or oec, operator engaged construction · february 2012 115-117 s. main st. suite a celina, ohio,...

February 2012

115-117 S. Main St. Suite A Celina, Ohio, 45922 USA

567-510-5200 www.avanulo.com

Or OEC, Operator Engaged Construction

By David I. Cahill

Avanulo White Paper #323

Summary of Contents

Enrigi The last frontier

Shout out the purpose Declare the real function of the new installation loud and clear

Set the non-negotiables Separate wants from needs with absolute clarity

Synergize the Flow Determine and define the natural streams in the plant and design in a natural harmony, flexibility, and efficiency

Build it

Follow your plan with frequent reference to its purpose

Go Vertical Start it up on time, on budget, and w/o surprises

Summary

To the reader: We hope you find this Avanulo Blue Paper valuable. We know that your time is precious, so we have structured the format of this document to accommodate your needs. For a quick read, refer to the “in a Nutshell column” on the left. For more detail, read the right hand column

About Avanulo Avanulo means progress, and our passion lies in helping our clients progress their goals. Our partners all have at least 20 years of experience in their fields of expertise. Our Motto is “Enjoy the Business Result” or ETBR. We believe every improvement action should have a tangible result, and we structure our solutions to achieve measurable results within a specific timeframe. Our chief focus is to help our clients increase their Safe, Ethical, Profit or SEP. To us, that means to make as much money as possible without occupational injury, and without moral, environmental, or economic harm to the community.

Helping you to think your way through instead of buying your way out

In a Nutshell . . . What is it? Enigi or Operator Engaged Construction.

• Avanulo’s concept for building new plants and installations with Lean pre-loaded.

Why is it important? Fuzzy purpose = fussy results.

• Enigi enables new plants to experience vertical start-ups and achieve and maintain the cultural benefits of a continuous improvement culture from day one.

How do you apply it? Understand the real purpose.

• The purpose of the plant is to help operators make product.

• Deeply engage operators in design, construction, and start-up

Supporting Concepts

• Purpose-centered Mgt.

• Needs vs. Wants

• Natural Flow & HMI

• Employee Engagement

• Ergonomics

• Vertical Start-up

• Avanulo’s OEC Checklist

Operator Engaged Construction – the undiscovered country Some years ago, we had the accidental benefit of having the future operators, mechanics, and quality techs of a manufacturing plant participate in its construction. The pant received a large amount of government funding and tax credit based on how many employees it would employ and when it would employ them. The project ran late, and the employees were brought on board, prior to the completion of construction, to meet the requirements of the incentives received. The operators were integrated into the construction team with surprising benefits. We developed Enigi from that experience. When writing this paper we conducted our usual research to benchmark our experiences against that of others, and against the literature. Surprisingly, we found that this was a virtually untapped area in the literature of continuous improvement and employee engagement. Because there is so little (really none) academic review of this concept, we can refer to only indirect sources, and therefore, this is a blue paper, and not a white paper. Nevertheless, we have applied this approach several times, and its benefit has proven to be reliable and repeatable. The simple truth is clear to us. If you involve your current or future operations employees in the design and construction of your new plant or installation, you will practically ensure a vertical start-up, and you will jump start your continuous improvement culture in a way that brings you years ahead of the normal development curve. This blue paper provides 5 simple steps to help you get the most out of your new construction project through OEC and makes a compelling argument that hiring your new operations employees, or at least one shift of them, prior to breaking ground is a value-added concept.


In a Nutshell . . . What is it? Shout out the purpose.

• To enable operators to make product to specification.

Why is it important? This establishes the customer for the project.

• Too often engineers see the VP, the budget, or time as the customer. This inaccurate focus dramatically limits the plant’s ability to fulfill its purpose over the long run.

How do you apply it? Declare it, support it, and make the customer (the operator) visible, present, and integral.

Supporting Concepts/literature • Achieving Cost Savings and

Employee Satisfaction by Involving Employees in Plan Design; presented by Connie L. Rank-Smith, SPHR, CBMS, CMS; April 11, 2010

• Measuring The Total Economic Impact Of Customer Engagement - A Multi-Company ROI Analysis; Project Director - Jon Erickson; Forrester Consulting; September 2008

• Putting your client to work – a good way to achieve great service at low cost? – European Business Review 2012; by Phillip G. Moscoso, Alejandro Lago, and Marlene Amorim;

Shout out the purpose Often, when we do things repeatedly, we become unconsciously competent - so adept at performing a function that we don’t think about the function itself. Instead we focus on the work at hand. Sometimes this is effective, but increasingly in the more dynamic world of manufacturing today, meta-cognition, or thinking about thinking, is proving invaluable. We need to consider the reasons why we are doing something, and how we think about our work more often, for better results So, what is the purpose of building a new plant?

• To meet increased demand?

• To reduce cost?

• To get closer to the market?

