“12 months ago we put two 2nd hand PCs on our factory floor, which cost us $500, and $11,000 of industry developed job and staff time tracking software in. With this labour management software we have achieved 150% additional production from all our factory staff, which increased our profit by $225,000 per year”
Managing Director of Zooby Cabinets, Colin Ballantyne advises:
"12 months ago I had not given it allot of thought and I suppose I assumed that our factory floor and staff were productive at manufacturing kitchens. However we were starting to lose jobs on price and our profit was too low so we knew we had problems with our labour times being too long and our labour cost being too high on each kitchen. We did have a manual system where our factory staff recorded in their work diary at the end of every day the times they started and finished each job and then our admin staff keyed these times into the job cost part of our finance software to enable me to review the actual times taken on jobs against the budgeted times, that we had in our quotations. I expect that our factory staff were at the end of the day making their best guess at recalling and recording their start and finish times on jobs but, when scrutinised, the times reported on jobs were found to be substantially in error, hours out at times. As the times reported were highly inaccurate myself and other management could not carry out three critically important functions in our business, namely:
1. we could not use the actual times to motivate our factory staff to work more productively
2. we could not use the actual times to discuss with our factory staff why they ran over the budgeted times, and
3. we could not use the actual times to improve the accuracy of future quotations
The solution to our problem was simple, we needed to replace our manual time recording system with a factory floor based computerised system. We invested in two $250 second hand PCs for the factory floor and Empower Job and Staff time tracking software. The Empower deal included all the factory and office software we required, software installation, factory staff and management training, implementation advice and unlimited on going monthly direction, advice and support. This package was $11,000 total, with terms payable over 6 months, which made it easy to afford. The software was quick, simple and painless to put in, set up and learn and we got significant production gains in the first week of putting it in. We followed Empower's advice and broke our jobs down to the following four stages of each kitchen:
1. CNC and Edge
3. Bench Top
Shortly we will progress using Empower to track the following additional Processes;
1. Pre Production - B4 Client Order (selling, design)
2. Pre Production - After Client Order (detailed design, order materials, receipt materials, program machines, site measure)
4. Client requested Changes
For each new kitchen a client ordered we then put into Empower the total budgeted time from our quotation plus the budgeted time for each stage of each kitchen. On the factory PCs our factory staff got to see the jobs assigned to them, the budgeted time they had available to them to complete the job when they started each job and they saw the actual time they achieved when the finished each job. That is, Empower Software gave each of our factory staff a performance review at the end of every job.
The biggest gain we got was from our factory staff being aware of the times and knowing immediately at job finish how their time went against budget, our staff really stepped up to the plate and have maintained their high productivity. Our foreman uses Empower Management version live throughout the day to view production and productivity of each kitchen and each staff member live.
As Managing Director of the business I view and analyse performance on every job and discuss performance with my foreman and factory staff regularly. As the times from Empower are highly accurate our staff fully accept the times which makes the discussion about performance possible and beneficial. Also as the times from Empower are highly accurate and live myself and other managers can make far better business decisions because our decisions are based on accurate facts - rather than on gut feelings, averages and historical times and events.
Up to 12 months ago we had 5 factory staff and 1 foreman. From using Empower for only 12 months we now produce the same number of kitchens and achieve the same monthly turnover with 2 factory staff and 1 foreman. 3 less staff saves us in excess of $225,000 wage cost saving each and every year. This is a $225,000 per year pure cream additional profit - from Empower which cost us the $11,000 once only payment. Looking back on it, prior to having Empower Software, our business was highly unproductive and our business was bleeding cash and therefore floundering as a result. We got a full return on our investment, that is full payback, on Empower Software in less than 2 months.
Using this type of labour management software is the most important tool that every TAFE trainee should be learning as it teaches how to manage staff and time, how to budget labour for all processes, how to monitor actual labour on all processes, how to work as a team and most importantly how to make profit from each kitchen or client.
Empower is the single best investment we have made in our business in the last decade. Empower Software has transformed our:
•profit per kitchen
•price competitiveness in our local market place
•our profit per kitchen, and
•aspects of our entire business
My advice to every joiner, manufacturer and engineer in Australia - put in Empower Software, you won’t regret it. If anyone wishes to phone me to discuss our system or view it working please call me. I welcome your call 08 9140 1500".
Have something to say? Share your thoughts with us in the comments below.