metrics for process excellence - opex...

Leader Strategy SessionMetrics for Process Excellence

DuPont, Houston & AustinConducted by:

CenTex OpEx Consortium

Martin Nazareth April 2015

Executive Summary

A three-hour Leader Strategy Session was conducted on April 23rd in Houston and April 24th in Georgetown, TX. The focus of both sessions was Metrics for Process Excellence. Sixteen leaders from nine organizations participated in the sessions. The session agenda included:

• Introduction

• Focus Topic Presentation

• Leader Discussion on Sub-topics I – V

• Consortium Business & Open Forum

The topic was introduced using a presentation to clarify the scope of the discussion. Five sub-topics were chosen for discussion based on typical problems faced in strategic planning.

Leaders from different organizations shared their successes and lessons learned indicating what works and what to avoid. Live discussion and feedback forms revealed an extremely positive feedback.

The session concluded with announcements of the next few events of the Consortium and training sessions available for complimentary seats:

– May 21, 2015: Benchmarking Session — Focus: Workplace Organization & Visual Mgt. .— Location: Entegris, Burnet

– July 16, 2015: Benchmarking Session — Focus: TBD— Location: TBD

– Leader Strategy Session: Topic: Metrics for Process Excellence : Apr 23, 2015, Houston — Apr 24, 2015, Austin/Georgetown

– Training (COC Members may use their complimentary training seats for any of these)

• Week of June 15: Leader Training Week, India

• July 15, 2015: Theory of Constraints — (Leader Training)

LEADER TRAINING WEEK (Location: Houston, TX)

• Oct 13 – 14, 2015: Integrated Management System — (Facilitator Training)

• Oct 15, 2015: Enterprise Transformation for Leaders — (Leader Training)

• Oct 16, 2015: Strategic Metrics for Leaders — (Leader Training)

WEBINARS

• Webinar — Advanced Process Excellence: May 28 — Capacity Verification and Run at Rate

• Webinar — Back-to-Basics of OpEx Webinar Series: May 29 — Rapid Improvement Workshops (Kaizen)

• Webinar — Product Development Process Webinar Series: May 27 — Excellence in Sustaining Engineering

• Webinar — Theory of Constraints Webinar Series: Restarts Aug 28 — Foundations of TOC

Participants

Organization First Name Last Name

Austin Water Benyamin Ayman

Austin Water Bruce Coe

Dupont John Gay

Dupont Ray Nelson

Entegris Craig Ragaglia

OpEx Solutions Gary Johnson

OpEx Solutions Ken McClymonds

OpEx Solutions Martin Nazareth

OpEx Solutions Vivian Sullivan

Optibelt Vernon Rego

PEMEX Procurement, Inc. Patricia Shepherd

TAM International John Babineaux

TAM International Fernando Guirola

TECO Westinghouse Garison James

Wolfram Mfg Steven Resnick

Wolfram Mfg Katherine Satterwhite

Topics Covered

Metrics for Process Excellence Overview

Introduction

Sharing of Knowledge & Experience Discussion Topics

Consortium Business & Open Forum

Adjourn

Agenda – Austin/Georgetown

1:00 – 1:15 Introduction

1:15 – 1:40 Focus Topic Presentation

1:40 – 2:00 Leader Discussion on Sub-topic I

2:00 – 2:20 Leader Discussion on Sub-topic II

2:20 – 2:30 Break

2:30 – 2:50 Leader Discussion on Sub-topic III

2:50 – 3:10 Leader Discussion on Sub-topic IV

3:10 – 3:30 Leader Discussion on Sub-topic V

3:30 – 4:00 Consortium Business & Open Forum

4:00 Adjourn

Note: Houston session began ½-hour earlier to compensate for traffic.

Leader Strategy Session (LSS) Objectives

Learn by sharing

Enterprise transformation

Successful Strategies

TransformMetrics

Motivating people

Extending enterprise

Topics Covered


Introduction



Adjourn

Operational Excellence ExecutionKey Factors

Execution

Resources

Strategy

Follow through

• Strategy helps you identify critical metrics

and link them to performance

Link to Specific Metrics

Metric Performance

Business Strategy

System Design

Metric Metric

Topics Covered


Introduction



Adjourn

Topics

• Sub-topic I: How well are your metrics connected with your

process? Have your metrics helped you move the needle -

your key goal metric is steadily improving?

• Sub-topic II: What are the top three metrics you use to

ensure process control that work well?

• Sub-topic III: What are some of the gaps in your current

metrics that make them not so effective?

• Sub topic IV: What is the review cadence for your

performance metrics?

• Sub topic V: How do you react to variations from plan or

target?

Sub-topic I: How well are your metrics connected

with your process? Have your metrics helped you movethe needle - your key goal metric is steadily improving?

