Lean value chain analysis and design for global precision engineering products leader in aerospace industry
The issue
- A complex multi-stage casting, machining and coating operation manufacturing precision components for the aerospace industry
- Underperforming organisation and low levels of ownership for improvement
- Extremely low velocity through the process, with poor yields and excessive scrap
- High inventories of work in progress and finished goods
- Production measures encouraging over-production
- Silo mentality in operations exacerbating the WIP situation
- Disaffected workforce with little interest in driving continuous improvement and no effective performance management in place
Solution
- Analyse the current situation to articulate the operational improvement potential (yield uplift and inventory reduction)
- Create the business case for change (P&L and cash impact)
- Design a pilot to create an integrated supply chain for the largest volume product including suppliers and JV partners
- Detail design of a pull model and elimination of WIP stages along the entire supply chain
- Re-design of the layout and organisation to separate ‘dirty’ and ‘clean’ operations to reduce rework
- Launch of a continuous improvement approach within the shop floor to tackle scrap, rework and productivity issues
- Design and introduction of a cascaded performance management framework
The results
- 40% reduction in inventory identified through WIP elimination
- The feasibility of a 50% reduction in production lead time confirmed
- 10 percentage-point improvement in yield performance from closer process control
- Plan to deliver £5m savings in-year agreed
- Changes to ways of working implemented in pilot cells with Lean work-flow approach trialled
- Programme of Lean training and continuous improvement projects implemented
- New KPIs are being used to drive the performance of the value chain in place of traditional cost absorption metrics
An award-winning team
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Building organisational capability to drive rapid performance improvement
The issue
- Curzon Consulting were initially engaged to define the programme efficiencies of a public body with a target of £302m for the current investment period
- Alignment of financial targets and scope at scheme level enabled us to provide assurance that the programme will succeed
- It also revealed that there were some critical underlying issues around people and processes that needed practical solutions
- Project configuration and change control were not historically managed well across the programme; project baselines were not agreed/recognised, and redesign often occurred
- There was an embedded Process Compliance culture. People were more concerned on outputs and checklist completion than project outcomes and performance
- There was inconsistency in capabilities and performance among the PM community. Projects seemed to follow contractor’s agenda rather than the client’s
- Project and programme performance was poor and in general all projects were over budget and running behind schedule, costing millions to the Programme
What we did
- Assessment of the management capability to implement change and mobilise the workforce
- Analysis and prioritisation of the project management capability gaps for current and future operating model
- Project lifecycle process mapping to understand gaps, levers and weak points
- Communication of spend profiles to focus on project high cost and critical path activities
- Reinforcement of the role of the PM in the operating model and the support available from specialist functions
- Development of an on-the-job training approach to deliver immediate results and simultaneously start to address the capability challenges for long term results
- Focus on people behaviours around process adherence and promote and install an intense focus on project performance to achieve the Programme’s objectives
- Set performance indicators that were aligned towards outcomes, rather than outputs, to bring performance visibility
The results
- Established a holistic view for an integrated project configuration and control framework. Programme has visibility on project progress and Project Manager development
- Increased alignment to project configuration and adherence to the baseline
- Created and installed a clear set of impactful project cost, schedule and risk related metrics. These are now being used for project performance management
- Improved forecast stability and reduced risk exposure
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Developing multiple pathways and identifying over £16m cost savings at a major health insurer
The issue
- Pressure to increase efficiency in their claims due to rising medical costs
- Large variation in costs between suppliers and across the UK
- Lack of structured routing for members to effective treatments and cost efficient providers across hospitals, clinics or doctors
- Poor cost control with growing pressure to tackle medical costs due to rising claims and pressure on margins
- Difficulty negotiating cost reductions with hospitals, and huge number of suppliers (including doctors) to manage
What we did
- Initial project to identify opportunities for cost reduction for specific saving target (£16 million in year)
– Developed and prioritised 14 opportunities
– Integrated milestone plans to achieve savings that year - Second phase project to extent treatment pathway opportunity (MSK) and develop new treatment pathways
– Identified possible treatment pathways in major medical treatment areas
– Developed and communicated a new analytical methodology to understand spend variance, behaviour across specialists, by hospital and pathway
– Collaborated with medical experts to develop care journeys to triage, treat and follow up
– Business cases developed to support cost effective pathways roll out
The results
- £16 million in cost savings in year identified and resource planning completed to ensure in year delivery
- Identified a solid saving of up to £36 million cumulatively over three years via medical pathways
- Trained out how to use new analytical methodology
- Delivered relevant and valuable research (internal / external) to underpin treatment pathways including medical studies, historic analysis and case studies of implementation
What our clients say
“As a result of Curzon’s support a strategic and digital leap has been made in how we manage the entire asset lifecycle to transform our Developer Service experience. This is a programme and a product that sets a new benchmark within the industry.”
