Process. Execution. Discipline. Manufacturing words, right? Yes, but they are also words that describe the way effective management should work. Just as quality manufacturing depends on a controlled and organized method, so does the management behavior that gets all of the production work done.
What would happen if a plant manager or senior executive purchased a new machine and didn’t train the operators? Of course, that would be an obvious waste of the new asset; the projected and expected return on investment would not be achieved. Yet today, millions of dollars are being spent by manufacturing companies on technical and technological changes without a team of managers who can ensure sustained progress.
For example:
- Company XYZ hires consultants so that the organization can receive its mission-critical ISO 9001 certification. But what happens when these experts leave? Unless the management team has been trained and understands how to engage employees and to hold employees accountable—i.e., to work within a management system–what good are the new rules and procedures? The manufacturing system breaks down as a result and a great deal of expense was wasted.
- A company, losing business because of frequent late deliveries, decides upon a strategic initiative: OPERATION ON-TIME. Analyses are done, and the three most frequent mistakes are discovered and discussed. Unfortunately for this company, however, success of a strategic plan ultimately depends on individual accountability. The actions listed are for departments, not named employees, and have no deadlines, milestones, meetings or metrics. A task that is “ongoing” is never really completed or achieved…and neither is this goal. Without the understanding of management, the strategy is just hope.
- A third enterprise puts new safety procedures into place, believing that improved results will simply come. But they won’t, unless managers know how to follow a process of communication, setting metrics and goals, and having regular and consistent follow-up meetings. Another strategy dies in the Boardroom because of a lack of management ability.
Quality management, like quality manufacturing, is a results-oriented system of processes. There are step-by-step, proven methods that result in positive individual, team and overall performance. These stand on a foundation of solid principles, and depend on a set of practiced skills. Here are a few other ways in which the requirements for manufacturing excellence resemble that of management.
- Formal Systems—How do we manage? What is our culture? Who reports to whom and who is accountable to whom? Critical step: establishing management norms
- Process Capability—What is expected of each employee? Does “D” always happen after “A-B-C”? Critical steps: The Quarterly Audit and the Annual Performance Review
- Preventive Maintenance—How do we make our employees ready for their next jobs? How do we ensure that we have a solid bench of talent to combat turnover? Critical steps: Moving from reactive to proactive management, and having a recruiting and overall manpower strategy
- Delivery—What do we measure, and who is accountable? Critical step: Agreeing on goals–and regular and consistent follow up
- Continuous Improvement—Who do we develop, and how? How do we upgrade and empower our employees? Is the organization chart really how things work here, including the interpersonal relationships and communications? Critical step: Immediate feedback on good and poor performance
- Communication—How do we train communication, which means written, verbal, non-verbal and meetings? How do we ensure that our managers are getting their points across? Critical step: Managers need to understand that they are always communicating
In 2015, ISO 9001 was modified to put a greater emphasis on engagement. Why? Gallup surveyed 1.4M employees, and found that a lack of employee engagement—employees being involved and caring– costs American businesses $500B in productivity each year. The employee’s relationship with his/her direct manager accounts for at least 70% of the variance in employee engagement scores across all business units. Yet, 50% of managers have never had any kind of management training.
According to Gallup, improved manufacturing employee engagement can result in these improvements:
Productivity +21%
Turnover -45%
Safety incidents -44%
Absenteeism -37%
Quality defects -41%
Just as investments in technical and technological improvements should not be made in a factory with archaic or under-maintained equipment, neither should a company spend a lot of money changing a process without the commensurate investments in management. Only the managers can execute and ensure sustained progress. It is they who need to understand the system, who build employee engagement and who manage the process.