Sawmill Margin Improvement
This sawmill was facing closure unless a transformation could be achieved within 12 months.
“This project has been the most successful improvement project I have had the opportunity to be associated with in my 37 years in the industry.”
— Regional Manager, Manufacturing
“We now measure and track everything from one end of the mill to the other, there is not a stone left unturned. We used to monitor the lumber out the back door, now we look at everything from logs in, to lumber out and everything in between. We’ve made the transition from a reactive to a proactive approach.”
— Sawmill Supervisor
Context/Challenge
This client engaged RLG to co-implement a continuous improvement project at a major British Columbia sawmill. Industry benchmarks had ranked the division 12 out of 13 in its group of direct competitors. Several of the mills that had ranked that low in the previous year were already out of business.
At the start, client leadership acknowledged the situation as:
- High unit costs: For the division to stay competitive, unit costs needed to come down while lumber quality and lumber recovery indicators needed to be improved.
- Low focus and accountability: From leadership to the front line, the organization lacked a cascading focus on key metrics and a guiding ‘north star’ of what good looked like.
- Varying ways of working: Individual leaders and teams worked independently of other teams, rarely following consistent processes and effective use of data and systems.
Approach
A successful business transformation had to start with clarifying to all employees the severity of the situation. All department heads developed a new “Success Vision” to bring the mill back into a top percentile ranking and communicated this vision to all personnel.
- Measurable Operational Indicators: The vision was translated into clear targets and milestones in all departments. Employees were made aware of what was expected and why these targets were critical.
- Improvement: More than 500 ideas were raised from the front line toward achieving targets and milestones.
- Accountability: Accountability for results was increased.
- Communication: Improved quality of meetings, interactions and communication processes.
- Skill Development: Leaders and teams were trained and coached one-on-one and through timely feedback to become more confident and capable.
Result
By investing in its people, culture and business processes simultaneous to changes in its facility, the operation performed at a level reflecting the capabilities of a modern facility and an efficient workforce. After 12 months, operational performance delivered targets promised to the Board, and justified the payback to capital investment:
- Sawmill average daily production improved by 42%
- Conversion costs dropped 8%
- Planer shift production increased 10%
- Export grade outturn increased by 65%
- The RLG project was a 24:1 return on investment
The management tools and processes, and development through training and one-on-one coaching, effectively transferred skills to the staff and hourly workforce, ensuring sustainability and continuous improvement of performance.
Ready to change the way YOUR business is done?
We would love to learn about your unique challenges. Contact our team for a no-obligations conversation or even a site visit.
