Northrop Grumman. Effective Benchmarking Versus Industrial Tourist. Glenn Marshall Benchmarking & Sustainability Champion

Transcription

1 Northrop Grumman Shipbuilding Effective Benchmarking Versus Industrial Tourist Glenn Marshall Benchmarking & Sustainability Champion Quality and Process Excellence Division

2 A Historical Perspective 2 Northrop Grumman Corporation Copyright 2010

3 Northrop Grumman Shipbuilding Over a century designing, building, overhauling and repairing ships for the U.S. Navy, the U.S. Coast Guard and world navies The nation's sole industrial designer, builder and refueler of nuclear-powered aircraft carriers One of only two companies capable of designing g and building nuclear-powered submarines One of the nation s leading providers of major surface combatants (destroyers, cruisers, high endurance cutters, and amphibious assault ships) for the U.S. and international navies Have built over 70 percent of the U.S. Navy s current surface combatant fleet After-market services maintenance, repair, and overhaul support a wide array of naval and commercial vessels The Nation s Military Shipbuilder 3 Northrop Grumman Corporation Copyright 2010

4 Process Improvement Our History Mfg/Shops Supply Chain Mgmt Engineering Programs/ Ass y&test Enabling Processes LEAN ARCHIPELAGO Lean Production & Mfg Engineering Lean Implementation Coalition Process Qualification 5S Kaizens Six Sigma IPPD Lean Process Qualification MOS Lean Events LEAN ENTERPRISE Lean infrastructure LIC established The Road to Lean Released Focus on Value Stream Enterprise Excellence Council GreeNG Program Measure e What Matters Continuous Improvement System & Assessment Process Excellence Division Initiate Gallup Surveys PROCESS EXCELLENCE Training Within Industry Programs Lean$Green Shipbuilding National Association Of Manufacturers Finalist US Senate Quality & Productivity Award 2004 State Shingo Award 4 Northrop Grumman Corporation Copyright 2010

5 Value Stream Thinking Value Stream: Refers to all the activities the company does to design, order, produce, and deliver its products to the customer. (Activities can be value adding or non-value adding.) Contracts Design/ Navy Planning & Pricing Eng. Planning Supply Detail Mfg. Assembly Chain Mgt. Planning Ops. Ops. Navy Value Stream Management External Suppliers Internal Suppliers Internal Customers External Customers Value Stream Thinking: Everyone at all levels of the organization and across programs understanding what their products are, knowing who their customers are and what their customers value. It is everyone working together to remove waste from our processes!

6 Engaging People using the Continuous Improvement System Northrop Grumman Newport News CONTINUOUS IMPROVEMENT SYSTEM Review Review & Plan Plan Next Next Cycle Cycle CI Lead Team Define Define Products Products Typical Supporting Initiatives June 2007 Revisiion B OUR CONTIINUOUS IMPROVEMENT I MIISSI ION Giivee ourr Navvy ccussttomeerrss morre vvallue fforr ttheiirr moneyy by iimprrovviing ourr perrfforrmance.. OUR CONTIINUOUS IMPROVEMENT I VIISI ION Wee wiillll be prroacttiive advoccattess off ourr sshiipbuiilldeerrss.. Wee wiillll unlleassh tthee poweerr off ourr grreatteesstt assssettss,, ourr peeopllee,, tto cconttiinuousslly iideenttiiffy and eelliimiinattee wasstte,, rreeducce vvarriiattiion and iimprrovee ttottall vvalluee ssttrream perrfforrmancce.. We wiillll crreeattee and ssussttaiin possiittiive momeenttum by rrecogniizziing and rreewarrdiing iindiivviiduall and tteeam ssuccceessssess.. Measure Measure What What Matters Matters Create Create Future Future State State Implement Continuous Improvement Action Plan Analyze Analyze Current Current State State Identify Identify Customers Customers Clarify Clarify Customer Customer Requirements Requirements CPAP MOS LEAN SIX SIGMA OFI Safety Task Teams Copyright 2007 Northrop Grumman Corporation Our Continuous Improvement System (CIS) provides the common framework to better align our value streams - enabling deck plate success. 6 Northrop Grumman Corporation Copyright 2010

