Published: 04 January 2021
Low cost access to Lean expertise
The Covid-19 pandemic has created an economic shock the magnitude of which most have never seen before, this crisis is expected to result in the 3rd biggest fall in world economy in the last 170 years. In addition to the impact on health and well-being, countless organisations have ceased to trade, while others are finding themselves increasingly at risk from global recession. No manufacturer is immune to the effects of this economic crisis and no one can really predict what lies ahead. The loss in confidence is affecting everyone, with even the exemplary ‘benchmark’ manufacturers being hit by shrinking demand for products, from consumers switching to cheaper products in the grocery market to postponing the replacement purchases for durable goods.
A tactical focus is the response of many in such times in a bid to maintain a holding position or simply to survive. It is tempting to simply introduce drastic measures to get an immediate short-term gain, such as reducing budgets, work shifts, headcount and extending supplier payment terms, all of which can produce the easiest and most obvious cost reduction measures. However, organisations should be very cautious about cutting costs at the expense of generating low morale with employees and damaging relationships with those who may be core in your drive for future growth. Businesses will need to take a much broader view to address the fundamentals of how to better manage the end-to-end supply chain.
Just like every other business BTA are not immune to the risks that the current situation presents, as a B2B service supporting manufacturing operations large and small, we too are feeling the impact that our clients are experiencing. However, as an organisation we have quickly realised that in order to be prepared and profit for the 'Bounce Back' effect expected in 2021 we will need to adjust to market requirements and make necessary changes to our current business model.
As a team trained by Toyota and well-conditioned in the methodologies of the Toyota Production System, we decided to explore the first of the 5 Key Principals on which this successful system is built, 'Identify value through the customer’s eyes' for our own organisation. Discussions with existing clients, both new and long-term revealed that although training and development of their workforce remains an important aspect, at this point in time action and results are a much higher priority and a main focus of many. A common theme of discussions has indicated survival, profitability, and growth come first, workforce development second, because businesses simply don't know what the future holds for them at this point in time.
In response to this feedback BTA have reassigned the majority of their team to deliver and support their Change Management Partnership service, designed to deliver immediate action and accelerated improvement results for businesses facing performance issues relating to Quality, Delivery or Cost. This service has been available to a select number of organisations over the years, who have seen it as a cost-effective low risk alternative to employing staff on a fulltime basis. However, it would appear that now is the most appropriate time to upscale this service and make it available to all businesses that are experiencing difficulty in facing the challenges of this economic downturn.
Lean is a straightforward concept; it means doing things well along the entire supply chain and across all functions of the operation whilst striving for profitable growth. The view of the directors at BTA is that the pursuit of lean operations has never been more pressing and should not be optional. For those businesses that have already embarked on their journey it’s time to intensify the effort and, for those who are yet undecided, it is time to stop hesitating and look at how to turn the challenges they face into opportunities.
BTA’s experience is that there is a vast array of untapped potential in all organisations and lean can provide one of the critical levers to accelerate the pace of change for businesses. There is no golden bullet or miracle cure to ride out the current economic downturn and individual businesses will need to focus on different aspects of their operation to exploit the opportunities.
For many businesses who are in the process of implementing new ‘ways of working’, there will be the inevitable challenge around whether the business is following the right path as the sense of urgency quickens. It is right for businesses to remain cautious; however, BTA would argue it might also be the most opportune time to adopt and implement Lean methodologies. If driven appropriately, even in this current downturn a company can gain a competitive advantage and emerge as a more agile player when the upturn comes.
However, employing the skills and knowledge required to address fundamental business issues can often be restrictive, the recruitment process can be both lengthy and costly, then there's the remuneration package once the 'right' person has been identified, which not unusually, and in most cases will challenge existing pay structures in order to secure the employment of someone with Lean knowledge and more importantly extensive experience of transformation. There are obviously many other considerations, especially if this is a new appointment, that will also require some level of expenditure that can be expected, but for a new appointment this is not without risk.
BTA’s Change Management Partnership has been specifically developed to minimise both risk and expenditure for host organisations. It offers not only what can be considered a self-financing professional service, but on every single project undertaken to date, an exceptional R.O.I. One client subscribing to this service on a 4 day per month basis, has realised £1.2m in savings during the first 6 months of support, a figure well above their budgeted expectations. This type of improvement result is only possible using dedicated, knowledgeable and highly experienced staff, so if you’re serious about improving the performance of your business, want to do it quickly and cost effectively, contact us to explore your options.
Published: 04 January 2021