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Does Your Factory Have a Resource Efficiency Strategy?

There are many overlaps between operational excellence, resource efficiency and broader sustainability issues. Improving product quality reduces rework and saves raw materials, energy and water. Sound preventive maintenance programmes improve safety, product quality, reliability and throughput. The elimination of bottlenecks, achieved through structured constraints analysis, increases throughput and reduces idling of machines, reducing energy intensity. These are just a few examples.

Because of these overlaps, it is easy for organisations who have invested resources in continuous improvement programmes to believe that resource efficiency is somehow included in these improvement efforts, and that additional effort is unnecessary. For process-specific issues, such as material usage, this may be true, and often performance management in these areas is already part of operational management systems. There are however many resource efficiency issues that involve specialist measurement and analysis, a knowledge of recent technological developments, the ability to optimise and modify existing equipment to reduce resource use while not compromising other operational objectives, and most importantly, the ability to take a systems view. Organisations that are serious about resource efficiency should begin the journey of developing these capabilities in-house, and need a clear strategy.

Like operational excellence, resource efficiency is a multi-level issue. Without the participation of staff from shop floor level all the way through to senior management, your efforts will at best be piecemeal and incoherent. Resource efficiency is also a multi-dimensional challenge, and impinges on all of the systems typically required to run a manufacturing operation. So while you need to have a clear strategy for resource efficiency, that strategy should not be executed in isolation. Here are some examples of how resource efficiency can be embedded into routine operational management:

  • Including energy, water and material usage risks in the risk register
  • Including the skills required to develop and maintain a resource-efficient operation in training and development plans
  • Considering component failures that result in resource efficiency problems when developing preventive maintenance tasks
  • Routine identification of investments that will improve resource efficiency and including these in planning and budgeting processes
  • Building resource-efficient work practices into quality management systems, such as the work instructions used by plant operators
  • Identifying suppliers and service providers that can support resource efficiency initiatives as part of routine procurement practices
  • Relating the performance of individual raw materials to resource efficiency – the cheapest materials may not necessarily have the lowest life cycle cost for your business
  • Including measures of resource efficiency in the scorecards used to measure and monitor operational performance

Your resource efficiency strategy should have clearly defined focus areas, which could be developed using something as simple as a Pareto analysis. Take care to define precisely how you intend to integrate resource efficiency into your operations. Your strategy should span all levels and functions within your organisation. In communicating it, tailor your message to the audience, and construct performance indicators relevant to each target group. Most importantly, measure performance religiously and keep a live record of tasks and projects to be completed in support of improved resource efficiency performance. Demonstrating the link between action and outcome is vital for facilitating change.

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