Summary: When order volumes exploded, this manufacturer ramped up by implementing a rapid cultural transformation that drove ongoing, double-digit productivity gains in subsequent years.
Business Snapshot: This company markets innovative, environmentally focused and energy-saving technologies that provide clean, safe and aesthetically pleasing water to residences. It manufactures a broad product portfolio ranging from filter housings, filter cartridges, drinking water systems, softeners, pressure vessels and control valves marketed under a number of prominent brand names.
A workforce of 120 operates 10 value streams in this company’s 60,000 square-foot manufacturing facilities, located in Milwaukee, Wisconsin.
Background: The Milwaukee plant had been pursuing aspects of Lean for some time prior to its acquisition. Homegrown kaizen events had led to some successful workouts for spot areas. However in 2002, the company needed to scale up production at the same time it faced workforce and facility constraints. The managers recognized that the workplace was hobbled by poor organization flow, wasted motion, and haphazard storage practices. They felt they needed a wholesale transformation to a operationally excellent organization.
Engagement: According to the current Regional Operations Leader, the company wanted to move past its current state. “We had the typical starts and stops, with pockets of improvement,” says the Regional Operations Leader. “But the company as a whole hadn’t embrace lean as a way of working. Action workouts were ad hoc and short-lived. There was no transfer to other areas.” The managers came to the realization that the implementation of Lean tools and practices was not sustainable in a culture that was mostly compliant and being driven from the top.
The Plant Manager also had words to share. “The Regional Operations Leader and I saw Tony Mangione’s Delta Stratagem approach in action at one of our sister companies in Syracuse, New York. Tony’s approach was unique in that he addressed the business culture and underlying issues at the worker’s level in order to get traction for the change needed. He knew that people and culture change had to come before the implementation of the tools.”
Ready to move
The company offered fertile ground for Delta Stratagem’s unique approach to rapid transformation. The Delta Stratagem approach was selected for application to all the plants located in San Diego, California, Rockford, Illinois, Westborough, Massachusetts and Minneapolis, Minnesota, in addition to the Wisconsin facility.
“Here in Milwaukee, an unprecedented surge in orders impelled us to move quickly to meet demand,” remembers the Plant Manager. “Tony brought an unconventional top supported/bottom activated strategy for making the structural, operational, and interpersonal changes need to establish a culture of personal ownership and continuous improvement. From the management team to the shop floor personnel, he got to the core of what we believed and how each of us saw our work.”
As the Plant Manager recalls, “We were fortunate that even though we came from a traditional manufacturing environment, our employees were willing to make changes. Tony has a talent for making people understand why we’re doing the things we’re doing as well as what we’re doing.”
The Plant Manager agrees. “Tony knows what makes people tick. He’d single out the most resistant individual in a group and work with the challenges that person raised. At the end of the day, Tony turned the most skeptical people into our biggest cheerleaders for the transformation, dissipating any resistance.”
The Plant Manager felt that one of the factors that led to a positive outcome was the early involvement of the company’s Human Resources team. “HR became a huge proponent of what we were trying to accomplish. Because they were up to speed, they were able to help people through the kinds of conflicts and questions that come up when you redefine the workplace.”
Tuning Up a Culture
Every person working at the company went through one of Delta Stratagem’s five-day Transformational Workshops.
“Before, employees were only slightly involved in Lean and Six Sigma,” adds the Regional Operations Leader. “Supervision, management and manufacturing engineers ran the show. Employees participated, but had to be lead. From the employee point of view, the change proposed was ‘something that was done to you.’ Tony turned that attitude around to personal commitment, ownership and doing.”
According to the Regional Operations Leader, “Tony’s workshops shook up the organization.” Employees were introduced to new ways of thinking about work and their roles. “I would say that everybody was challenged by the workshop. The employees were being asked to speak up without fear. And the management team had to be able to let them go and run with it.”
