MESA Part 5 – Forging a Path Forward

This posting is a continuation of the “MESA to Change Direction?” posting.  This series discusses how to implement MES systems using a Business Process Management approach, looking at the manufacturing processes and then determining how to implement those processes through changes in how operators perform tasks and the technologies that enable those changes.

It’s not enough to simply hold workshops solve world hunger and sing Kumbaya.   Having a roadmap, a plan for change, and the business case to back up our claims for improvement can make it a reality.

Ok, so we’ve held the workshops…   WHOOHOO!   Exhausting as they are, we’re now armed with some fantastic information. Our four deliverables from those workshops look something like this:

To-Be Process

A process map of how each manufacturing activity will be performed in the Future State.

During the workshops, we sketched these on flip charts or whiteboards at a high level.  Afterwards, we need to create an electronic version with all the details, both in the form of a process flow map, and a textual document describing the process.  Route it through the participants and get their sign-off.   

System Footprint

A mapping of the capabilities defined in the above processes to existing systems and new systems that will be required to support the Future State.    This requires some analysis.  We’ll need to determine which capabilities (or pieces of capabilities) will be performed through modification of existing systems, and which will be performed through acquired systems.  We’ll need to identify those new systems.  How?  Because many of the MES application vendors (MES, LIMs, Data Historians, PLM, etc) have developed and market their products using the ISA-95 standard its usually a straight-forward process to map the future state processes with MES application capabilities.

Interfaces

A collection of “touch point” agreements between systems that specifies each specific interface called out in the To-Be process.   This provides the information we need to get the IT department in gear.  Probably the most important piece of this deliverable though is a Data Walk-Through.  This takes our future state process, assigns real values to the data transferred between systems so everyone can see how their processes will be expected to work.  I can’t emphasize enough how important this is.  Just seeing the real data will bring everyone down to the reality of how the new process will work.

Business Case

A high level business plan that contains:

• Description of the objectives
• A list of requirements
• A Gap Analysis
• A description of the change management issues
•  A migration plan
• Expected ROI’s by activity

Objectives – We’ve already collected these for the workshops, we just need to include them to frame the business case.  We can also provide some high level statements, from analysis of our future state and ROI, for how our new way of doing business will meet our objectives.

Requirements – Since we’ve conducted our workshops based on ISA-95 capabilities and functionality, we need to capture those capabilities and assign a priority value to each.  The intent here is to form the basis for selection of technologies and provide justification for changes in current business practices. 

Gap Analysis – Working from our list of shortfalls from the workshops we can now develop a gap analysis that describes how the new process addresses those shortfalls, or describes the mitigation plan where the processes do not address or solve the shortfalls.

Change Management – By including a change management champion in our workshop sessions, we’ve been able to collect change management issues, bring them into the discussions of future state, and begin the planning to address them.  The list of change management issues may surprise you but it’s imperative that the company is aware of and planning for the changes in how you will do business.  Change issues can range from simple tweaks to the way a department handles a transaction, to an overhaul in how documents are managed and employees are trained or certified.

Migration Plan – No matter how you will proceed, having a roadmap for how you will get there is critical.  A high level technical roadmap that calls out the order and timeframe of implementation of the systems needed to support your future state can provide the budgeting information you need to sell your program internally.   Don’t think it’s all about the budget either, having a plan for implementing fundamental capabilities or capabilities that have far reaching impact in your organization can help you transition smoothly and more efficiently.

Return on Investment – All the work we’ve done in the workshops to determine the costs of the shortfalls we’ve identified pays off here.  Remember that each workshop was set up for a particular set of capabilities or functions, and that we’ve collected the shortfalls, and the costs of those shortfalls for those capabilities.  In addition, we’ve identified estimates of lost opportunities during those workshops.  This defines our ROI for each of those activities.  Having this granular level of ROI allows us to do one very important thing, we can measure it.  Along with the identification of the ROI for each activity, we’re going to identify the KPI that measures how well we will accomplish the improvement we seek.

OK, that’s great!  We’ve got our workshop deliverables.  Now what do we do with them?

Next time – Making It Real

MESA Part 4 – Laying the Foundation for Change

This posting continues our discussion of how to apply Business Process Management methods to implementing MES. 

In previous discussions we talked about the materials we needed to prepare for a series of Consensus Workshops.  What are Consensus Workshops?  That requires a little background. 

What is a Consensus Workshop?

For the selected functional areas (see below) subject matter experts from each of the affected departments or functional areas are assembled to; review the current As-Is state and shortfalls, generate a To-Be state process flow, determine how the process flow addresses the shortfalls and the company objectives and strategy, develop a list of the gaps between the To-Be state and those shortfalls left unaddressed, and address the change management issues related to the future state processes.

What are the topics for the Workshops?

The full list of topics available for holding Workshops follows the ISA-95 Model:

1. Production Control
2. Quality Assurance
3. Maintenance Management
4. Material and Energy Control
5. Product Inventory Control
6. Production Scheduling
7. Procurement
8. R&D
9. Order Processing
10. Cost Accounting
11. Product Shipping

Some notes on this list:  You can usually combine Material and Energy Control with Production Inventory Control under a single topic Inventory Management (as it is in the MOM).  This allows you to address raw materials, WIP, and finished goods discussions in a single workshop.  If Energy Control is a significant topic, create a separate workshop for it.  Don’t discount the Cost Accounting and Order Processing discussions, they may be short but they can be significant.  For example, determining how product unit costs are evaluated can affect critical KPI’s and incentives.

