Creating front-line leaders to solve problems at Nestlé
INTERVIEW – In this Q&A, we learn how the Technical & Production (T&P) area of Nestlé Colombia Ecuador is using lean and Art Smalley’s four types of problems framework to bring leadership closer to the gemba.
Interviewees: Maria Fernanda Avellaneda, Manufacturing Strategy Manager, and Fabio França, Regional Technical Vice President, T&P Nestlé Colombia Ecuador.
Planet Lean: Large corporations typically have a lot of experience with the implementation of improvement methodologies. Where is T&P Nestlé Colombia Ecuador in its improvement journey?
Maria Fernanda Avellaneda: We have been working with our in-house system – Nestlé Continuous Excellence – for around ten years (globally, the organization has been using it for much longer). As far as our manufacturing operations go, we have two main approaches coexisting within NCE: Total Performance Management (TPM) and Lean Thinking. Of the two, lean is certainly the “new kid on the block”, having been introduced in our processes around three years ago.
Our ambition in T&P is to achieve a cultural transformation and develop the capabilities of our front-line people, so that they become more autonomous in their ability to solve problems. We have certainly begun to see progress in that direction, even though most of our lines still have a long way to go before they reach the level of autonomy that we want them at. What we have realized is that for this process of transformation to occur we need the consistent presence of leadership on the floor, to accompany our people. And we have been struggling with that: meetings and every-day problems get in the way and keeping leaders away from the gemba, slowing down the progress of our transformation.
PL: How do TPM and lean interact within NCE?
Fabio França: Every company has its go-to improvement system. Ours has always been NESTLE CONTINUOUS EXCELLENCE – NCE (TPM in manufacturing and Lean Thinking for the whole value chain). I remember that when we decided to introduce lean in our factories in Brazil, we initially started by applying TPM in one site and lean in another. When we tried to bring the two together, we understood we had made a big mistake: people in both sites were happy with the systems they had and were reluctant to embrace the other. That’s when we realized that there was no need to keep TPM and lean separate. Their principles and tools are remarkably similar.
TPM has a strong emphasis on machinery, lean on the wider concept of waste elimination. They match perfectly. Ultimately, the only thing that matters is the outcome for our consumers and at Nestlé we are trying to think in terms of business opportunities rather than the methodologies we use to pursue those opportunities.
PL: How is lean helping you to accelerate the pace of change?
FF: Lean Thinking supports our efforts to transform the culture at Nestlé Colombia Ecuador. It provides us with a more holistic view of our work and helps us to identify business opportunities for improvement across the value chain. It’s making us all better businessmen and businesswomen.
MFA: While our conversations are still mostly focused on TPM, lean is certainly starting to make its contribution. How? During the 2019 Lean Summit organized by the Lean Institute Colombia, we heard about the four types of problems outlined by Art Smalley in his most recent book. We saw it as an opportunity to clarify the problem-solving responsibilities of people at different levels of the organization and decided to run an experiment in our six factories.
We in the “improvement team” didn’t need any convincing, but we wanted to ensure that people across all sites came with us on this journey of discovery. That’s why we created a multifunctional team to work on this experiment.
Our first step was analyzing our approach to management using the Lean Transformation Framework. We could see that all the elements of the “house” were there but decided to challenge ourselves to engage in more focused conversations on our management system and how it was influencing our transformation. Talking about different types of problems and who has responsibility over them led to constructive conversations and to the identification of numerous improvement opportunities.
Lean has allowed us to build on our work with Total Performance Management with a newly found focus on customer value and on the attainment of autonomy of our front-line teams. In fact, I would say that TPM and lean are fully complementary.
PL: What can you tell us about the role of leadership in the transformation?
FF: Lean is teaching us a different approach to leadership, one that is embodied by the concept of a gemba walk and that emphasizes observation, active listening and a deep understanding of the work. It is simply not enough to ensure we make our production goals; it is critical we figure out under what conditions those goals are met, so that we can improve the process and ultimately achieve better results. For that to happen, we need to be humble, servant leaders.
PL: Can you tell us more about your work with the four types of problems?
