During the normal course of business there comes a time when it makes sense to expand your footprint in the marketplace; or perhaps consolidate facilities that are closely located to better serve customers or take advantage of economies of scale. Or maybe a relocation to gain efficiencies. Regardless of the reasons, business leaders periodically are faced with the complicated task of moving their team to a new facility.
I have been asked by clients in the past: How is it that companies constantly create waste without realizing it? I think of this precise scenario when I try to answer this question. As organizations expand and grow, it is very common for these initiatives to happen without taking a closer look at the effects of such significant changes.
For instance, new equipment brought in during a rush period is placed on any given available space. When the organization relocates, the equipment ends up in the same arrangement as in the previous facility, regardless of where it should be. This also happens with infrastructure: Equipment or offices are planned first, only to later find out that power, water, air, data, or gas supplies cannot be installed in accordance to the equipment location. Often this is caught too late and drastic rushed changes need to be made to the plan.
Unfortunately, in many cases these oversights end up becoming significant expenses for the business. I wanted to offer the following concepts to help you avoid committing some of the mistakes I have seen in the past.
One of the fundamental concepts in Lean. When organizations are relocating, they often bring everything at the facility with them; whether they need it or not. During a relocation/consolidation is the perfect time to look at the things you have in your facility that are no longer necessary and getting rid of them. Also, take advantage of the change and encourage your team to change their habits and start fresh with an organized environment at the new facility.
Please read our complete guide to implementing 5S to learn more.
8 Deadly wastes
Front and center in creating efficiencies. Before you design the layout of your facility, I encourage you to analyze the flow of the different product lines. Look at them and evaluate if you are creating waste or minimizing it. Consider travel distances, co-located equipment such as shared resources, the sequence of your processes, dock doors, building entrances and monuments, large or immovable structures within your building.
Value Stream Mapping
As mentioned before, the opportunity to improve your business during these initiatives is ripe for the taking. Use value stream mapping to expose all the non-value-added activities in your business. For those businesses that are laid out by common equipment/departments, or run their product/services in batches: Consider changing to value streams and implementing the concept of one piece flow, balanced to your demand.
The concept of workforce flexibility, while simple is very powerful. During your relocation/consolidation there is a risk that a portion of your workforce may decide not to join you at the new facility; before, during or after the change and sometimes with short notice. This could bring significant consequences to your business. Before executing, evaluate the effects the changes will have on your employees: geographically, and on their roles going forward. Identify where you have single points of failure and create a plan to reduce the risk and recover in case of a significant loss.
Consider these concepts before you execute, many hurdles will be avoided, and your transition will go more swiftly.
Please share your experiences in the comments section.