in front of them every day. Many
hourly workers Felt they already Practiced what the Game preached
[Refinery Operator]: The idea of the Manufacturing Game was to show
you that only a few people take care of equipment. But hourly
workers have always worked for perfection and to fix things that
needed to be fixed. When you have to play a game that tells you
what youve been telling management for years, its like rubbing your
nose in it. A lot of company people said, This is great. I guess
they are the ones that should play the game. Question: What would
the value be to an ongoing process of using the Game as a practice
field, with everyone getting to play new scenarios, to build
insights and try experiments in accelerated time? Who should have
multiple experiences? [Refinery Maintenance Worker]: The
Manufacturing Game is like this: You teach someone how to play
bridge and then you play one game. Then, you never play another
game and everybody says, Well, you know how to play bridge. I dont
think thats the object. You dont want to learn how to play the
game, you want to learn how to make it work.
22. A Voyage Beyond the Horizon and Back Houshower 07/01/99, 13
And that it Should have focused on other issues, including
manpower. For instance, the game focused too much on mechanical
defects. We did not apply the game concept to manpower and
trainingand these are defects that can cause big trouble. There is
an unfortunate mindset that ignores problems if they dont move oil,
but if a gauging system goes down and the area specialist is
gonehey, Id still be working on it because I dont work out there.
But looking back, Most agree That the game helped start The
improvement process. qq Question: What was it about the game that
caused this? [Refinery Operations Supervisor]: It was later, when
we started progressing with the CI Forum and action teams that we
looked back on the board game and thought, This is what they meant.
The Manufacturing Game was the beginning of a thought process that
grew in impact. [Refinery Maintenance Supervisor]: Having been
involved with preventive maintenance activities for my entire
career, the game was a dream come true. Top management support for
a program centered on a proactive approach to problem solving was
wonderful. Prior to the implementation of this program, we did
experience success, but infrequently and with much greater effort.
The game made improvements much easier to accomplish because, in a
short period of time, there was a common desire to achieve
improvement goals. People began to Reevaluate typical Business
practices, [Refinery Maintenance Supervisor]: People began
recognizing that defects came in with equipment we werent
generating defects, we were buying them. So people started looking
closer at what we were buying and reevaluating the lowest bid
philosophy. [Refinery Maintenance Supervisor]: Im not a great game
guyit opened management eyes more than workers. But I give it
credit for helping people be more conscious of the budget,
especially during the Town Hall meeting where they broke it down
and you talked about the costs of each job.
23. A Voyage Beyond the Horizon and Back Houshower 07/01/99, 14
qq Town Hall Meetings: The site manager held quarterly Town Hall
Meetings to review major issues including refinery financial
information, productivity, and Health/Safety/Environmental
statistics. Town Hall Meetings included a sit-down lunch for 2-300
employees in the Refinery Recreation Hall. Various managers and
supervisors presented important information. Question & Answer
sessions allowed employees to ask and receive answers from top
refinery management regarding critical issues. Especially through
their work on the action teams [Refinery Change Manager]: The game
did have a cause and effect impact on root cause analysis. Some
contractors came to maintenance and pointed out a problem with some
pipethere was a one inch groove in the bottom. Maintenance took an
extra effort to look at this from a design standpoint. Instead of
simply replacing the pipe, they changed its diameter to reduce
turbulence. This is a success story, just like the butane story,
but one that wasnt publicized as much. It happened invisibly due to
the influence of the game. That were formed as part of the game
workshops. [Refinery Change Manager]: As an outcome of the
workshop, we immediately did real work. We formed action teams on
the second part of the second day and worked on a real problem. q
Action Teams: Action Teams were formed during the second day of the
Manufacturing Game session. The goal for each team was to apply
learning from the game by identifying and addressing a particular
defect problem in their area. The number of teams grew in relation
to the number of game sessions. The Action Teams enjoyed a great
deal of freedom to prioritize problems and they received financial
support as needed. Clearly, The Manufacturing Game Was an important
tool for focusing everyone on a new improvement agenda. [Refinery
Maintenance Supervisor]: The Manufacturing Game was a tool that
[Refinery Manager] used to focus everyone on what our targets and
objectives should be. It was just common sensefixing things right
the first time and taking time to do it. [Refinery Maintenance
Worker]: The game helped by getting everybody together to recognize
the problems that we had. People practiced Simply working together,
And over time, [Refinery Training Supervisor]: the game breaks down
status. I made sure that an hourly maintenance guy sat in
operations or that an engineer sat in maintenance. They focused on
the game and let all the other stuff go. They simply worked
together.
24. A Voyage Beyond the Horizon and Back Houshower 07/01/99, 15
Sharpened the vision of what they wanted to create. qq Question:
The game and accompanying action team sessions grappled with issues
of how and why people learn and improve. How does your organization
address these questions? [Outside Consultant]: Over the course of
many sessions, the focus shifted from problems to results and each
time more good results were covered. People were creating a shared
vision and the presentations by [Refinery Manager] and [Refinery
Maintenance Manager] were sharpening the picture of what people
wanted to create.
