The document discusses how improving productivity through operational improvement initiatives can improve a company's operating margin. It describes how utilizing tools like continuous process improvement (CPI), Lean techniques, and building a strong CPI culture can help increase productivity, reduce costs, and improve sales and pricing power, thereby increasing operating margin. The document is from a company called Sustainable Productivity Solutions that provides operational improvement consulting services and training.

1. Improving Productivity
Improves Operating Margin
Facilitated by
© Sustainable Productivity Solutions Slide 1

2. Our Company
Our team utilizes an innovative & practical approach to deliver sustainable
operational improvement solutions.
We Solve operational performance problems.
Facilitate operational improvement teams.
Train others to successfully apply operational improvement tools
– We work side-by-side with your team to:
• Resolve difficult operational performance problems
• Streamline existing processes
• Instill a continuous process improvement culture
• Use simulation to optimize facility layouts and flows
– Training programs offered both in-house and publicly
Clients: Manufacturers, Produce Growers Shippers, and Railroaders.
Based in Santa Cruz, CA (Bay Area – Central Coast)
© Sustainable Productivity Solutions 2015
ReduceOR.com
Slide 2
“… rather than spoon-feeding the information,
he explains the concepts
and then motivates you to apply the concepts
on a real problem …” - Milind Makwana

3. Khaled Mabrouk (Founder)
B.S. Industrial Engineering - Purdue University
30 years experience in a variety of industries.
Part-time Industrial/Simulation Engineering Instructor
Areas of Expertise:
– Solving difficult operational capability problems
– Building CPI (continuous process improvement) Culture
– Coaching leaders on improving employee engagement
– Simulation Modeling and Analysis
Published 20+ papers
Professionally active; including IIE, 6 Sigma Conference Board
Aerospace
Agriculture
Appliance
Auto
Banking
Call Centers
Consumable Goods
Desert Racing
Forest Products
High Tech HW
Insurance
Office Products
Placement Agency
Postal Service
Software
Specialty Coffee
Steel
Transportation
Warehousing
Waste Management
© Sustainable Productivity Solutions 2015
ReduceOR.com
Slide 3
“… provided us with Great Results, and left us with guidelines, and
procedures we now use on other projects …” - Andre Bergevin

4. Improving Productivity
Improves Operating Margin
Improve operating margin by:
– Increasing sales & pricing power
– Decreasing costs
Improve productivity using productivity tools:
– Increase operational flexibility and process velocity, reduce
variability, improve product quality.
As a result, you increase quality and breadth of offerings
so as to increase sales & pricing power.
– Get more accomplished with less resources.
As a result, you decrease costs.
© Sustainable Productivity Solutions Slide 4
“… recommendations were implemented and improved
the throughput of the plant …” - Kurt Eichmeier

5. Continuous Process Improvement (CPI)
Frontline teams:
Monitor their operation’s performance metrics
Prioritize operational improvement opportunities
Determine root cause of these operational challenges
Generate and test solutions to resolve these operational challenges
Select and sustain best solutions for these operational challenge
© Sustainable Productivity Solutions Slide 5
“… used a structured and disciplined approach … to inspire individuals up and down the
organization to embrace the philosophy of Continuous Improvement …” - John Hogarth

6. Gemba Boards Drive CPI Behavior
CURRENT PROJECTS
• 2 – 3 projects
• Brief project descriptions
• Highlight progress/results to date
• Key contact
METRICS
• 5 – 7 metrics
• Use control charts spanning 60-day
time periods
FUTURE PROJECTS
• Ideas
© Sustainable Productivity Solutions Slide 6
“… keen observer of people who develops a strategy to influence and alter his
customer’s behavior, as needed, to achieve project success …” - Fred Beschorner

7. Stages to Building a CPI Culture
1st Stage - Fix your biggest operational challenges
– Increase process velocity
– Reduce variability in operational performance
– Improve productivity
2nd Stage - Increase productivity and employee engagement
– Utilize LEAN tools to increase productivity.
– 5S for improving safety and productivity, and reducing material and tool costs.
– Visual Management to maintain transparency and keep consistent operational pace.
– Standard work, line balancing, setup reduction, etc.
– Increase support for and engagement of front line managers
3rd Stage - Build a CPI culture, where all employees are trained
and engaged in the operational improvement process
– Develop and use Gemba Boards to manage operational improvement efforts,
and to track Leading Indicators
– Leadership team proactively promotes the CPI culture.
© Sustainable Productivity Solutions Slide 7
“… analytical skills, operational excellence knowledge and communication
skills make him the perfect change agent …” - Elyas Ackhar

8. 1st Stage
Select the right project:
– Choose a challenging operational capability problem
– Ensure that resolving this challenge is critical to reducing
operational costs
– Ensure individuals involved with specific operation are available
to provide perspective on issue
Frame expectations:
– Clearly define what issue is
– Clearly define what improvement is needed
– Ensure leadership team supports operational improvement effort
© Sustainable Productivity Solutions Slide 8
“… ability to use advanced modeling tools to cut through the complexity of his customers’
systems and help them drive to effective resource allocation decisions …” - Pete Kalish

9. 2nd Stage
As you accumulate success stories, work to:
– Understand operational engineering tools and methodologies.
– Understand how operational engineering tools and
methodologies fit your organization’s needs and culture.
– Develop a game plan for continuous improvement journey:
• Employee Engagement
• Process Driven
• Visual Management
• Control Charts
© Sustainable Productivity Solutions Slide 9
“… had more impact on implementing change than any other facilitator
that I have encountered in my career …” - Randy Ollenberger

10. 3rd Stage
© Sustainable Productivity Solutions Slide 10
Identify Necessary Change in
Leadership Behavior
Roll Out OE Tools
Work With Leadership Team to Identify
Next Set of OE Tools to Promote
Identify Initial OE Tools to Promote
Leadership Team OE Training
Execute Successful OE Projects
“… understands the customer’s
requirements and does what it
takes to meet or exceed those
requirements …”
- Roger Klungle

11. Control Charts Reduce Fire-Fighting
© Sustainable Productivity Solutions Slide 11
Build a Productivity
Program
Use Control
Charts to
track Leading
Indicators
Problem Solve in
Firefighting Mode
Proactively
Problem Solve
NO
YES
“… provided our company with insightful
solutions to business problems …” - Brian Jacob

12. Building CPI Culture Requires Both
Culture Change & Tools Propagation
© Sustainable Productivity Solutions Page 12
5S
Visual Mgmt
7 Wastes
Work/Wait
Value Added
Data Collection & Analysis Pareto Charts
VSM
ID Failure Points
Root Cause Analysis
- Fishbone
- FMEA
Best Practice Standard Work
Control ChartsID Leading Indicators
Mistake Proofing
SMED
Line Balancing
Level Loading
Pull Systems
Etc.
Kaizen
Solution Prioritization
Process Mapping
Sustaining Solutions Continuous Process Improvement
Using Gemba Walks
LEAN
CPI Culture
LEAN on
Steriods
Leadership Team
Changes Behavior
Front Line Team
Engaged
Culture Change
Tools Propagation