• To launch a new product? All these reasons come to mind, but to get the most out of our construction project, we must remember, and focus, on one simple purpose. We are building this plant to enable the operator to make the product to specification. The operator will then reduce cost, or meet increased demand, or launch the new product. Our purpose in construction is clear – to enable the operator to meet her production goal. The operator is therefore the customer. How odd that, in this era of customer satisfaction and employee engagement, we often build plants for people whom we have never met, and whose needs and wants we have only heard about through others. In the absence of the voice of the customer, other voices fill our mind; the voice of the budget, the voice of the executive, the voice of the calendar. They all become the customer. Our purpose shifts to one of meeting the budget, or finishing on time, and these are not purposes, they are requirements. To be really successful in a plant construction project, we must declare the operator the customer, and we must respect him and involve him heavily in the design and construction phases. We must declare the real purpose and keep it clear in our minds.


In a Nutshell . . . What is it? Set the Non-negotiables.

• Distinguishing between wants and needs, and then keeping them visibly animated maintains focus on the project purpose.

Why is it important? Over the life of the project, the purpose can become lost or diffused significantly reducing results. How do you apply it? Use a classic decision-making process, and animate it rigorously.

Supporting Concepts/literature • The Rational Manager: A Systematic

Approach to Problem Solving and Decision-Making (Hardcover) by Charles H. Kepner (Author), Benjamin B. Tregoe (Author) – 1965

• Benchmarking

• Avanulo’s Decision-Making Worksheet

• Avanulo’s Consensus Matrix

Set the Non-negotiables Construction Projects for manufacturing installations are among the most complex projects undertaken in business. The myriad issues can be daunting. The administrative and bureaucratic demands can overwhelm even the most experienced project manager. The dynamic nature of this type of project can also be a challenge. Initial plans can change rapidly. The late-breaking and fluid realities of location suitability, funding, materials availability, and technological feasibility all play their part in occupying the project leaders, limiting their ability to keep the purpose clearly in mind. The complexity and dynamic nature of these projects combine to blur the line between need and want, which can increase costs and reduce results. The negative effect caused by the natural twists and turns in construction projects can be minimized dramatically when we clearly define needs and wants, keep them highly visible, and distinguish between them in our treatment of the project. Formally applying a classic decision-making process is the key to keeping the project

focused, on track, and true to its purpose. Rigorously applying such

a process can ensure that needs and wants are

clearly defined, well distinguished, and

highly visible. Once this state is achieved, project decisions can be continually metered against the priorities of needs and wants. The result is a highly effective, and nimble, process for keeping the project true to its purpose. Involving current or future operations people, enables them to leverage this approach to their advantage and make sure that the end result is a plant able to produce to specification. This keeps cost and timing in their proper places, as requirements, and not as purposes driving the project.


In a Nutshell . . . What is it? Synergize the flow.

• Having operations people identify, define, harmonize, and optimize the various processes, or flows, while designing a plant.

Why is it important?

• Done well, the result is a vertical start-up and a harmonized plant.

How do you apply it?

• Have operations people study the processes and how they fit together and then optimize them using their experience and common sense.

Supporting Concepts

• Avanulo’s Flow Charter

• Value Stream Mapping

• PSM

• HACCP

• ISO

• SIPOC

• Zoning/5S

• Kaizen

• Avanulo’s OEC Checklist

• Avanulo’s Plan Guard

Synergize the Flow

Deming, and the other great leaders in the field of continuous improvement, long ago convinced us that everything we see is the result of a process, and that all processes conform to universal principles of behavior. Every manufacturing plant has a series of processes, or flows, that follow these universal principles. A new plant can be designed in a way that acknowledges these flows, supports their natural behavior, and promotes harmony between them, or it can ignore or even thwart these flows, and create permanent barriers to continuous improvement and optimization. To ensure that the plant design supports natural flow and harmony, its various processes must be reviewed from many angles, and by people who have the appropriate experience, willingness, and ability, to give thorough attention to this detailed and demanding work. Who better to do this work than carefully selected representatives of the groups who will eventually operate the plant? Using proven techniques, normally employed by project engineers or managers, the natural abilities, experience, and common sense of operations people can be magnified to ensure extraordinary results. Tools like Value Stream Mapping, PSM, HACCP, FMEA, SIPOC and 5S, in the hands of employees motivated to ensure their plant is the best it can be, will yield results far superior to those obtained by the traditional approach driven solely by engineers and managers. Involving operations employees in the identification, definition, and optimization of plant flows prior to start-up is a tremendously effective, and affordable, method for ensuring project success.


In a Nutshell . . . What is it? Build in the Wisdom.

• Involving operating people in the construction and commissioning of the plant.

Why is it important?

• Their involvement ensures the quality of these phases, builds a pride of ownership, and set the stage for a continuous improvement culture.

How do you apply them?

• Have them deeply involved in building and commissioning through the use of proven continuous improvement tools.