25. A Voyage Beyond the Horizon and Back Houshower 07/01/99, 16
Chapter Two: The Sailors Learned to Sail the Seven Seas 2.3 The
Ship Sailed Beneath One Banner: Dont Just Fix It, Improve It! Dont
Just Fix It, Improve It, was the slogan that became a plant wide
model for proactive maintenance and manufacturing. The slogan was
formally introduced in 1995 as part of the program to reduce the
expense of equipment defects and failure rates. Reducing mean time
between failure rates for refining equipment was an important
measurable outcome, but the slogan was just as important in
supporting a mental model for how to conduct business in all parts
of the refinery operation. Throughout 1995, dozens of action teams
worked independently on Improve it projects. Many success stories
contributed to measurable improvements throughout the refinery, and
the butane action team story painted a clear picture for an
internal and external audience of what it was possible to
accomplish.
26. A Voyage Beyond the Horizon and Back Houshower 07/01/99, 17
Three simple decision rules that will create proactivity, if
understood and promoted in every decision, every day, by everyone
The old rules (formerly driving reactive behavior) were more like:
dont fix it if it aint broke dont spend any money its not my job
it! Dont just fix it, improve it! Dont Just Fix It, Improve It, was
a simple message that applied to everything. [Refinery Maintenance
Manager]: Dont Just Fix It, Improve It, was a simple consistent
message that applied to virtually everything. We were not just
talking about pumps, but our other organizational and management
decisions. At the time, we did not realize it, but it became our
policy. And what an easy to remember policy it was! [Refinery
Maintenance Manager]: [Midwest State System Manager] was new to
refining and he could cope with a problem happening, but his
question was always, What are you doing so that this wont happen
again? [Midwest State System Manager] was the first person I heard
use the expression, Dont Just Fix It, Improve It.
27. A Voyage Beyond the Horizon and Back Houshower 07/01/99, 18
It was easy to sell Because it emphasized craftsmanship [Refinery
Maintenance Worker]: Dont Just Fix It, Improve It, was a good
thing. It put a little more emphasis on the craftsman, to get their
input to other people. They started to listen to what we really had
to say. [Refinery Maintenance Supervisor]: I saw a lot more
flexibility on the operations side. Dont Just Fix It, Improve It,
was ingrained into everybodys head. If we were trying to do a rush
job, the mechanics quickly pointed it out to us: Dont just fix it,
improve it, huh? And better equipment. [Refinery Maintenance
Worker]: People were definitely working differently. We were doing
the same amount of work with fewer people. Our materials were
better and we were working smarter. The message Became ingrained as
everyone practiced it qq Question: It appears that change takes
time. Does making this explicit (through a slogan) support
progress? [Refinery Maintenance Supervisor]: The slogan became a
reality when everyone repeated it. As an example, I evaluated 40
pieces of equipment and of those, 5-6 were in bad shape and had
very high maintenance costs. My recommendation was to repair those
first and budget for the rest on a priority basis over 2-3 years.
However, when I presented this to my supervisor, he said, Lets do
them all. This was how the proactive mindset worked. And management
Invested the necessary resources. [Refinery Maintenance
Supervisor]: Over three years, since installing air conditioning at
a cost of $5,000 per shelter, we have gone from replacing eighteen
control boards each year (at $4,000 each) to less than four last
yearand weve had some very high temperatures. Management was
willing to say, Nobody likes to spend money, but OK, youre
convinced this is a problem, so spend. We did and we solved the
problem and saved a lot of money. [Refinery Maintenance Worker]:
There was a strong commitment to improving stuff. Training was
always offered in areas where we lacked it or needed it, and we
have some real nice equipment to use. The improvement concept has
proved itself in our mean time between failure rates. As a result,
People gained ownership, [Refinery Management Team Member]: The
action teams felt they had the power to fix things and they were
given money and authority to make changes.
28. A Voyage Beyond the Horizon and Back Houshower 07/01/99, 19
[Refinery Operations Supervisor]: To replace parts is easy. To
improve you need investigation, new parts and capital. It costs
more money, but [Refinery Manager] and [Refinery Maintenance
Manager] were completely on board. If you could demonstrate
improvement potential, they were glad to spend the money. Results
improved, [Refinery Manager]: [Refinery Maintenance Manager] and I
shared a philosophy that if you gave people adequate leash and the
necessary tools and resources, you could get some very good
results. And people worked together More effectively. [Refinery
Maintenance Worker]: With cross-functional action teams, you tend
to take ownership in the equipment you are working on. You develop
a work history behind why it fails and you know what keeps it
functioning. You also get familiar with the people who operate the
equipment. Together, you structure the day and become more
efficient at doing what you do. Managers came to view Maintenance
work as skilled insurance (versus a necessary evil), [Refinery
Management Team Member]: You had to change perception to realize
that a maintenance guy is like having insurance. You would rather
be paying him to sit and do nothing and then, you could take that
time to train him and put him on an action team. An essential idea
was not to break trust. If maintenance improved everything so it
didnt break, we werent going to get rid of them. We would find
something for them to do and we would develop skills that they
didnt have because we had extra time for training. And hourly
workers Changed their view of work to flexible problem solving.
[Refinery Maintenance Supervisor]: Our objective was just common
sense. We fixed things right the first time and took time to do it.
