Operational Excellence - It's a Mindset, Not a Project

Transcript

[00:00:52] Josh Santo: Today’s guest has spent more than 30 years leading operational excellence across industries and continents from India to China to Hong Kong and the US. He’s a certified TPM instructor, lean six Sigma Master black belt and servant leader who’s helped transform manufacturing operations through continuous improvement, capability building, and a deep commitment to empowering people at every single level of the organization.

[00:01:19] Josh Santo: Over the years, he’s led large scale transformation initiatives across dozens of plants, reducing unplanned downtime, improving asset reliability, and building high performance cultures rooted in learning and ownership. He believes operational excellence isn’t about tools or efficiency alone. It’s about how leadership empowers teams to solve problems, sustain improvements, and take ownership of their work.

[00:01:45] Please welcome to the show Director of Operational Excellence and Asset Reliability for Mondelez International, Rajeev, Seth.

[00:01:54] Josh Santo: Rajeev, thanks for joining us today.

[00:01:56] Rajeev Seth: Thanks for having me here. Jos, nice to meet you here.

[00:01:59] Josh Santo: Yeah. Yeah, it’s been a little bit of a back and forth trying to get you on, you know, the holidays are always difficult to schedule, but I appreciate your persistence ’cause I’m really eager you’re the first true operational excellence individual that we’d be speaking to on the podcast. So I’m really excited to cover all of the great topics that we’re planning on covering today.

[00:02:21] Rajeev Seth: Okay. I’m also very excited to share my experience, my thought process with you. And I’m looking forward to this session. Yes,

[00:02:30] Josh Santo: Yeah, me too. So we start out, every episode, we want to understand what a day in the life is like. So you are currently a director of Operational Excellence. Rajeev. My first question to you, what does a typical day look like for you as a director of operational excellence?

[00:02:46] Rajeev Seth: Very interesting question. I can say that my day is not defined by meeting or dashboard and checking the dashboard. My day is started with the purpose every morning, when it starts. Normally I am reconnecting with that purpose. What is that purpose? To help the team to work is smarter, simplify the way of working and building the right culture.

[00:03:15] Rajeev Seth: To drive the operational excellence. So it is not

[00:03:20] Rajeev Seth: checking the KPIs or checking the dashboard, but meeting to the purpose and also telling the people intolerance to the losses, which is the operational excellence. So this is the mindset which we need to write, and when the day unfolds, I focus on DMS, which is called Daily Management System, to check what went well.

[00:03:45] Rajeev Seth: In last 24 hours and where we can improve. And also we are discussing what is the insight and we are changing in that into action. And when they move further, I’m focusing on coaching and guiding the plant leadership team. So that they can have the confidence on operational excellence tools in their thinking. And also I’m reinforcing that operational excellence is not a project, it’s a mindset to drive a hundred percent employee engagement and reinforcing Jira loss culture. So in sort my day, start with the purpose. Powering by, by the pupil and driving the mindset and doing the things better than we did yesterday.

[00:04:43] Josh Santo: How do you go about reconnecting with that purpose?

[00:04:47] Rajeev Seth: Yeah. Interesting question again, that we are checking the KPIs, on the DMS and those KPIs are focused on safety quality. Delivery cost, sustainability, and morale. So we are checking whether we are meeting that purpose across those six domain or not, since that six domain is reflecting the entire supply chain. So that is the way how we are checking with that purpose.

[00:05:21] Josh Santo: Okay, so you, you said you start off each morning, not necessarily with a meeting, but first you’re reconnecting and reflecting on that purpose. And one of the ways that you get your mindset back into that purpose is by looking at specific KPIs you mentioned, six domains that reflect the supply chain.

[00:05:42] Josh Santo: Now, one of them that you called out is. Morale. That one stuck out to me, because that one seems like it might be a little bit hard to measure as a KPI and a little bit harder to quantify as how it impacts the operations. Could you talk to us a little bit about morale, what you’re measuring, what you’re looking for?

[00:06:08] Rajeev Seth: Yeah, that morale can be. Measured and it is a soft part. It is not a hard KPI, it is measured by the engagement and how you are engaging the team. You are building a capability and you are empowering that. So I put it in a a specific manner, engagement, capability building, and empowerment wide. Since we cannot build a capability if teams is not engaged.

[00:06:42] Rajeev Seth: We cannot empower them if they are not capable to make the right decision. So if your team is engaged, capable, empowered then they will work on a high morale. That is that and why When I am talking engagement, engagement for me is horizontally and vertically across the organization.