7 Continuous Improvement Process 7 Northrop Grumman Corporation Copyright 2010

8 Measuring What Matters Enterprise Value Stream Management System Enterprise - Value Stream - Scorecard An integrated balanced scorecard for measuring, reporting, and managing the sustainability of an enterprise at all levels; by focusing on key performance indicators of the enterprise value streams to minimize the consumption of resources (human and natural capital) to effectively maximize the creation of value for its customers, stakeholders, and communities. Enterprise - Value Stream - Scorecard Corporate Strategic Goals & Objectives 1. Customer Perspective - Best in our Industry for Customer Performance 2. Financial Perspective - Consistently Top Quartile for our Industry for Financial Performance 3. Operational Perspective - World Class Level of Operational Excellence 4. People Perspective - World Class Level Place of Employment 5. Sustainability Perspective - World Class Level Total Corporate Responsibility Work Teams Key Performance Indicators (KPI) Value Streams KPI Programs KPI Sector KPI Corporate KPI Work Team Measures Value Stream Measures Program Measures Sector Measures Corporate Measures Reduced Cycle Time Reduced Lead Times Schedule Performance Index (SPI) Increased Output Increased First Pass Yields Increased Safety / Skill Levels Increased Productivity Increased Throughput Increased Improvement Projects Participation / Engagement Cost Performance Index (CPI) Days of Inventory / Turns Gallup Survey Return on Net Assets Corporate Strategic Goals & Objectives : ---- Customer Financial Operational People Sustainability Reduced Scrap / Waste Reduced Resource Consumption Sustainability Index (SI) People Process Performance

9 Why Do Benchmarking? Many fortune 500 companies and other large organizations have embraced benchmarking as an important t systematic ti methodology for achieving the organizations strategic objectives. Benchmarking is reflected in the Malcolm Baldrige National Quality Award criteria more extensively than any other management concept. Source: APQC Companies who used benchmarking to measure business performance against their peers achieved 69% faster growth and 45% greater productivity over those who did not. Source: Price WaterhouseCoopers

10 What is Benchmarking? Benchmarking the systematic process of seeking out and adapting best practices and using benchmarks Best Practice - a practice that fully satisfies customers, produces superior results in one operation, performs as reliably as any alternative and can be adapted elsewhere Lessons Learned a practice that once performed, leads to an unintended and often undesirable result 10

11 Casual VS Effective Benchmarking HARD FACTS Dangerous Half Truths & Total Nonsense by Jeffrey Pfeffer / Robert I. Sutton There is nothing wrong with doing benchmarking to set standards, close gaps, or prevent reinventing the wheel. The logic behind what works at top performers, why it works, and what works elsewhere is barely understood, resulting in mindless initiations. The first thing people copy is the most visible, obvious, and frequently least important practices. Toyota s success is not a set of techniques or tools --- its their philosophy. Instead of copying what others do we need to understand how they think. You need to ask the question about your new knowledge.. will this really work in my company?

12 How to Become Effective at Benchmarking? Find Trusted Benchmarking Partners APQC, Boeing, Raytheon, Northrop Grumman, others What We Have Learned Use the APQC Code of Conduct and infrastructure Understand your process first What gaps do you want to close Develop questions to find the right partners Benchmarking partners are looking to get value in return Be prepared to offer a reciprocal visit Record findings and share the learning Define an action plan to deploy new knowledge

13 Benchmarking Guide NORTHROP GRUMMAN NEW PORT NEWS Process Excellence Division, Department O09 Strategy Benchmarking Guide Defining the responsibilities and steps for identifying benchmarking opportunities Outlining how to initiate benchmarking projects with internal and external sources Describing how to share and deploy best practices across the sector, enterprise, and with our customers and suppliers

14 Benchmarking Process Enables Continuous Improvement BENCHMARKING REPORT Company Information: Name Address Point of Contact Hosting Attendees Visiting Attendees IMPROVEMENT PROJECT IMPLEMENTATION Purpose Key Findings or Takeaways Lesson Learned / Best Practices Actions Items for Deploying Best Practice Notes Continuous Improvement System Document and Deploy Best Practices Close Gaps & Improve Performance VALUE STREAM MAP BENCHMARKING PROCESS CI SCORECARD Process Improvement Project (PIP) Define Problem Analyze Measure Improve Control Step 1 Identify the gap (s) to be improved Contact PE Benchmarking Champion Define what Is to be benchmarked Review APQC Code Of Conduct Step 2 Identify internal / external potential benchmarks Determine data to collect Review OR data, share findings Proceed To Site Visit Set up benchmarking plan / trip Step 3 Conduct benchmark visit Offer reciprocal visit Analyze & document findings Share findings and deploy Complete bench marking report 14 Identify Performance Gap Identify & Benchmark Best Practices Northrop Grumman Corporation Copyright 2010 Celebrate Success

