Operational Excellence

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See how operational excellence drives the profit of a company. Learn techniques to improve efficiency and effectiveness of your operations.

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Operational Excellence

  1. 1. Operational Excellence – Improving Profitability 1.562.860.8637 ITS NOT STRATEGY THAT MATTERS – ITS EXECUTION THAT COUNTS info@cpsphere.com www.cpSphere.com
  2. 2. ITS NOT STRATEGY THAT MATTERS – IT’S EXECUTION THAT COUNTS  cpSphere  Delivering Next Generation of Solutions 17215 Studebaker Rd. Suite 390 Cerritos, CA 90703 1.562.860.8637 1.562.860.8611 growth@cpSphere.com 1.562.860.8637 ITS NOT STRATEGY THAT MATTERS – ITS EXECUTION THAT COUNTS www.cpSphere.com info@cpsphere.com www.cpSphere.com
  3. 3. Operational Excellence Systematic management of all the processes to achieve world class performance by:  Efficient utilization of tools  Optimization of Resources  Elimination of process waste / inefficiencies 1.562.860.8637 ITS NOT STRATEGY THAT MATTERS – ITS EXECUTION THAT COUNTS info@cpsphere.com www.cpSphere.com
  4. 4. Lack of operational Excellence … Results in low profitability and cash flow issues When do you address it? 1.562.860.8637 ITS NOT STRATEGY THAT MATTERS – ITS EXECUTION THAT COUNTS info@cpsphere.com www.cpSphere.com
  5. 5. Operational Excellence Becomes a Concern when…  Cash flow starts to get a little tight – Trouble meeting payroll – Suppliers are screaming for payments – Inventory is out of control – Expenses are rising faster than revenue  Backlog starts to shrink  Opportunities are missed due to cash flow issues 1.562.860.8637 ITS NOT STRATEGY THAT MATTERS – ITS EXECUTION THAT COUNTS info@cpsphere.com www.cpSphere.com
  6. 6. Improving Profitability – Traditional Approach  CFO/Department Head is responsible to lead the cost cutting efforts Focus usually is on cutting expenses    Workforce Extend Reduce Scrutinize Reduction Payment Terms Employee Perks Purchasing 1.562.860.8637 ITS NOT STRATEGY THAT MATTERS – ITS EXECUTION THAT COUNTS info@cpsphere.com www.cpSphere.com
  7. 7. Performance Improvement: Strategic Approach Generate Ideas to measure the identify waste achieve a better current level of level of output performance Performance improvement is all about organizational change 1.562.860.8637 ITS NOT STRATEGY THAT MATTERS – ITS EXECUTION THAT COUNTS info@cpsphere.com www.cpSphere.com
  8. 8. Ideas Should be… • Effective • Efficient, and • Adhere to Market Forces 1.562.860.8637 ITS NOT STRATEGY THAT MATTERS – ITS EXECUTION THAT COUNTS info@cpsphere.com www.cpSphere.com
  9. 9. How to Generate The Ideas Value Stream Mapping   $ Visualize Your Eliminate Increase Processes Waste Profits   Value Stream Mapping is a Lean technique Lean: A business system for organizing and used to analyze the flow of materials and managing product development, operations, information currently required to bring a product suppliers, and customer relations to create or service to a consumer. precise customer value—goods and services with higher quality and fewer defects—with less human effort, less space, less capital, and less time than the traditional system of mass production. 1.562.860.8637 ITS NOT STRATEGY THAT MATTERS – ITS EXECUTION THAT COUNTS info@cpsphere.com www.cpSphere.com
  10. 10. Purpose of Value Stream Mapping  Identify processes where “Lean” techniques can be applied  Help reduce / eliminate wait time  Eliminate process waste  Reduce production cycle and processing time  Understand process linkages and dependencies  Create the basis for “Lean” implementation plan 1.562.860.8637 ITS NOT STRATEGY THAT MATTERS – ITS EXECUTION THAT COUNTS info@cpsphere.com www.cpSphere.com