[00:07:07] Josh Santo: Okay. Engaged, capable, empowered. And is that something where there’s official checks or official. Observations you can make to determined if the team is engaged, capable, and empowered? Or is this a conversation with leadership who’s sharing their perspective on their teams and how they would rate them?

[00:07:34] Rajeev Seth: Yeah, it is a both way. leaders need to develop some of the touch point, how they can check whether my team is engaged, capable, and empowered. Some of the text touch points means that. How they are feeling, what they are doing on a day-to-day basis, and whether they are doing the firefighting or they are preventing the fire, right?

[00:07:58] Rajeev Seth: So this is the point where the team can check whether the team is engaged and power and capable. Second point is leaders also need to spend time on the soft load through leadership Gemba. So that they can also check the culture from me. Culture is the smell of the place where leaders are acting like a coach and mentor to solve and take care of the barriers from the core team member, and they are helping them to take the right decision at the right time.

[00:08:38] Rajeev Seth: So these are the few. Majors, we can, we can, we can take to check whether our team is engaged, capable, and empowered or not. So this are the way we can do that.

[00:08:52] Josh Santo: Okay, so it sounds like there’s a little bit of need to have a proof point there with the idea of that leadership Gemba. So the team, the leadership team must be actively involved. This is one of the ways in which they’re required to be actively involved is that leadership Gemba. Where they go, they observe, they see with, with fresh eyes and.

[00:09:13] Josh Santo: Then you talked about really an approach to leadership. So are leaders being the coach and the mentor, and are they guiding the folks in their stead to make the right decisions at the right time? I think that’s a, a really interesting breakdown of how you can tap into morale. In your experience, is this a common approach to gauging morale?

[00:09:37] Rajeev Seth: Yeah. people can use the different approach for that. But, from my perspective, from last 20, 25 years, I am having this approach and leadership Gemba, what I’m talking that there are two. approach to solve a problem. First thing is that either you can move the authority to the information or you can move information to the authority.

[00:10:04] Rajeev Seth: So I believe that you need to move authority to the information, which is at the, at the bottom of the pyramid. So it means leader need to be at the shop floor, rather you are moving information to the authority that is not there. Right approach. Since when you are moving information to the different layers, always there is some distortion in that information, so leaders need to be at the soft level to to check where the problem is happening.

[00:10:37] Josh Santo: Hmm. So because there is often some sort of distortion in the transfer of information, you see it as more effective for the authority for leadership to go to where the information is coming from, the source of the information

[00:10:54] Rajeev Seth: Exactly, exactly. And also very important point, which I mentioned that engagements must be happen horizontally and vertically. So that is also very critical, for the operational accession.

[00:11:09] Josh Santo: Understood horizontally and vertically. Talk to us a little bit about what you mean by it having to happen both horizontally and vertically.

[00:11:21] Rajeev Seth: Yeah, horizontally might mean that all the functions in the organization must be part of the operational excellence journey. This is, the horizontally might mean that all functions, uh uh, should be the part. Vertically, my mean is that all level of the organization from the vice president to the director, to the core team, member, supervisor, everyone, that is the way I am, doing it horizontally and vertically.

[00:11:50] Rajeev Seth: We should not leave any function or any level disengage in this journey. So this is, this is my main, originally in vertically.

[00:12:00] Josh Santo: Horizontally spanning across the operation. So in this case, we might be talking about quality, continuous improvement, production, operations, hr, and various other.

[00:12:13] Rajeev Seth: Yeah.

[00:12:14] Josh Santo: And then vertically would be going deep within that. So that’s leadership at the top level. That could be plant management, that could be the different management of each of those functional levels.

[00:12:25] Josh Santo: It could be the, the, the, the quality engineers or the process engineers, or even all the way down to the operators on the line.

[00:12:35] Rajeev Seth: Really?

[00:12:36] Josh Santo: So you’re saying it’s important to engage both of those at the same time? I think that’s a, an interesting way to think about it. Something that might get overlooked, particularly in continuous improvement or any sort of transformation projects, is who all actually has to be involved and being very intentional.

[00:12:54] Josh Santo: About how you spread the impact and the buy-in across multiple groups, as well as multiple levels of stakeholders within those groups. Now, I’m curious, Rajeev, when you think about that, what have you seen others in manufacturing get wrong about operational excellence and how it relates to that need to go horizontal and vertical?

