Friday, December 8, 2017

Yearly Planning and Goal-Setting- It’s Not Just for Bigger Organizations

By: Dave Nelson

Years ago in my career, I was the president of a small custom fabricating/molding company. If you had asked me back then about my yearly plans and goals, I would have rattled off reason after reason for why that type of planning doesn’t work for a small company.

In hindsight, what I once believed to be legitimate reasons for not using those strategies were actually poor excuses. Upon further reflection, you may find you are in the same boat as I was. Below are my past “go-to” excuses for avoiding goal-setting, along with my current words of wisdom that challenge those excuses. Does anything sound familiar?

  • We are too small for it to matter.
    • The size of the company is irrelevant. Any business can achieve positive impacts from achieving a set goal.
  • We don’t have time to plan.
    • The time used to plan for your company’s future is worth the rewards it could bring on. If you could save $50,000 by investing two days of your time, why wouldn’t you?
  • I know where I want to go, I don’t need to plan anything out.
    • Having goals in mind is a step in the right direction, but your team should be included in the plans as well. Goals also should be written down and thought through. After all, a goal not written down is just a wish.
  • We did a planning exercise a few years ago, but it was a waste of time.
    • Here it would be beneficial to look further into why the exercise wasn’t helpful. There is a good chance your answer resides in one or both of the following reasons:
      • You tried to be too precise, thus making it an overwhelming ordeal.
      • After you finished, you rolled up the documents and never looked at them again.

Chances are you’ve heard these excuses before, or even used them yourself. In my role as Business Solutions Specialist at The Center, I talk with a lot of small manufacturers and I cringe every time I hear the same excuses being used that I rattled off years ago.

Operating a business without any plans or goals is like driving cross country at night. You will eventually get to where you’re going, but you won’t see beyond your headlights so you will likely miss great opportunities along the way. I would like to challenge you to instead drive in the daytime; put your excuses aside and begin making goals and plans for the upcoming year.

To make this process as effective as possible for you, I have gathered some of my most useful techniques for approaching goal-setting and planning. Read on for proven methods that can be applied to your company.

  1. Start small. You don’t have to boil the entire ocean at once. Start with a short, manageable list of two to five goals for your company to achieve and continue from there.
  2. Include your key team members in the process of establishing next year’s goals and plan for them together. Goals that are developed independently then passed on to the team are rarely fulfilled. 
  3. Set periodic (quarterly or monthly) goal/plan review meetings for the year upfront. Add them to the calendar for all those involved. This limits the possible excuses for not getting action items done in time.
  4. Make sure your goals are SMART:
    • Specific
    • Measurable
    • Achievable
    • Realistic
    • Time-Bound
A few examples of SMART goals that your company could develop include:
    • Increase revenue from X category by X% within X months
    • Reduce overtime by $X in X months
    • Increase on-time delivery to X% within X months
    • Launch a new website in X months under a budget of $X

Developing set goals and plans for your company is not something you must, or should, do on your own. This leads to my final and most valuable suggestion: Hire someone from outside of your company to facilitate your meetings and discussions. Investing in a facilitator, like one of our experts at The Center, greatly changes the dynamic of the overall activity, as they increase active participation and reduce the “just agree with the boss” line of thinking. An outside facilitator can provide your business with clear and fresh ideas gathered from past experience with companies similar to yours that were once in similar situations.

Your business, no matter how small it may be, can greatly benefit from some goal-setting, whether it is done on your own or with an expert’s guidance. As Brian Tracy, famous motivational speaker, once put it, "Goals allow you to control the direction of change in your favor." Make 2018 the year you put your excuses aside and discover the power of planning.


MEET OUR EXPERT
Dave Nelson
Senior Business Solutions Manager

Dave joined The Center in 2013 as a Senior Business Solutions Manager. Working directly with manufacturers in Wayne and Monroe counties, he enjoys helping small and medium-sized companies reach their full potential. Dave is a seasoned professional with expertise at identifying/opening new market opportunities and increasing market penetration in existing markets. He also has extensive experience in generating/growing new business and selling intangible services.




Since 1991, the Michigan Manufacturing Technology Center has assisted Michigan’s small and medium-sized businesses to successfully compete and grow. Through personalized services designed to meet the needs of clients, we develop more effective business leaders, drive product and process innovation, promote company-wide operational excellence and foster creative strategies for business growth and greater profitability. Find us at www.the-center.org.

Friday, December 1, 2017

Food Processors Can Get Lean with a Helping of Kaizen

By: John Spillson

Kaizens have been used in the manufacturing world for years. You’ve probably heard “Kaizen” mentioned around your facility a number of times- but what exactly is a Kaizen? And who can it benefit?

