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From Turnaround To World ClassFrom Turnaround To World ClassCMC 91st Annual Conference
Adrian Butler
May 5th 2011
Click to edit Master title style
Why is Improvement so Hard to Sustain?
What is the Board Room talking about?
Re-structuring N IT
Partnering Agreements I know!!
Re-structuring New IT Systems
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Rationalisation
Consolidation
Move to China
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Consolidation
J i t
Cut Heads
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Joint Ventures
Buy New Technology
Squeeze Suppliers
O
©
TechnologyOutsource
What is the Board Room talking about?
Let’s improve the way we
But we’ve always done y
work?it that way!
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What? With that old equipment?
It’s the Nature of the Beast!
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You won’t change anything
We’ve already done continuous
©
anything around here
continuous improvement
Myths and Legends - 1
Belief
“We know what our problems are it’s fixing them that’s the difficult bit!”We know what our problems are, it s fixing them that s the difficult bit!
Fact
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• On over 400 processes we have asked the operational management team “what are the top 3 causes of lost opportunity on the shop floor?”
• Only once have we had the correct answer onsu
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• Only once have we had the correct answer
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Estimated Top 3 Problems
• 15 managers
ze
• What are top 3 problems?
• 36 different answers
• All chose 3 problems in hts
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Prob
lem
Si All chose 3 problems in
someone else's area
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Prob
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P P P P P P P P P Pr Pr Pr Pr Pr Pr Pr Pr Pr Pr Pr Pr Pr Pr Pr Pr Pr Pr Pr Pr Pr
Myths and Legends - 2
Belief
“We are already doing the best we can we are running at 90% efficiency”We are already doing the best we can, we are running at 90% efficiency
Fact
hts
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• True performance and opportunity is often hidden
• This hides the potential and reduces the drive for improvement
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• Self fulfilling prophesy
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Measured Efficiency by Industry100
80
95
858580
90
80
70
65
75
6560
70
(%)
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60
45
60
4540
50
rue
Effic
ienc
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40
30
20
30
Tr
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0
10
20 ©
0Ship Build &
RepairFMCG Manual Batch Automated
BatchAutomotive Paper Mill Contiunous
ChemicalsContinuous Chemicals
Myths and Legends - 3
Belief
“It is all about which methodology – should it be lean, six sigma or world class manufacturing?”manufacturing?
Fact
• It is about prioritising problems and solving them hts
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• It is about prioritising problems and solving them
• Any rigorous process will do this for you. Some will be marginally better than others
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• Any is better than none
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Myths and Legends - 4
Belief
“We’ll never improve until they get us some new equipment”We ll never improve until they get us some new equipment
Fact
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• Locked into a mindset that links progress with new machinery, many manufacturers fail to see the additive power of lots of small inexpensive improvements
• Many shop floor problems seem trivial but they are exactly the problems that are onsu
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Many shop floor problems seem trivial but they are exactly the problems that are slowing down your production line while you sit here now
• Do we really know that we have squeezed every ounce out of the existing kit?
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Myths and Legends - 5
Belief
“We need to start a company wide initiative – we will wait until the right time”We need to start a company wide initiative we will wait until the right time
Fact
hts
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• It will never be the right time
• It is best to start in one small area and get a big result
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Myths and Legends - 6
Belief
“The workforce is the problem they want to do things the way they have always doneThe workforce is the problem, they want to do things the way they have always done it”
Fact hts
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Fact
• Almost without exception, the employees we meet are desperate to see their daily problems sorted out and are keen to be part of the solution
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• The biggest resistance to change often lies with the supervisory and middle management team
“Of the 43 companies I have worked with, I have only ever had problems with one © N
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Of the 43 companies I have worked with, I have only ever had problems with one group of employees. I have, however, had problems with 43 management teams.”
