Friday, April 4, 2014

Focus and Leverage Part 332

In this final posting of this extended MRO CCPM case study, I want to demonstrate the results achieved and summarize the important lessons learned.  I hope you have enjoyed this series and that you have learned from it.  Although this was a case study on a CCPM implementation, the lessons learned apply to virtually all improvement initiatives.

Our initial implementation yielded results that surprised all of us.  On the very first series of aircraft, the total cycle time for scheduled maintenance decreased by 38% with aircraft throughput increasing by 40 %.  One of the keys to our early success was reducing the total WIP of aircraft in the process by 50%.  This had a major impact on reducing our multi-tasking of aircraft and set the stage for the other aircraft that we would eventually convert to CCPM.  Needless to say, the leadership team was impressed with the results and encouraged up to push on to the other airframes.

As I mentioned, we cut our WIP level by 50% in scheduled maintenance, almost eliminating multitasking, enabling the workforce to concentrate on getting the job done without moving on to a new aircraft.  This action translated into early finishes thus giving more available aircraft to the students to fly each day.  It also provided flexibility for unscheduled managers to manage their resources instead of them being managed.  We focused on Buffer Management, and investing in our people with the cycle times being virtually cut in half with a proportional increase in throughput of aircraft through our scheduled maintenance process.  Looking back, it’s my belief that the most important learning was that we now knew that the constraint was the actual Critical Chain and we did everything we could to protect it.

In addition to the tangible results we achieved, there were also many intangible benefits realized which contributed to our overall level of success.  For one, our production control department now had the flexibility to control which aircraft should be launched into the scheduled maintenance process and which ones could wait.  This allowed us to plan more effectively and virtually eliminated the “push” mentality that had “clogged” the maintenance hangar.  Our unscheduled maintenance could now better prioritize what was urgent and what would be better left to the non-launch hectic times of the day and week, such as the week ends.  Our level of communication between shifts accelerated upward to never-before seen levels because we now had effective shift tie-in meetings, Because of these meetings, there was never a doubt about where an aircraft was in the scheduled maintenance process and what work had to be done on it.  This resulted in the virtual elimination of duplicate work being done by the on-coming shift workers.

Before CCPM, if we would have been one aircraft short for any reason, there would have chaos in the maintenance hangar.  Prior to our CCPM implementation we had requested more hangar bays and more parking and office space for years, but in the days after our implementation, space was no longer a problem simply because of the WIP reduction and the speed at which we turned aircraft through the scheduled maintenance process.  One last intangible was the lessened impact of employee attrition.  Prior to our implementation our attrition rate was around 80% which caused extreme difficulty getting aircraft through the process in a timely manner.  With our streamlined CCPM processes, standard work and in-house CCPM training we were able to overcome this obstacle quite easily.  The attrition decreased somewhat, but it was the ease of information flow between and within shifts that helped the most.  With the CCPM software, there was no longer any doubts about what the priorities were.

The overall results of this implementation were amazing.  In the remainder of this posting, I want to summarize the achievements made as a result of our CCPM implementation.  For example, by reducing the WIP by 50% on all of our different aircraft types, we were able to reduce the number of aircraft being tied up in scheduled maintenance.  Because this DoD customer did not have to purchase additional aircraft for school use, this WIP reduction and cycle time improvement translated into more than $90M M in savings and cost avoidance for the customer.  Because of the cycle time reduction and increased throughput by an average of 40+ %, this effect translated into the equivalent of additional aircraft being created.  Needless to say, the customer was very happy with this effect because there was no longer a need to purchase additional aircraft to accommodate the flight school..

Because of the WIP reduction, we were also able to reduce the combined space requirements in two of the aircraft hangars by over 18,000 square feet.  There had been plans to increase the size of hangars at these two airfields, but this expense was no longer needed resulting in over $2M in cost avoidance.

Because of the reduction of WIP on another helicopter airframe, the equivalent of giving back two aircraft for immediate school use resulted in approximately $60M in cost avoidance and savings for this DoD customer.  Because of the reduction in scheduled maintenance cycle time on this aircraft by an average of 47%, like the other aircraft significant $ savings were realized.

Finally, the CCPM implementation resulted in totally eliminating the need to outsource aircraft for scheduled maintenance in 2009 and 2010.  To put that in perspective, in 2008, approximately 19% of two of the aircraft types had been outsourced and by eliminating this need, significant dollar savings were realized.

Before closing, I want to summarize what I feel were the keys to success in this CCPM implementation and then finish with our lessons learned. In no particular order of importance, the keys to our success were:
  • The creation of a “core team” comprised mostly of the true subject matter experts (SME’s). The SME’s are the actual people doing the work which in our case study they were the mechanics, avionics tech’s, QA inspectors, logistic’s personnel, etc.  They must be permitted to define the new methodology without reservation and interruption by the leadership of the organization.
  • Top Management and leadership must be committed to the success of the CCPM implementation.  They must let go of the command and control mentality that many leadership teams exhibit.  Regardless of what the leadership team thinks, they truly are not the experts when it comes to doing the work.
  • In addition to leadership’s commitment, they must also actively participate in the implementation of CCPM.  Leadership must be ready at all times, to remove any barriers that get in the way of the SME’s.
  • The establishment of a robust and active problem resolution process is critical to the success of any CCM implementation.  No longer can symptoms of a problem be treated, but rather root cause analysis must be the order of the day.  If only the symptoms of the true root cause are treated, the problems will resurface time and time again.
  • One of the keys to for a CCPM implementation is the subordination of all other processes to the success of CCPM.  This has to be the priority focus.
  • he CCPM software is the vehicle for prioritizing the work to be done every day.  These priorities are color-coded in their order of importance with all “reds” being the top priority, followed by “yellows” and then “greens.”  The SME’s can no longer pick and choose what to work on or the implementation will not succeed.
  • Finally, the performance measures must be changed to reflect the new way of managing projects.  The ratio of % buffer consumed to % critical chain complete is a simple, yet very effective way for leadership to monitor project status.  In addition, the fever charts should be reviewed by leadership and everyone else and any place where buffer consumption is heading due North should become the top priority for everyone concerned.  For if the reason for the excessive burn rate of the project buffer is not corrected, the project is guaranteed to be late.

There may be other keys to success, but these are some of the more important ones that we observed in our implementation.  CCPM is clearly much more effective than CPM in terms of project completion rates.
I'd like to finish this series by discussing some of the more important lessons learned from this CCPM implementation.
  • First, we learned that if you want a project plan to work, make sure that the true subject matter experts are the ones to develop it.  It doesn't matter if it's a software development process or, like ours, an MRO project.  If the true SME's aren't used to develop it, it will fail!
  • We learned that attempting to measure local efficiencies in the process will take you in the wrong direction.  It's important to understand that excess capacity is truly not a bad thing.  In fact, having excess capacity at various parts of the process helps to improve your flexibility.
  • Leadership's role must become one of support rather than directing the team's activities.  There's no room for the old "command and control management style."  Leadership's involvement must include being available to remove barriers when the workers need their help.
  • Being able to sustain your improvements is, by far and away, the most difficult behavior to achieve.  The natural tendency for the work crews at this MRO site is to fall back to their old ways and habits.  You must constantly reinforce this new way.  The good news is.....this new way is much less stressful.
I hope you have enjoyed this series on Critical Chain Project Management.  For me, this implementation was an eye-opener and helped me understand a new way to manage and execute projects.
Bob Sproull











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