MFA: Of all the lean ideas we have implemented, this is one of the most impactful. Our analysis revealed that a lot of our leaders were working on type 1 and type 2 problems (troubleshooting and gaps from standard), even though these should be a prerogative of the front line. This was keeping them away from the gemba. In the light of this, one of our deliverables is now to understand what we need to provide to our people to make them more autonomous. Is it more training? Coaching? Different and perhaps more challenging objectives?
The “four types” categorization of problems was a great addition to our arsenal of tools and techniques and made our management system leaner. Clearly defining problems means ensuring that the right people take responsibility for the right things. (We have even designed a training based on the four types of problems and introduced A3 Thinking to give people an extra tool they can use in their problem-solving work.)
When we asked operators to share their feedback, what we learned was enlightening and very satisfying. They told us that leaders were now challenging them to raise problems and take responsibility for them. They talked about the proximity of leadership to the floor, implicitly challenging us to continue with this in the future. That factory managers spend time on the shop floor and take this part of their work so seriously speaks volumes about their engagement. There is no doubt in my mind that this exercise allowed those of us in a more corporate position to better connect with the gemba.
We are now in phase two of this experiment, where we are looking at what we are going to change in the management system in the light of what we learned from the experiment. We are currently making a big effort to improve the information flow towards the lower levels of the organization, for example.
FF: We are pretty good at putting problems on the table, but we have to get better at understanding on whose table those problems should end up! That’s where the four types of problems help. It makes no sense for operators to tackle large-scale organizational issues, just like it makes no sense for management to fight fires on the floor.
This approach to categorizing problems is a great opportunity for us to better manage the information we have and use it to understand how to best attack difficult situations. Needless to say, our role as leaders is to give front-line workers the autonomy and the tools they need to solve any problem they encounter.
PL: What has the past year taught you about the possibility to effect change when most of us are forced to work remotely? Is it possible to continue a transformation?
MFA: To an extent, it is, but nothing is going to change the fact that you have to be at the gemba. That’s where a transformation really takes place. At our factories in Colombia and Ecuador, we have a position known as NCE Factory Coordinator. NCE Factory Coordinators work as extensions of my department in different sites, articulating the improvement work that needs to happen in each of them. In the past year they have been instrumental in ensuring the continuity of our efforts.
With the specific four types of problems experiment, some of the members from the “improvement team” led the experiment with the support of the NCE Factory Coordinators, who made an effort to keep people engaged despite the distance and impossibility to come together. Coupled with the engagement of the management team and the fact that factory managers supported each other remotely, this allowed us to carry on with our transformation in the midst of the pandemic.
PL: Where do you want for the factories at Nestlé Colombia Ecuador to be in the future?
MFA: I would love to never hear again from our leaders that they don’t have the time to go to gemba because they are working to solve a problem they should not work on in the place. And, of course, I would love to see continuous progress in the application of TPM and Lean Thinking. We are working to integrate a different language in our daily work, which puts value creation for customers at the heart of what we do. With TPM we are becoming more efficient, with lean we are making the connection clearer between our work and the customer. We look forward to continuing this experiment and see where it leads us!
FF: This experiment is already bearing fruits and we are very excited. If we manage to create more growth for the business, we will be then be able to reinvest some of those earnings in projects that help us to contribute more to society. We need to look past profits and efficiency only and clearly define and communicate the role that Nestlé wants to play in the wider community, for example with regards to sustainability.
PL: What about your experience working with Lean Institute Colombia?
MFA: The most important thing for us is that the relationship with the institute is not a consultant-client relationship. I don’t see them as consultants, but as an ally supporting us in our development and learning. The work we are doing together is helping us to tackle some of the weakness of our system, not to replace it with a different one.
Thanks to our experiment leaders for making this transformation possible:
Mery Barbosa – Bugalagrande Factory
Dario Granda – Cayambe Factory
David Bolaños – Manufacturing Strategy team member
Helver Ocampo – Bugalagrande Factory
Augusto Maestre – Valledupar Factory
Juan Ortiz – Manufacturing Strategy team member
Vanessa Arias – Sur Factory
Fabio Ñañez – Bugalagrande Factory
Francisco Coy – Bugalagrande Factory