| Transforming
into a Lean Agile pan-European Enterprise
Due
to the terrorist attack on
9/11/01, low inflation and rapid global competition, European
corporations are caught in a frenzy of reducing overhead
costs and time to market, and increasing manufacturing
capacity and product quality. However, the real
opportunities for restructuring are when a business stitches
together its business processes with partners processes
to create a virtual company that serve to deliver value
to the customers. In other words, it is important to
first articulate the business network that contains the
core processes across different organisations and then
to create an lean agile
enterprises. As a consequence, Strategic Value
Management has been gathering management attention.
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The Method Of Strategic Value Management
Every
revolution of the Action-Plan-Do-Check cycle propels the organisation forward increasing
economic value added (EVA) and Cashflow |
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Investing
in People & Culture
“There
is only way to get any competitive advantage and its not
by having smarter people then anybody else. If you can
get your people to interact in fundamentally better ways
than other organizations then you have something that is
absolutely cannot be copied” John Old,
Texaco
Companies
are spending large sums on IT. But if
they don't address the people issues and implement the required change
in culture, they could take a big step backwards as IT
is only an enabler.
Early
adopters of Knowledge Management have realized the power
of knowledge and the rewards due to staff empowerment.
These organizations have recognized that it’s the
individuals that are the key contributors to success.
It’s due to people that new processes, products and
services are developed through the culture of
innovation. It’s the individual that brings
about change and the organization acts as the supporting
mechanism.
The
essential stages of empowering people
are communicating, gaining understanding, assessing the
individual's capability, providing specific skills
training, and selecting the right individual to fill
defined roles in the new environment.
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| Capturing
Value Through Customer Relationship Strategy Getting
the customer relationship right is required for creating
lasting value. Unfortunately, for many companies, the
quest to capture value form better customer alignment
has not produced the expected return on investment. Also
while more information is available on behaviour of
customer interactions, companies continue to have
difficulties leveraging that information to enhance the
customer relationship.
We
believe that to
capture value, leading organizations need to
clearly articulate strategies that are supported by
organising business process, technology and
accountability, enablers to build long-term relationship
with segment-level customers. This means changing
the processes, interactions and culture of all of the
partners in order to satisfy the ever-changing needs of
the customer relationship and to provide seamless
service. As business cycles shrink and customer
relationships become more personalized and one-to one,
only knowledgeable staff, flexible processes, and manoeuvrable
technologies can support the swift transition required
to continuously adapt, survive and thrive.
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| The
process for creating the right people culture |
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| People will feel confident as they
are involved in the changes
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British
Aerospace's Operation
Re-engineering
manufacturing operations into three separate businesses
to achieve world-class performance with overall positive
cash flow during the process of change.
A
major re-engineering programme is under way at BAe to
make Airlines Division a world-class competitor and cut
30% from operating costs.
Ingersoll
Engineers (Bourton Group) recommended a strategic plan
involving division of manufacturing operations into
three businesses separated physically, organisationally
and financially.
Supply
was being developed as a competitive supplier of
high-quality aircraft noses, major sub-systems and
assemblies.
Assembly
has the task of meeting the critical requirement of
competitive cycle time for aircraft assembly to first
flight.
Customisation
of stock build aircraft operates as both management
headquarters and a key customisation centre.
Responsibility
and accountability for each business is made visible,
and each has its own technical, logistical and
administrative support.
There are
six key drivers for change.
Inventory
reduction is the key to cash-positive
restructuring. A site-wide inventory reduction team has
helped release over £100M in a year.
Space
reduction: Sales per square metre
doubled by using space more efficiently.
Lead
time/Cycle time reduction: New methods
of working were implemented to reduce cycle time, and
thus lead time and inventory.
Lean
manufacture with JIT supply: A
functional structure was changed to one based on tasks
and teaming in cells. JIT material supply was the
cornerstone of the new manufacturing methods.
Make
vs buy analysis highlights which simple
components can be bought in, allowing concentration of
effort on product-specific and strategic skills.
Cultural
change received priority treatment.
Communication, training and recruitment were all part of
the programme.
By using
resources within the business the management team
implemented the changes with positive cashflow
throughout the five year programme. British
Aerospace System |