©
A Point of View
The Shop Floor Worker
• Little focus on budget, often just wants to do a ‘quality job’
• Frustrated at lack of action on simple issues
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• “They’ve changed the management but problems are the same”
• What do all those people in the office do?
• It used to be much better onsu
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It used to be much better
• I guess it’s the nature of the beast
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A Point of View
The Director
• Focused on customers, budgets & improvement programmes
• Tends to only hear about ‘big’ issues – the system materials supply retention old kit ht
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system, materials supply, retention, old kit...
• Rarely hears any detail from the shop floor
• Their toolbox is strategic – re-organisation, new systems, outsourcing, etc
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A Point of View
The Middle Manager
• Focused on delivery and budget
• Gets all the gripes from the shop floor but will only report the ‘big ones’
• Often pushed to report progress repeatedly
T d t bl th t d f bl hts
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• Tends to blame other trades for problems
• Typically rewarded for fire-fighting, not for continuous improvement
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What are the Steps to World Class?What are the Steps to World Class?
Where do we start?
Understand current status• Understand current status
• Be objective• Some elements of the operation may be world class, while others will be turnaround
• Actions taken must match the problem
• A new ERP system will not help if all the base processes are broken hts
Res
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y p p• Driving process speed will not work if the process is not robust
• Helps to categorize the areas by: Turnaround, Transition or World Class status
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Consumer Model
• Process Lock Down• Performance Tracker
• Labour Optimisation• Scheduling Optimisation
• Work Flow Modelling• PLC Modification
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• OEE• Variance• Waste• LossesO hi d t bilit
• Training: Problem Specific• Training: Generic
(Lean/Six Sigma)• Giveaway Manager
NPD F l
• Speed/Output Debottleneck• Training: Advanced Problem
Solving and Improvement• Value Engineering
C it l I t t R d ti onsu
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• Ownership and accountability• Improvement Cycle Measure• Labour Manager• Training: SOP Establishment• Efficient Physical Logistics
• NPD Funnel• Changeover Improvement• Variance Tracker• Supply Chain Developer
• Capital Investment Reduction• Automation• Accumulation• Supply Chain Optimiser
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• Efficient Physical Logistics ©
Benchmarking at a Food Company
Planning
Production Control
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Engineering
Production Imp Cycle
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NPD
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Hygiene
Quality / TechnicalManagement
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Total Shopfloor
TransitionT d W ld ClTransitionTurnaround World Class
Turnaround Businesses
These are the hardest companies to improve• These are the hardest companies to improve
• The basic systems need to be built by blood, sweat and tears while all the pressures of firefighting are crashing around
• Process Lock Down• Performance Tracker
crashing around
• About 20% of manufacturing has an element of this category
• Red technical audits• Few SOP’s hts
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• OEE• Variance• Waste• LossesO hi d t bilit
• Few SOP s• Variation in product, settings, little black books• Technical data filled in prior to the run• Frequent plan changes• BOM’s being consistently error ridden• Regularly running out of components and packaging on
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• Ownership and accountability• Improvement Cycle Measure• Labour Manager• Training: SOP Establishment• Efficient Physical Logistics
g y g p p g g• Limited tracking performance• Limited labour control• Large turnover of senior staff• New products hitting the production with the wrong packaging, high
waste levels, little visibilityL k f hi d t bilit ©
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• Efficient Physical Logistics • Lack of ownership and accountability
• This is where the true visionary management teams are needed. There are no easy answers or short cuts. The foundation needs to be built up brick by brick in a
©
p ystructured methodical way.
