Effectively managing a manufacturing company with a large number of factories requires a common operating approach as well as a broad range of applications and enabling technologies which will enable people to speak the same manufacturing language all of the time.
This was one of the key takeaways from a Manufacturing Leadership Council plant tour last week at Johnson Controls, International’s Norman, Oklahoma, plant, where the company makes its Light Commercial Rooftop products. Nearly 80 ML Council members toured the 522,000-square foot facility and heard about how the company devised and implemented the Johnson Controls Manufacturing System (JCMS) and nine mobility-enabled applications.
JCMS was launched in 2013 to help JCI achieve its goal of becoming one of the most operationally excellent companies in the world. At that time, JCI, which had about 300 plants, had what it describes as “pockets of excellence” among its facilities but the practices in place in many of these, exemplified by 140 performance metrics, did not amount to standards for the company as a whole.
A framework was developed that has four key foundational elements and nine principles. The foundational elements are: customer focus, a stable operations environment, an organizational mandate based on pull, and a zero tolerance for waste policy. The principles include elements such as total quality, empowered people, a safe workplace, design for manufacturing techniques, and what Johnson officials call “visual factory”.
Flash forward to 2018 and JCMS has been deployed in all of JCI’s now 133 manufacturing plants. ML Council members were told that JCMS, which has nine performance metrics and 17 leading metrics, has resulted in $180 million in gross savings, a 46% improvement in employee retention, and a 14% reduction in safety recordings in the company’s FY2017 year.
“JCMS has become a great framework for us,” said one JCI executive during the tour. “It has become the cornerstone for acquisitions and joint ventures. Now, we are all speaking the same language all of the time.”
JCMS implementation and practice has occurred over a time period in which JCI itself has been transforming as a result of acquisitions and divestitures. In September of 2016, JCI merged with Tyco, a leading provider of fire and security systems. Shortly thereafter, JCI spun off its Automotive Experience business to Adient plc, which is now a $16 billion company. And in the first quarter of its fiscal 2018 year, JCI sold its Scott Safety business to the 3M Company for $2 billion. As a result, the prior 300-plant manufacturing footprint was reduced to 133 facilities.
The transformed JCI, which was started in 1885 in Wisconsin as Johnson Electric Service Co., a provider of automatic temperature regulation systems for buildings, is now a $30 billion company with 120,000 employees. JCI is organized into two business units: Building Technologies & Solutions, and Power Solutions. The Norman plant is part of the Buildings group.
Along with JCMS, JCI has been developing a host of smart systems to drive operational excellence, improve efficiencies, and spur productivity within its plants. A major part of this drive has been the development of the following software applications:
- The JCMS Web App – this foundational application provides best practice availability information and helps drive the JCMS deployment and execution process.
- Layered Process Audits (eLPA) – this IOS- and Android-enabled audit application complies with JCMS and is being deployed to more than 80 plants in JCI’s FY 2018 year.
- Corrective Action/Problem Solving (CAPS) – this cloud-based application is based on 8D and 4D reporting processes. It is currently deployed in all 133 plants.
- High Performance Teams (HPT) – also a cloud-based application, this is being deployed globally in 2018 for shop floor employees. The software is used by 20 self-directed work teams locally in Norman.
- JCMS Digital Handbook – this application stores JCMS maturity model and related documents and links to supporting materials and learning capabilities.
- Manufacturing Execution System (MES) – this application, from MPDV Mikrolab GmbH, provides shop floor execution management and integrates with JCI’s SAP system.
- Yale Vision Application – this is a fork lift mobility application.
- Thors – provides fork lift-mounted screens to improve warehouse picking.
- Warehouse Revitalization – an application that will support the introduction of robotics in the warehouse.
JCI officials, who participated in a question-and-answer session with ML Council members after the tour, explained that the applications can cost between $2 million and $3 million and take up to two years to develop. Payback has to be two years or less, although sometimes it can occur only after six months or so, they said.
Importantly, the applications are not considered IT projects. “Plant people own the applications,” said one JCI executive. “They support the teams.”
And, perhaps even more importantly, success with some of the applications such as HPT, is very dependent on how advanced teams are in their experience and usage of the software. “The maturity of the team is the key dynamic.”
JCI executives emphasized that the right process is also essential to the success of an applications portfolio such as the one it has built. What’s been learned throughout the process is that organizations must start by identifying a pain point or an opportunity to do something better, then build use cases, test in different plants and under different scenarios, and then deploy in a way that leverages employee engagement and commitment so that the application isn’t rejected.
Looking ahead, the JCI executives said they are committed to using advanced technologies to achieve even more on their journey to manufacturing excellence. “Our targets are very aggressive,” said one executive. “We are raising the bar every year.”