[00:13:22] Rajeev Seth: Yeah, there are, there are many, many points. the company feel that,this is the operational excellence, for example, many times. Company are focusing on operational excellence is a project, not a long term cultural shift. It means that they are focusing that this is a six months to 12 months project, which we can complete, and then we will do our routine job.

[00:13:50] Rajeev Seth: So operational excellence is a marathon. To win or run a marathon, you need to be fit from mentally and physically. Same way. If you want to do operational excellence, you need to be capable and you need to have a right culture. So this is the first mistake companies are doing. They are considering operational excellence project. Second thing, they are not focusing on the leadership behavior. Leadership behavior is the first lever to drive the operational excellence. If leaders are not doing the daily management system, if they are not following the standard work, if they are not asking the right question, if they are not doing the role model behavior,

[00:14:45] Josh Santo: the

[00:14:46] Rajeev Seth: they are not having the right mindset, then how you are expecting others to do the same thing.

[00:14:53] Rajeev Seth: Right? This is the second, point. The people are underestimating leadership behavior. Third point, which most of the companies are missing, they are not connecting operational excellence with the KPIs. Most of the time companies are appreciating or celebrating number of, we did number of Kaizen Rehab.

[00:15:23] Rajeev Seth: Or number of training hours, we did the training. So, this is okay, this we need to focus, but ultimately, operational excellence need to be connected with the business KPIs, improving the uptime, improving the base number, those numbers. So these are the three, three points where most of the organization misunderstood the operational excellence.

[00:15:51] Josh Santo: So those three points, treating operational excellence as a project, the lack of appropriate leadership behavior, and missing out on connecting the impact with tangible business key performance indicators.

[00:16:08] Rajeev Seth: Yeah.

[00:16:10] Josh Santo: So that idea of treating operational excellence as a project, what exactly does that mean? Could you give us an example of, of how someone might see operational excellence as a project as opposed to, like you said, a marathon.

[00:16:28] Rajeev Seth: Yeah. Most of the time organization are feeling that the operational excellence is something extra, which they need to do. It is. It is. They need to do routine, their functional job, and this will be top of that, their functional job, but it is not. So sometime functions are saying we will do our routine job from Monday to Thursday and Friday.

[00:16:56] Rajeev Seth: We will do operational excellence. So, so this is, this is not going to work. Operational excellence is the way you are going to work on daily, weekly, and monthly. This is not the additional work. So, so this is, this is the, this is the misunderstanding. Companies has, functionals has, this is extra work. This I can do after my routine work.

[00:17:22] Josh Santo: Got it. So seeing their routine work as what they do every single day, and seeing operational excellence as a special exception whenever the need arises, whereas what you’re saying is no, the way that you do work must be operationally excellent, and any special projects that we do must be done in mind with this is going to enhance or change how we do things.

[00:17:50] Josh Santo: Every single day and not just be a temporary. Let’s do this once. Let’s finish it. Let’s move on to the next thing.

[00:17:58] Rajeev Seth: Yep.

[00:17:59] Josh Santo: Now, with leadership behavior, one of the things that you called out, if leaders aren’t following standard work, if they’re not being role models of the ideal behaviors. How can you expect others to do the same? So there’s a critical need for leadership to walk the walk, so to speak. When you Yeah. Walk the talk.

[00:18:22] Josh Santo: Yeah, talk the talk, walk the walk, walk the talk, all of it. And all, all sorts of variation of that phrase. where do you think the, the gap comes from?

[00:18:34] Rajeev Seth: Yeah, mainly gaps comes from the first barrier is people are feeling a, silo mindset, number one. Second is. The people in the function had a conflicting priorities, right? So these are the two main barriers, which I am finding that people are not focusing on the operational excellence. So normally what we are doing and what the company need to do, they need to start with the OGSM, that what is their Objective. Goal, Strategy and the Measure, right? So they need to start with the OGSM exercise, which will help them to define their compelling business need, what is their purpose, what they want to do, and then how they are going to measure that objective. What is their goal? What is the strategy they need to follow since strategy is a choice, what they want to do to meet that goals and how they are going to measure that strategy.

[00:19:52] Rajeev Seth: So they need to prepare OGSM for the broader organization, which is setting the tone for the future. That OGSM need to be drilled down to each functional level horizontally, and also need to be drilled down to the different levels so that individuals are connected with that purpose. If you are doing that, then everyone is working towards a common goal.