Houston Session:

• KPI flow-down by engaging shop people

• Key is to connect to primary goal

• Quick or short-term fixes have consequences

• Measured differently in different areas and connection was not the best

• Some metrics are useful — must watch the ones that move the needle

• Mature companies have metrics with better connections

• Pick significant few

• Service level watched closely

• OTD is lagging and drives less actions

• Watch our internal performance — that makes sense — not driven from top



Austin Session:

• Metrics moving them in the right direction (3)

• Data quality not accurate due to collection method

• Developed automatic system health check evaluated daily

• Data analysis of meantime to repair

• Focus on 8 key/critical metrics (selected from 50 to 60 performance metrics)

• Safety and property damage are key determining factors

• Cut down considerably on response time for priority 1 breakdowns

• #1 metric is final test (functional)

• Product time can be a year and have fluctuations in process

• Ongoing electrical measurements are manual/operator dependent — moving to more automated (sensors) for process

measurement

• Metrics aligned to customer service level — 98% OTD (DOT).

• Process control must be within 3 of specs

• Must be provided electronically during process

• Used to be focused on end-result metrics vs now leading-edge indicators

• In-process data has shifted to electronic data gathering and now is leading versus lagging in past

• Correlating behaviors to process — looking for key metrics that lead to issues on output metrics

• Customer requiring leading indicators

• Redefining what matters



Austin Session (cont’d.):

• Key metrics monitored closely from several views: $/MT (metric ton), safety

• Variations stemmed from stop/start operations

• OTD metrics and escapes (bad parts getting to customers) and weekly sales numbers were good when

they had hi-volume orders — with the current oilfield downturn, starting to look at process and production

times (predictors) to lower lead time

• Escapes and paperwork/documentation must be ready at time of delivery — sales result of quality & OTD

• Lagging indicators — metrics work well but need adjustment to lead a bit more.

Sub-topic II: What are the top three

metrics you use to ensure processcontrol that work well?

Houston Session:

• Scrap, Non-conformance Report (NCR), OTD, Total Recordable Incident Rate (TRIR)

• Improvement is due to volume going down

• TRIR worse with low volume

• X-Dept. audit

• Observation cards

• Cost (lagging), sales/capacity, safety, RCA

• Delivery, quality, logistics, time to PO

• Delivery to promise

• Delivery to request

• Material availability (on time to shop)

• Repeat customer complaints

• Safety near-misses, First-pass Yield (FPY), OTD, lead-time monitoring

• Service levels, inventory rations, reserve stock for customers

• Inventory data quality

• Overall equipment effectiveness (OEE)

• KPI flows down to leading indicators

• More frequently

• With good targets

• Tool costs

Sub-topic II: What are the top three

metrics you use to ensure processcontrol that work well?

Austin Session:

• Quality, escapes, OTD, sales, tool-life & other in-shop processes (setup time, etc.)

• Sampling of product throughout process and distribution system • Process adjusted accordingly (lagging, even though there are leading indicators)

• Error notices triggering corrective action

• Field warranty

• Service-level tracking, inventory levels, critical stock

• First-pass yield to process, sampling, analytical testing (proper testing w/out contamination)

• Purity checks of baked anode density, green anode density

• Bench time, training numbers (incl. ), new contacts

Sub-topic III: What are some of the

gaps in your current metrics that makethem not so effective?

Houston Session:

• OTD lagging (2)– Look at supply chain control

– Leading indicator DVM

– Schedule changes

• Slow cycle on review and adjustment due to lagging indictors

• Short-term actions affecting long term

• Manual metrics — non-standard large spreadsheets

• Hidden capacity

• Downtime

• Too much time to transition between products — not running fast enough

• Only finance numbers count — lagging

• Better monitoring and improvement

• Cost of unreasonable delivery — hot jobs

Sub-topic III: What are some of the

gaps in your current metrics that makethem not so effective?

Austin Session:

• Lack of leading indicators (3)

• Metrics not drilled down to daily activity

• Lack of reporting tools

• Data manually recorded in QA folders—lack visibility of QA metrics (2)

• Monitoring and implementation has room for improvement

• Too many metrics to track

• Metrics not visual to right people

• Need to have correct metrics for shop vs. corp. (parts per hr., etc.)

• Lack of data compilation—trending is lacking

• Only high level metrics reviewed weekly

• Need more metrics for a longer period

• Challenging to add metrics w/o impeding work

Sub-topic IV: What is the reviewcadence for your performance metrics?

Houston Session:

• TRIR and OTD monthly • Tool cost weekly

• Schedule performance daily

• Results metrics monthly• Leading weekly/daily

• Shop floor daily and by hour

• Company level monthly• Departmental level weekly

• Operational daily

• Leading by shift• Lagging monthly

Sub-topic IV: What is the reviewcadence for your performance metrics?

Austin Session:

• Monthly (improving leading indicators), weekly for lagging indicators

• Daily & hourly for leading and monthly for lagging indicators

• Weekly or biweekly (lagging), ongoing for operational (mgmt.)

