S6-Talent Management - O-I Case Study, 4-25

New Horizons, No Boundaries

O-I Case Study: Lean Six Sigma — Not Just for Manufacturing Anymoreby Dan Rubin, Senior Consultant and Alina Haas, O-I, VP Human Resources

May 1-3, 2011

© 2011 Towers Watson. All rights reserved.

2011 HR Service Delivery Forum

2

World’s leading glass packaging company

Who is O-I?

Asia PacificNorth America EuropeLatin America

A market leader in all regions in which we operate

3

We are a truly global company

$6.6 billion in net sales in 2010

24,000+ employees

81 plants in 21 countries

Joint ventures in five countries

1,900+ worldwide patents

13 official languages

World headquarters in the United States (Perrysburg, Ohio)

4

We are a

preferred partner for many global brands

Glass packaging for beer, wine and spirits, food and non-alcoholic

beverages

Glass packaging for drug and chemical industries

Tableware, including stemware

5

What is Lean Six Sigma

Continuous improvement philosophy that

combines traditional Lean Manufacturing

approach with Six Sigma DMAIC

methodology

6

DMAICProcess Improvement Road Map

Define the problem, the voice of the customer and the project goals

Measure key aspects of the current process and collect relevant

data

Analyze the data to investigate and verify cause-and-effect

relationships. Seek out root cause of the defect under investigation

Improve or optimize the current process based upon data analysis

Control the future state process to ensure that any deviations from

target are corrected before they result in defects

THE ENGAGEMENT SURVEYLean Six Sigma in Practice

8

Overarching Principles

Build broad-based support and process

discipline by engaging all regions and

major functions in development, delivery,

analysis and survey action planning

Segment employee population to allow for

meaningful analysis and clear

accountability for follow-up

Establish appropriate benchmarks

(manufacturing, high-performing

companies, country-specific norms)

Survey must generate actionable

outcomes

9

Kaizen Charter

Deliver global employee engagement survey to 22,000+ employees

during a four week period

Measure global and regional employee engagement against O-I’s

strategic priorities

Assess changes since prior leadership-only survey

Develop on-going tracking and reporting process to hold organization

accountable to improvement

Identify linkages between key ongoing initiatives and employee

engagement

Build accountability for improvement into managerial performance

assessment

10

LSS Process

Pre-Kaizen

Team member selection

Teams and role definition

Participant pre-work

Kaizen

Part I — Survey design and development (2 days)

Part II — IT considerations, metrics and survey

logistics (2 days)

Part III — Communications strategy (2 days)

Post Kaizen

Communication plan

Survey administration strategy

Manager and HR support tools

Results rollout

11

Pre-KaizenTeam Member Selection

Individual Characteristics

Key leader in area of expertise

Knowledgeable in regional/functional issues

International exposure

Ability to express opinions and ideas clearly and

confidently

Fully empowered to make decisions and take action

Able to devote up to five hours of pre-work in

preparation for Kaizen

Team Structure

HR Communications Finance

Technical LSS Black Belt Business

12

Pre-KaizenPre-work is essential to success

Gather Voice of the Customer from regional and functional leaders

and key stakeholders

Complete organizational hierarchy

13

Finalize Questions

Identify carryover questionsValidate against

topics/initiativesFit to 20 minutes

Questions Reviewed and Selected Based on Best Fit to Survey Objectives

Item selection checks

and balances

continually revisited

Reality check on

content and project

scope

Rationalization of

questions

Analysis and

revalidation of themes

Kaizen — Survey Design & Development Category and Question Selection Process

Survey Categories Distributed to Teams

14

Survey Design

Category Selection and Alignment

Towers Watson

Categories and

Questions

O-I

Categories and

Questions

O-I Initiatives

Category

Empowerment

Change Readiness

Wellness Culture

Category

Risk-Taking

This company has

established a

culture where:

People can

challenge our

traditional ways of

doing things.

O-I has established

a culture where:

People can

challenge our

traditional ways of

doing things.

Index Score

provides metric for

questions related

to specific

initiatives.

15

Kaizen — Survey Design & Development Selecting Survey Questions

Is the question relevant for the global

employee population?

Can the question measure achievement

against O-I’s strategic focus areas?

Is normative data available for this

question?

Will we be able to take action as a result

of the data gathered from the question?

Does changing the question of a

normed question add real value?

