Operational Improvement
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Driving Operational Excellence: Cost Reduction and Increased Output.
In today’s highly competitive global market, businesses can’t afford to be complacent with their current performance. External pressures—including inflation, global tariffs, exchange rate volatility, new competitors, and environmental shifts—make simply maintaining your current cost base a sure path to losing competitiveness, forcing organisations to relentlessly pursue improvements—whether through better customer service, increased equipment output, higher yields, or reduced labour costs. Ultimately, the central challenge is ensuring these critical operational improvements directly impact your net profit and bottom line.
Problem-Solution Framework
Optimising Operational Performance: From Core Ingredients to World-Class Efficiency
All operational processes share the same fundamental elements: a conversion process, materials, and people. Consequently, manufacturing businesses universally contend with challenges like machine breakdowns, material delays, staffing shortages, and defective materials or products. These issues directly and significantly erode a company’s net profit.
Measuring World-Class Performance
World-class operational benchmarking is defined by an efficiency of 85% or greater. This means that for every 100 products a process could theoretically produce, more than 85 are saleable.
The first essential step toward improvement is accurate measurement. The industry standard for this is Overall Equipment Effectiveness (OEE). A dedicated effort to measure and improve OEE can dramatically boost productivity; most companies see an average increase simply by starting to measure and analyze this data.
While OEE addresses process efficiency, success requires you to effectively sell the increased output to truly improve your bottom line. To achieve this, businesses often employ Value Stream Mapping (VSM). VSM analyses the total time required to move a product from start to finish, identifying:
- Mismatches in process steps.
- Non-value-adding activities.
- Wasted labour.
- Excess work-in-process (WIP) inventory.
Our Operational Improvement Process: Gaining Control and Driving Improvement
In our experience, two critical factors drive superior operational performance: Gaining control of operations and understanding how the process works through robust data analysis.
Many businesses struggle with factories that are “out of control.” This often leads to:
- Failure to meet promised customer delivery dates.
- Wasted production capacity due to constantly shifting priorities.
- Increased breakdowns and quality issues resulting from rushing, poor setup, and a lack of process understanding.
Step 1: Establish Control and Stability
Stabilise and Schedule: Take immediate control by setting a weekly production schedule based on known, reliable capacity, and commit to not changing it. This action alone typically increases output by 10% – 15%.
Integrate Functions: Recognise that product manufacturing is a collective process. Ensure all supporting functions (Purchasing, Warehouse/Logistics, Quality Control, etc.) are integrated and committed to the process schedule.
Step 2: Data-Driven Understanding and Elimination
Gather Data: Begin rigorously collecting process data to understand critical factors.
Engage Staff: Involve staff at all levels in understanding and analysing this operational data.
Eliminate the Top Ten Issues: Systematically eliminate the problems that cause the most drag on efficiency, starting with the top ten.
Step 3: Capacity Building and Strategic Growth
Develop Robust Models: As issues are resolved and stability is achieved, build the foundation for continuous improvement.
Strategic Investment: Integrate the capacity model into the overarching business growth model to plan and time capital investments accurately.
Innovation and Supply Chain:
Process Innovation: Consider if the product can be made differently to simplify and accelerate the process.
Supplier Performance: Critically assess supplier performance and analyze purchasing spend to reduce costs and ensure reliable material flow.
Our Areas of Expertise
We specialise in the successful implementation of key operational strategies:
step 01
Robust Production Planning Cycles: We establish inclusive, cross-departmental planning cycles—a fast and effective method for gaining operational control. In as little as 12 weeks, we have helped clients boost On-Time In-Full (OTIF) customer service from 20% to over 85%.
step 02
Capacity Modelling: We develop accurate capacity models that provide a clear understanding of your capability and the optimal way to plan your business. These solutions range from simple Excel tools to fully integrated SAP software.
step 03
Simple Downtime Tracking and Analysis: By implementing systems, from manual sheets to real-time automation, and coupling them with robust planning, this analysis alone can recover 10% of your lost production time.
step 05
Integrated Process Optimisation: We combine and analyse the critical relationship between materials, line output (capacity & OEE), batch sizes, operational staff, and planning processes to consistently meet your customers’ needs.
step 06
Overall Equipment Effectiveness (OEE): We implement OEE frameworks to help you fully leverage and maximise your operational efficiency.
The Challenge
A client's high-speed packaging lines were in a state of operational crisis. The business was suffering from over 300 back-orders, customer service levels had plummeted, and overtime costs were spiraling out of control. The root cause was a dysfunctional planning process that was creating a bottleneck and preventing the team from meeting customer demand.
Our Solution
Our intervention began with a focused assessment to diagnose the core issues. We then implemented a consensus-based planning cycle designed to fix the dysfunctional process. This new approach integrated commitment from all key functions, ensuring everyone was aligned and accountable. By establishing this disciplined, forward-looking process, we rapidly regained control of the packaging operations.
The Results
Our solution delivered a sharp and immediate turnaround. Within just 12 weeks, the number of back-orders was slashed from over 300 to just 50. This dramatic improvement in output and efficiency directly addressed the client's most pressing problems.
Client Impact
The successful turnaround not only reduced back-orders and overtime costs but also had a significant positive impact on the client's reputation and customer relationships. By restoring stability and improving service levels, we transformed a failing operation into a reliable asset, proving how a disciplined planning process can deliver measurable results and restore business health.
Our Areas of Expertise
We specialise in the successful implementation of key operational strategies:
step 01
Robust Production Planning Cycles: We establish inclusive, cross-departmental planning cycles—a fast and effective method for gaining operational control. In as little as 12 weeks, we have helped clients boost On-Time In-Full (OTIF) customer service from 20% to over 85%.
step 02
Capacity Modelling: We develop accurate capacity models that provide a clear understanding of your capability and the optimal way to plan your business. These solutions range from simple Excel tools to fully integrated SAP software.
step 03
Simple Downtime Tracking and Analysis: By implementing systems, from manual sheets to real-time automation, and coupling them with robust planning, this analysis alone can recover 10% of your lost production time.
step 04
Integrated Process Optimisation: We combine and analyse the critical relationship between materials, line output (capacity & OEE), batch sizes, operational staff, and planning processes to consistently meet your customers’ needs.
step 05
Overall Equipment Effectiveness (OEE): We implement OEE frameworks to help you fully leverage and maximise your operational efficiency.
Robust Production Planning Cycles: We establish inclusive, cross-departmental planning cycles—a fast and effective method for gaining operational control. In as little as 12 weeks, we have helped clients boost On-Time In-Full (OTIF) customer service from 20% to over 85%.
Capacity Modelling: We develop accurate capacity models that provide a clear understanding of your capability and the optimal way to plan your business. These solutions range from simple Excel tools to fully integrated SAP software.
Simple Downtime Tracking and Analysis: By implementing systems, from manual sheets to real-time automation, and coupling them with robust planning, this analysis alone can recover 10% of your lost production time.
Integrated Process Optimisation: We combine and analyse the critical relationship between materials, line output (capacity & OEE), batch sizes, operational staff, and planning processes to consistently meet your customers’ needs.
Overall Equipment Effectiveness (OEE): We implement OEE frameworks to help you fully leverage and maximise your operational efficiency.
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- Case Studies
Proven Results in Supply Chain Excellence
Cold Chain Optimization
A leading pharmaceutical manufacturer faced recurring temperature excursions during product transport.
Supplier Network Resilience
An engineering client struggled with frequent supplier delays and material shortages.
Manufacturing Efficiency Boost
A major manufacturing company suffered from inconsistent production outputs and excess waste.