Case Study: Transformative Organizational Design in CPG

A medium-sized consumer packaged goods (CPG) manufacturing company, was struggling to keep pace with rising demand in a competitive market. Their operational inefficiencies and equipment downtime were impacting production schedules and profitability. Despite investments in modern machinery, the organizational structure was limiting their ability to optimize overall equipment effectiveness (OEE) and achieve consistent product quality.

Recognizing these challenges we initiated a comprehensive organizational redesign and alignment of the Systems of Work to boost OEE, improve asset health, and streamline processes, ultimately enhancing the reliability of their production plant.

Phases of Organizational Design

1. Developing Design Criteria

We developed a set of design criteria tailored to their strategic goals:

·       Optimize equipment utilization and minimize downtime.

·       Standardize processes to enhance production efficiency.

·       Empower teams to take ownership of asset health and operational issues

 These principles focused on fostering collaboration and promoting a data-driven culture.

 2. Scenario Concepts and Alternatives

The company explored three organizational models:

1.      Centralized Maintenance Hub: Maintenance activities grouped under one unified department

2.      Line-Focused Teams: Teams dedicated to specific production lines

3.      Integrated Hybrid Model: Combining centralized oversight with specialized line-based roles.

 3. Macro Organizational Model

After discussion and thought we adopted the Integrated Hybrid Model, creating a balance between centralized control and line-specific expertise:

·       Reliability & Maintenance Division to oversee asset health across the facility.

·       Production Line Teams with direct responsibility for operations and immediate troubleshooting.

 4. Micro Organizational Structure

The new structure involved detailed organization charts:

·       Reliability Division: Led by a Reliability Manager, supported by predictive maintenance technicians and analysts.

·       Production Teams: Supervisors, operators, and quality assurance specialists aligned to specific product lines

5. Job Descriptions and Gap Analysis

We evaluated current roles and identified skill gaps, particularly in condition monitoring and lean manufacturing techniques. New roles included:

·       Predictive Maintenance Specialists focused on early detection of equipment issues.

·       Line Coordinators to ensure smooth day-to-day operations and process adherence.

6. Implementation Plan

To implement the new structure we followed a detailed roadmap:

1.      Upskilling Initiatives: Training programs for staff to build competency in asset management and operational excellence.

2.      Pilot Testing: Testing the new model on a single production line before scaling.

3.      Transparent Communication: Rolling out the new structure with clear messaging and stakeholder engagement.

Results and Impact

Improved OEE

·       OEE improved from 68% to 88% within nine months.

·       Unscheduled downtime decreased by 40%.

Enhanced Asset Health

·       Predictive maintenance strategies extended equipment life by 20%

·       Reduction in repair costs by 25%.

Streamlined Processes

·       Standardized workflows reduced production delays.

·       Faster resolution of operational issues due to empowered line teams.

Increased Reliability

·       Consistent delivery schedules improved customer satisfaction.

·       Reduced waste and enhanced overall efficiency.

This organizational redesign was a game-changer. By strategically aligning their structure with their goals and a robust Systems of Work they not only achieved operational excellence but also fostered a culture of innovation and accountability, paving the way for sustained growth in the dynamic CPG market.