How do we select the topics?

As you prepare the As-Is state process flows and gather shortfalls for the way you currently do business, a picture emerges of areas that need attention or present opportunities.  You could hold a workshop for each area of the ISA-95 model, one for all the activities in Production Control, one for all the activities in Quality Management, one for all the activities in Procurement, etc.  Do you need to hold a workshop for every area?  That depends on how comprehensively you intend to apply an MES system.  Another way to look at it is to identify those areas with the most problems and the most opportunity for payback.  It’s a trade-off, expediency and short-term payback versus comprehensiveness and longer term payback.

A few of the advantages of selecting a limited number of areas are;

• It is usually easier to determine the true ROI for change.
• It’s easier for participants to understand the value of the change. 
• It requires fewer resources to implement.  

Remember it’s a trade-off.  There are also advantages to the comprehensive approach;

• Having a full picture of the numerous and various interfaces between systems and implementing them one time is much more efficient, 
• Even if you don’t implement all of the future state or To-Be processes you will have a long-term plan to work towards,
• It’s easier to implement full-scale change while you have your foot on the gas.

Next Time:  Creating the Framework for Change

MESA Part 3 – Delivering Value through BPM Workshops

This post continues the discussion of how to apply Business Process Methods to implementing MES based on the ISA-95 standard.

As you recall, we had to develop some material before holding consensus workshops.  It goes something like this :

1. Use the ISA-95 definitions for manufacturing activities and determine those performed
2. Determine the strategy and objectives of top management. 
3. Develop an As-Is state in the form of a process flow for each activity
4. Determine the shortfalls, issues, and requirements for each activity

This material provides the framework and focus for consensus workshops that will be held to determine how to both address identified shortfalls, and to reach the objectives of top management.

So, what do we expect to get out of the workshops?  In order to develop a justification and plan for reaching the aforementioned objectives, we need some supporting material:

1. To-Be Process – This is a process flow that has been modified from the As-Is process flow we bring to the workshop for each activity.  Again, this is a high level flow that shows how the basic activities are performed and the information flows between different activities, systems, and resources.  Don’t forget to put it down on paper.  A textual description of the process flow goes a long way in clearing up the understanding of what’s going on.  I usually put this into a companion document that accompanies the process flow.
2. Systems Footprint – Although we’d like to focus discussion on the process alone, independent of which system performs each.  As much as we’d like to believe we can start over and make everything work in an optimal way, it’s not completely practical.  There are legacy systems that already perform some functions, and initiatives for new systems that will pick up other functions.  Without getting into details, a high-level mapping of functions across existing systems will help to determine what the technical roadmap for implementation will look like.
3. Business Case – Here’s where collecting those shortfalls in the As-Is state really pays off.  If we assign an issues Champion to bring real-life examples of each shortfall, and an estimated cost per occurence, we can start to build a case for ROI.  This goes a long way in addressing the savings and efficiency aspect of the business case, but we shouldn’t ignore lost opportunity costs.  If we consider the revenue impact of reaching the objectives laid out by top management, we can calculate the impact of increased revenue as well.  Consider the example in my previous post “MES for Competitive Advantage.”  During our workshop, we should capture how the To-Be process will address the shortfalls and provide competitive advantage.
4. Change Management – How a company addresses change determines how successful the MES implementation will be.  It’s critical that a Change Management Champion, CMC,  attend every workshop, capture issues requiring change in related functions, departments, and systems.  The CMC will be a liason role that communicates the impact of the proposed To-Be state.  It is critical that the CMC has the full and real support of top management.  Change can be difficult and it will be important to identify areas of resistence, overcoming resistence, and determining the cost for change.  In addition to determining the impact of change, the CMC will also identify those areas that will require either modification of training or additional training.

 This is material that we develop during the workshop.  It doesn’t have to be detailed or pretty.  It does have to address the shortfalls and objectives, so keeping the conversation focused is important.   

What workshops should we hold?  The workshops should be organized at a level high enough to capture one of the major areas in the ISA-95 framework (for example:  Quality, Production Control, Inventory Management, Maintenance, Procurement, etc).  Each workshop will address a series of activities performed for an area.  For instance, a Quality workshop might address:  Test Definitions and Distribution, Testing Procedures (in-line, at-line, off-line),  Material Review Board, MRB, procedures for rework, Quality analysis procedures).  These are by no means complete, but they should address those areas where the shortfalls are significant and are critical to meet the objectives laid out.

Who should attend?  Representative Subject Matter Experts, SMEs, that either appear on the As-Is process flow, or subject to change with the anticipated To-Be process.   As much as manufacturing companies hate to commit these resources to these kinds of workshops, because they were hired to actually produce things, their participation is absolutely critical to the success of the proposed changes.  Without their input and consensus, there will be resistence to change that is not always possible to overcome, and mistakes made in both requirements and implementation strategy that will be costly to remedy.

Next time – Laying the Foundation for Change