• Monthly high level performance, daily sampling, leading indicators for NH3

• Financial, booking & sales daily — sufficiency errors, warranty is monthly

• Leading daily, weekly and lagging monthly depending on stats

Sub-topic V: How do you react tovariations from plan or target?

Houston Session:

• Love honesty but hate the truth

• Why several times• What to do about it

• Gap is systems thinking

• Engage the messenger

• Drives reactive changes

• Address the top issue

• Ask the doers and immediate supervisors whether they see a problem

• See where variations come from and make adjustments

• Brute force

• See as opportunity

• Visually manage — juggle between silos

Sub-topic V: How do you react tovariations from plan or target?

Austin Session:

• Redundancy — chemical and air monitoring

• RCA, cause and effect, problem solving, bring in right personnel (1) and BONUS!!! for

good variations

• Realistic analysis — system or human, then take corrective action

• Red, yellow green—monthly review that drives action to turn around red

• Assign SPA to solve

• Use area RASIC for metrics to identify who will fix problem

• Go back to revising process on operating floor (training, what went wrong with assumption

that employee did not mean to make a mistake, so training is studied)

• Escape parts brought in and replaced immediately and bad part studied to determine

problem and find root cause

• Adjust metrics

• Red metric has action items assigned

Key Takeaways

80% of all participants feel their organizations have failed to move the

needle with current initiatives and metrics!

• Houston Session: Everyone has 11th-hour problems

Metrics must have a reason

Metrics must be meaningful

Metrics should derive from customer noticing

There should be a connection between lagging & leading metrics

Have right metrics aligned to your goal and use them the best way possible

• Austin Session: ID key leading indicators and develop control action plans to stabilize situation and make it a sustained

reaction instead of an event (3)

Different businesses need different metrics

Challenge to evolve to determine the key indictors to focus on

Competition is forcing continuing improvement

Making metrics visible to people who need them (2)

Make people more involved so more angles viewed/problems solved

Prioritizing and reduce key indicators

Independent metrics vs dependent metrics (interdependencies)

Group communications

No emotions — use data and facts rather than emotion

Focus on the right metrics

Don’t cut-and-paste

Topics Covered


Introduction



Adjourn

Announcements — COC Events

— July 16, 2015: Benchmarking SessionFocus: TBD

Location: TBD

— Leader Strategy SessionFocus: Strategic Planning for 2016

Sept 17, 2015 Houston, TX

Sept 18, 2015 Austin, TX

— May 21, 2015: Benchmarking SessionFocus: Workplace Organization and Visual Management

Location: Entegris, Burnet

— Oct 21, 2015: Benchmarking SessionFocus: TBD

Location: TBD

Announcements — Training Courses

Please note that COC Members may use their unused complimentary

training seats for any of these courses.

Leader Training Week, India — Week of June 15, 2015

Theory of Constraints — July 15, 2015 Location TBD

Next US Leader Training Week — Oct 13-16, 2015, HOU

– Integrated Management System — Oct 13-14, 2015

– Enterprise Transformation for Leaders — Oct 15, 2015

– Strategic Metrics for Leaders — Oct. 16, 2015

Customized working sessions to help organizations solve issues

they may have in different areas. COC Members may substitute their complimentary

System Review for a one-day workshop.

• Setup Reduction

• Engineering Process Analysis

• Failure Modes and Effects Analysis

• Capacity Analysis

• System Review

Announcements — Live Webinars

Please note that COC Members may use their unused

complimentary training seats for any of these webinar

series. All series restart in August.

• Advanced Process Excellence Series

May 28: Capacity Verification & Run-at-Rate

• Back-to-Basics of OpEx Series

May 29: Rapid Improvement Workshops (kaizen)

• Product Development Process Series

May 27: Excellence in Sustaining Engineering

• Theory of Constraints (TOC) — Sequential

Restarts August 28, 2015 Foundations of TOC

Upcoming Professional Org. Events

AME Cincinnati 2015

ANNUAL CONFERENCE & EXPO

October 19 - 23, 2015

Cincinnati, OH

ANNUAL CONFERENCE & EXPO

May 30 - June 2, 2015

Nashville, TN

World Conference on Quality and

Improvement

May 4 - 6, 2015

Gaylord OpryLand Resort and

Convention Center

Nashville, TN

Publication Opportunities

Industrial Engineer is a practitioner magazine, not a journal. As

such, content is more geared toward the “real-world” and less technical

than journals.

– Submissions should range from 2,000 to 3,500 words, be non-

copyrighted, original work, and include practical ways to help our

readers make improvements in their professional lives. IIE prefers

submissions written in third-person narrative that concentrate on

process, not products. Articles that focus on future trends, thought

leadership and/or that take a how-to tone are more likely to be

accepted. Graphics, charts and photos are encouraged but not

mandatory.

– Deadlines are two months in advance. So anything received by April 1

could be considered for June, etc.

Topics Covered


Introduction



Adjourn

metrics for process excellence - opex...

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