15 Benchmarking DM(B)AIC Process Process Improvement Project (PIP) Define Problem Measure Analyze Improve Control Step 1 Identify the gap (s) to be improved Contact PE Benchmarking Champion Define what Is to be benchmarked Review APQC Code Of Conduct Step 2 Identify internal / external potential benchmarks Determine data a to collect Review data, share findings OR Proceed To Site Visit Set up benchmarking plan / trip Step 3 Conduct benchmark visit Offer reciprocal visit Analyze & document findings Share findings and deploy Complete bench marking report

16 Benchmarking Matrix Industry Best In Class NGSB Process Excellence Benchmarking Matrix Industry Best Practices Strategic Planning / Deployment Hoshin Kanri Business / Quality System Lean Accounting / Balanced Scorecard Training Within Industry Enterprise Value Stream Idea Creation / Suggestion System Maturity Assessment Employee Engagement Customer Engagement Supplier Engagement Best Value Supplier Strategy Benchmarking Industry Best In Class Toyota Danaher Toyota Danaher Alcoa Toyota Danaher Toyota ESCO Northrop Grumman Newport News (NGNN) Toyota HON ESCO Malcolm Baldrige Shingo LESAT Toyota ESCO HON Toyota Dell Disney Ritz Carlton AME Best Practice Workshop NGNN Supply Chain APQC Raytheon Boeing Knowledge Management - COP APQC Raytheon Boeing

17 Benchmarking Maturity Matrix 17 CI Initiatives Benchmarks Prior State Current State Future State Strategic Planning - Hoshin Kanri Toyota Danaher - AME Conference Toyota Danaher - AME LEAN not part of Strategic Business Plan NGSB - Benchmarking Maturity Matrix Lean Part of the Strategic Business Growth Plan - Silo moving to VS Lean is key business driver and Value Stream Thinking is in place Business / Quality T t CIS System is deployed d and used routinely to Silo Thinking Continuous Improvement System (CIS) System prevent problems and improve quality Lean Accounting / Balanced Scorecard Training Within Industry Marco Level Value Stream Ideas Suggestion System Maturity Assessment Employee Engagement Customer Engagement g Supplier Engagement Lean & Green Sustainability Benchmarking - COP Knowledge Management Danaher - Lean Accounting Summit - AME WW II TWI Shipbuilding - Toyota - ESCO AME Conference - NGS-NN Toyota - HON - Industry Award Winners SPQA (Malcolm aco Baldrige) - Shingo - LESAT - AME AME - Ventana - Toyota - TWI Summit TEAM ONE - NSRP - ACIBC VBEC - Honda - Wal-Mart - Raytheon - NIKE MIT - AME - GE - DuPont - Alcoa - Nike APQC - AME NGS-NN, Raytheon - Boeing APQC - Raytheon - Boeing Traditional Metrics Started training Supervisor and Foremen Silo Process Mapping OFI - Buying Ideas Adopting Measure What Matters (MWM) Enhanced Personal Leadership (EPL) - Management Operating System (MOS) VS Mapping at Marco Level and some VS done at Micro / Silo Levels with Customers & Suppliers OFI and CIS System to provide a forum for identifying and implementing ideas Defining leading metric to support Key Performance Indicators (KPI) for People, Q,D,C, & Sustainability TWI Pillar of CIS - Respect for People (JI) & (JR) and Continuous Improvement (JM) - Standardized di d Work Marco to Micro VS Maps drives all CI project selections and resources distribution Standardized Work and sharing ideas by most employees (%) Assessing Part of LESAT Enterprise Wide Baseline and CI Maturity Assessment for value streams the Organization developing CIS Maturity Assessment thinking and engagement by all Employee Survey Arms Length Lowest Bidder - Lots of Suppliers Cost and Risk Reduction Industrial Tourists Lots of Lessons learned data base Gallup Survey to measure engagement Building Partnerships Lean Supply Management - Reducing numbers and Supplier Delegated Inspection (SDI) Certification Moving from reactive initiatives to proactive identification & elimination of Lean and Green wastes Engagement goals met by all departments for best in class Partnerships built and joint decision making is common best practice Building a small certified base - Best Value Suppliers Total Corporate Responsibility (TCR) is a business strategy to sustain and grow industry reputation and market share Casual Benchmarking with Guidelines moving Proven process and learning is being shared and to an Effective Process deployed across value streams Consolidate lessons learned with COP starting to deploy Northrop Grumman Corporation Copyright 2010 Consolidate lessons learned with mature COP in place reaching out to other sectors

