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We once had a MES project with a large medical devices company.  This was a great project, that started well, and then the project sponsor went on vacation.  After a week he did not return, then two weeks, then three….

Then, not at all.

We all (Flexware and the customer) found out the way he had justified the MES project was by using some budget left over from another project.  They certainly needed the MES, and we all knew this was going to be a great solution.  These games get played with capital money sometimes, but this one got some real scrutiny when this guy left the company.  The project manager we were working for (she worked for the sponsor that left) called us and asked us to stop our work immediately.

The big meeting….

So here we are, a small company with this large project, stalled.  The Plant Manager called a meeting and asked us (now this was our problem) how we were going to justify this project.  He said “If you can’t tell me right now how much this project is going save me, we are not going to do it.”  Of course, he meant finish it.  I replied by saying “Justifying MES systems is very difficult and requires good data, great understanding of the problems and opportunities, and will take some time.  I can have the project finished in the amount of time it will take to do the justification.”

After some more flaming hoops, we got to finish the project and it all ended well.  It is a constant reminder that sometimes MES takes vision and faith.  I liken it to on-line banking.  There were probably many “old-school” banks that probably scoffed when someone said “you better get online banking up and running here or you may be out of business.”  “Where is the ROI?  Prove it to me!”, they said.  I hope they took the leap of faith and invested in these improvements, because if not, they may be watching from the sidelines.

Same goes for manufacturing and MES investments.  Sometimes it is ROI, vision, and faith combined that gets these projects done.  Sometimes it is leftover capital budget.

I have been very impressed with Steve Bell and his approach.  Check out his website at www.steadyimprovement.com.

Also, you can get his book here:  Amazon.com

Last week I met Scott Sorheim over the phone through a mutual friend.  He has a company called Lean Technologies, and his product is called “Thrive.”

I really appreciate guys like Scott because they have passion for manufacturing and they are willing to “hang it all out there” and work on solutions.

Scott’s Blog:  http://leantech.com/blog/

Lean Technologies Website:  http://www.leantech.com/

We are often asked to help justify Manufacturing Execution Systems (MES) solutions in order to get capital approval to move forward.  This is a monumental task because MES systems are very difficult to justify on hard savings.

One of the reasons MES solutions are hard to justify is they help you with many “soft” improvements.  Deming said “You cannot improve what you cannot see.”  MES solutions help you see what you need to improve, and help you systematize your improvements.  What is that worth?

Here are some practical items you can focus on for your justification:

1. What manual data collection can be eliminated?  What does that cost in real labor?  Not only in the people collecting the data, but those the scrub it, chart it, report it, and debate its accuracy. (Reduces Cost)

2. What “oops” problems could be eliminated with more synergy in the manufacturing process?  Wrong labels on parts or containers, shipping product that had questionable parts/processes, quality spills, adding value to known bad product? (Reduces Cost)

3.  Could you increase velocity or agility if you could manage complexity and proliferation of your products?  Would you still have to hire extra expediters?  Would you have to build the new line?  Would you be able to take on more work? (Increases Revenue)

4.  Could you provide better visibility into your operations for your customers?  What would better customer service do for your relationship with your existing customers?  Would they give you more work? (Increases Revenue)

5.  Have you had a quality spill you can quantify?  What did it cost?  What if you could eliminate or reduce the cost of the next one? (Reduces Cost)

As I write this, I think this post could be turned into a multi-part series…  Feel free to contact me if you need more ideas for justification.

As I was reading and catching up tonight, I just could not help but see the stark contrast in stories between Walgreens and General Motors.

Walgreens - Employees at This Walgreens Distribution Center Are More Able Than Disabled

http://www.evolvingexcellence.com/blog/2008/02/need-some-eager.html

General Motors - GM offers buyouts to 74,000

I know GM must do something to stop bleeding money, but it never fails that those companies that take care of their employees are healthier companies.