Wed first look for a problem and then put team members together to
address it. The idea was to solve the problem and then disband and
go on to the next issue.
29. A Voyage Beyond the Horizon and Back Houshower 07/01/99, 20
qq Question: How do you measure the impact of changes in attitude
on improvement? [Refinery Change Manager]: The oil and sewer team
offers a good example of how completely some of the teams took
ownership of problems and how independently they worked. They never
had a meeting or wrote a report. In fact, we thought they were dead
in the water. However, we noticed a 75% reduction in oil to the
sewers. That saved us big dollars. How did this happen? They just
did it with a proactive attitude. The message reinforced The
importance of Pride in work, [Refinery Engineer]: With Dont Just
Fix It, Improve It, the maintenance technicians had more pride in
their jobs. They knew they were doing things right. And operators
gained more trust in maintenance since things didnt break right
away. [Refinery Operator]: Preventive maintenance is just basic
stuff. When you determine that something is a problem, you need to
follow through and repair it until you fix it properly. You need to
stick with the problem. an attitude that was already present,
[Refinery Operator]: Everybody wants to do a good job. The mind set
has always been present. When the refinery runs good, we have a
good day. When it doesnt, our day is hectic. You might be in the
office, look out, see that the flare is up, and think, Boy,
something must have broken down. But you go back to work. For the
operator who is killing himself to keep it running, it is
traumatic. But not always supported. [Refinery Operations
Supervisor]: I like the Dont Just Fix It, Improve It piece of the
program. This was an approach I recognized from twenty-five years
ago as a helper on the unit. But at that time, an hourly person was
supposed to do what they were told and stay within a box. [Union
Officer]: The improvement attitude was always there for the
craftsmen. If you go out and fix something you want to make sure
things are running, but this does need to be reinforced with
programs like Dont Just Fix It, Improve It.
30. A Voyage Beyond the Horizon and Back Houshower 07/01/99, 21
The slogan reinforced Managements commitment [Refinery Maintenance
Worker]: Management finally turned around and said, Well, we are
getting rid of the reactive way we do maintenance and go to a
proactive approach. We knew that before. The only way to improve
something is to maintain it. to plant-wide improvement, [Global Oil
Manager]: The message was a shared vision that was very
understandable to all employees. It allowed 500 employees to make
correct decisions in the field and dramatically improve
reliability. And helped everyone Experience early success, [Outside
Consultant]: Early on, they had a big turn-around and these action
teams, instead of working on pumps, had some pretty big impacts
because they really caught on to the idea of defect elimination.
This was the beginning of people starting to implement Dont Just
Fix It, Improve It. Especially through the Butane action team story
[Refinery Manager]: We were lucky to get the butane success story
quickly. You could point to it and say, Thats what this is about.
In addition, from the mechanics and operators point of view, a
stupid thing had been going on far too long. Now, they finally had
the opportunity and a way to change it. This reinforced the idea
that management was committed to improvement. That proved They
could achieve Significant monetary success. [Refinery Change
Manager]: The butane story proved there could be success and the
learning history helped because we were able to tell the story in
an authentic way. The story became well known inside and outside
the refinery and Global Oil. Everyone talked about it as an example
of what could happen with this approach. q Butane Action Team: The
Butane Action Team was formed during one of the early Manufacturing
Game workshops. The team was initially asked to address human
factors that management assumed were contributing to excessive
flaring in the butane area. With support from the area team leader,
the team decided to ignore their instructions and address the
problem by focusing on hourly concerns about safety and equipment
reliability. In a relatively short time, and with very modest
investment, the team identified and resolved several equipment
problems that resulted in annual savings of $1.5 million in
reducing product weight loss. The Butane Story has been widely
publicized through a Learning History on the actions of this
team.
31. A Voyage Beyond the Horizon and Back Houshower 07/01/99, 22
In fact, There were many success stories That could have been told
to demonstrate the real power of The simple message, Dont Just Fix
It, Improve It qq Question: How important were action teams for
making improvement concepts understandable and for achieving
performance? And how important is it to publicize success stories?
