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STAGE.4 TRAINING, SETTING UP NEW COMPANY STRUCTURES
& PLANNING FOR THE CHANGEOVER TO EV
This is the longest period before switching to EV and can take up to 5 months for large companies and it assumes that the company wishes to carry out a rapid conversion rather than a step by step one. All the new structures, items such as the 2 "cascades" of measures & their targets, one for meeting production schedules and the other for achieving continuous financial improvement which is directly linked to core financial targets, are either planned in detail or both planned and implemented in cases where they do not disrupt current operations.
The planning is largely done by one or two appropriate senior managers for each area of operations. In addition specific training may need to be given to selected people or groups from the portfolio of short training courses. The latter are also supported by training handouts designated "Team Sheets" of which there are about 40 from which a selection is made depending on current knowledge in various areas of the company. A specific area which often needs implementing or up-grading is Standard Procedures. Many companies have these in place but they are often based on ISO or related systems which may not be the type which are "owned" by a particular team or person. The latter concept of ownership is vital if the continuous improvement concept of EV is to be installed and maintained over time.
The training of senior managers in the new skills and methods of EV is a very important feature of this stage. For example in every case so far the company CFO has required training in the key features of Added Value Contribution Accounting as this is not covered by standard accountancy courses in the West, apart from a very cursory mention of it in a few isolated cases. In fact Accountancy Standard Methods do not exist for it in Australia and we generally use Singapore Standards. This method is vital to calculate the V.A. ratios used in the first part of the company diagnostics.
Some of the major missing elements (skills & methods) in the "top-down" management area for senior managers in most companies are:
1. The EV External Drive Strategy, this defines the company's products & services and the market
2. The Internal Continuous Improvement Strategy, very few companies have this in place
3. The four sequential core continuous improvement tactics, these are rarely present
4. The 2 cascades of measures and targets, these clearly define the portions of both the production schedule and continuous improvement activities and on-going targets for every employee
5. A measurement method to determine which bottom-up new methods and skills are required in order of priority to achieve rapid continuous improvement
6. The correct teams and their members, an EV measurement methodology exists to determine these
7. The method for converting standard financial data to the appropriate Value Added Ratios both for accurately assessing company performance and as the starting point for the continuous improvement cascade of measures and targets
8. The measurements for determining whether employees are being managed so as to obtain their maximum creative involvement in developing the company
9. The achievement of standard procedures "owned" by employees, this is an essential ingredient to ensure retention of any improvement methods
10. How to remove the "us and them" barrier in some companies which effectively stifles continuous improvement
11. The Method for ensuring the maximum communication with employees
"HOW TO BRIDGE FROM OUT-DATED CURRENT MANAGEMENT TO MODERN EV MANAGEMENT"
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