Jason Tucker
Director of Alliances & Integrated Supply Chain, Anglian Water
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Increasing patient satisfaction through orthopaedic Enhanced Recovery Programme
The issue
- Reimbursements – Operational and commercial risk transferred from insurer to provider via fixed reimbursements
- Pain – 45%+ patients stated moderate to severe pain within 48 hours of surgery, delaying recovery
- Mobility – Physiotherapy started late usually within 24-48 hours post surgery causing delay in mobility
- Length of stay – 4-6-day length of stay resulting in marginal clinical benefit, unnecessary cost and higher infection risk
What we did
- Established one multidisciplinary team
- Developed Evidence-Based Enhanced Recovery Programme (ERP)
- Established ERP training programme
- Designed and implemented pilot ERP programme (ERP)
The results
- Reduced pain scores by 45%
- Decreased mobility times by 65%
- Shortened hospital stays by 43%
- Reduced hospital cost by 20%
- Increased patient satisfaction by 37%
An award-winning team
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Reducing 30 day re-admissions by leveraging patient remote monitoring solution
The issue
- Colorectal surgery (related to cancer) accounted for 27% of the total case mix for a large healthcare system
- Colorectal surgery department noticed a steady increase in the number of patients returning back to the Emergency Room (ER) for non-urgent issues over a 24-month period
- 30-day readmission rates were significantly above the national average
- Based on an initial internal assessment, the hospital management and colorectal surgery department hypothesized an issue with the patient discharge process
- Established a cross-functional team to perform a root-cause analysis of the entire patient journey and flow
- Mapped the entire patient journey and flow and identified a number of improvement opportunities
What we did
- Designed a pilot study to test a new discharge process enabled by technology
- Enrolled 97 patients, focusing on younger more tech savvy profile who were open to self-managing recovery during post-operative phase
- Identified root-causes of readmissions into ER (over 78% non-emergency which could have been avoided if patients were better educated and informed during the discharge process)
- Redesigned the discharge programme with a greater focus on patient self-management enabled by smart technology
- Sent patients electronic reminders to help keep them on-track with recovery milestones
- Established post-discharge daily check-ins to track stoma output, incision photos, pain levels, bowel function, etc.
