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Unexpected Productivity Loss after Newbuild – Who can afford this?

An unexpected productivity loss

A purposely build production facility is a large capital investment generally build with the aim to improve productivity. It is therefore unfortunate that an unexpected productivity loss worth 10% -15% of the capital investment value typically occurs after a commissioning handover from the engineering team to operations.

The commissioning engineering team has adjusted and calibrated the new machinery to ensure it runs at name plate. Operations have been provided with a training session, the equipment is set to self-regulate and still there is a significant drop in production that lasts for at least 12 months and often longer.

Three questions are obligatory:
  1. Can you afford this?

Underperformance is the least affordable when you have just completed a major capex and need to have maximum return on investment. Especially when the reason for the capex is an increase in productivity.

  1. Why does this happen?

Operators are trained to perform a sequence of actions, but these environments require operators to act on data driven problem solving as the production environment is too complex to pre-program all possible variations. 

  1. How can you make sure it does not happen?

Productivity People has a track record of developing operator capability programs to ensure operators understand can react to a changing operational environment.


Why does this happen?

Operators are trained to perform a sequence of actions. They do not necessarily understand the reason nor wider implications of their actions. This works fine in a traditional manual setting where there is a direct feedback loop with each action. The operator is able to ‘see’ what they do.

However, modern manufacturing technology involves technical processes that are driven by automated production systems that react to changing production parameters. Again, the system works when the operational environment is static and when equipment can continue to behave exactly the same as it did when it was programmed.

Unfortunately, a production system is a highly complex environment and it is near impossible to pre-programme all possible variations. A changing environment needs adjustments which requires operators to have process specific knowledge and act on information derived from data driven problem solving. This requires a very different skill set than carrying out a sequence of actions. The inability of operators to react to and correct imperceptible changes in the process allows the process to veer of course unchecked until it is fully derailed.

In contrast to common understanding, this problem is augmented not mitigated by automated data generation and digital information outputs, as this places another layer between the operator and the process and requires an understanding of trends analyses and additional abstract thinking.

About the author: Dr Liddy Bakker is the Director for Knowledge Management and Founder of Productivity People and the Global Lean Alliance.

Download our brochure here, if you like to learn more about how Productivity People can assist you with operator capability.