Mastering Operational Flexibility
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The document discusses three ways that manufacturing "masters" achieve operational flexibility to manage volatility and drive growth. These include: 1) Capturing insights directly from customers to better anticipate demand patterns, 2) Remodeling production lines to prioritize flexibility and accommodate more product variations, and 3) Assigning new flexibility metrics to regularly assess efficiency, productivity and responsiveness to changes.
Mastering Operational Flexibility
- 1. Mastering operational flexibility Three ways to manage manufacturing volatility and drive growth
- 2. 2 Managing manufacturing volatility Barriers exist to achieving flexibility Copyright © 2016 Accenture All rights reserved. Operational flexibility—the ability to meet changing customer demand and control costs—is hampered by: said the production process 61% Barriers to operational flexibilitySluggish production changeovers Resistant workforce practices Lack of consistent, multichannel customer information lack accurate and timely “market sensing”33%
- 3. 3 Driving operational flexibility Mastering demand fulfillment and costs Copyright © 2016 Accenture All rights reserved. Masters that achieve operational flexibility apply three practices: said operational flexibility is a strategic priority 94% There is a gap between prioritization and progress have achieved it in the past decade11% Capture insights directly from their customers Remodel production lines Assign new flexibility metrics But only
- 4. Masters anticipate demand patterns faster than their peers 42% 58% Copyright © 2016 Accenture All rights reserved. 4 Capture insights directly from their customers End-customer tracking vs. Direct-customer tracking How important are the following capabilities to achieve operational flexibility? Masters % of survey respondents says “Extremely important” Masters Others • Better anticipate demand patterns by tracking end-customers’ behaviors directly. • Do not rely solely on channel partners. Source: Accenture Manufacturing Flexibility Survey, Accenture Institute for High Performance, 2015
- 5. 5 Remodel production lines Masters adapt their production lines to prioritize flexibility Copyright © 2016 Accenture All rights reserved. of masters expect to increase the size of their production lines in the next decade 62% of masters say manufacturing more SKUs per line is extremely important 58% Masters • Accommodate greater volume and use more stock keeping unit variations. • Use cross-trained machine operators to reduce changeover times. Source: Accenture Manufacturing Flexibility Survey, Accenture Institute for High Performance, 2015
- 6. 6 Assign new flexibility metrics Masters measure value chain flexibility Copyright © 2016 Accenture All rights reserved. Masters • Regularly assess efficiency, productivity and flexibility. • Employ robust metrics to track business changes. Source: Accenture Manufacturing Flexibility Survey, Accenture Institute for High Performance, 2015 27% 31% 28% 46% 54% 58% Masters Others Which of the following metrics do you track on a regular basis? Average changeover cost or time Number of prototype iterations Inventory days of cover by SKU*
- 7. 7 Three ways to manage manufacturing volatility The path to operational flexibility Copyright © 2016 Accenture All rights reserved. Overcome obstacles to manufacturing success: Capture insights directly. Track end-customer behaviors to anticipate demand. Prioritize value chain flexibility. Reengineer the value chain to address areas of need. Employ new metrics. Measure value chain flexibility to be responsive to change.
- 8. 8 About the research Accenture Institute for High Performance Copyright © 2016 Accenture All rights reserved. business executives from manufacturing companies, examining the period 2005 to 2015 Conducted online survey between July and August 2015 Annual revenues greater than US$1 billion 8countries and 6 industries Extensive secondary research 247
- 9. 9 Contact us Copyright © 2016 Accenture All rights reserved. Smriti Mathur Associate manager Accenture Institute for High Performance smriti.mathur@accenture.com Raghav Narsalay Managing director Accenture Institute for High Performance raghav.narsalay@accenture.com Aarohi Sen Associate manager Accenture Institute for High Performance aarohi.sen@accenture.com Mastering operational flexibility Three ways to manage manufacturing volatility and drive growth
- 10. 10Copyright © 2016 Accenture All rights reserved. The Accenture Institute for High Performance develops and communicates breakthrough ideas and practical insights on management issues, economic trends and the impact of new and improving technologies. Its worldwide team of researchers collaborates with Accenture’s strategy, digital, technology and operations leadership to demonstrate, through original, rigorous research and analysis, how organizations become and remain high performers. For more information, follow @AccentureINST or visit www.accenture.com/Institute About Accenture Institute for High Performance Accenture is a leading global professional services company, providing a broad range of services and solutions in strategy, consulting, digital, technology and operations. Combining unmatched experience and specialized skills across more than 40 industries and all business functions—underpinned by the world’s largest delivery network—Accenture works at the intersection of business and technology to help clients improve their performance and create sustainable value for their stakeholders. With approximately 373,000 people serving clients in more than 120 countries, Accenture drives innovation to improve the way the world works and lives. Visit us at www.accenture.com About Accenture