- Implemented algorithms to flag patient issues and automatically provide feedback to patients on how to self-manage or how and where to find relevant support
- Developed intelligent notifications to automatically notify clinical team members if patient at risk
- Designed and implemented a dashboard with real-time reports and analytics to help the care team understand a patient’s post-operative concerns, trajectory of recovery and ways to improve patient experience
The results
- Delivered a 72% reduction in 30-day re-admissions
- Avoided 7 ER visits which were resolved through triage via telephone consultation or outpatient clinic
- Improved patient satisfaction scores by 24% (compared to baseline pre-launch)
- Based on the success of the programme, supported client to identify other surgical programmes to roll-out similar solution
An award-winning team
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Leveraging procurement to increase profitability of orthopaedic services
The issue
- Many suppliers (18+) resulting in reduced spend leverage
- Prosthesis selection based on supplier systems familiarity not generic technical spec
- Large cost variances for similar hip and knee systems from supplier to supplier
- Large amount of “additional” costs associated with instrumentation and loan kits
- Huge variety in ‘same’ type of hip and knee systems (7+ systems for each)
- Too many system variations (75+) resulting in staff needing to be trained on many systems/brands
- Varying published data to support clinical outcomes of implants resulting in low predictability of patent outcomes
- Huge cost-per-procedure variance impacting profitability at Orthopaedic Consultant and Hospital level
- Need to increase profitability
What we did
- Increased spend with fewer, more capable suppliers
- Established patient profiles. Use patient profiles to guide system selection
Linked into project to Care Pathways - Established minimum acceptance of prosthesis outcomes (leveraging ODEP ratings for both hips and knees)
- Established dedicated training for Orthopaedic Consultants and clinical staff
- Renegotiated with partner suppliers based on redistributed business (volumes)
- Established traffic light reporting for Ortho hip and knee (cost and compliance to agreement)
- Established a clinical advisory group to evaluate innovation and agree protocols to be followed by all Orthopaedic Consultants across the Group
The results
- Delivered 22% in annualised savings through volume leverage and brand/system standardisation
- Reduced clinical risk by only allowing 10 or 10* ODEP rated products and eliminating Orthopaedic work at low volume sites
- Increased profitability substantially which allowed the BD teams to improve NHS and PMI contract win rates
- Reduced supplier power (demonstrated appetite and willingness to shift balance of power)
- Improved patient satisfaction and outcomes by channeling more work to Orthopaedic Consultants with higher PROMs scores
- Reduced subjectivity by ensuring system selection based on patient profile
- Standardised length of stays for given procedure and patient profile
An award-winning team
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Evaluating structural entity options for a new arm of government transport body
The issue
- Embryonic consulting business established one year ago by a local government body responsible for transport, to monetise and deploy in-house specialist experience
- Consulting business deeply embedded in one of the organisation’s existing holding companies
- Business had not yet established the appropriate frameworks for managing revenue, project delivery, Intellectual Property and assets
- The client wanted to review the optimal entity structure for its Consulting business in order to better drive commerciality
- Strong desire to set up the Consulting business using an entity structure that fostered commerciality and leveraged in-house resources in the most optimal way
- Clear focus on building a profitable revenue funnel, self-financed growth, better IP and asset monetization, capitalisation on tax benefits, simplified and robust governance and transparent risk management
- Aim to start competing for, or partnering with big organisations to, deliver Advisory, IP and Operations & Maintenance contracts
What we did
- Conducted an exhaustive benchmarking exercise to provide the client with insights into how other service utility organisations have established successful Consulting businesses
- Defined a robust set of design principles and considerations for reference throughout the operating model design exercise
- Identified and shortlisted a set of structural options following a complete option evaluation in terms of feasibility and suitability
- Conducted end-to-end scenario testing, using carefully selected in-flight example bids, across the shortlisted structural options
- Refined the final structural model based on outputs of the scenario testing, for proposing to the client’s Finance Committee.