[Global Oil Manager]: Documenting and advertising success stories
is clearly important. The butane story was a high profile story
because of the $1.5 million savings. But there were dozens of
others that meant a lot to people in their areas. In fact, these
should have been more widely acknowledged. You have to get all the
stories out or you wont get the participation and buy-in from the
wider organization. qq Dont Just Fix It, Improve It and Mean Time
Before Failure (MTBF) at Heartland In spite of the closure
decision, pump MTBF and Planned Work continued to improve. Pump
reliability increased by fivefold; costs dropped more than $1.5
million per year. Maintenance switched from reactive repair of
breakdowns to proactive defect elimination and prevention with a
focus on operational discipline. Our learning culture enabled us to
continue improving in spite of a very difficult situation,
eventually resulting in sale of the asset to North American Oil, a
win-win-win for Global Oil, for North American Oil, and for the
employees/community. Our learning culture enabled us to create a
new future for Heartland Refinery 0 10 20 30 40 50 60 70 1992 1993
1994 1995 1996 1997 1998 1999 Year PumpMTBF(months) Chapter Two:
the Sailors Learned to Sail the Seven Seas
32. A Voyage Beyond the Horizon and Back Houshower 07/01/99, 23
2.4 The Ships Officers Steered a New Coursethe Continuous
Improvement Forum Dont Just Fix It, Improve It, spawned hundreds of
individual and action team efforts to improve performance. While
some were successful in measurable terms, many were not. Management
recognized that a formal process for shared leadership and
course-setting was needed to sustain this effort. Heartland
management launched the Continuous Improvement Forum (CIF) in late
1995. As participants recall, the CIF was an innovative vehicle for
sustaining improvement efforts and reinforcing passion and
commitment for overall performance. The Heartland Refinery CI Forum
was an organizational innovation designed to get the whole system
into the room, including senior managers, supervisors and team
leaders. Typically, 25 to 30 people attended, and meetings lasted
for half a day to all day, depending on the agenda. In addition to
a focus on performance goals and hard targets, systems thinking,
visioning, learning histories, and productive conversation tools
all found a place. An essential feature of the CI Forum was the
focus on collective thinking and use of reflection to learn. The
impetus to create the Forum came from two places. First, in the
Manufacturing Game workshops it is a regular practice to stop the
simulation after every five weeks of operation and review
performance measures. The second motivation came from the Refinery
manager who wanted a means to understand action team results,
create a roadmap for the future, and create more alignment in his
teams.
33. A Voyage Beyond the Horizon and Back Houshower 07/01/99, 24
Management established The continuous improvement forum to
communicate what was important [Refinery Manager]: We established
the CI Forum in late 1995 with about twenty-five people that could
make things happen with responsibility and authority to spend money
in the right places. We wanted everyone to understand what was
important in terms of performance. We had the ideas, we had the
workshops underway, and we had some measurable success in
performance. But we still didnt have a clear articulation of what
the overall improvement program really was about. We decided that
we needed to have some kind of forum to make sure that everybody,
from all the departments and teams, were on the same page. We
wanted everyone to understand what was truly important in terms of
performance. [Refinery Training Supervisor]: A group of us worked
on where we were going. [Refinery Manager] said, This is what we
have accomplished and this is where we want to go. People got
onboard because they knew they were going somewhere. And formalize
The path forward Around seven key Improvement issues. [Refinery
Maintenance Manager]: We got a visit from [Global Oil Manager] who
had been plant manager at Outback Refinery and we were telling him
how we were doing things proactively. His question was, Where are
you goingwhats your game plan? We had to say, Well, we dont really
have one. He suggested we take a look at the road map they had
developed and it was really from this conversation that the CIF
developed around the effort to pull proactive manufacturing
together plant-wide.
34. A Voyage Beyond the Horizon and Back Houshower 07/01/99, 25
q The Roadmap and Seven Key Issues: As noted by persons
interviewed, the refinery roadmap identified measurable improvement
goals and progress in seven important performance areas. The
roadmap was not unique to Heartland. In fact, it was adapted from
the roadmap of another Global refinery. The CI Forum quickly
incorporated the roadmap as a primary strategic planning tool for
persons and teams in all areas of the refinery. The CI Forum
established benchmarks and goals for performance in the seven key
areas over a five-year period. This challenging process involved
critical self-analysis, aggressive target setting, and effective
communication to convince others to buy-in to the program and make
progress toward measurable objectives. In general, persons
interviewed spoke more about the participatory structure of the
forum and the importance of open dialogue in achieving objectives.
However, the importance of connecting continuous improvement to
measurable goals should not be ignored. Just like the Dont Just Fix
It, Improve It! slogan, the Progress Roadmap was widely circulated
and used to measure personal and team progress through the
improvement effort. Heartland Refinery: Key Issues and Improvement
Roadmap Key Issue 1995 1997 1997 CIF Average 2000 Rating Target
Rating Range Target 1. Leadership 1.0 3.1 2.5 1.0 5.0 4.6 2.
Personal Commitment/ 1.1 2.8 2.4 1.0 5.0 4.2 Team Participation 3.
Customer Focus 0.8 2.8 2.0 1.0 3.9 4.1 4. Supplier Relations 0.8
2.7 1.9 0.5 4.0 4.3 5. Standardization, Control 0.8 2.6 1.8 0.5 4.0
4.3 & Capability 6. Communication & 0.6 2.6 1.8 1.0 4.4 4.5
Performance Reporting 7. Strategic Integration of 0.5 2.8 2.6 0.0
5.0 4.5 Improvement in Refinery qq Question: Was the incorporation
of the Roadmap luck, or did this result from a willingness to learn
from others? [Refinery Manager]: We didnt invent the seven key
issues and the road map. We adopted and adapted to them. We looked
at them and they made a lot of sense because they incorporated just
about everything that we could think of that we needed to address.
We looked at the roadmap and did a gap analysis between where we
were and where we wanted to be. Then we laid out action items for
the next five years, but we focused on the next year. [Refinery
Management Team Member]: The CI Forum focused everyone on the seven
key issues that we defined as critical for the plant. We wanted to
see how we could implement those within the facility.