[00:20:23] Rajeev Seth: People do not have a conflicting parity. People will not work in a silo mindset. So this is the way how you can synchronize everything towards your reason and long-term thought process.

[00:20:38] Josh Santo: So that leadership behavior, at least the gaps in the ideal leadership behavior in what is needed in order to truly support an operationally excellent operation. You mentioned a siloed mindset and often conflicting priorities, and that’s something that’s come up quite a bit on the relatively short tenure.

[00:20:58] Josh Santo: Of this podcast is that idea that different priorities are actually driving conflicts that make people less apt to work together because they’re each pursuing the goals that are determined by their management, that their bonuses might be tied to et cetera. So they’re going to prioritize these differing goals That then puts conflict in between the two groups.

[00:21:20] Josh Santo: Most notably what’s come up on the show, Rajeev is. Production versus quality production, getting, a, a certain number of units. Produced, and if they have to sacrifice quality in order to hit that number, they’re okay with that. Whereas quality is really pursuing, you know, making sure that it’s right the first time, and making sure that everything is done to spec and meets the customers’ requirements, et cetera, et cetera.

[00:21:48] Josh Santo: Ultimately, they’re both in their own way working towards the same goal they want to deliver. The product to the customer by the time they expect it. and I think if, if pressed, ideally to the specification that’s needed, however, the ways of getting to that goal seem to differ, right? If I, if I’m in production and I have to have a hundred good parts, and I’ve got, let’s say a 20%.

[00:22:13] Josh Santo: Scrap rate, well then I shoot for 120 parts as opposed to getting those 100 parts right, the, the first time, that kind of thing. So you said, bring in the OGSM objective goal strategy and measures to really be able to define how we’re going to be able to work together. What the right strategy is gonna be for us and, and, and get those groups both at a horizontal level and a vertical level, all working together so that leadership is modeling the right behavior and the folks within their stead can then model that right behavior and work together as well. the last thing that you called out was connecting with a business, KPI. now what I’m curious about that is whether or not there are specific KPIs that should always be targeted with when thinking about operational excellence, or is this something that you think kind of varies depending on what the issue is?

[00:23:16] Josh Santo: What are your thoughts on connecting with the business? KPI.

[00:23:20] Rajeev Seth: Yeah. As. Before that, normally KPI is also defined in a six domain safety, quality and delivery cost, sustainability and a morale. So this is the leading indicators, which normally business are missing on a day to day basis. But operational excellence, we are focusing on, on the KPIs, which are more. Important for the shop floor. So this business KPIs are the lagging indicator, right? We need to focus on leading indicator, which we are saying key activity indicator. KAI rather focusing on KPI, you need to focus on the KAI and when I am talking with the daily management system, DMS. DMS has different levels.

[00:24:20] Rajeev Seth: DMS four, DMS three, DMS two, DMS one, DMS four, and five is for the leadership level. So they are more focusing on the KPIs, less Ks. But when you are going below DMS two, DMS one, there are more KPIs, less, less. KPIs more K since they are checking leading indicators so that they can correct the problem faster. So this is the way how we are linking the KPI at the different level. So if you are checking all the time, the lagging parameters, then always you are doing the firefighting. You are not preventing the problem.

[00:25:14] Josh Santo: Hmm. I think that’s an interesting way to think about it. Just to recap that for the audience, we’ve got KPI, which is a key performance indicator, and you mentioned that that is a lagging indicator. Lagging meaning by the time you find out what that metric is, whatever impacted that has already happened and has already affected your operations.

[00:25:38] Josh Santo: Whereas a leading indicator, which you said was K. Ai, which I believe stands for key activity indicator. If you focus on that, you can get ahead of the kpi. I, so if you are doing well on those leading indicators, the lagging indicators, which represent the overall business value, those indicators should be positively impacted as well.

[00:26:05] Josh Santo: And then you brought up the concept of DMS, which is daily management system, correct.

[00:26:11] Rajeev Seth: Yeah.

[00:26:12] Josh Santo: Daily management system and having different levels within that and depending on which level, the higher levels are looking at KPIs and not KAIs . Whereas the lower levels we’ll be looking at, actually, I, I got that backwards.

[00:26:25] Josh Santo: the lower levels are looking at the KPIs, not the K Wait, I’m

[00:26:29] Rajeev Seth: No, no, no,

[00:26:30] Josh Santo: my notes. No, I had it right the first time.

