In the ninth of our ‘Lean manufacturing in the digital age’ series, we explore the most common barriers to operational agility and, most importantly, how to overcome them.
Becoming more agile is a goal that has long been a board room objective – what organisation wouldn’t want to react quicker to opportunities or pivot in time to avoid potential trouble?
Although frequently superseded by goals that deliver (or are perceived to deliver) more tangible/immediate returns, recent events have promoted operational agility from its position on the corporate back burner.
Agility, and the responsiveness and flexibility it enables, is now seen as mission critical – particularly by industrial businesses.
Whether it’s caused by a global pandemic, political obfuscation or any another event – when disruption strikes, your business needs to be ready.
“With agility, flexibility and responsiveness, businesses can act swiftly to steer a new course with confidence and adapt to evolving global challenges,” Accenture notes in its recent Continuity in Crisis report.
So, where is this greater agility going to come from? Digital tools, according to Accenture. Its report notes that; “Organisations are increasingly using platforms that support analytics, artificial intelligence and machine learning, alongside greater automation” in order to “gain insights and become more intelligent.”
That global perspective correlates with the sentiments of British manufacturers, as revealed by The Manufacturer’s Annual Manufacturing Report 2020.
The vast majority of those surveyed (87%) agree that their organisations need to adopt digital technologies in order to prosper. Almost the same (89%) believe that digital technologies, greater connectivity and greater data intelligence will improve their supply chain relationships.
Given how dramatically Covid-19 blindsided industrial businesses large and small, many manufacturers are clearly still being tripped up by one (or likely more) of the below barriers.
Five main barriers to operational agility
- Lack of executive direction and/or procrastination
- Centralised and/or one-way governance
- Lack of a 360-degree organisational view
2. Decision making
- Unempowered employees who must ask permission before acting
- Disjointed planning and/or contradictory objectives
- Lack of urgency and undefined or unrealistic timescales
- Prioritises stability over being more dynamic and responsive
- Experimentation is not encouraged
- Committed to doing things “the way they have always been done”
- Resistant to change, technology and automation
- Lack of collaboration across departments, functions and specialisms
- Lack of direction and/or a shared sense of purpose
- Nobody championing change
- Knowledge is retained by individuals
- Reliance on manual, paper-based processes and siloed information
- Outdated resources, skills or tools
- Lack of measurement, analysis, control and visibility
- Inaccurate and/or rudimentary forecasting and demand planning
In the wake of Covid-19, many management teams are taking stock of exactly what they do and how efficiently they do it.
A particular focus for them will be increasing their organisation’s ability to better respond to such events in the future, and that starts with better analysis and management.
One business already reaping the benefits of making this a priority is a multiple award-winning Devon-based food manufacturer.
Established more than 15 years ago and with aspirations to significantly grow its turnover, the business needed a system that would provide integrated finance, production and stock management.
Its previous system couldn’t provide the clear visibility, deep level of analysis or ease of reporting required, forcing employees to use a range of Excel spreadsheets and manual processes to overcome the shortfalls.
Furthermore, the lack of adequate barcoding (used to control materials and track pallet despatches and transfers) resulted in a duplication of time and effort. These and other factors were all negatively affecting the company’s operational agility.
With continued expansion resulting in a growing number of manual processes and disparate IT systems, the business decided to review how it could implement tighter controls over its financial, production processing and stock control.
The decision was made to invest in Access ERP, an integrated ERP solution from award-winning software provider Access Group.
The new system, which includes barcoding and offers real-time data collection for stock and manufacturing, provides visibility of information across the organisation while facilitating the projected future growth of the business.
Moving away from paper-based reporting and improving access to information has enabled the creation of up-to-the-minute production reports allowing teams to analyse activity in an instant.
This has helped the whole business to function much more effectively and efficiently, as the company’s finance director explains:
“We no longer carry out monthly stock takes as inventory is reconciled in real-time saving us around £12,000 a year.
“With Access ERP we can view the stock position on the system in real-time and know it’s 99% correct. This has given a real boost to our customer service as we have full confidence in the accuracy of the information we’re providing.
“The flow of information around the organisation and through the production process is greatly enhanced, with electronic data capture via handheld devices improving despatch processes too.”
“With Access ERP we’ve futureproofed the business and could easily double or treble in size. We’re looking to grow to around £20m over the next two or three years to maximise production capacity; we’re confident that Access will easily support us every step of the way.”
Understandably, habits of a lifetime become barriers for companies wanting to achieve operational agility. But, as many discover once they adopt digital technology, sometimes the way they’ve always done it isn’t the most efficient way.
The Access Group has a resource hub for manufacturers wanting to learn more about how to use software and technology to achieve operational agility, visit it here.
Check out the other articles in our ‘Lean manufacturing in the digital age’ series:
- The key to Lean Manufacturing in the digital age
- Is Frankenstein’s monster disrupting your Production Planning?
- Don’t let Legacy Software be the albatross around your neck
- Does your Supply Chain contain more holes than Swiss cheese?
- Greater Productivity isn’t delivered by hand
- Could the loss of one person sink your business?
- Supply Chain Transparency – helping manufacturers to deliver the goods
- Operational Agility – is your business more sloth than monkey?
- R&D: You miss every shot you don’t aim for