How we developed a 3-year strategic direction to achieve operational efficiency for a global packaging company

The scope of the project was to develop a 3-year strategic direction for all North American production facilities to increase operational stability and cost efficiency. The focus was to perform a fair efficiency benchmarking across activities performed by direct and indirect labour to derive actionable optimisation potentials for each production facility.

Direct and indirect labour activities in North American production plants

Industry: Packaging

Company size: ~6500 employees globally

Project duration: < 6 months

We followed a 5-step approach to achieve a realistic and insightful internal efficiency benchmarking and derive a 3-year strategic plan.

Step 1: Collecting people baseline data

The project began with collaborating with the central HR team to develop a comprehensive dataset encompassing year-round employment details across all facilities. This dataset enabled us to calculate actual working hours per person.

Step 2: Jointly designing activity lists per function

Building upon the baseline, we engaged with functional experts to tailor activity lists specific to their organisational context. Through collaborative efforts, we designed a list that accurately reflected the diverse functions within the organisation, ensuring a comprehensive understanding of activities performed.

Step 3: Mapping working hours at every production facility

Later, our joint project team visited each facility to interview plant specific stakeholders. The objective was to align stakeholders with precise activity interpretations and allot their working hours to each activity. This data served as foundation for the project.

Step 4: Deriving efficiency optimisation potential

Next, in collaboration with the local and central experts, we identified key quantifiable factors that drive the efforts of the analysed activities. To add a further dimension that increases comparability we grouped plants as preparation for the benchmarking per activity. This grouping was defined based on various factors (e.g., size of plant, product complexity, etc.). The following driver-based benchmarking served as a basis to derive efficiency optimisation potentials.

Step 5: Validating efficiency optimisation potential

In this step of the project, we discussed and validated optimisation potential results with each plant management team through intensive workshops. This collaborative process facilitated the sharing and learning of best practices while developing a 3-year strategic direction for each facility.

• We created widespread buy-in from corporate and plant level stakeholders in identifying efficiency optimisation potentials across all facilities
• As a team effort with the client, we identified an optimisation potential of ~10% of the cost baseline
• We created the basis for a culture of best practice sharing across plants to continuously improve
• We developed a comprehensive data-driven tool to help assess current and future staffing requirements
• We co-created a strategic direction for each plant for the next three years