How do you know your Op-Ex initiative is successful?
What are the metrics to use?
There obviously are some effects every manager desires to see – shortening lead times, increasing performance / yield, lowering unit cost etc. These are important and any reasonable Op-Ex initiative will have some sort of performance and/or cost metric as its KPI. There are however some, that are even more important than the “hard” business results. The ones that are in fact their long term enablers – are your people engaged in the initiative, do they actively participate, is there a constant flow of improvement ideas, etc.
Without the “people metrics”, the “hard” ones can obviously be achieved. Most often as a once-off success, followed by a long fight to repeat the result. It strikes me every time I have a conversation with a senior manager bragging how business-oriented their Op-Ex (mostly Lean) is, how good the business KPIs are, followed by a visit to the factory floor to see people chasing their tail because they have no time to think. Just like in an old construction joke with a guy furiously running with an empty wheelbarrow, because he has no time to actually load it.
One of the best, i.e. most successful, Op-Ex initiatives I’ve run with a Client had an interesting mix of top-level KPIs:
- performance (quiiite a stretch),
- conversion cost (didn’t know if at all feasible at the start),
- happy people.
That’s it. Just 3 of them. And the most meaningful for the plant and the company as a whole. We’ve reached them all just because people were in the focal point of the initiative. We naturally needed performance, but it was not about chasing the people to run faster – we needed them happy. And they were (and still are!) happy to actively participate, improve and develop both themselves and the company. A pleasure to see them every time I visit.
And that’s the key.
Sooo…
- Is your Op-Ex framed right?
- Does it have the right set of KPIs?
Please let us know in the comments below 🙂
If you’d like some assistance in making them right – drop me a note and I’ll be happy to help.