“Always plan ahead. It wasn’t raining when Noah built the ark.” Cardinal Richard Cushing
Greetings from 32,000 feet over Salt Lake City, Utah….
Today, I visited a factory with one of my clients who is a key supplier, and experienced an incredible tour by the materials manager, Bob. In this plant, this materials manager isn’t a senior executive or even a top manager. But Bob’s passion for his operation and understanding of his company’s goals were most impressive and instructive. Here are some highlights:
Before our tour, Bob outlined his operation’s Six Core Values:.
- Service to the Customer
- Cost (his operation is a cost center, not a profit center)
- 5S (i.e. Housekeeping)
Bob explained he runs a huddle every day, as do the two other shift leaders. The agenda is short; the huddle lasts only 5 minutes. He starts with a safety review, asking his team to relate examples of good safety practices in use and if they have observed anything raising a current safety concern. If time allows, they will also discuss one or more of their other Core Values.
I noticed several exemplary practices, clearly borne out of careful planning. First, they DO have a safety culture. Bob explained they acquired many tools, such as their machine tools, or even the robotic packagers, specifically to improve worker safety and reduce injuries. A 5-gallon pail of lubricating oil can weigh over 50 pounds, so back injuries used to be very common at this plant – not any more. Another standout observation was the factory’s cleanliness. Making beautiful fasteners is actually dirty work. Steel is typically extremely dirty and requires lots of petroleum for lubrication. Lots of water and oil splashing around on deck here (notice how I wove in an “Ark analogy”)! Yet, this plant was immaculate. Nonetheless, Bob still apologized, saying it wasn’t up to his personal standards.
I told Bob I was so impressed with everybody encountered at his factory. He explained despite a tight job market, with employees hard to find, they hire only one in every 25 people interviewed. Even in a tough hiring environment, they haven’t relaxed hiring standards. He said it’s their key to hitting operational goals every year.
I asked Bob about wages for the production workers. He replied a plant floor worker earned about $20 per hour last year, but each also received a 2014 bonus check of about $4,500! I asked him how bonuses were calculated? Guess what? Bonuses tie directly back to the organization’s Six Core Values! Workers first need to meet their cost budget, which typically means a 5% improvement over the prior year. Then, they must receive no deductions for problems related to the other five Core Values. If they hit those targets, then the company splits the amount saved over budget 50-50 with employees, with everybody awarded an equal share.
I teach this stuff every day in my planning work – that‘s what made this experience both so cool and personally validating: Meeting Rhythm, identifying Core Values, simple but repetitive Cascading Communications and hiring The Right People. But here I got to see it all come together to substantively impact an operation. Sometimes I get client pushback: “We are getting too big to run daily huddles,” or “I have to settle for C players because there just aren’t any A or B players available.” But this BIG operation, a Fortune 500 company producing over 100 units per year, continues to stay true to their Core Values and maintains high employee standards.
Yes, indeed, I love it when a plan comes together!
For more, read the full article at BizTimes.