The future is bright for many manufacturers. After a slump in demand last year due to COVID-19, order books have filled up again. Pent-up demand, combined with a broad economic recovery, have provided many opportunities for growth. However, this optimism has been overshadowed by supply bottlenecks in the raw materials market. Many primary products and components are difficult to obtain, with long lead times or exorbitant prices. For the fulfillment manager, this creates unexpected planning challenges.
Typical planning set-up in plant engineering
A Chief Operations Manager (COO) ensures that that everything runs smoothly. When the job is done right, the COO’s impact on operational performance and KPI’s is positive. This is true for large or mid-sized companies. That's why COO’s strive to keep planning tightly managed. Depending on the size of the operating unit, a COO may do some of the master planning themselves or else lead a small team of planning staff. However, as COVID-19 hit the economy hard last year, many companies found themselves with fewer resources to devote to planning.
Stress from both sides
As a result, the planning function is now being squeezed from both sides. On the one hand, higher volumes alone generate more complexity. On the other hand, priorities must be adjusted due to scarcity in raw materials. Planning managers must come up with alternative scenarios which are agile. They must deal with constant change. This demands more time from leadership teams and will create more stress as well. With increased stress, the natural response of many operation leaders is to lead more narrowly and authoritatively, with more direct instructions.At the same time, this situation is not healthy in the long run, because COO’s also have medium and long-term tasks waiting to be solved which require flexibility and open-mindedness
The call for a planning tool
The solution is an elegant industrial planning software that pulls together basic planning data similar to the way I have been doing it alone as COO for the last few weeks - partly by hand. A tool that helps to regain control, and that works more accurately than your best employees. Unfortunately, the path to this planning paradise is not a direct one, and it can even lead to a never-ending IT project
The limits of classical process re-engineering
The classic approach to introducing the new tool-based planning process usually goes like this: analyze the current situation, define the target process, configure the system, train employees, then complete the roll-out. For simple planning processes, this also works very well. However, plant engineering has pitfalls here. Engineered-to-order projects are unique. They often consist of reusable modules enriched with special designs. Therefore, the planning parameters can never be set as precisely as in series production. Contextual know-how is therefore also necessary to drive this planning process. At the same time, it makes sense to delegate the design of scenarios to planning staff in order to leave room for longer-term management tasks. However, it’s often the case that not only the tool is missing, but also the technical and leadership competence in the planning staff, which would be necessary to drive successful planning.
Interim management: quick relief and sustainable change
The use of an interim manager can immediately relieve the COO by directly leading the planning process and figuring out what’s most important to the company. Formally, he is assigned two tasks: leading the operational planning and introducing a new process with digital tool support. As an experienced executive, the interim manager knows that change management is essential for project success: Where is more discipline required? How does anecdotal evidence not lead to a showstopper? How must the organizational structure evolve? Who in the company is capable of taking over the planning in the long term?
When seeking a suitable interim manager, it’s important to ensure that the manager brings both operational management experience and a full conceptual backpack. Growth phases are good opportunities to develop the organization further, because the additional resource input pays off quickly and also because development of young talent through coaching attracts more talent to join you. You can strengthen your competitive position.
Conclusion
The current economic situation offers good opportunities to develop your organization with digital tools. An interim manager can help alleviate operational pressures as well as develop processes, leadership, operational discipline, and communication to ensure that your investment in the future is sustainable. If you want to discuss how to lay out such an intervention do not hesitate to get in contact with me through LinkedIn or mail (ld@dittmann-development.com) or simply call (+41 79 827 06 58).