  11. 11. Value Stream Mapping – Case Study 1.562.860.8637 ITS NOT STRATEGY THAT MATTERS – ITS EXECUTION THAT COUNTS info@cpsphere.com www.cpSphere.com
  12. 12. Business Case Problem Statement Solution Losing Business to competitors due to Improve lead time performance by long lead times and late deliveries. synchronizing production with customer demand. Key Requirements 1. Reduce flow time to meet customer Ideal State demand. 2. Reduce RAW, WIP and FGI levels. • On-Demand • Defect Free Measurements • 1-By-1 1. Total flow time • Lowest Cost 2. Inventory levels 3. EBIT performance. 1.562.860.8637 ITS NOT STRATEGY THAT MATTERS – ITS EXECUTION THAT COUNTS info@cpsphere.com www.cpSphere.com
  13. 13. Value Stream Map – Current Process 1.562.860.8637 ITS NOT STRATEGY THAT MATTERS – ITS EXECUTION THAT COUNTS info@cpsphere.com www.cpSphere.com
  14. 14. Team Brain Storming Session • Can Customer increase the size of the blanket order and provide us with a longer term forecast visibility? • Can we flow the demand down to the supplier with a longer term visibility? • How can we reduce wait time? • How can we reduce change over time? • Can we reduce lot size? • Can we merge production processes to reduce travel time? 1.562.860.8637 ITS NOT STRATEGY THAT MATTERS – ITS EXECUTION THAT COUNTS info@cpsphere.com www.cpSphere.com
  15. 15. Value Stream Map- Future Process 1.562.860.8637 ITS NOT STRATEGY THAT MATTERS – ITS EXECUTION THAT COUNTS info@cpsphere.com www.cpSphere.com
  16. 16. Strategy Implementation Check List • People Do Plan • Product • Systems Act Check • Processes 1.562.860.8637 ITS NOT STRATEGY THAT MATTERS – ITS EXECUTION THAT COUNTS info@cpsphere.com www.cpSphere.com
  17. 17. Next Step • How would you apply Value Stream Mapping into your Business? 1. Share the business challenge with your key staff. 2. Define business case 3. Define a high level business process 4. Define activities for each business process including wait time. 5. Randomly pick a minimum of 5 current jobs and record all activities and time. From the initial customer call to receipt of payment for the goods or services. 6. Map the process – this is your current value stream map 7. Categorize each activity as value added or non value added 8. Define a map eliminating as many of the non value added activities – now you have a first draft of the future state 1.562.860.8637 ITS NOT STRATEGY THAT MATTERS – ITS EXECUTION THAT COUNTS info@cpsphere.com www.cpSphere.com
  18. 18. CPSPHERE – HELP YOU FOCUS & GROW Did we all Get it? 1.562.860.8637 ITS NOT STRATEGY THAT MATTERS – ITS EXECUTION THAT COUNTS info@cpsphere.com www.cpSphere.com
  19. 19. Next Step Identify Strategic Pricing Align Adoption Initiative Operations • Set the price which • Create a consensus is easily accessible • Address adoption • Does your product • Set Target Profit to mass of buyers hurdles in offer exceptional • Come up with • Use Pricing actualizing the Buyer utility? Target Cost Corridor Tool strategy • Use Buyer Utility • Streamline Cost • Balance Scorecard Map Innovation Measuring Business Success Operation Excellence November 1st , 2007 October 4th , 2007 It is a given fact; whatever you Name of the game is “Profit”. Learn techniques for streamlining your operations measure, it improves. Learn how to that results in positive bottom line for your growing business. define an operating plan for your business and what to measure 1.562.860.8637 ITS NOT STRATEGY THAT MATTERS – ITS EXECUTION THAT COUNTS info@cpsphere.com www.cpSphere.com

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