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FLEXO Magazine : July 2010
FTA Great Lakes Group Goes on a Lean Journey PCMC Tells its Story By David Lanksa What does it take to achieve great results? How do you improve quality, drastically reduce inventory costs and free up valuable floor space? How do you de- velop a management model that provides sustainable bottom line profitability? For Paper Converting Machine Co. (PCMC) and the Barry-Wehmiller family of companies, the focus is not on the results themselves. Rather, they choose to focus on the means to achieving great results: a leadership philoso- phy predicated around respect for people and continuous improvement. This was not always the case. It has been a long process of cultural transformation. On May 18th, the FTA Great Lakes Group (GLG) was privileged to go along on a Lean Journey with Craig Compton, PCMC’s VP of operations as our tour guide. SySTemS ThinkinG For PCMC, as with many companies, the management philosophy had long been based on a traditional bottom line mentality. Unfortunately, bottom line management based on command and control often leads to fragmented actions, which lack alignment with organizational goals. Manage- ment mistakenly considers the bottom line result to be the goal, using metrics and status reports to control and monitor progress. In this environment, management dictates blanket solutions, which are not focused on root causes. This puts em- ployees in a defensive mode, worrying more about justifying their actions than coming up with solutions. A Lean environment, by contrast, is process oriented. Man- agers don’t view themselves as managers. They are lead- ers who teach and mentor their team members to become problem solvers. They engage team members by creating an environment where their ideas are valued and it is OK to fail. Ideas for improvement are not force-fed to underlings, but flow from a team atmosphere where problems are identi- fied and solved together. Compton said his favorite saying is, “ What did you learn?” A Lean environment encourages “systems thinking,” where processes and people are aligned with organizational goals. By focusing on improving processes, people and systems, a Lean environment produces substantial bottom line results. DeFininG LeAn So what is Lean? Some would say reduced waste, improved throughput, greater value to customers and associates, process improvement or improved quality. While these are all potential benefits of Lean, Compton indicated that he sees Lean as the basis of a fundamental enterprise-wide shift in expectations, measures, performance and culture. He termed the shift, a “Lean conversion,” which, in order to succeed, must become a central pillar of the company ’s business strategy. By engaging, empowering and entrusting every associate, a Lean conversion provides a sustainable competitive advantage. And although it is easier to see tangible results on the plant floor, the same focus on systems, people and processes drives operational excellence throughout the organization. People-centric “inspirational” leadership is the key to achieving and sustaining a Lean culture. Inspirational leader- ship begins with a vision to foster buy-in throughout the orga- nization. Barry-Wehmiller came up with a vision in 2002 called “Guiding Principles of Leadership. ” Inspirational leadership grows with recognition of the daily examples of leadership at all levels within PCMC. Compton said they have celebrated and recognized more exemplary leadership in the past four years than in his previous 16 years with the company. PCMC’s “Guiding Principles of Leadership (GPL) include a clear and compelling vision, leadership, communication, measurables, and stewardship. The GPL aspire to a leader- ship environment based on trust and communication that brings out the best in the individuals. It allows everyone to have a meaningful role, and in so doing inspires pride. It challenges everyone to grow personally and professionally, liberating them to realize true success. Twenty-seven members from across Barry-Wehmiller participated in a dialogue on Leadership to create a vision Elements of PCMC’s Lean Journey • Systems Thinking • Guiding Principles of Leadership •7S • Value Stream Mapping • Kaizan Events FTA TODAY for the convergence of Lean and the GPL. In an attempt to articulate the culture, they came up with a saying that is part of the process: “We measure success by the way we touch the lives of people.” Compton said, “We believe we can have a profound impact on the quality of life of every one of us. We believe as business leaders we have a profound opportunity and responsibility to those people.” One of the most profound components of the Lean journey is the concept of fulfillment, according to Compton. “We want people to leave every day with a sense of fulfillment. If they do that, they will do some really great things for the business, some great things for our customers, (and for their families). Getting better operating income, higher end productivity turns, reduced inventory. That’s great stuff. Those are byprod- ucts of this (process).” In a typical Lean journey, you want to focus on non-value- added activities. Machining parts adds value for the custom- ers. The time a machinist spends looking for a program, materials, tooling and fixtures does not add value. So Lean activities typically revolve around reducing cost and lead times. As part of PCMC’s journey, they want to see empower- ment and fulfillment increased. Compton spoke to the personal impact of Lean. “It enhanc- es how we communicate. Four and one-half years into this journey, I didn’t realize how poorly we communicated in our business until we were at where we are today. The company holds daily meetings in every part of the business. The first thing we talk about is celebrating and recognizing our indi- viduals. Then talk about the current issues in our process.” BeyonD 5S... 7S After PCMC’s purchase by Barry-Wihmiller, they built a foundation for their Lean journey on 7S events, where they would clean, paint and organize each target work-space to make it safer and more efficient for the people that work in that environment. Using cross-functional teams, the 7s events focused on 1. Safety, 2. Sorting, 3. Straightening, 4. Sweeping, 5. Scheduling, 6. Sustaining, and 7. Satisfaction. The 7s teams produced visible results when they set about to physically “fix” something in the plant. “You could physically see the change that you made in the business,” said Compton. This began to create the culture change the company was seeking. They set up a schedule and encouraged everyone to participate. Since then, the teams completed 275 such events. Value Stream Mapping helped the company align busi- ness processes that bring value to their customers, as well as identify those activities that did not add value. Elimination of non-value-added activities greatly improves the company’s efficiency, customer service and product deliveries. invenTory inveSTiGATion During the plant tour, one of the team members described how PCMC used to have $21 million worth of inventory on the shelf, yet still was late on everything. Material would be received, then physically moved to its predetermined inventory holding location in the farthest corner of the massive ware- 48 FLEXO juLY 2010 www.flexography.org FLXO_July10_v2.indd 48 7/16/10 9:37 AM
Sustainable Summer 2010