35. A Voyage Beyond the Horizon and Back Houshower 07/01/99, 26
[Refinery Management Team Member]: The CI Forum allowed us to come
back and ask, OK, what are the issues? What do we need to keep
pushing? The CI Forum constantly refocused our attention on looking
for new opportunities to improve. It was important that senior
managers did not dominate because it supported consensus and
ownership. [Refinery Manager]: We did lay out an agenda that
summarized the progress toward the goals that we were trying to
make happen. But this was just to provide a topic for discussion
and we had a lot of discussion about the topic. Some meetings
lasted three to four hours and didnt really resolve anything. Those
were frustrating, but they had to be that way, because over time,
we were able to achieve close to universal agreement about the five
year targets that we established for hydrocarbon loss, safety, and
other important measurements. There wasnt anybody on the management
team that could say that the refinery was headed in a direction
that they didnt agree with or have a say in. They understood where
we were going and why we were doing it. The forum steered
improvement in a clear direction, [Global Oil Manager]: The
formation of the CIF established a formal process for keeping the
improvement process going and keeping it in the forefront for all
employees. For example, the forum used the bug symbol and a
newsletter to communicate with everyone. [Refinery Manager]: We
were after the total refinery operation and the roadmap provided a
good articulation of what our program was and where we wanted to go
over five years. I dont think there were any key refinery issues
that we didnt address. We assigned champions to each issue and they
were folks that could make a difference.
36. A Voyage Beyond the Horizon and Back Houshower 07/01/99, 27
identified roles for managers, [Refinery Management Team Member]:
The forum involved most of the people in charge of different areas
and held them accountable. We were going to go forward and everyone
knew his or her role in the process. looked for new opportunities,
[[Refinery Operations Supervisor]: The CIF looked for ways to
maximize efficiencies and opportunities. I really enjoyed the
meetings. I went to a lot of them on my days off. and communicated
a participatory attitude to the entire workforce. [Global Oil
Manager]: Everyone that participated in the CI Forum had the
[Refinery Manager] to you attitude that really emphasized direct
communication about all the issues. By having that, you could take
the message back to people in your area and could communicate with
everyone. [Refinery Manager]: Throughout Global Oil, people have
team meetings, but they are not as representative of the whole
organization. Other sites do not go as deep across the system as we
did with the CI Forum. And they do not operate as much like a forum
where everyone is encouraged to participate.
37. A Voyage Beyond the Horizon and Back Houshower 07/01/99, 28
Chapter Two: The Sailors Learned to Sail the Seven Seas 2.5 The
Officers and Crew Practiced Essential Skills They Listened and
Communicated As early as the first Manufacturing Game session,
reflection sessions (on the second day of the program) provided a
place for everyone to practice listening and communicating. This
effort and the introduction of new communication technology had a
significant impact on performance. Both initiatives helped the
officers and crew collaborate to achieve higher performance.
Perhaps, it all started with listening. [Refinery Maintenance
Supervisor]: Management started listening. Some of that came from
the Game and some is just so simple. I'm just talking about, Oh,
this grinding wheel isnt quite as good as the one I saw at the show
last weekwhy dont you buy one? And you say, OK, Ill do that. You
invest a few hundred dollars and show that you are listening and
that you will take someones ideas and put them to work. When
management listens to workers in small ways, they will come up with
more ideas, knowing they have a chance to put them into play. That
is the basis of trust. Senior managers were willing to listen until
it hurt. [Refinery Maintenance Manager]: After the game was over I
asked the union people what they thought about it and they said,
Hey, this is what weve been telling you for years. My response was,
Well, were finally gonna listen to you. The game provided a
mechanism for communicating across the entire organizationthat was
its biggest contribution. [Outside Consultant]: The January 1995
workshop was the toughest we had. [Refinery Training Supervisor]
invited all of the most disgruntled people in the refinery because
he was trying to make sure that [Refinery Manager] got a good
understanding of what the big issues were. People were really tough
on [Refinery Manager] but he handled it very well. He didnt turn
defensive.
38. A Voyage Beyond the Horizon and Back Houshower 07/01/99, 29
They listened to frustration, [Refinery Training Supervisor]: I put
[Refinery Manager] together with some very vocal guys. They chewed
him and he didnt say a word. Usually all the moaning gets sanitized
and all the top man hears is that there are problems but they are
being worked on. This time, [Refinery Manager] heard directly from
the front-line workers and he became more receptiveit was the
listening and understanding that made the difference. tough
criticism, [Refinery Operator]: We do not need a gamewe know the
worth of improvement. Just explain clearly what you expect from us
and let us explain what we expect from you and lets get together.
That is all we need to do. [Refinery Operator]: The game was a
joke, but it had a section where you could vent your frustrations
and [Refinery Manager] and [Refinery Maintenance Manager] were
there and had to take it, and that was good. and ideas for change.
[Refinery Operations Supervisor]: The reflection sessions allowed
people to be heard and listened to. In the past, good ideas ended
up in a black holeall of a sudden, people started to see results.
[Refinery Management Team Member]: Our training sessions were
really communication sessions. People can perform when they
understand what to expect. Managers encouraged employees to
experiment with their ideas. [Refinery Operator]: The butane action
team was a spin off from a Manufacturing Game session. Everybody
participated and listened to each other, and like the story says,
we saved Global Oil $1.5 million per year for a $15- 20,000 item.
