Local Knowledge Key Asset in Location Decisions
The ideas of local leaders who handle the day-to-day management of operations can be successfully applied by corporate leadership to the rest of the company.
Tim Feemster, Managing Principal, Foremost Quality Logistics and Noah Shlaes, Managing Director, Strategic Consulting Group , Newmark Grubb Knight Frank (Winter 2011)
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Fine-Tune and Repeat
Then, it happened again. These regional leaders showed our report to their counterparts in other regions, who then decided to get on the bandwagon. At this Kaizen-driven (focused on continuous improvement) organization, they paused to fine tune our approach to the question. They sought to reduce cost and repetition, while retaining the local involvement that makes the process work.
We were asked to utilize this revised process for five other regions. The result? A formal plan for evaluating and siting parts facilities in multiple regions.
This process happens everywhere in strong companies. Ideas arise from local leaders responsible for day-to-day management of operations, and continuous improvement processes apply them to the rest of the company.
For instance, a lean warehouse operations strategy - born in a local warehouse operations team - converted the Toyota production management system from its manufacturing focus and applied it to warehouse operations. Piloted in a Midwest facility, it used value stream mapping to find the best processes to tackle. After that proved successful in the Kaizen event, the locals continued to hold Kaizen events throughout the facility.
These process improvements succeeded in driving out waste, lowering cost, and improving the client service. The locals presented results to the management team of the industry vertical. Applying a Kaizen process, the strategy was documented and rolled out to other sites in the vertical. Within a very short time, it became a major thrust of the entire organization and is still in place today, years later.
When a good idea shows up at the local level, how can we assure that it continues to make a difference?
• Start with a good prototype - Don't get involved too early, and allow the first attempt to run its course and prove its effectiveness.
• Involve the right people - Include local and regional leaders, and those affected by the strategy, especially cross-functional teams.
• Get support and funding if required - Management must commit to carrying the process forward.
• Pause to think - In taking a local process to a national application, break it into pieces and allow for input and redirection.
• Communicate - Use graphics, online collaboration, and process documentation to keep a multilevel, cross-functional project on the same page.
• Project into process - Invest in documentation, process improvement, and communication so that the same results can be replicated elsewhere. Start with "copy exactly" and consider improvements.
In which situations should companies ignore the advice of local entities?
"Ignore" is pretty tough. But many locally-developed ideas do not scale up. More
- David Kollmorgen, International Director and Lead of Business Intelligence, JLL