EMPOWERMENT

John Henshell internal communications sample, empowerment, employee engagement

WORKERS PLAN TO IMPROVE PROFITABILITY

Boyds strategy to sell ltalia D’Oro espresso coffees starts with offering great products, but to expand our sales nationally, we also need to offer competitive pricing. Management wanted to determine if our prices were nationally competitive, and if they could be lowered and still meet our objectives for profitability. Cuthbert Tinsel was charged with preparing a competitive market analysis. Then, Sales, Marketing, and production managers addressed the challenge of lowering the selling price. The Managers determined that we needed to reduce production costs. Mario Maraga asked Mike Bonds to find out if we could reduce production costs by increasing productivity enough to make a lower price possible. Employing the philosophy that the people who really understand and influence a process are those who do the work, Mike asked Gary Waters (Foreman) to form and coach a team to investigate ways to improve the espresso production process for 8.8-ounce valve bags of whole bean and ground espresso. Bob Carson, Cliff Christian, Cheri Carson, and Mark White (“The Espresso Team”) were charged with analyzing the entire production process, except for packaging material and equipment, to figure out how we could meet a specific productivity rate. Mario and Danny Raymond researched and reviewed costs to determine that productivity rate (in cases per man-hour).

Bob, Cliff, Cheri, and Mark explored changing every facet of labor, developed ideas, and reviewed suggested process improvements with department management. Their conclusion was that we could meet the objective and make long-term changes that could increase productivity even more. On June 29, Cuthbert Tinsel proudly announced that a significant decrease in espresso prices would become effective July 12.

The Espresso Team prepared a detailed, comprehensive operations manual called “The Espresso Report.” It includes flow charts showing roasting, quality assurance, and packaging processes. Written procedures describe the technical set-up process, including programming of machines. The description and instructions for product change-over and set-up are five pages long.

The team knew that set-up time was a major cost factor, and they came up with several solutions to reduce set-up time. First, they decided that we needed to increase the volume on each production run, and have a minimum run size. As we expect to sell more espresso by lowering prices, we can have larger runs without having to warehouse more product. The team also found means of improving the technical set-up process.

The number of tasks involved in packaging caused a bottleneck and slowed the process. The gable-top bags had to be manually folded over, which didn’t leave enough time for the operator to align them in a case. So, the bags were put into a larger box, and then labeled before final packaging. Mike says the Espresso Team used the theories of “constraint” and “diminishing returns” to figure that it would actually cost less to use more people, but not too many people, in the packaging process. By having three people perform the distinct tasks in assembly-line fashion, we can produce more cases per man-hour.

The team also recommended using separate film sizes for 8.8-ounce ground and whole bean espresso, because bags of ground espresso can be shorter, and thus save film. We hope to increase volume enough for the suggestion to be feasible.

“The Espresso Report” itemizes procedures for a five- to six-bag quality assurance trial run that is employed before full production runs. The procedures include comprehensive, multi-step testing for package integrity (seam and dip-tank testing and visual review of eight qualities, such as location of the valve), print alignment, weight accuracy within three grams, and grind quality (reviewed by a Roastmaster). The trial packages must pass each test, or we run more trials until our QA objectives are achieved. For Mike documentation shows each test was completed. Trial runs save us from wasting coffee and film. The operators will work closely with Kristy Marin and other employees for efficient, on-the-spot quality review.

As Mario reported, part of the “MOMs’” mission is to achieve excellence in manufacturing. This challenge provided the opportunity to exemplify the mission, and to employ the Total Quality Management philosophy of empowerment. Mike is excited that “We’re actually doing these things now.”

Mario says, “Congratulations to the Espresso Team for contributing to manufacturing excellence!”