Thursday, May 26, 2005

Planning is a best practice at Moog Baguio

Business Times p.B3
Thursday, May 26, 2005

By Moje Ramos-Aquino, FPM
Planning is a best practice at Moog Baguio

FOR an entrepreneurial venture to stay in business, there is a need to differentiate itself on the bases of service, quality and value-creating processes that are hard to copy. These are determined via a thoughtful strategic planning.

At Moog Controls Corp. in Baguio, one such value-creating process is their annual strategy development process. This is done with the all-important inputs from all its customers collated and reported twice a year by their operations managers. They have regular weekly and teleconferences with customers. Their customers play a pivotal and active role in overall planning. They also have a formal SWOT (strengths, weaknesses, opportunities and threats) analysis to get a big picture of their internal and external environment.

Annual and long-term objectives that support company goals are, then, set at the corporate and operating areas levels. They also determine monthly production plans and daily and weekly planning flow and metrics.

They do a regular management metrics review weekly and monthly. A few examples of these metrics are customer satisfaction, quality, on-time deliver and performance. They, likewise, do a weekly and monthly operational reviews to insure Moog Baguio is making the progress desired and for adjusting deployment immediately as needed.

They make sure that everything adhere to all requirements of quality audits such as AS9000 and rigorous aerospace system incorporating ISO-9000. Moog Baguio is regularly inspected by aerospace regulatory authorities such as JAA, ATO and FAA as well as customers’ customers like Boeing and Airbus.

They take their planning seriously and even have a module on strategic plan included in introductory training for each new employee. All their goals and goals accomplishments are rolled out before the employees through general employee meetings, department meetings, bulleting board postings, and company newsletter. Performance expectations are then set.

Regular agenda in their Weekly Production Reviews are shipment deliveries, labor utilization (budgeted hours, indirect labor vs. direct labor, labor standards and variance, capacity), work-center queue, machine utilization, gages and tools calibration, new projects implementation and status, quality and process qualification implementation status.

Monthly Operations Reviews assess performance in sales per standard labor hours, product deliveries and orders, shop capacity and load, labor efficiencies—utilization and labor standards. Quality and financial performance are further reviewed in these meetings.

Moog gathers its data and information through its extensive use of Moog Business System, Material Requirement Planning system and extensive IT network, desktop systems with e-mails and the Moog Intranet.

They adhere in all ways to Itars and FCPA rules and all laws of both the Philippines and the United States. They strictly follow their corporate ethics program embodied in their Moog Philosophy of mutual trust, sense of individual responsibility, self discipline and mutual respect that governs employee discipline and conflict resolution and problem solving.

Twice a year, Moog Baguio’s general manager attends a formal review and planning strategic meeting with their corporate headquarters officers at Moog Inc., New York, USA. In between these formal occasions, visits are made by corporate officers to Baguio and corporate directions, including organizational development and human resources matters are taken up.

Measures and indicators are reviewed, monitored, updated and modified during the semi-annual and annual strategic planning sessions. Moog Baguio relentlessly pursues this virtuous cycle of planning, deploying, measuring, analyzing and planning, deploying, etc. No wonder Moog Baguio was recognized in the recently concluded Philippine Quality Award.

In the Philippines, many entrepreneurs have yet to discover the significance of planning and performance measures as a competitive edge.

In our continuing Journey on Entrepreneurship, we will again look at other best practices by exemplary organizations right here in our country.

(Moje Ramos-Aquino, president of Paradigms & Paradoxes Corp., can be reached at

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