A Production Efficiency Driver You Might Be Overlooking
Why so many companies lose profit to OEE
The manufacturing industry has historically been a hotbed of innovation, ...
Productivity
Common Challenges, Part 2: How performance tools get misaligned
Did you have a good day? How do you know?
When our consultants ask front-line managers or employees if they have ...
Want Accountability In the Workplace? Do this, or else
Managers are not cops, overlords, cheerleaders or shepherds. They are people who through luck, political savvy, ...
The Need to Reinvent Your Operating Models in a Post COVID World
COVID-19 will change how many businesses engage with customers and their workforce. Re-envisioning both selling, and delivery models will be critical for many.
Finding opportunities in maintenance
As technology has advanced and organizations have become more and more reliant on smoothly running equipment, ...
Finding opportunities in finance areas
If you look at some of the activities performed by finance personnel with a critical external eye, you can often find people doing things for reasons that may no longer be valid.
The by-product savings in variable overhead costs
Finding the opportunity with variable overhead costs requires trying to understand how these costs are allocated in the financial statements and then analytically drawing some correlations between those costs and the process hours.
The variable nature of fixed overhead costs
When companies volumes decline they are often stuck with more fixed costs than they need. Fixed costs are often much more difficult to reduce than variable costs because they represent a longer term commitment in many cases.
How much indirect labor do you really need?
Indirect labor includes supervisors, material handlers, quality technicians, mechanics, and IT support, all functions which are required to support the production of goods or services. While the functions are important to keep organizations working, its not always easy to determine how many people you actually need.
The two components of direct labor costs
Hours worked are driven by how many people you need to run a process to achieve some volume output. So there are two distinct analytical questions; how do you staff the process, and how well does the process run?
Too bright to see opportunity
It takes quite a lot of humility to find opportunity and sometimes being smart simply makes it that much harder.
The good and the bad of overtime
Whenever we see overtime over 5% an analytical red flag goes up and we start to suspect that there may be too much cost built into the process. Many organizations use overtime to offset peak volume periods.