Turnaround Example: Process Lock Down
W i ht T (G d B f)W i ht T (G d B f)
12.5
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Turnaround Example: Performance Tracking
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90
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Improvement Project
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Production t i d ©
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Turnaround Example: Performance Tracking
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Transition Businesses
This is where the• This is where the majority of processes are
• The factory is now
• Smooth operation is maintained by the efforts of a few
• The huge opportunity of
• Labour Optimisation• Scheduling Optimisation
The factory is now under control and operating consistently
• Audits are usually
• The huge opportunity of an engaged workforce with the ownership and accountability to drive the performance forward ht
s R
eser
ved
• Training: Problem Specific• Training: Generic
(Lean/Six Sigma)• Giveaway Manager
NPD F l
green, occasionally amber
• Delivery performance is over 99%
performance forward remains largely untapped
• Problems are often hidden or accepted as the nature on
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• NPD Funnel• Changeover Improvement• Variance Tracker• Supply Chain Developer
over 99%
• Short interval control is established and understood
pof the beast
• There is no “burning fire”
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• Factory measures drive performance
• The challenge here is often getting the “vision “of what is possible.
©
Transition Example: Labour Optimization
Basic shift schedule is 12 people perE l S h d l d • Basic shift schedule is 12 people per shift, modified to accommodate vacations and change requests
12
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Employees Scheduled
• Modelling tool developed to predict number of employees required based on workload
8
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©
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0 0 0 0 1 1 1 1 1 2 2 2 2 2 3
Workers Scheduled Workers Required
Transition Example: Labour Optimization
D il S h d l d Effi iE l S h d l d
100%
110%Daily Scheduled Efficiency
12
14
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90%
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8
10
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Scheduled Efficiency
0 0 0 0 1 1 1 1 1 2 2 2 2 2 3
Workers Scheduled Workers Required
Transition Example: Labour Optimization
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Transition Example: Labour Optimization
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Transition Example: Labour Optimization
110%
Weekly Labour Efficiency
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Scheduled Efficiency Actual Efficiency Cost Baseline
World Class Businesses
Most elements of production are being continually• Most elements of production are being continually optimised
• Employee led continuous improvement at the factory floor is a reality
• Work Flow Modelling• PLC Modification
floor is a reality
• Daily firefighting has become a structured, rigorous and owned process of problem elimination
hts
Res
erve
d
• Speed/Output Debottleneck• Training: Advanced Problem
Solving and Improvement• Value Engineering
C it l I t t R d ti
• All levels of the organisation have clear ownership and accountability
• The challenge is believing we can get better onsu
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• Capital Investment Reduction• Automation• Accumulation• Supply Chain Optimiser
• The challenge is believing we can get better