There were two parts to this story: the hourly guys made the
success happen and the head of the team listened. [Refinery
Operator]: The best thing we have ever done is open up planning
meetings and bring in some of the people that work with equipment.
If you include people that work in the field it really benefits the
company. You cant just install something. You need to identify the
needs of the people that are running the equipment.
39. A Voyage Beyond the Horizon and Back Houshower 07/01/99, 30
Hourly participation also improved with new technology including
[Refinery Operator]: The E-mail digest, info bulletins and all new
communications were real good things. Before, you would have to
write a note and put it in inter-office mail, but it would take two
days to get a response. With E-mail, a response can be five minutes
and you can tell a lot more people what is going on. the PI system,
[Refinery Engineer]: The PI system allows everybody to access all
the manufacturing parameters so that more people will see process
changes and inform others if they see a change that should not have
occurred. info-bulletins [Refinery Management Team Member]: The
info-bulletin is another way to communicate with everyone.
Everybody gets used to seeing it and it becomes ingrained over
time. and e-Mail. [Refinery Operator]: Having a lot of PCs
installed, having everybody on e-mail and information bulletinsall
these things together improved communications. They helped
everybody feel that they knew what was going on and were part of
what was happening. q The Impact of Improved
Communications/Technology: Communication improved following
reengineering and the establishment of daily cross-functional
production meetings and regular area team meetings. q In 1995, the
PI (Process Information) System was introduced. PI is a computer
software program that stores, analyzes, and displays vast amounts
of process data, and most important, makes that data available in
less than five minutes (compared with one day for the previous
system). The new system dramatically improved the quality and
availability of process data available to a wide range of refinery
employees. q In 1996, personal e-mail accounts were provided to all
hourly employees, giving everyone in the refinery access to
electronic communication. As needed, special Info Bulletins were
quickly developed and distributed via e-mail, especially regarding
rapidly developing sale/closure issues. Direct communication
contributed to more collaborative relationships [Refinery
Engineer]: People need to understand exactly whats going on, whats
important and what makes money and what doesnt. These issues need
to be communicated directly from the top dogs mouth so that people
know there is commitment. This was something [Refinery Manager]
accomplished through his participation in game sessions and Town
Hall meetings.
40. A Voyage Beyond the Horizon and Back Houshower 07/01/99, 31
and a higher level of trust. qq Question: just how important is
trust in a change effort? [Refinery Management Team Member]: What
we tried to do was establish a more collaborative working
relationship with the union and start really discussing ways to
improve refinery performance. We would go off-site with the union
committee to educate each other on business and union issues. It
was an open dialogue and a way to start establishing
communications.
41. A Voyage Beyond the Horizon and Back Houshower 07/01/99, 32
Chapter Three: Everyone Got Onboard and Sailed Together-- Personal
Commitment Was Crucial For Success When the learning history was
commissioned, some persons in the organization expressed a
hypothesis that personal transformation was an important part of
the overall improvement process. The learning history interviews
did not provide evidence to confirm or disconfirm this. We asked
people to talk about the notable events in the story of the
Heartland Refinery. When we asked people to talk about what
happened in the area of personal change, they emphasized shared
public expressions of behavior change. These included: (3.1) taking
risks, (3.2) seriousness of purpose, and (3.3) the shared
commitment that resulted from taking time to build a constructive
dialogue among all employees.
42. A Voyage Beyond the Horizon and Back Houshower 07/01/99, 33
Chapter Three: Everyone Got Onboard and Sailed Together Personal
Commitment Was Crucial for Success 3.1 Everyone Onboard Took Risks
With New Behaviors You cant expect to move forward without taking
risks, is an important lesson that Heartland managers and workers
internalized and practiced. Heartland managers and hourly personnel
affirm [Refinery Manager] for his willingness to let go of control
and live with the perception that he was a weak leader. In
addition, they recognize a number of individuals for acts of
courage that helped change behavior and move the organization
toward higher performance. The plant manager understood the
importance of encouraging people to take risks. [Global Oil Senior
Manager]: The trick is beating down the barriers that separate
people and demonstrating the rewards of taking risks in terms of
communicating how they feel and wanting to help each other, rather
than seeking personal praise and benefits. Heartland was successful
in taking people from an individual to a team level because
[Refinery Manager] was very good at this. He is a servant leader
who constantly draws attention away from him to others. [Refinery
Maintenance Supervisor]: [Refinery Manager] had one of the biggest
effects on performance. He allowed people to take risks without the
danger of being censured if it didnt work as expected. You cant
expect to move forward without taking risks. Although he received
criticism for lacking authority [Refinery Maintenance Manager]: Our
senior management were perceived as lacking leadership because we
werent in everybodys face all the time telling them what to do. In
the long run, forcing the organization to step up to the plate,
giving area teams authority and resources to make and implement
decisions, this was a major contribution to the organizations
accepting ownership for refinery performance.
43. A Voyage Beyond the Horizon and Back Houshower 07/01/99, 34
he wanted people to take responsibility [Refinery Management Team
Member]: [Refinery Manager] is not one who is going to go out and
figure out how to run the Cat Cracker. However, if you need
something for the Cat he is going to try and round up the troops
and resources so you can fix it. He was always out in front saying,
We need to fix this guyshow can we do it best? and he supported
them. [Refinery Operations Supervisor]: [Refinery Managers] role
was to make sure that something was being done, not to solve the
problem. qq Question: Did this approach change behavior from
finding fault to seeking greater responsibility? [Refinery
Maintenance Supervisor]: The impact on behavior was widespread.