“Seeing our operations through Tony’s eyes showed us what waste meant at both the personal and the structural level,” says the Plant Manager. “People were accepting of what we needed in terms of tools and understanding to make positive changes out on the shop floor.”
Subsequent workouts were nothing less than a reinvention of the workplace. “We moved everything out of a given area,” says the Plant Manager. “We stripped and resealed the floors and painted what needed paint. Then we reset the area as a team, using layouts based on what we’d learned about labor efficiencies, timings, and placements.”
Over time, the entire company learned about the seven wastes and how to recognize them within everything that they did. But just as importantly, people learned that they could make improvements on their own in this new culture. With more open lines of communication, employees could stand up and know that their voices would be heard at all levels of the organization.
Empowerment was not conflict-free. In one case, management had agreed conceptually with some proposed changes, but kept on delaying implementation and requesting additional studies. When the operations managers were offsite at a corporate meeting, the impatient production line team took action. They rearranged equipment, moved inventory, and restructured the job flow without direct management involvement. When the leadership team returned, the changes were already in effect and operational. A project estimated to take a week to complete by a few was implemented overnight by all.
Indeed the culture had changed. In a big way, these employees had stepped over the old boundaries of roles and responsibilities and took on some of the managers’ authority, truly taking empowerment to heart. With some coaching by the HR department, the managers accepted that the employees were justified under the new rules of shared ownership of the workplace. It also helped that the changes yielded substantial improvements. In the end, everyone involved learned from the incident. And the team members were understandably proud of the success that accrued from their personal initiative, while the management team acquired a greater respect for the workforce as partner in the drive for Lean.
Improvements That Delivered Payback
The Plant Manager reports that the cultural change enabled the company to meet its production goals. “We didn’t have to add a second shift and struggle to find skilled workers in order to meet demand; we manufactured more product with the same number of people. The employees developed a position rotation strategy that keeps them fresher and more aware of what’s happening on the line. They lowered their fatigue level and go home feeling less tired – more satisfied about their jobs.”
Adds the Regional Operations Leader, “Credit for some of why we were able to move Tony’s foundational work out to the shop floor is due to Jim McDonough of the Delta Stratagem team. He brought his visionary engineering expertise right on site for hands-on lessons that showed our teams more of the potential of what they could achieve.”
Other improvements extend beyond the shop floor. “Under Tony’s influence, we changed our product development process,” says the Plant Manager. “Now sales, marketing, engineering design and manufacturing engineering are all involved, working as team. We even created a war room for the group. By applying the new approach to the design and manufacturing process, we’re making it easier for our customers to assemble, install and program our new products.”
Virtually overnight, new product introductions transformed from the usual confusing nightmares to become smooth and easy transitions. After the company was acquired by another, the new owners sent their Value Stream Mapping specialist to define the Value Stream of two new product lines. He estimated two days for the design of each Value Stream – four days in all. But by applying Delta Stratagem’s simplified WasteFinder© method, the Milwaukee team completed both value streams in just a day and a half, much to the amazement of the expert.
Change Momentum – Sustained
The changes sparked by Delta Stratagem have stuck. The Regional Operations Leader reports “Gross margins continued to go up about 3 points per year, even in a declining economy. The biggest gain was out on the shop floor, especially in material handling. Employees take pride in keeping their areas tour-ready at all times, and they proudly conduct the tours. And work is organized so that we can scale up more easily; putting four people where there were originally two, for example.”
In the years since Delta Stratagem’s involvement, the company has gone private. “Our new culture was definitely a factor in the acquisition,” says the Regional Operations Leader. “We were considered one of [parent company’s] lead plants. We received many accolades and gave many tours. We continue to see double-digit productivity increases year-to-year. We couldn’t have done this without Delta Stratagem’s cultural transformation. While we’ve pursued our own improvement path in recent years, Delta Stratagem and Tony Mangione launched a cultural change that continues to be a win-win-win for the company, our employees and our customers.”