Data — Key Issues

Normed/Not Normed

In Scope/Out of Scope

Strategic/Tactical

Validated/Non-Validated

16

Kaizen — Survey Logistics Survey Delivery Process — Paper

Suppliers Inputs Process Outputs Customers

Surveys Submitted

Survey tool kit

Paper surveys

Communication

Towers-Watson

Comm. team

Kaizen team

Employees

Local Mgmt

Senior Mgmt

Receive

tool kit

Develop Location strategy

Prep &

Setup

Schedule

& admin

survey

Ship surveys back to

TW

Close

out

survey

Input Metrics Process Metrics Output Metrics

Quality

Speed

CostNumber of

paper surveys

15-20 minutes per survey

75 – 80% participation

rate

Customer

Employees

Kaizen TeamSenior Mgt

Senior MgtKaizen team

OT Hours

17

Survey Delivery Process - Paper

Pro

cto

rT

ow

ers

-

Wa

tso

n

Lo

ca

l

Co

ord

ina

tor

Em

plo

ye

eR

eg

ion

al

HR

Re

pL

ea

de

rsh

ipP

lan

t

Ma

na

ge

r

Receive Tool

Kits

Receive Tool

Kits

Logistics

Room setup

Food

Create a Launch

Team

Communication

promotion of

survey

Communication

promotion of

survey

Communication

promotion of

survey

Assign

Coordinators

Setup survey

schedule

Setup survey

schedule

Complete

surveys

Train proctors

on roles and

expectations

Administer

survey

Evaluate

response rate

Communication

Track overall

plant response

rate

Evaluate

response rate

Thank employees

for completing

survey

Kaizen — Survey Logistics Swimlane for Paper Survey Delivery Process

18

Kaizen - Survey Logistics High-level Project Timeline

Step Date Responsibility

1 Send Kaizen pre-work to participants June 3 O-I

2 Return pre-work assignments June 17 O-I

3 Complete planning for Kaizen event June 18 O-I/JB/TW

4 Survey design and development – Kaizen Part 1 June 21-22 O-I/TW

5 Tech requirements, metrics, logistics – Kaizen Part 2 June 23-24 O-I/IT

6 Communication strategy – Kaizen Part 3 June 28-29 O-I/TW

7Finalize communication strategy/plan for survey

launch/administration July 2 O-I/JB

8Sign-off on all survey content, including

demographicsJuly 2 O-I

9Finalize senior leadership participant list (those who

will receive the leadership supplement)July 2 O-I

10Align senior leadership HRIS information with

demographicsJuly 6-16 O-I/TW

11 Set up English online and paper surveys . . . etc. July 6-12 TW

19

KaizenCommunication Strategy

Communication Objectives — Examples

Launch and Administration Results and Action Planning

Provide rationale for “why survey and why

now”

Define “what’s in it for me” for all key

stakeholders

Share high-level results, key themes and

overarching priorities (don’t drown people

with data)

Set expectations about action and the

plan to make this happen

Barriers and Challenges

Launch and Administration Results and Action Planning

Complexity of 13 different languages and

two survey methods (paper and online)

Participation in light of conflicting priorities

Skepticism — what could I lose if I answer

this survey honestly?

Risk of “dead space” between time

employees take the survey in Sep/Oct and

results/action planning in 2011

Ongoing commitment of resources at local

levels

20

Post KaizenNext Steps

Final survey sign-off from key stakeholders

Project plan and timeline

Communication

• Elevator speech — talking points for report out to stakeholders

• Participant invitation to survey

• Define survey terminology

21

Post-KaizenDeliverables

Communication plan finalized and disseminated

Survey administration toolkits developed in 13 languages for regional

and corporate locations

Train-the-trainer workshop

Employee feedback sessions held

Your Voice collaboration space launched

22

Project Plan

The project plan

was updated for the

remaining project activities

We are here at the

close of the event

23

Post-Kaizen RACI

R = Person(s) who is responsible for performing the action/task

A = Person who is held accountable for action/task completion

C = Person(s) who is consulted before performing the action/task

I = Person(s) who is informed after performing the action/task

24

Storyboard:

Global Employee Engagement Survey

Project Goal Results & Outcome Process Sustainability

Survey requirement is to

have an average

completion time of 15 to

20 minutes

Global manufacturing

company response rate

benchmark:

75 – 80%

(2008 response rate –

93%)

Name of Survey: Your Voice

Incorporated data from the following surveys:

HPP, Change Readiness, LSS, Pathways into

survey design

Determined delivery method which will be a

combination of paper and web based approach

Survey will be translated into 13 languages

Communication strategy was developed to

engage the location coordinators, management

and the O-I population

Business linkage analysis developed to include

the addition of internal O-I metrics to survey

results to determine correlations between

engagement and business results

Project Plan revised with

Towers Watson (TW) and

task ownership

established

A follow-up Kaizen will be

conducted in early 2011 to

establish the action

planning process

Location coordinators

have been identified to

carry out the process at

the local levels to

maximize participation and

handle daily tasks for

survey administration

TEAM

Back Row:

Front Row:

Sponsor: Alina Haas

LSS Black Belt: Mike Petrous

25

Key Learnings

Pre-work added value to survey results

Access to dedicated subject matter experts invaluable

Participation was rewarding

End product is better by virtue of team diversity

We are proud of the product delivered through a disciplined process

Cross-functional and cross-regional participation in Kaizen creates

win for team and O-I

Fosters long-term work relationships

Reduced survey creation time by 80%

S6-Talent Management – O-1 Case Study