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P&G Plant Tour: ML Council Members Say Industry Transformation Won’t Affect the Need for Plant Floor Disciplines

Posted By David Brousell, October 13, 2015 at 8:05 AM, in Category: Factories of the Future

PG_Plant_Tour.jpgMany people in industry today believe that the convergence of manufacturing with new and advanced technologies such as 3D printing, cyber-physical systems, and Big Data will have a profound effect on the way production is organized and conducted. But as long as factory floors designed to produce large quantities of products remain in existence, disciplines of operational excellence will continue to apply.

That was one of key beliefs expressed at a roundtable meeting on operational excellence held last week by the Manufacturing Leadership Council, whose members traveled to Iowa to tour Procter & Gamble’s sprawling personal care products plant in Iowa City and learn about P&G’s Integrated Work System (IWS) operational excellence model.

The IWS, part of P&G’s manufacturing culture for more than 25 years, focuses on driving continuous improvements in throughput, quality, productivity, and cost reduction. IWS has been implemented in all of P&G’s 133 plants worldwide. It is underpinned by a philosophy of zero loss, total employee involvement, and so-called “servant leadership”, a concept with roots in ancient China that was popularized in the 1970s in an essay called “The Servant as Leader” by Robert K. Greenleaf.

Many Council member companies on the tour have had their own factory floor operating models in place for many years, also designed to improve operational efficiencies and with varying degrees of similarity with IWS. But all are looking at a future – which the Council calls Manufacturing 4.0 -- in which the industrial landscape is dramatically changing as a result of global business trends, demographic changes, and technological disruptions.

Just how much these trends and disruptions may alter decades-old production models on plant and factory floors, and the operating models that manage them, was the subject of some debate at the P&G meeting. But the consensus was that operational efficiency models such as IWS will continue to be mandatory as the winds of change blow.

“Manufacturing will be totally different in five years,” said one Council member from a large consumer products company, adding that the future will be shaped by five “vectors” – robotics, digitization, inter-connectedness, new millennials, and operational efficiency methods. “But when it comes to the shop floor, the principles of operational efficiency will be necessary. The tools and the methodology, however, will have to evolve.”

Added a Council member from a large medical devices company, “We are not letting technology define us. Shop floor principles won’t change.”

The challenge of adapting how principles of operational excellence are applied will test many manufacturing companies as they march into an increasingly technology-intensive world that demands agility and fast response. And the key to fostering that agility, as Council members were told by P&G officials, is creating the right level of stability and predictability via their operational excellence model.

At the P&G Iowa City plant, which makes such brand name products as Pantene shampoo and conditioner, Scope mouthwash, Ivory soap, Crest toothpaste, and Vidal Sassoon hair care products, frequent product line changeovers is a fact of production life, a fact that requires the agility only a stable production system can provide.

But P&G officials emphasized that a stable and predictable production system doesn’t mean that the system always remains the same or that, because of standardization in the system, innovation is frustrated.

“Stability does not mean the status quo,” one P&G official said. “What we call IWS today is not what it was years ago. In the last five years, for example, there has been a big change in equipment ownership (by employees}. Some people also confuse innovation with improvisation. What you have to do is channel the right new idea, focus it, and make it effective.”

During the tour, Council members saw several instances of where IWS-inspired improvements are enabling P&G to up its game in operational efficiency. In what P&G calls its “Line 13”, for example, the manufacture of beauty care products had required 53 operational steps. Using an analytical methodology called Unified Problem Solving, line management set a goal of reducing that number to 24 steps per day.

Line management not only reached that goal but has exceeded it significantly. The line is now at 12 steps per day.

Council members also heard the story of a “crisis moment” in the manufacture of shampoo. Bottles were coming off a line with unwanted “foam” in them. The problem was traced to one of the tanks where the shampoo liquid was being made. Line management’s initial belief was that the foam was the result of a failed “O-ring” in the tank, but after further analysis using the UPS methodology, it was revealed that the problem actually resided in one of the raw materials used in the product.

During the roundtable discussion, many Council members praised the P&G IWS system for its principles and methods. In particular, they said that the link P&G has established between IWS principles and people is the key to IWS’s success. And some admitted that their own companies have not forged that link well enough themselves.

Said one Council member from a large chemical company, “For us, the engagement is missing. We need to get more employees on the shop floor involved, rather than get the lean experts to come in and have them nod their heads.”

Fostering greater employee engagement and involvement, however, often requires breaking down organizational hierarchies and embracing a flatter structure and a more collaborative decision-making process, a challenge for many companies used to more hierarchical, command-and-control ways of doing things.

It’s a process that P&G is well aware of. One P&G executive at the roundtable last week told the story of being assigned in 1991 to manage a factory in Europe. He went to the factory determined to apply the principle of servant leadership, and when he arrived at the facility, immediately went to work on the factory floor to show employees he was not above doing the work himself.

Shortly thereafter, he said, he was approached by one of the workers at the factory and told he was not authorized to be on the factory floor. “A strike almost occurred,” he said.

Attitudes, work process, and organizational models all take time to change, of course, but for P&G as well as many Council member companies, the operational model is the compass in what often seems like a time of unending change. And the root of any model goes to the heart of what a company truly is.

“At the end of the day, “ said one P&G official, speaking of IWS, “the system is not a set of tools. It is about culture. It is about enabling people to do a perfect job.”

The Manufacturing Leadership Council’s next plant tour is at General Motors in St. Catherines, Ontario, Canada, in November. The discussion theme will be Building Next-Generation Teams. Register now on http://www.mlcouncil.com/?elqPURLPage=882




Written by David Brousell

Global Vice President, General Manager and Editorial Director of the Manufacturing Leadership Council

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As an investor, consumer and fan of P&G, it was great to hear about P&G’s Integrated Work System, particularly the powerful concept of servant leadership. I am curious as to whether P&G shares the specifics of the economics of their business units with their employees and allows them to share in the financial improvements of their efforts? I have seen these two concepts drive great improvements in hundreds of companies, including Southweast Airlines, United Technologies and BHP Billiton. Further empowering employees with economic information is a powerful driver of continuous improvement, so I was thinking it fit well with P&G's objectives. Here are three articles that provide more background:
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