Brisbane is desperately short of senior Continuous Improvement (CI) professionals. Six Degrees Executive’s Daniel Pirrone provides a snapshot of the challenges and opportunities facing Supply Chain CI in the Sunshine State.
In terms of relative economic growth, Brisbane’s $162 billion economy is ranked third in Australia, despite Queensland remaining in sixth position in terms of overall economic performance. Encouragingly, the city is Australia’s second-largest destination for establishing startups and is regarded by many as being on the brink of a growth explosion.
Yet an ongoing lack of investment means many businesses risk being hampered by a skills shortage in a pivotal role: Continuous Improvement.
Dan Pirrone speaks with experts working in the Continuous Improvement space to understand how we got here, the critical challenges facing CI and the factors that will determine success.
Continuous Improvement in Brisbane
Although most organisations recognise that Continuous Improvement is crucial to a businesses’ long-term success, this recognition has not been backed by investment in talent.
Brad Jeavons (Business Improvement Manager, Winson Group) estimates that there are only 15 to 20 dedicated Continuous Improvement leaders in Brisbane. Companies tend to opt for consultants instead, but Jeavons cautions that this approach may not add value:
“Any business using a CI consultancy first needs to ensure there’s a feedback loop framework in place to ingrain cultural change. Otherwise, it will simply be another two-day workshop that is forgotten within a month.”
Businesses appear to concede that there is a need for CI, but have limited planning and resourcing available to implement any formal processes.
Cheryl Trembath (Continuous Improvement Manager, Elgas) believes many organisations minimise investment due to their short-term focus, “which is exactly why they don’t see results – it’s a vicious paradoxical cycle”. Trembath is concerned that medium-sized businesses are in the most vulnerable position as they are typically unable to resource Continuous Improvement even though they are experiencing growing pains.
What’s the answer: more professionals, or cultural change?
As with any talent gap, one way to tackle the shortage is to seek senior professionals from other industries with transferrable skillsets – particularly in strategic and soft skills. But Trembath warns against tasking generalists with a CI program.
Sometimes CI hiring just involves a skillset tick-box exercise when hiring. Quite often new hires can talk the language only at surface level. They have Green Belt certification but little application experience.
Companies tend to expect their line managers to be generalists with exposure to Continuous Improvement, but this often means they become bogged down with functional, day-to-day tasks and are able to achieve little in terms of CI. Ideally, a dedicated CI champion would function as a resource to draw upon across the business, making recommendations and coaching from a position of impartiality.
“Staff are usually all-rounders, or engaged as contactors which by nature won’t allow for long-term development”, Trembath says. “A lot of CI managers come from technical or engineering backgrounds, but often struggle to sell ideas, concepts and strategies up and down the business. The best ideas never take off if they aren’t sold properly. Without these soft skills, even the most technically adept CI manager will fail.”
A counterpoint on how to introduce Continuous Improvement into an organisation, is to view CI as a culture rather than a role. Instead of engaging external consultants, a business would be better off launching an internal program and tap into its latent pool of talent. Jeavons says Continuous Improvement should be “the underpinning mindset in every function, not a stand-alone activity” – but the culture needs to be driven from top down with a dedicated CI leader.
Critical issues for Continuous Improvement leaders
Any Continuous Improvement role must be understood against the background of Industry 4.0, a technological revolution driven by automation, the IoT, cloud computing and Big Data. Industry 4.0 is expected to radically transform many industries including supply chain and logistics, with the paradigm shift being seen as impactful as the 19th-century shift to the combustion engine. An early adopter at the Port of Brisbane, Patrick Corporation, has been investing in port automation and robotics since the 1990s and has seen benefits including increased speed of unloading, reduced dwell time for trucks, higher efficiencies and (importantly) greatly improved safety.
Craig Luxton (National Logistics Manager at Team Transport & Logistics) also sees improvement through technology as a fundamental part of Continuous Improvement, but warns that companies can outpace their customers:
“The problem is that clients can hinder technology implementation. For example, if a carrier has a sophisticated WMS-integrated platform but the client is still running paper-based processes, they will lose any efficiencies,” Luxton says. “This quickly becomes unfeasible with razor-thin margins. More and more, the decision will come down to partnering with the right (technologically enabled) clients, rather than chasing all businesses at the lowest-margin possible.”
Luxton sees one-touch and responsiveness as critical CI issues in supply chain, along with the importance of demand planning to optimise customer experience. “Logistics is service-based. The winners will be whoever can create the most value for their client, not deliver the lowest bottom line,” he says.
Trembath comments that Continuous Improvement professionals are vital for helping businesses learn from past mistakes. “Across the board, hardly any businesses codify and track past improvement projects, even if they were failures,” she says. “This is massive loss of potential to allow revisiting, rescoping, reviewing and potentially re-iterating past projects.”
Major factors that will determine success
Industry 4.0 is likely to create new jobs, but will also see many jobs lost to automation. This can be seen as both a challenge with a displaced workforce and an opportunity to. “Australia’s biggest opportunity is in labour – we have always struggled with our high labour rate. We are going to see a movement in the workforce away from blue collar work due to automation. What will we do with this displaced workforce? Reskilling will be a huge challenge.”
Luxton foresees an exciting Industry 4.0 journey ahead for logistics: “IT is very under-utilised in the Transport industry, particularly in terms of information flow and data infrastructure. Successful businesses will be those who can focus on system efficiencies; adapters will survive.” Technologies in the pipeline include automated trucks, geo-caching, automated warehouses, and better linkages between the first and last mile.
But it’s not all about ones and zeroes. Jeavons believes that environmental consideration is becoming more important than ever for businesses, and should be synonymous with Continuous Improvement. “Going green is no longer an afterthought for charity,” he says.