• In many ways these are the easiest businesses to improve. With a solid foundation and the whole organisation pulling in the same direction single ©
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organisation pulling in the same direction, single changes can have a significant impact
• By definition, these companies cannot stand still• Challenge and innovation
©
• Challenge and innovation
World Class Example: Speed Optimization
C
07:5
0
08:5
0
09:5
0
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0
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13:5
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0
17:5
0
18:5
0
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0
20:5
0
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Open Chamber
Full Production Cycle
pand Take Moistures
Check Moistures in Lab
Unload Chamber hts
Res
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Blow down with Air
Apply Steam
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Vacuum Pump-Down
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Heat Applied
World Class Example: Speed Optimization
P dMoisture Profile by Tray Procedure
• Check Moistures on all trays• Manual Check for wet product
S l M i t t k f “d ” d t6.00%
7.00%
Moisture Profile by Tray
• Sample Moistures taken for “dry” product
5.00%
Sample Moisture
Min Moisture
Max Moisture
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0.00%
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1 6 1 6 21 26 31 36 41 46 51 56 61 66 71 76 81 86 91 96
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Sample #
World Class Example: Speed Optimization
P dMoisture Profile by Tray Procedure
• Check Moisture• Outliers tracked and problems solved to
t6.00%
7.00%
Moisture Profile by Tray
root cause
5.00%
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0.00%
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1 6 1 6 21 26 31 36 41 46 51 56 61 66 71 76 81 86 91 96
2 3
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11-15
©
1 1 2 2 3 3 4 4 5 5 6 6 7 7 8 8 9 9
Sample #16+
World Class Example: Speed Optimization
P dMoisture Profile by Tray Procedure
• Check Moisture• All samples moisture < 3%
A i t < 1%6.00%
7.00%
Moisture Profile by Tray
• Average moisture < 1%
• Reduce dry time of next chamber by 15 minutes
5.00%
Sample Moisture
Min Moisture
Max Moisture
hts
Res
erve
d
• If failure occurs, update Product Standards to reflect last successful run
Challenges3.00%
4.00%
Moi
stur
e (%
)
onsu
ltant
s Lt
d. A
ll R
ig
Challenges
• Potential alternate cause of failure
V i bl f ft l ki i ti
2.00%
© N
ewto
n In
dust
rial C
o
• Variable performance after locking in time
• Chambers E, G vs. A, B, C, D0.00%
1.00%
1 6 1 6 21 26 31 36 41 46 51 56 61 66 71 76 81 86 91 96
©
1 1 2 2 3 3 4 4 5 5 6 6 7 7 8 8 9 9
Sample #
World Class Example: Speed Optimization
C
07:5
0
08:5
0
09:5
0
10:5
0
11:5
0
12:5
0
13:5
0
14:5
0
15:5
0
16:5
0
17:5
0
18:5
0
19:5
0
20:5
0
21:5
0
Open Chamber
Full Production Cycle
pand Take Moistures
Check Moistures in Lab
Unload Chamber hts
Res
erve
d
Blow down with Air
Apply Steam
8% onsu
ltant
s Lt
d. A
ll R
ig
Pause in Defrost Cycle
Refrigeration
Load Chamber
8% decrease in process time
© N
ewto
n In
dust
rial C
o
Vacuum Pump-Down
Pause in Cycle
©
Heat Applied
World Class Example: Speed Optimization
C
07:5
0
08:5
0
09:5
0
10:5
0
11:5
0
12:5
0
13:5
0
14:5
0
15:5
0
16:5
0
17:5
0
18:5
0
19:5
0
20:5
0
21:5
0
Open Chamber
Full Production Cycle
pand Take Moistures
Check Moistures in Lab
Unload Chamber hts
Res
erve
d
Blow down with Air
Apply Steam
onsu
ltant
s Lt
d. A
ll R
ig
Pause in Defrost Cycle
Refrigeration
Load Chamber
© N
ewto
n In
dust
rial C
o
Vacuum Pump-Down
Pause in Cycle
©
Heat Applied
