An Operational Readiness Audit Helps H-E-B Expand Production on Schedule
H-E-B is an American, privately held supermarket chain based in San Antonio, Texas, with 400 stores in Texas and Mexico. With $26 billion in annual sales and more than 116,000 partners (employees), H-E-B is recognized for its commitment to its customers, the communities it serves, philanthropy, diversity and sustainability. The company operates several manufacturing facilities in Texas, including one of the largest milk- and bread-processing plants in the Southwest. H-E-B produces many of its own-brand products, including milk, ice cream, bread, snacks, and ready-cooked meats and meals.
Starting-up New Production on Schedule Calls for an Experienced Advisor
H-E-B needed to expand their snack food production and modernize their manufacturing facilities. A project to build the “most brilliant snack food plant in the world” had begun construction when H-E-B contacted Life Cycle Engineering (LCE) to assist in the operational readiness phase of the project. With new technologies, a new methodology for operation, and a tight schedule to get the facility up and running at design rate, H-E-B was looking for guidance to develop a detailed step-by-step plan to accomplish the operational readiness activities as well as commissioning and start-up for the new plant.
Creating Operational Readiness Begins with Auditing Preparedness for all Functional Areas
The construction team had a detailed construction schedule, however the operational readiness details were only developed at the highest level, and tactical details to accomplish the objectives resided in silos within the organization. LCE was hired to first perform an audit of all functional areas needed for operational readiness, and determine the preparedness level for each of the functional areas, with respect to project, organization and knowledge development, as well as people and materials management.
One of the audit’s goals was to better understand the operating teams’ involvement in the project development, and activities that might have been missed given the construction of the site had already begun and detailed engineering was completed. LCE provided a detailed audit checklist to the leads of each of the nine functional areas reviewed (Safety, Environmental, Project Management, Materials Management, HR, Finance, Maintenance, Operations, and Commissioning.) The checklist included approximately 1200 areas that needed to be reviewed for operational readiness. Based on the feedback from leads as they assessed their areas, LCE’s expert developed an audit to dig deeper into areas that were deemed inadequate or behind schedule. He conducted interviews with each of the functional area leads, and reviewed documents to determine work quality and progress against the projected start-up date.
Operational Readiness Audit Report Identifies Gaps and Recommends Strategies for a Successful Start-up
The result was a detailed report for the H-E-B team that identified all gaps and recommended actions to close those gaps. The audit uncovered numerous issues as well as pockets of excellence. Significant issues included:
Teams were acting in silos: Although they were having weekly meetings, the communication structure did not close all the gaps between the various groups (operations, maintenance, safety, finance, etc.) LCE helped the H-E-B team develop a War Room strategy to make the deliverables visible to all parties. A daily standup meeting was structured to deliver daily plans and critical activities to the entire team.
The hiring schedule wasn’t aggressive enough: The existing plan to hire all operations/maintenance technicians to deliver the required amount of information to run the plant at optimal design specifications was never going to meet the goal. The amount of Maintenance plans, operating procedures, LOTO procedures, and required information to optimally run the “most brilliant snack food plant” could not be achieved with the limited resources on site, and the number of hours available between the audit and the commissioning start date.
Planning for commissioning and start-up was behind schedule: The commissioning and start-up plans had not been started. The resources to develop those plans were not available and there were no plans to hire them within the required timeframe. Another planning oversight was a lack of hot commissioning materials scheduled to be available for validating equipment specifications. LCE’s expert provided the commissioning team with a management structure and approach, as well as Excel-based tools to manage the commissioning of the project.
Starting up a new capital project can be a daunting task, especially when a new facility incorporates new technology and a new methodology for operation. By engaging with an experienced external advisor to conduct an Operational Readiness audit, H-E-B was able to pinpoint potential trouble areas, implement new strategies, and identify all the activities that needed to be completed prior to commissioning and start-up of its new state-of-the-art snack food plant. The start-up performance for the plant was so strong that H-E-B plans to repeat the same approach as it plans for future expansion of its manufacturing capacity.
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