Download - Star Guide Delivery Performance (2.2)
Operational Excellence
Illustrated in the context of improving delivery performance at a contract manufacturer
June 21, 2011
Dan Dodd
2
Operational Excellence – Two Keys
5
24 month Demand, Supply, & Inventory
plans
ManagementBusiness Review
DemandReview
SupplyReview
ProductReview
Finance IRReview
Start(Begin Month)
MRP
• Executive led• One plan aligned
with financials
Doing the Routine Routinely
Sales & Operations Planning
Modern operational excellence is 75% lean and 25% S&OP in terms of effort/focus, but
S&OP comes first because it sets the direction
An Example From My Experience
My resume – the delivery improvement example is highlighted Early Stage Ventures (Synvasive and TranS1) Corporate Operations Excellence (Cooper
Industries) Contract Manufacturing (Accellent – 120
person $30M Star Guide factory) Internal Consulting (Bell Labs) Consulting (PB Farradyne)
The issue: transforming the factory from a laggard to a leader in delivery performance
The Situation & the Changes
Before Process After
Production meetings focused on late orders that needed to ship that day
S&OP Looked several months forward, keeping orders to the schedule
Orders pushed to the floor irregularly, and too many
Lean (ConWIP) Half the number of orders on the floor – clear priorities
Long raw material lead times
Lean Increased number of parts on kanban ten-fold
Changes in people, processes, and systems
End Result
Factory went from ~#9 out of 10 in division in delivery performance to #1 or #2 From missing 5-40 orders a month (out of ~
200 orders/month) To some months with no late orders
Inventory turns and quality improved Revenues doubled Margins improved Promotions all around