Supporting Concepts • OEC Checklist

• SOPs

• Cause Analysis

• Brainstorming

• Avanulo’s 1440 Mgt. System

Build in the Wisdom Now that you have a plan, the entire project team can support it. Instead of just working to put up walls or install equipment, everyone will be focused on their part in the harmonization and optimization of the plant, so it can fulfill its purpose, which is to enable operators to make product to specification. As the plant is constructed, modifications will occur, dry and wet tests will be conducted, systems will be labeled, drawings will be updated, and preparations for start-up will be made. The knowledge of plant systems, equipment configuration, and control schemes gained by operations people during this phase of the project will knock years off of their learning curves. In addition to their ability to promote success through the application of their knowledge and experience, operations people involved in this phase will develop a pride of ownership in the plant that is almost impossible to acquire any other way. They will see themselves, and rightfully so, as designers and builders. This will set the tone for the culture of the plant, which will enable the organization to sustain a healthy respect for operating people and their abilities, thereby promoting employee engagement. Respected continuous improvement tools like SOPs, Cause Analysis, Brainstorming, the 1440 Management System, and Red-Green Analysis, will be invaluable templates for formalizing employee involvement. Having operations employees who help with and oversee the construction of the plant, will set the stage for a vertical start-up, and lock in a culture of engagement and continuous improvement.


In a Nutshell . . . What is it? Go Vertical.

• Planning for and achieving a flawless, or vertical, start-up.

Why is it important? It defines a successful project like no other indicator, and it guarantees the benefits of Enigi – pride, ownership, and a continuous improvement culture. How do you apply it? Use proven vertical start-up and continuous improvement techniques to build and execute a flawless plan.

Supporting Concepts

• Avanulo’s Vertical Checklist

• WMS

• Wet Runs

• Loop Checks

• Stress Tests

Go Vertical The plant is nearly built and some systems are commissioned. Soon it will be time to start-up. What will the start-up be like? Will the plant start-up flawlessly, ramp up, and slide into an easy predictable groove of efficiency and predictability, or will begin its life in fits and starts, revealing a lack of forethought and poor planning? The dream of every plant manager is to have a vertical start-up, which is a start-up that goes as smoothly as a rocket taking off - just countdown and blast-off. Although no amount of planning and pre-work can absolutely guarantee a vertical start-up, the fact is that a vertical start-up is possible, and the odds go up dramatically when operations employees are involved in the design, construction, commissioning, and start-up of a new plant. When you establish vertical start-up as a goal at the beginning of the project, and when you involve operations people in that goal, everyone on the project will keep this goal in mind as they do their work. Because the operations people truly understand the value of this objective, they will keep it alive during the formative phases of the project. Using their leverage and influence as the customer, and proven tools like the Vertical Start-up Checklist, WMS, Wet Runs, Loop Checks, and Stress Tests, operating people will ensure that the plant is designed to run and ready to start-up.


We want to hear from you Avanulo 115-117 South Main St. Suite A Celina, OH 45833 USA Tel: 567-510-5200 Skype: 567-510-0714 E-mail: [email protected] Web site: www.avanulo.com About the Author Dave Cahill is the Managing Partner and Founder of Avanulo, a unique embedded consulting firm that has a presence on three continents. Dave is a senior manufacturing professional who has his roots in cost control and continuous improvement. He has worked for world-class organizations like Tenneco and Groupe Danone. He has served in general, line, and staff positions and has led large teams to excellence. Dave is the inventor of several effective business tools, like Kuplo, the 1440 Management System, and the Opportunity Tree. He has taught continuous improvement and revenue enhancement to thousands of people in 10 countries. Dave has also overseen the successful resolution of several large-scale, business crises. Prior to his work in the private sector, Dave taught college level Spanish, Russian, and German, and served in the US military as both an enlisted person and a commissioned officer.

Summary Enigi, or Operator Engaged Constriction (OEC), is a proven approach for ensuring the success of a construction project, such as a new plant or a major installation, for a manufacturing organization. Enigi was discovered accidentally by the founders of Avanulo, and has evolved over the years into an employee engagement approach that stresses the assignment of at least one shift of operations people (even if you must hire them ahead of schedule) as early in the design and construction phases as possible. Enigi then leverages the abilities of these people through proven continuous improvement tools to ensure successful, design, construction and start-up by deeply engaging operations people in the process. Shouting out the purpose builds a foundation of success for the project by reminding every one of the one true purpose – to ensure that operators can make the product to specification. Setting the Non-negotiables creates a powerful and visual set of the needs and wants in the project. Having this set of well-defined needs and wants enables the project team to remain true to the purpose at the tactical level. Synergizing the Flow ensures that the plant design addresses the natural flows that exist in all plant processes and harmonizes each in a way that promotes efficiency across the operation. Building in the Wisdom is a simple process for ensuring the deep involvement of operations people in the actual construction and commissioning of the plant. This involvement prevents flaws that will hinder start-up, instills pride and ownership, and plants the seeds of a continuous improvement culture. Going Vertical is a mindset that enables the entire project team to focus on the eventual goal of a flawless start-up. It is the prize jewel in the crown of Enigi.

or oec, operator engaged construction · february 2012 115-117 s. main st. suite a celina, ohio,...

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