At its most basic level, a Kaizen is a change for the good, coming from the Japanese “kai” meaning change and “zen” meaning good. The way manufacturers use Kaizen, it is a method of improving business operations and decreasing waste within a facility, benefitting not only the process but also the team involved. They serve to identify, target and quickly attack a deficient area in a facility or to capitalize on an opportunity for improvement.

You may be under the impression that Kaizens can only help traditional manufacturers who create auto parts or work with textiles. This could not be further from the truth. Any manufacturer, including those in the food processing industry, can benefit from a Kaizen. The goal of a Kaizen is simple: reduce waste and improve processes in a targeted area. Waste is waste, regardless of the industry, and a Kaizen can help you get rid of it.

How Does a Kaizen Work?
Kaizens begin with your team being introduced to an overview of several Lean methodologies, including value stream mapping, 5S and standard work. This enables them to learn how to identify which steps in their processes do or do not add value, how to create a clean, safe and organized work environment and know the importance of creating standardized work instructions.

Once the team has a good understanding of Lean, they map the current state of the process. No judgements, evaluations or improvements are made at this point, it simply serves to put the process on paper. Dr. W. Edwards Deming, a main influencer in the Quality field, famously stated, “If you can’t describe what you’re doing as a process, you don’t know what you’re doing.” By being asked to think critically about processes, this provides an accurate starting point and clearly lays out where things currently stand.

Each process step of the map is then analyzed and labeled as one of three categories: Value Added, Non-Value Added, or Necessary but Non-Value Added. The goal here is to eliminate or improve steps that do not add value, and minimize those that are necessary but do not add value.

Next, an action item list is created that helps get to the ideal future state of the process, assigning tasks of what needs to be done, by whom, and by when. This allows the team to get involved in the transformation as they gain more momentum and seek the next hurdle to overcome. After improvements are talked out, put on paper and implemented as part of the future state, the impacts will be realized.

Kaizens do not take as much time to implement as you might think, as they are typically completed in a week or so. While some may worry this is not enough time to have a real impact, the opposite is true. The team’s motivation and energy peak during the first week of a Kaizen, making it an exciting and eye-opening process for everyone involved. A successful event also can yield positive results years down the road as the company fully embraces a culture of continuous improvement.

Case Study: Kaizen in the Food Industry
After learning about the benefits of a Kaizen, you might be considering implementing one within your food company. But what would a Kaizen look like in a food company? Our team at The Center recently worked with a nutritional supplement company to assist in their new product launch process. This called for a Kaizen.

In the past, this company had experienced timing overruns and high variation in launch duration when rolling out new products. This resulted in missed opportunities in product availability in both catalog and online sales. During the mapping process, our team identified a total of 99 process steps, with 42 steps being non-value added. Four bottlenecks also were discovered, including the creation of the preliminary statement of work, prototyping, label creation and first run production. To address these issues, 35 action items were created. Once successfully implemented, these action items reduced the new estimated lead time by 29% to only 89 working days. The solutions put into place included:

  • Standardize New Product Info Packet
  • Cross-train staff to eliminate wait steps
  • Consolidate SKUs
  • Track inaccuracies to reduce them
  • Auto-generate some documents to eliminate data entry errors 
  • Standardize label sizes and usage 
  • Reduce prototype shipping sizes 
  • Reduce first product lead time

On day five, the final day of this project, the team presented their plan to management for how to move forward, specifically discussing how to alleviate several bottlenecks, complete their action items and significantly reduce new product launch time. This allowed them to beat competitors to market with their industry-leading products.

As you can see, the type of company or product involved has no bearing on the success of a Kaizen. Whether it be a traditional manufacturer or a processor of food products, the driving principles of Lean and Kaizen can be applied and dramatically improve a company’s processes. Although the industry may vary, Kaizens should always be structured, focused, action-based, implemented quickly, data-driven and exciting!


MEET OUR EXPERT
John Spillson
Food Business Development Manager

John works to develop and expand the food program at The Center. His experience operating his own business has given him knowledge in production, sales, food safety, marketing, warehousing and logistics. John comes from a long line of entrepreneurs, following both parents and grandparents in operating their own family food businesses. Prior to joining The Center, John owned and operated his own food processing company for more than 20 years. He loves helping food processors almost as much as he loves food itself.



Since 1991, the Michigan Manufacturing Technology Center has assisted Michigan’s small and medium-sized businesses to successfully compete and grow. Through personalized services designed to meet the needs of clients, we develop more effective business leaders, drive product and process innovation, promote company-wide operational excellence and foster creative strategies for business growth and greater profitability. Find us at www.the-center.org.