[00:26:33] Rajeev Seth: You are right first time. On the higher level, you are checking more KPIs, less Ks. At the lower level you are checking more KAI, less KPIs.

[00:26:45] Josh Santo: There we go. So sometimes iterating, reiterating it over and over just to get it to stick. So more KPIs at the higher levels. ’cause you’re focused on, operational results at the lower levels, more KAI s because you’re focusing on what are the things that are currently within your control right here, right now, today. Great. So altogether, A lot of times manufacturers, here’s what they get wrong about operational excellence. They treat it as a project as opposed to the way that you do the work that you do. The goal is to operate excellently, not to do projects. That are within the scope of operational excellence.

[00:27:30] Josh Santo: Leaders must have the right behaviors in place, both with themselves and within their teams. And you really have to look at, are there any conflicting priorities that are preventing different groups from working together effectively so that the operation can operate in an excellent manner. And then finally.

[00:27:50] Josh Santo: Another misstep is around connecting to the business value business KPIs, and you mentioned this idea of focusing on not just KPIs, but also bringing into consideration the cais so that you move from reactive firefighting to proactive problem solving, preventing the fires from the first place.

[00:28:15] Rajeev Seth: Yeah, exactly.

[00:28:16] Josh Santo: One of the things that’s come up a couple of times in the things that you’ve shared is the importance of, importance of engaging teams horizontally and vertically. In your experience, what are some of the things that maybe act as barriers to getting teams engaging correctly, both horizontally and vertically?

[00:28:39] Rajeev Seth: I think I mentioned it in earlier question that, silo mindset and conflicting priorities. These are the two main barriers people are. Finding. And the third thing, is that this is not my job. This is the job of the operational excellence team. Operational excellence team will drive operational excellence.

[00:29:01] Rajeev Seth: I will do my functional role. What is my role? To make the product, to make a quality or do the financing job, those things. So they feel that we have a operational excellence function. They will take care, operational excellence. We’ll do our routine job, whatever functional role need to play. So these are the, these are the few barriers or the mindset people has, which is not helping the, companies to drive the operational access in a right, right behavior in the right mindset.

[00:29:37] Josh Santo: Interesting. So let’s say that you encounter that perspective, that idea that this is not my job, this is operational excellence’s job. How would you respond to that mindset to help change their minds or get them to see it a different way?

[00:29:53] Rajeev Seth: Yeah, actually for that, what Opera Ions team is doing, they are generating a trust in the functional team and how you can generate the trust you need to have a. Learn to teach mindset. So you need to teach them what, while doing it. So they need to learn the thing while they are doing it, and then they need to teach the same thing while doing it with their team.

[00:30:19] Rajeev Seth: So first they need to generate the trust, with the team so that they are finding that this is their job to do. Second thing, they need to create a pull. If you are pushing operational excellence, it cannot generate the momentum. So you cannot generate momentum by push. You can generate the momentum by pulling when people are pulling operational excellence.

[00:30:46] Rajeev Seth: So this is the second point. And when you have the higher pole. Leadership role is to just to channelize that energy in the right direction. Very simple. So to take care that barrier, first, you need to generate the trust. And second, you need to generate the pull for the program.

[00:31:12] Josh Santo: Generate trust, generate pool. That idea of generating trust, trust can be a difficult thing to establish, especially if there’s any sort of history there or preconceived notions on certain topics. have you found it best to help create trust as an operational excellence leader?

[00:31:38] Rajeev Seth: Yeah, actually.

[00:31:39] Josh Santo: Yeah.

[00:31:40] Rajeev Seth: Sometime what is happening, operational excellence is working like a coach that they are going to the planned they’re doing coaching and they are not having the skin in the game. So mainly that you should not act like a coach. Yes, you can act like a coach to train them since you are expert, but sometime you also need to do some kind of on onsite onsite handholding in the working session.

[00:32:09] Rajeev Seth: So that you are doing the things with them, you are helping them to make things better. So if, if the, if the operational team are, are seeing that these are the, these people are the part of my team, they are helping me to simplify my work, then obviously they have higher trust on you. So don’t act like an external consultant.

[00:32:38] Rajeev Seth: Act like a partner with them and to solve their problem, rather just doing the workshop, doing the training session. It is not enough to generate the trust.

[00:32:52] Josh Santo: So another example of really. Go to Gemba, be there with them. And in this case, you’re not just observing here you are helping them identify problems and then working with them to overcome whatever those problems might be.