18 Leveraging Internal and External Learning Networks Leveraging Learning Networks Regiona al Na ational Shingo Prize Association for Manufacturing Excellence (AME) EPA Innovation Center Society for Manufacturing Engineers (SME) Institute of Management Accountants Academia Industry Lean Accounting Summit Training Within Industry Summit Manufacturing Extension Partnership Society of Women Engineers (SWE) APQC Benchmarking & KM Government Shared learning with regional partners 18 Interna al Local Shared learning with local organizations Shared learning within an organization Northrop Grumman Corporation Copyright 2010

19 Benchmarking Summit N orth Am merica AME International Conference & Learning Summit AME / APQC National Benchmarking COP APQC, Boeing, Northrop Grumman, Raytheon, National Training Within Industry Training Lean Accounting Summit Lean Accounting Lean and Green Summit Sustainability APQC Conference Knowledge Management onal Regio Southeast Region of Association for Manufacturing Excellence 12 States Local Virginia Business Excellence Consortium Hampton Roads Quality Management Community AME / APQC Webinar (Your Desk)

20 Benchmarking Enablers Industry Publications National Conferences Societies & Associations Opening Doors for Benchmarking, Networking, and Shared Learning from Conferences, Publications, and Professional Organizations.

21 Benchmarking Opportunities Summary of 2010 Benchmarking Events Calendar Events / Workshops Date Location Takeaways Slots SPQA Forum Sept Richmond Sharing Best Practices to Move Ahead Open Lean Accounting Sept Las Vegas Lean Accounting - Measure What Matters - Open AME National Conference Nov Baltimore Best Practice Workshops, Keynote Speakers, and Tours - Open Companies / VBEC / HRQMC Tours VBEC 22-Jun Richmond Colonial Webb Contractor - Strategic Supplier relationship 3 HRQMC 24-Jun Norfolk HRQMC - CI Culture - A3 Problem Solving - Value Stream Mapping 3 VBEC 21-Jul Newport News HRQMC 10-Sep Suffolk Training Within Industry Session - NGSB and Alfa Laval Deployment HRQMC - Continuous Improvement Forum 35 Open NGSB 15-Sep Suffolk Target Distribution Center - Warehousing Operations 10 VBEC 12-Oct Richmond Creating A Quality Culture - David Mann 5 Webinars AME/APQC Benchmarking 31-Aug Webinar AME APQC CoP - Webinar Sharing Best Practices Open For additional information on these activities contact Glenn or Glenn. Marshall@ ngc.com or go to PE Website 21 Northrop Grumman Corporation Copyright 2010

22 Benchmarking Report Company Information: Name Address Point of Contact Hosting Attendees Visiting Attendees Purpose Key Findings or Takeaways Lesson Learned / Best Practices Actions Items for Deploying Best Practice Notes Benchmarking is only effective when a new Better Practice is shared and deployed.

23 Benchmarking Initiatives / Summary Increasing Deployment of New Knowledge Developing a Continuous Improvement Maturity Model for Shipbuilding Extending our Value Stream Improvement efforts to our Suppliers and Navy Customers Launching Industry Transformational Initiatives: Virginia Business Excellence Consortium (VBEC) National Benchmarking CoP through AME /APQC National Lean Accounting Community of Practice Regional Communities of Practice Enterprise Excellence through Shared Learning Always Good Ships 23 Northrop Grumman Corporation Copyright 2010

24 Benchmarking Resources Association for Manufacturing Excellence (AME) American Productivity & Quality Center (APQC) AME / APQC Benchmarking CoP Open Forum ame.org/index.aspx?page=cop Society of Manufacturing Engineers (SME) American Society for Quality (ASQ) Society of Women Engineers societyofwomenengineers.swe.org Shingo Prize for Operational Excellence org U.S. Senate Productivity and Quality Award for Virginia (SPQA) Virginia Business Excellence consortium Hampton Roads Quality Management Community

25 Questions? 25 Northrop Grumman Corporation Copyright 2010

26 Thank You!!!!! Come Join US!