When we had an incident, like the instrument freeze-up, we didnt
look for whose fault it was. We looked for ways to make sure it
didnt happen again. Other places I have been, it was a lot easier
to pin the blame on someone than to fix the problem. [Refinery
Management Team Member]: Management had to learn to let go and the
workforce had to learn not to just sit back. We had to move from,
Gee, they didnt ask me to be on an action team, to Well, you dont
have to be asked: Call the team and tell them you want to be on it.
As part of the upward feedback process in performance assessment,
Global Oil Oil made it mandatory and put this requirement in its
communications with Heartland Refinery. We said to ourselves, No,
thats not the way we operate in our culture. We promoted it in
light of continuous improvement and the team environment, but did
not mandate it. Every eligible employee participated. A variety of
individuals also took risks at key moments, qq Question: How often
do we think of taking risks within our organization? [Outside
Consultant]: The role that the training manager played was
powerful. He was willing to do some things because of his years as
a union officer that I think is unusual in an organizational change
effort. Some of the things he did, like getting all the union guys
to show up with the plant manager, I dont think many people would
have the courage to do that.
44. A Voyage Beyond the Horizon and Back Houshower 07/01/99, 35
in an effort to build real understanding, [Refinery Training
Supervisor]: To be honest, I set [Refinery Manager] up. In January
1995, I invited him to play the game. I picked some guys to
participate who were very vocal because I thought [Refinery
Manager] was getting a sanitized version of our situation and the
dissatisfaction levels in the plant. The hourly guys really told
him how they felt. Some of it was right and some of it was not, but
at least he understood how they felt. passion for improvement.
[Refinery Manager]: [Refinery Change Manager], [Outside
Consultant], and [Refinery Training Supervisor] pushed very hard
all the time. They pushed us farther and at a very rapid speed and
did not let [Refinery Maintenance Manager], me or anybody set
higher priorities. We all adopted their passion for improvement as
a way to move the organization in the right direction. The plant
manager was even willing to share his fears with everyone.
[Refinery Change Manager]: [Refinery Management Team Member] asked,
Is this plant safe to work in? At that point, [Refinery Manager]
opened up and made some very honest comments to the group. He said,
Whenever I hear a steam vent release or boom, I wake up in the
middle of the night sweating. I dont know if its safe either. Is
it? He let that hang in the middle of the room with these angry
union people, engineers and others. This was a big turning point
because honesty about current reality became an important issue.
Breakthrough performance simply could not have happened without
this openness. [Refinery Change Manager]: Lee Solomon, the industry
consultant who does refinery benchmarking, has said that the number
one factor that makes a pacesetter asset is that you need a
maverick at the top. You need someone who is willing to take risks.
We had that in our senior managers. Without them, its hard to
imagine that this would have happened.
45. A Voyage Beyond the Horizon and Back Houshower 07/01/99, 36
Chapter Three: Everyone Got Onboard and Sailed Together Personal
Commitment Was Crucial for Success 3.2 The Ships Officers
Demonstrated Seriousness of Purpose Senior managers at Heartland
consistently demonstrated their commitment to people, shared
responsibility and the Heartland Refinery. They proved they were
serious about change through significant commitments of personal
time, direct communication with employees and direct support for
employee ideas. Their efforts helped build an organization that was
willing to learn and benefit from the workforces already existing
pride and sense of community. Seriousness of purpose by senior
managers was a key ingredient. [Global Oil Senior Manager]: Success
began with the commitment of [Refinery Manager] and [Refinery
Maintenance Manager] to the process. Without their leadership and
desire to improve the operation, nothing could have happened.
Having [Refinery Change Manager] around helped themhe gave himself
completely to the process and was a zealot in the best sense. The
key was simply the realization by senior refinery managers, and
with support from [Midwest State System Manager], that this was the
way to achieve sustainable results. [Refinery Management Team
Member]: [Refinery Manager] took everything seriously. It was
really in his heart to do it, not something that someone from
London said was the flavor of the day. This included a desire for
input from all parts of the organization. [Refinery Training
Supervisor]: [Refinery Manager] came to almost every Manufacturing
Game and reflection session. He and [Refinery Maintenance Manager]
listened to what people had to say. The people wanted to be
listened to and respected. They wanted to give suggestions and have
input. If you are really listening, you cant just sit there and
listen forever. You have to do something. That is what really
counts. The plant managers leadership style was important. [Outside
Consultant]: [Refinery Manager] is probably the best plant manager
I have met. He works with people and understands people. Yet he
does not let that weight his decisions for the plantif he has to
make an unpopular decision, he will.