[00:33:08] Rajeev Seth: Exactly if, yeah, that is the, and you also need to need to solve their problem. So always the manufacturing team are doing the firefighting since they are, have a lot of pressure to solve that problem. So you need to also teach them how they can, they can reach from fighting fire to preventing the fire more.

[00:33:30] Rajeev Seth: So if they are moving to that, obviously they have a higher trust on you.

[00:33:36] Josh Santo: Well, speaking of, that’s a topic that comes up frequently when I speak with leaders in quality, continuous improvement, and more. It’s this idea of moving out of a firefighting approach. It’s come up a couple of times in our conversation so far.

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[00:36:17] Josh Santo: So Rajeev, I’d love to talk about this particular topic. How can manufacturers transition from fighting fires to avoiding fires?

[00:36:26] Rajeev Seth: Yeah, this is, This is interesting question and, very simple to answer. whenever you have a problem or issue in the manufacturing domain or any domain, you need to take a corrective action and a preventive action. But most of the time, organizations stop at corrective action. They are not taking the preventive action.

[00:36:54] Rajeev Seth: So that’s why corrective action will help them to start the production immediately. But preventing action is, is helping them to prevent that problem to reoccur in the future. So that is the one mistake most of the time, operation team is doing there, a stopping act. Corrective exam only. Not going further.

[00:37:21] Rajeev Seth: Prevention.

[00:37:22] Josh Santo: Why do you think that is? Why do you think it stops at corrective action?

[00:37:27] Rajeev Seth: There are several points there. Sometime they do not have a capability to do a a right root cause of the problem, so they are addressing only the symptom. So if you are not. Addressing the root cause. Obviously the problem will come. So, sometime they do not have that kind of capability to reach to the root cause.

[00:37:53] Rajeev Seth: Second time. Second, second point. Sometime they, they are too hurry to start the production, right? They have a lot of pressure to meet their daily or weekly, volume. So that’s why they are not going to the next level of the. Preventive accident. So these are the, these are the two main barriers I am finding in the operational access domain that people are not going from the fire, going from fighting fire to avoiding fire mode.

[00:38:29] Josh Santo: So you mentioned really it could come down to capability, meaning do the folks who are responsible for identifying the corrective action and the preventive action, do they have that capability? Do they, have they been trained in how to really get to a root cause and how to identify what appropriate?

[00:38:48] Josh Santo: Actions are to take in order not only to correct it, but prevent it in long term. And then the other thing that you mentioned was being too hurried to start production to hit the numbers that they have to hit. on that last point, on on being too hurried, what, what would have to change to make the appropriate space for the type of problem solving that would need to occur?

[00:39:15] Rajeev Seth: Yeah, exactly. So as I mentioned that leadership need to, embrace the daily management system, DMS, right? In DMS, we need to have leadership standard work that is the part of the DMS in leadership standard work. There are pre DMS and post DMS activity that after the DMS, you need to identify what are the critical problems I have today and on which critical problem I need to do the root cause and analysis.

[00:39:54] Rajeev Seth: So most of the time people are missing post DMS activity. They’re doing the DMS, they are checking the performance, but they are not focusing or spending time to do a exact route or analysis of the top losses. So, so mainly the extended work process are linked with each other. If you have only DMS, you do not have.

[00:40:23] Rajeev Seth: Leadership standard of work is in, built in the DMS then, then it is, you are not, you are not taking the maximum mileage of daily management system.

[00:40:36] Josh Santo: And one thing that you said that stood out there, you said Spend time. And when I heard that, I heard. Prioritized. It’s not being effectively prioritized in that case. There’s always something else to do. And essentially what you mentioned is, you know, if you’ve got your DMS, part of that is leadership standard work.

[00:40:54] Josh Santo: There’s activities that are pre DMS, post DMS, and one of the things that you have to evaluate or what are the critical problems affecting us today, which of those require corrective action and are you prioritizing the time? To spin towards identifying what those, what that root cause is so that you can take the right actions and prevent them from ever occurring again.

[00:41:19] Rajeev Seth: Yep.

[00:41:20] Josh Santo: That reminds me of a book that I read, called People Solve Problems by an author named Jamie Flinch Ball. And one of the things that he argued is that. You have to make the space and prioritize the space for problem solving, meaning it has to be prioritized that people can cut out an uninterrupted amount of time to focus their attention on the problem that’s occurring so that you can fix drivers of that problem. And the argument being it’s gonna take away from your goals today because it’s an investment into the future. and it’s one of those things that if you’re not prioritizing that you’re gonna be continued to be plagued,by impacts on your KPIs like we talked about.

