October 30, 2024 4 Steps to a Fast Manufacturing Plant Turnaround

Even well-run companies occasionally have a manufacturing plant that jumps off the rails. 

By David Pate, VP Operational Excellence Practice at TBM Consulting

After five years of turmoil from COVID, staffing shortages, supply chain issues and transportation challenges, many manufacturers are struggling to make up lost ground. Add to that the inevitability of Murphy’s law – anything that can go wrong, will – and it’s no surprise so many plants are in crisis, repeatedly missing production and financial targets. And each hiccup, no matter how minor, draws them further into a downward spiral.

While every plant assumes their challenges are unique, I have two pieces of good news. First, you’re definitely not alone. The reality is most struggling manufacturing facilities face virtually the same hurdles. Second, that means there are some well-established protocols that can help across any sector.

Here’s a simple, four step system that can turn any facility around fast:

1. Evaluate. First, identify the root cause(s) of inefficiencies. This requires a clear, unbiased look at what’s going on. Assemble a cross-functional team to review current metrics, identify primary loss drivers and obstacles to improvement. Look at processes as well as people and equipment. After all, if your machinery isn’t running at peak performance, no process change will ever make up the difference. Now is also the time to decide where you aim to be: Set target KPIs and identify the remediation path and resources you need to get there.
   
   When setting KPIs, be thoughtful of which to choose. First, evaluate where you’re at from customer perspective. Think about how you serve your customers and what will provide the most value. This allows you to see where you need to get in the big picture and can help set crucial KPIs without overwhelming the team.
   
   Leaders, do not sugarcoat the situation in this phase. Be clear about where the plant is at and what needs to happen differently to improve operations.
   
   
2. Stabilize. Deploy a diagnostic team to stop the bleeding. The goal here isn’t necessarily to improve right now, only to halt additional losses. You’re going for the low-hanging fruit to fix the obvious problems. Take a look at talent. Does management have what it takes? Does your staff need additional training? Is poor retention a problem? You may need to adjust staffing to optimize, including reassignments. This phase is about having the right people in the right places doing the right things. Critically think and being honest if you have people in place who can execute, and consider if they could contribute more in another role.
   
   Be proactive in communicating your objectives to maximize cooperation and help people feel more at ease as changes begin. Standard operating procedures must be in place so everyone understands what a successful plant should look like before jumping into the recovery stage.
   
   
3. Recover. It’s time to execute your remediation plans. In addition to implementing prescribed changes, leaders will also need to model the behavior they want to see and reinforce procedures. All the while, track and trend KPIs with real-time operational and financial metrics. Ongoing reporting of key metrics is essential for monitoring improvement. The recovery team should review progress with plant and company leaders at least every week.
   
   Be careful not to get complacent and postpone those check ins. Leaders must hold their teams—and themselves—accountable. Reinforce the “why” behind changes to maintain support and engagement, and gather feedback from everyone, including front-line workers and supervisors, to understand how things are working (or not). Deliberate auditing and coaching will help to maintain these new performance levels.
   
   
4. Sustain. Here is where the new processes become embedded in your DNA. Now that things are fully functioning, provide ongoing support and reinforce accountability. Immediately flag and address any dip in performance before it gets too far ahead of you. Continue regular team check ins, and conduct daily plant walks, audits and coaching.
   
   Getting back to previous performance levels comes down to maintaining a skilled workforce. You cannot afford to lose skilled, hourly folks who understand how processes work. And if you do, without a good succession plan, you’ll put yourself in a hole that is difficult to dig out of. Your people are the most important part of sustainment as they are the ones that make the equipment work and keep processes moving. Make your people a priority and check in with them regularly.

Leadership is at the nucleus of this entire method. In each phase, leaders need to think and behave differently because the turnaround process demands a team approach. Frequent, transparent communication that focuses on meeting objectives and the “why” is essential to a long-lasting turnaround. It also requires encouragement and reinforcement, so take time to celebrate incremental wins along the way to keep everyone engaged and motivated. Soon, you’ll all be reaping the benefits of faster, more efficient and more profitable operations.

About TBM Consulting:
TBM Consulting is a global operations and supply chain consulting firm that serves manufacturers, distributors, service organizations, private equity firms and their portfolio companies. We specialize in operational excellence, supply chain management, human capital strategy, private equity value creation, digital manufacturing, and management system implementation.

About the Author:
Dave Pate is an experienced business leader with previous roles in plant management, planning and lean operations. He currently serves as Vice President, introducing new clients to TBM, cultivating long-term growth with current clients and on-boarding new clients.

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