The results
- A benchmarking report, providing a crystallised view of the comparator landscape, including assessment of comparator suitability, and a summary of key insights and recommendations
- A report outlining the full assessment of entity options against a set of robust criteria and the rationale for down-selection
- A recommended structural model, clearly outlining three distinct entity options catering to the distinct requirements of each activity stream
- A high-level timeline illustrating implementation options and a trajectory of maturity
- A concise, crisp report containing key messaging for the Client to socialise to key stakeholders in order to secure Board approval
An award-winning team
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Unlocking over £20m in increased gross margin at a major health insurer
The issue
- Shrinking customer base
- 13 legacy books and numerous policy variants causing customer and staff confusion
- Operationally complex to manage – high cost to serve
- Existing proposition and pricing created trigger points for customer exit
- Customers not segmented by value
- No differentiated renewal or save strategies
- Not pricing for risk or maximised value retention
- Poor customer journey: passed from function to function, advisors not empowered
What we did
Designed & executed a pricing, product and service migration of all policyholders to one new modular product
- Developed new proposition which drove retention of high value customers and higher return from lower value customers
- Built in upgrade/downgrade ‘right-size’ choices to mitigate competitor switching
- Created pricing engine enabling all business to move to NCD-based policies and set renewal premiums to optimise gross margin
- Cut expected IT lead time to launch from 12 to 3 months
- Changed customer communications and management processes to de-risk customer disruption & loss
- Engaged Legal and regulator on ‘automatic renewal’ plans throughout
- Piloted the transition on 2 highest lapse-risk books to ensure error-free process and no adverse increase in lapse rates
The results
- Exceeded the £20Mpa gross margin improvement target
- Reduced customer loss by 25%
- Improved operating cost ratio from 30% to 16% with greatly improved IT flexibility
- Excellent customer and FSA feedback
- Successfully rolled out from personal to SME & Group schemes
What our clients say
“As a result of Curzon’s support a strategic and digital leap has been made in how we manage the entire asset lifecycle to transform our Developer Service experience. This is a programme and a product that sets a new benchmark within the industry.”
Jason Tucker
Director of Alliances & Integrated Supply Chain, Anglian Water
An award-winning team
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Performance turnaround at global construction product manufacturing group
The issue
- A European headquartered global construction product manufacturing & distribution group with a C. and S. American Division located across 14 countries
- The Division was consistently the worst performing business unit in the Group
- Interventions from Europe had failed to address the issues and turn performance around
- Performance was poor with an EBITDA generation significantly lower than the Group average
- Underperformance was a consequence of a multitude of issues: poor sales disciplines, inefficient production, lack of adequate cost management and ineffective leadership
- Previous attempts to turn the business around with other consultancies had failed
- The challenge was not only to quickly improve performance, but to set up the business for sustainable profitable growth
What we did
- With our Alliance Partner for C. and S. America, Curzon established a programme team to implement a comprehensive change effort
- A focus on commercial performance including pricing management and product mix optimised the market opportunities and stopped margin give-away
- Introduction of lean practices in manufacturing and distribution facilities improved productivity and started to tackle excess inventories
- Organisational changes were made to reduce management overheads and to streamline support functions
- Initiatives were piloted in country businesses and the learning was transferred to other business units through a centrally managed process to coordinate and accelerate the impact
The results
- Within one year the division rose from the worst to the best performer in the Group
- The combination of programme and other initiatives were delivering measurable bottom-line savings with a headline profitability run-rate that had tripled
- Change was happening on a broad base and over 1000 staff across multiple countries were involved improving the business
- Capability development and introduction of new tools, disciplines and ways of working had provided a solid platform to sustain the results
An award-winning team
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Company-wide performance improvement at UK water utility
The issue
- Ineffective incentive structure resulting in organisational silos & sub-optimal performance (in-house and contractors)
- Limited long-term planning and investment as result of weak and inaccurate in-house Asset Knowledge
- Legacy support services from merged smaller companies resulted in fragmented internal processes
- Lack of job prioritisation and adequate planning leading to poor productivity & rework
What we did
- Development and introduction of single performance management framework and incentive system to drive efficiency and customer focused culture
- Implementation of an Asset Capability Centre focused on three capability areas: Physical Asset Management, Stewardship & Delivery; revalidated proposed Capex and ran adaptive approaches on costs
- Implemented regulatory compliant Shared Services with revised governance, improved service levels and cost efficiencies
- Redesign and implementation of new job initiation, planning and scheduling processes
The results
- 20m annualised improvement in Totex
- Annualised Capex avoidance of c£18m throughout the regulatory period
- Annualised Opex reduction of c.£3m
- 25% reduction in shared service cost base
- 20% productivity increase in Field work, 30% increase in RFT and 10% reduction in Customer Complaints
£20m
annualised improvement in Totex
£18m
annualised Capex reduction
c£3m
annualised Opex reduction
25%
reduction in shared service cost base
20%
productivity increase in Field work
10%
reduction in customer complaints
An award-winning team