[00:42:09] Josh Santo: Whereas if you spend that time invest and sacrifice in the short term, then you can have that long term benefit. Well, this idea of firefighting versus prevention, fire prevention, how can someone listening to this conversation, how can they tell if they’re in firefighting mode instead of a fire prevention mode?

[00:42:36] Rajeev Seth: Yeah, it is, it is very simple to judge, on that. the first point is the time management. So what did that mean is that you need to, you need to measure your downtime. How much in your unplanned downtime and how much is your planned downtime? If your unplanned downtime is too much? It shows that always you are doing the firefighting. is the key metrices. If you are focusing only the lagging indicators in across all DMSs, it means you are doing the firefighting. Third point is the problem solving. If you are attacking only on the same term, you are not doing the root cause, so always you are doing the firefighting. So these are the three.

[00:43:31] Rajeev Seth: Parameters or simple major, which anyone can do, to check whether a company is doing the firefighting or avoiding the fire.

[00:43:42] Josh Santo: I like how you, you brought up the example of measuring downtime as being a really strong way of understanding, are you dealing with firefighting or have you prevented fires? Because it’s, it’s very easy to see that a machine is down. A line isn’t operating. Now the reason, if it’s planned, that’s one thing, but if it’s unplanned and you’re consistently having a percentage of unplanned downtime, then you might be in a firefighting organization. Any experience or any thoughts on a percentage of unplanned downtime versus planned downtime, like for example, is your perspective? Any unplanned downtime equals firefighting, or is it 20% of your downtime is unplanned downtime, and that could indicate that you’ve got an issue with firefighting. What are your thoughts there?

[00:44:41] Rajeev Seth: Yeah, so normally in the,

[00:44:45] Josh Santo: Normally.

[00:44:46] Rajeev Seth: in the manufacturing domain, if you are focusing on your efficiencies. We are talking 85% and more is quite good. efficiencies in our company. Yeah. kind of company. I’m talking the CPGs company. So 85%, 86% considered to be, to be good world class. So it means you have 15% loss, how that 15% loss is distributed.

[00:45:16] Rajeev Seth: So you need to have 5% unplanned. 5% is the planned 5% is for your changeover or sanitation or meeting the quality standard. So this is the way how it is distributed, but this is also one catch. If you are running only one product at a time and there is no changeover or less changeover in the line, so, so then this mattresses will be changed.

[00:45:51] Rajeev Seth: but unplanned downtime, should not be more than four to 5% in, in, hundred percent efficiencies by, so this is the, this is the thumb roll, which we are using.

[00:46:04] Josh Santo: Okay, great. I think that’s a great breakdown. 85% is world class manufacturing standards. if that means there is. A 15% loss within that equation. And that 15% typically made up of around 5% unplanned downtime, 5% planned downtime, and 5% activities related to changeover, clean, cleanup, inspect, lubricate, all the things that have to happen in order to transition from one run to the next run.

[00:46:35] Josh Santo: So I think that’s some really strong guidelines. So if you’re listening to this and you’re wondering. Is your organization a firefighter or a fire preventer? Those are some, some traits that you can look at in order to assess, where it stands. Now, another question for you, Rajeev. We’ve talked a lot about operational excellence.

[00:46:54] Josh Santo: I’m curious about your perspective around what may need to change in most approaches to operational excellence today?

[00:47:05] Rajeev Seth: Yeah, so one thing I need to mention here in operational excellence is one thing is the culture. Number one is if you need to have a operational excellence, you need to have a right culture. So what why I am saying. This culture since, excellence is one of the strategy you are choosing for the transformation, right?

[00:47:35] Rajeev Seth: And culture is defining how people are going to behave, how people are going to achieve that strategy transformation. So if your what and how is not synchronized is not matching. Then you cannot have the transform. So number one point is the, you need to have a right culture. Second point is in operational excellence, we are finding the sweet spot.

[00:48:07] Rajeev Seth: Let me tell you, we are finding the sweet spot of man machine material method. That sweet spot can different for every organization. Even in the same organization, if they have multiple manufacturing side or if they have multiple business u unit, sweet spot will change. So operational excellence is the finding that sweet spot and guiding the organization towards that sweet spot in the man machine material method. There is, there is no perfection. Right? Word is not perfect, but we need to find that sweet spot where, where we can maximize that performance.

