Running a business is complicated. Most managers, especially those in small companies, deal with hundreds of issues every week ranging from technical product, material, and machinery decisions and finance concerns to closing the next sale.
In such an environment an overwhelmed manager often forgets to focus on the big picture, the basics. Attending to those subjects that are critical to success requires an ability to keep your eye on the ball.
Just what are the basic elements that should engage the full attention of a company's top management? Let's look at some examples on the plant floor where the majority of money is consumed in a manufacturing business. Leaving more of those dollars in your checkbook must be a key goal:
Maximize your material yield. Lumber, veneer, and panelboard are the single largest cost element in a wood products company's financial statement. Yet this valuable input is often mistreated from the moment it arrives at the factory. Haphazard storage practices lead to warping and other damage that adversely affect the ability to obtain maximum yield of usable parts. Then the design and management of the cutting process compounds the loss by sending too much wood to the waste bin. Many managers, in fact, don't understand the simple, best sawing practices that will minimize that waste. Smart managers monitor their sawing methods and material yields regularly.
Optimize your workplace design. Sound ergonomics combined with logical placement of the material being processed relative to the work station or machine is basic to any efficient factory. Don't squander expensive labor and machine capacity with wasted movements.
Clean and organize your plant floor. If there is one tenet in lean thinking that anyone can implement, it is 5S (sort/straighten/scrub/systematize/standardize). Removing all unneeded materials and equipment, scrubbing the factory, creating a formal place for every required production input, and keeping the plant floor organized are musts for efficiency.
Manufacture accurately the first time. Properly designed, sized, and processed parts result in substantial assembly and in-service savings. Remaking defective parts is costly. Accuracy starts with sound product engineering, calls for clear communication of specifications to the front line workforce, requires easy-to-use measuring tools, and demands constant inspection. None of these prerequisites is complicated, but they require constant attention to detail.
Segregate defective parts early. A certain sign of a poorly trained workforce is failure to isolate defective parts immediately when an imperfection is first identified. By doing so, you create more calendar time to replace or rework the faulty part without delaying the work order. In addition, labor in downstream operations is saved by eliminating further processing of a component that won't pass muster at its final point of use.
Combine operations where feasible. Two simple plant layout techniques often translate into faster, more efficient processing. First, positioning two or more single-function machines within arm's length can create a flow line. In such a line operators can pass individual work pieces to the next machining step without de-stacking, moving, and restacking the parts. If warranted, the flow line area can be equipped with flexible dust, air, and electrical connections to enable rearrangement of these machines for processing different parts. A second idea is to utilize the lengthy cycle times on machines like point-to-point machine centers productively. By placing a second machine within reach, the operator can often complete an additional process step while waiting on the machining center.
Pay attention to tooling. The last piece of equipment purchased for a new machine is usually its tooling. But that machine's success in saving materials and rework often depends on using the correct blades, bits, or cutters. Tear out, chipping, visible knife marks, and other machining defects caused by improper or poorly maintained tooling mean excessive sanding and higher scrap rates.
Don't forget the office
Other examples of critical basics are found in the office:
Get on schedule. Keeping your plant on schedule is the key to completing jobs on time and satisfying your customers. And there is an important byproduct: nothing concentrates a plant's attention on minimizing machine times and reject rates more than trying to stay on schedule.
Know your costs. Without knowledge of your costs, you are managing by the seat of your pants. You simply must know which products and customers are contributing to your success or merely adding to your losses. Cost data is often painful to accumulate and analyze. Collecting machine processing times, material yields, and reject rates requires the involvement of your front line workers as well as someone to crunch the results into meaningful information. But once you have reasonably accurate cost knowledge, you can set standards for your operation and calculate what your profit ought to be.
Set expectations for every employee. The costs that you develop for pricing have another valuable use: setting expectations for labor productivity, yields, and overhead costs. For example, once you cost your products based on a set amount of labor hours, you have established a performance target for your front line workers. Most workers want to know what is expected of them and providing that information is one of a manager's principal jobs.
Measure your performance. These targets provide meaningful benchmarks against which to monitor your plant's performance in key areas such as labor productivity. Not only do most workers want to know what you expect of them, they want to see how they are performing against that goal. Don't forget the old adage - you get what you measure. Is there a better way to feel the pulse of your operation than to measure output per man hour, order fulfillment time, or other metric that contributes to your success?
None of the above ideas are revolutionary or complicated. Anyone with time can tackle these suggestions. Unless your plant is already exceptional, attending to these basics will bring immediate good results.
Bottom Line: Being the best you can be should be your overriding goal. If you can't handle the basics, you can't be the best. Period. End of story.
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