How to Achieve the Expected ROI from Food and Beverage Portfolio Companies
By: Joseph P. Patten
Managing Partner
Over the past several decades, fortunes have been spent to improve yield, reduce waste, sharpen quality, and increase productivity. Employee involvement programs, statistical process controls, lean manufacturing, and Six Sigma have been utilized to increase performance, strengthen customer loyalty, and improve profitability. In addition, more trading power has been conceded to the major retailers placing a downward pressure on the revenue line resulting in reduced profits. For many companies, the enthusiasm that went into the continuous improvement programs failed to sustain itself over time and in the end did not yield the results hoped for.
Today, there continues to be many consulting organizations, including MainStream Management (“MainStream”), which will help a company traverse the difficult waters to bring about fundamental cultural change by utilizing collaborative high performance work systems. However, these initiatives take a long time, are expensive, and are not without risk. Many investors do not have the time to wait and see if these programs will yield anticipated results. MainStream's Performance NOW bypasses structural and cultural obstacles to achieve fast and certain results.
MainStream recognizes that continuous process improvement (CPI) initiatives may take longer than a company or investors have patience for. In addition, traditional CPI initiatives do not always work well in multi-cultural environments or in Hispanic majority production facilities. Over the past ten years, MainStream has performed substantial work in production facilities throughout Latin America, Mexico, and the United States. What we learned through hard fought and disheartening experiences is how to perform in these environments. MainStream's Performance NOW addresses these shortcomings by introducing experienced operations managers into food and beverage production facilities whereby we can lead the implementation of programs that bring immediate change to a facility's performance while simultaneously providing mentoring and knowledge transfer to enable the managers and supervisors to sustain improvements.
Educational efforts in operations management over the past 40 years have focused on collaborative efforts whereby managers were encouraged to lead rather than direct, to participate rather than manage, and to use statistical measurements to gauge a process' success rather than hands-on experience. This body of thinking originated with Edward Deming's work in Japan in the late 1940's. Deming was absolutely correct in his assumption that a well-managed, collaborative work system would achieve the best results. What is not as prevalently discussed is Deming's recognition that a well-managed directive work system will achieve faster improvements and be nearly as productive of an endeavor as a well-managed collaborative work system. The difference is that collaborative work systems rely on the broad base skill and ability of the entire workforce, and directive work systems rely on the skill and experience of the ! oor managers. MainStream's Performance NOW utilizes the directive work system approach to create rapid results and immediate value for our clients by placing emphasis on 12 key focus areas that are critical components to the success of food and beverage companies.
Food and beverage companies make their profit, and meet safety and quality standards, by managing the details. Investors, Boards and effective senior management know this, but sometimes overlook the importance of managing the nuts and bolts when trying to bring about change. This is exemplified in a recent engagement with Armour-Eckrich Meats, a $1 billion branded meats company with a strong presence across retail, deli, and food service channels. The company's Kansas City meat production facility was producing an item for Subway called ‘sliced roast beef'. The item had five cost centers set-up to identify and track yield. MainStream's operations manager implemented small changes in the production process which resulted in $480,000 per month in savings.
For more information about MainStream or to discuss this article further please email info@mainstreamllc.com or call +1 (877) 785.6888.