[00:48:57] Josh Santo: So in that case, it’s really about the process, then the approach. ’cause like you said, it’s going to be different for every operation. And so it’s gonna take really getting in there and understanding what are the constraints with which you’re working, what are all the inputs into the process, what are the ideal outputs?

[00:49:17] Josh Santo: And really relying on professionals to identify what are the different things that may need to change or may need to be focused on in order to optimize as best you can, given current constraints. Across man, material, method, machine and so forth.

[00:49:36] Rajeev Seth: Yep.

[00:49:38] Josh Santo: Okay, great. Well, one last question for you here, Rajeev. We’ve talked a lot just about. Current day. We talked about things like the importance of going both horizontal and vertical. We’ve discussed the nature of operational excellence, how it’s really more so how you operate as opposed to a one-off project or goal.

[00:49:58] Josh Santo: We even talked about how to identify whether your organization is in firefighting mode or in fire prevention mode. Now I wanna change it up on you a little bit. What’s happening in the world of operational excellence that’s got you excited.

[00:50:13] Rajeev Seth: Oh, okay. So here, as I mentioned you, that operational excellence is finding a sweet spot between man machine material matter. Right now, what is very interesting is happening from last one or two years that. With the help of AI machine learning, we can monitor, predict the machine, halt and we can prevent the failure.

[00:50:45] Rajeev Seth: So out of four variables, one variable is a fixed machine, right? Second is method and materials. We also have automated process control. By automated process control, you can have the face lock loop on the basis of the product parameter, automatically process parameter is changed to recorrect the product parameter. It means the material and method is also synchronized. You have some automated solution to correct the product performance. Not only, only the things. Remain is the man. And when you have this kind of AI and automation, obviously the dependency on man or human is, is, has gone down. So people are not adjusting the process. It is adjusted by automated people are not, not maintaining the acumen. It is also maintained by some. Automated machine health check system and human is getting a signal what I need to do in my equipment. So your machine material and method are already fixed.

[00:52:12] Rajeev Seth: Now you need to build the capability in the human, in the coating so that whenever some problems come, he can do an effective root cause to prevent the failure. So that is very exciting happening in this domain that now we have less variability, more automation and less dependency on the human, so that people can do more value added activity rather.

[00:52:42] Rajeev Seth: Rather, they are doing the firefighting always. So now we are, we are talking that zero touch. That operator operator had had the zero touch of the machine, zero touch of the product, and we are also talking the light offs operation, that equipment is automatically running, process are automatically adjusted and there is zero touch in the equipment, zero touch in the product, and we are having the first time right product. So this is very exciting, which is happening from last, one or two years timeframe.

[00:53:25] Josh Santo: Yeah, a lot of changes have come about as a result to the. Relatively recent advancements in artificial intelligence, in particular machine learning. You mentioned this idea of, of machines and sensors and, and different things coming together to be able to monitor health and ultimately prevent failure.

[00:53:44] Josh Santo: So an example is, a product is passing down the line. the sensors indicate it’s, it’s within tolerance, but, maybe there’s some deviation between one unit and the next unit, and that’s typically indicative of some issue upstream. So rather than waiting for the next unit to be produced outside of tolerated spec, it sends signals since data sends, sends actions.

[00:54:09] Josh Santo: Upstream to let it know that, hey, there’s this adjustment that has to occur, and then the machines automatically make that adjustment so that the next unit that passes through is still within, not just the tolerated range, but a more optimal range within specification. and, and, and you mentioned this idea that it’s really about freeing people up to focus on more value added activities like.

[00:54:32] Josh Santo: Root cause analysis as opposed to having to deal with all the minor adjustments that may need to come, due to some of the situations like, like what we just described. That is certainly an exciting advancement. Well, Rajeev, we’ve covered a lot today. I want to thank you so much for your time. I feel like I’ve learned a ton.

[00:54:53] Josh Santo: I’ve took a lot of notes and I am gonna go through it and I might even have to go through them with you ’cause clearly I wrote some things down wrong, which I appreciate you correcting me here on the show about it. But regardless, I just wanna say how thankful I am that you took the time to make this work and share with us the ins and outs of operational excellence.

[00:55:14] Rajeev Seth: Thank you, Josh, for your time and truly, I love the conversation and saving my thought process here in.

[00:55:22] Josh Santo: Oh, we loved it too.