One Client’s Change Management Story
The Client: A heavy manufacturing plant in North America owned by a multi-national corporation
The Challenge: The plant was in danger of being closed after a number of years of heavy losses. The plant was plagued by a flat market, tough competition, high quality costs (rework), slow delivery, and an adversarial labor-management climate.
The Process: Three DTA consultants worked over a period of several months with plant leadership and a 23-person planning team made up of managers, workers, and union leaders. We designed and facilitated a 2-day all-staff retreat to develop and commit to a new strategy. All 250 employees attended along with 22 key suppliers and a panel of customers. Strategic goals were developed where everyone could contribute. An implementation roadmap was created for the next year.
Results after One Year
- Cycle times for product delivery dropped from 28 weeks to 18 weeks.
- The cost of quality (scrap, rework) dropped from 8.6% to 3.4% of sales.
- Sales were up from $40M to $50M in the first year and $60M the second year.
- Involvement of shop floor employees to lead plant tours got rave reviews from prospective customers and led to several new orders.
- Cross-functional teams were formed involving shop floor employees to address long standing process problems.
- All three United Steel Workers locals agreed to new three-year contracts that included managements need for more flexibility in job classifications and the unions need for an early retirement option for senior workers.
- Union grievances dropped significantly.
- The $5.5 million loss was trimmed to $1.5 million the first year
- All laid off workers were called back and the workforce increased by 20%.
- 25% of all workers were trained for new jobs or responsibilities.