Ops #6 - Can this plant be saved? Part III

Image source:Textually.org
I remember waking up in the middle of the night with my stomach in a knot. Everything that anyone could think of to turn the plant around had been done and it simply wasn’t working. People seemed happier and were working well together, and we were producing a lot of components, but lights weren’t being shipped. After four weeks we hit $850,000 past due. At this point everyone was really questioning the approach because we should have been shipping better, but we weren’t. In the end the only thing to do was to stay on course. Fortunately, the next week we started to ship at a tremendous rate. It was like a dam breaking. At week five we were down to $650,000 and by week six we were down to $300,000. By week eight we were below $50,000. The plant stayed current for at least the next year. There was always the specific customer issue to solve, but the plant was essentially healthy.

Once the customers stopped complaining and the customer service people from the company stopped complaining, the heat was off the corporate execs to do something about the plant. They found other headaches to focus on and talk of closing the plant just went away. There was still a lot to do, but the plant was well on its way to healthy production and much better financial performance.

Final Note:
Some people who have experience fixing underperforming, or disastrous operations, will first fix the problems and then work on the long term health of the plant. My approach is a little different. What I try to do is determine what infrastructure needs to be put in place for the long term, and then put it in place as quickly as possible. With this approach, the manager doesn’t have to change strategies, or have a point where things are going well enough to switch from the band aid to the long term cure. The down side is that sometimes things will continue to get worse while the infrastructure is being put in place. It is imperative to pick the most important infrastructure to put in place first that will have the dual effect of fixing the current problem and creating the foundation for the future. Another reason for this approach is that there is a danger of the band aid becoming the standard routine if it is place too long.