46. A Voyage Beyond the Horizon and Back Houshower 07/01/99, 37
[Refinery Management Team Member]: We were fortunate that [Refinery
Manager] was here a long time for a refinery manager. That helped
give people confidence and build trust. He communicated directly,
[Refinery Maintenance Worker]: [Refinery Manager] explains what he
wants and you see the follow-up. We had Town Hall meetings quite
often and I felt confident he was telling the truth. At a steak
fry, he is talking with you and laughing. He is not standoffishhe
is in with the work force. [Refinery Maintenance Supervisor]:
[Refinery Manager] is a coach. He is very fair and consistent. He
has the ability to understand that people have value. If you came
to him with an idea and you had it well thought out, he would give
you the thumbs up and support you monetarily. and encouraged shared
decision-making. [Refinery Management Team Member]: [Refinery
Managers] management style is that he wants you to make decisions.
Early on, he actually got criticized for this, but he prevailed
because people understood that they had authority to do what needed
to be done. In 1995, we needed to take some shut down time. I got a
meeting of the appropriate people together and then, [Refinery
Manager] wasnt able to attend. I asked him, Do you want me to
change the meeting date? He said, You guys go ahead. If there are
any issues that you cant resolve, just let me know and I will
resolve them. At the end of the meeting, the commercial
representative said, I cant imagine doing this at another refinery.
But this was typical of what we did. Some suggest that the change
in leadership began with an earlier plant manager [Refinery
Maintenance Supervisor]: The most meaningful event is not on your
list: [Midwest State System Manager] having employees up for lunch.
[Midwest State System Manager] would call me up (I was a shop
supervisor at the time) and say, I want so many people today or
tomorrow for lunch. So I would go and shop around for people. At
the beginning, nobody wanted to go. They thought it was another
management thing, but [Midwest State System Manager] really
listened to them and they could see results from their suggestions.
It was like the CI Forum happening before improvement started.
47. A Voyage Beyond the Horizon and Back Houshower 07/01/99, 38
[Refinery Management Team Member]: [Midwest State System Manager]
won a lot of little battles and this helped employees pick up a
notch on performance because they knew there was somebody who would
take the story back and show Global Oil what we were doing. even
though the organization did not want to listen. [Refinery
Maintenance Worker]: [Midwest State System Manager] wanted to hear
what we had to say. He listened and took it seriously. I think he
resigned because he took a lot of what he got on the grass roots
level and tried to take it higher up where they didnt want to hear
what was going on. At Heartland, senior managers demonstrated their
commitment every day. [Refinery Engineer]: Direct support from
upper management for all the issues that people had been pointing
out over a number of years was the major driver of continuous
improvementit was that simple. [Refinery Maintenance Manager]: The
continued time commitment of the senior guys, as part of the
Manufacturing Game sessions and through the CI Forum, made a huge
difference. [Outside Consultant]: The biggest challenge we had is
that the bulk of the employees had to witness that this kind of
program was sincerely believed in and supported by leadership from
the top. qq Question: Was managements leadership approach essential
or was it an added benefit? [Refinery Management Team Member]:
[Refinery Manager] and [Refinery Maintenance Manager] proved that
they were serious by two things. One, you had to go. And two, they
gave up their time to go to all of these sessions. They proved that
they were serious and that was important stuff. This provided
evidence of the organizations willingness to change, [Outside
Consultant]: There really was not a change in knowing what to do.
The real change was in the organization being willing to do it.
This is more of a behavior kind of change. I think [Refinery
Maintenance Manager] was very impressed with that and that he
noticed some difference in how people down in the shop felt about
this issue. The mechanics felt like, Oh, management is finally
committed to doing some right stuff.
48. A Voyage Beyond the Horizon and Back Houshower 07/01/99, 39
in a way that embraced the workforces pride [Refinery Operator]: A
bunch of proud people that work here have made success happen. We
knew we were always doing a good job, regardless of how the bean
counters put Heartlands performance in perspective. [Refinery
Management Team Member]: We shouldnt forget that our union and
hourly people are good conscientious folks who bought into this
process. That really helped in all the agreements and efforts to
improve performance. and powerful sense of community. [Refinery
Operator]: Most people really care. That is what has made
continuous improvement work. Their fathers and grandfathers worked
here, and front line managers and operators went to school
together. There is an unbelievable sense of community pride.
49. A Voyage Beyond the Horizon and Back Houshower 07/01/99, 40
Chapter Three: Everyone Got Onboard and Sailed Together Personal
Commitment Was Crucial for Success 3.3 The Crew Discovered that
Teamwork Requires Shared Commitment Teamwork is a desirable
component of improvement for all organizations. To an extent,
Heartland built teamwork on the foundation of a strong local
culture that emphasized faith, family and work ethic and on the
structural innovations of the reengineering effort, like area and
cross-functional action teams. The Continuous Improvement Forum was
also organized as a cross-functional team for managers. In
addition, Heartland Refinery personnel discovered that teamwork
takes on a new and more powerful meaning when built on the
cornerstone of shared commitment. Commitment is not something that
arises naturally out of working at the same refinery. It must be
developed and nurtured through the practice of building a
constructive dialogue with others. Effective teamwork requires
significant energy and involvement. [Refinery Maintenance
Supervisor]: Our success comes back to teamwork. There is no single
entity out here. People share here and even with other refineries.
We are willing to send people to help and we are willing to learn.
A good example is that I insist that my technicians, anytime they
work on an analyzer, make sure that the operators who use the
equipment know that they worked on it and ask t