World Class Example: Speed Optimization
C
07:5
0
08:5
0
09:5
0
Open Chamber
Changeover
pand Take Moistures
Check Moistures in Lab
Unload Chamber hts
Res
erve
d
Blow down with Air
Apply Steam
onsu
ltant
s Lt
d. A
ll R
ig
Pause in Defrost Cycle
Refrigeration
Load Chamber
© N
ewto
n In
dust
rial C
o
Vacuum Pump-Down
Pause in Cycle
©
Heat Applied
World Class Example: Speed Optimization
C
07:5
0
08:5
0
09:5
0
Open Chamber
Changeover
pand Take Moistures
Check Moistures in Lab
Unload Chamber hts
Res
erve
d
Blow down with Air
Apply Steam
onsu
ltant
s Lt
d. A
ll R
ig
Pause in Defrost Cycle
Refrigeration
Load Chamber
© N
ewto
n In
dust
rial C
o
Vacuum Pump-Down
Pause in Cycle
©
Heat Applied
C
World Class Example: Speed Optimization
07:5
0
08:5
0
09:5
0
Open Chamber
Changeover
pand Take Moistures
Check Moistures in Lab
Unload Chamber hts
Res
erve
d
Blow down with Air
Apply Steam
onsu
ltant
s Lt
d. A
ll R
ig
Pause in Defrost Cycle
Refrigeration
Load Chamber
© N
ewto
n In
dust
rial C
o
Vacuum Pump-Down
Pause in Cycle
©
Heat Applied
World Class Example: Speed Optimization
C
07:5
0
08:5
0
09:5
0
Open Chamber
Changeover
pand Take Moistures
Check Moistures in Lab
Unload Chamber hts
Res
erve
d
Blow down with Air
Apply Steam
41% onsu
ltant
s Lt
d. A
ll R
ig
Pause in Defrost Cycle
Refrigeration
Load Chamber
41% decrease in changeover
time © N
ewto
n In
dust
rial C
o
Vacuum Pump-Down
Pause in Cycle
©
Heat Applied
World Class Example: Speed Optimization
C
07:5
0
08:5
0
09:5
0
10:5
0
11:5
0
12:5
0
13:5
0
14:5
0
15:5
0
16:5
0
17:5
0
18:5
0
19:5
0
20:5
0
21:5
0
Open Chamber
Full Production Cycle
pand Take Moistures
Check Moistures in Lab
Unload Chamber hts
Res
erve
d
Blow down with Air
Apply Steam11%
decrease in
onsu
ltant
s Lt
d. A
ll R
ig
Pause in Defrost Cycle
Refrigeration
Load Chamber
cycle time
© N
ewto
n In
dust
rial C
o
Vacuum Pump-Down
Pause in Cycle
©
Heat Applied
Consumer Model
• Process Lock Down• Performance Tracker
• Labour Optimisation• Scheduling Optimisation
• Work Flow Modelling• PLC Modification
hts
Res
erve
d
• OEE• Variance• Waste• LossesO hi d t bilit
• Training: Problem Specific• Training: Generic
(Lean/Six Sigma)• Giveaway Manager
NPD F l
• Speed/Output Debottleneck• Training: Advanced Problem
Solving and Improvement• Value Engineering
C it l I t t R d ti onsu
ltant
s Lt
d. A
ll R
ig
• Ownership and accountability• Improvement Cycle Measure• Labour Manager• Training: SOP Establishment• Efficient Physical Logistics
• NPD Funnel• Changeover Improvement• Variance Tracker• Supply Chain Developer
• Capital Investment Reduction• Automation• Accumulation• Supply Chain Optimiser
© N
ewto
n In
dust
rial C
o
• Efficient Physical Logistics ©
Does the Process Deliver Value?
ed
110%
Output Efficiency by Week
td. A
ll R
ight
s R
eser
ve
90%
100%
dust
rial C
onsu
ltant
s Lt
80%
© N
ewto
n In
d
60%
70%
50%
5/20
114/
2011
4/20
113/
2011
3/20
112/
2011
2/20
11/2
011
/201
12/
2010
2/20
10/2
010
/201
00/
2010
0/20
100/
2010
9/20
109/
2010
8/20
108/
2010
7/20
107/
2010
6/20
106/
2010
5/20
105/
2010
5/20
104/
2010
4/20
103/
2010
3/20
102/
2010
2/20
10/2
010
/201
02/
2009
2/20
09/2
009
/200
9/2
009
0/20
090/
2009
9/20
099/
2009
8/20
098/
2009
7/20
097/
2009
6/20
096/
2009
5/20
095/
2009
5/20
094/
2009
4/20
093/
2009
3/20
092/
2009
Improvement Project
Improvement Project
01/0
517
/04
03/0
420
/03
06/0
320
/02
06/0
223
/01
09/0
126
/12
12/1
228
/11
14/1
131
/10
17/1
003
/10
19/0
905
/09
22/0
808
/08
25/0
711
/07
27/0
613
/06
30/0
516
/05
02/0
518
/04
04/0
421
/03
07/0
321
/02
07/0
224
/01
10/0
127
/12
13/1
229
/11
15/1
101
/11
18/1
004
/10
20/0
906
/09
23/0
809
/08
26/0
712
/07
28/0
614
/06
31/0
517
/05
03/0
519
/04
05/0
422
/03
08/0
322
/02
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