According to many reports, manufacturing is expanding at a faster pace than previously expected. In fact, by some accounts, the pickup in manufacturing may have been even stronger without a recent shortage of parts.
The Institute for Supply Management found that of the 18 manufacturing industries, 17 reported growth in April, including apparel, primary metals, miscellaneous manufacturing, food and several more.
Any pickup in manufacturing is a good sign for the economy and business’ collective bottom lines. But, this uptick in production also may mean that the shop floors are busier, workers are more tapped and customer demands are becoming even more stringent.
Even without the increase in production, there are a lot of “events” that can happen in a day – inventory shortages, equipment failures, employees who call out sick (the list goes on) – to impact delivery and, ultimately, revenue. We often point to those things and label them as “revenue killers.” And, it’s true as all of these issues, and more, have an impact on scheduling.
In many ways, scheduling has the greatest impact on the overall ability to reduce interruptions and, more importantly, maintain an environment whereby an organization is able to meet its customer promises.
Take for example Carlson Tools & Manufacturing, a Wisconsin-based company that has grown to become one of the largest tooling and manufacturing facilities of its kind in North America. Years ago, the company installed a manufacturing execution system (MES) to manage the flow of materials and jobs through its various shops. However, they never used the scheduling function, although they needed it badly.
When the company’s executives finally realized the inefficiencies associated with manual scheduling, they looked for a scheduling option that would integrate with Microsoft Project directly. After moving to the new scheduling system, shop floor employees were able to get their tools and materials together in advance of the work. In fact, Carlson noticed an increase in productivity of around 20 percent.
The reality is, the customer relationship suffers when manufacturers can’t deliver on time. When companies promise a delivery, and that promise is broken, customers start to doubt future orders. This is an especially harsh reality now that customers have more options than ever before with whom to work.
So, even as we take advantage of the increased opportunities and a stronger manufacturing landscape, now is the perfect time to ask important questions about how you are managing the customer experience and ensuring promises made are promises kept.
- How are you scheduling today? Are you scheduling based on customer demands or are you using data to analyze and pro-actively establish delivery timelines?
- Do you get tempted to over promise your deliveries because of competition? This isn’t a strategy that results in long-term success as it can lead to customer dissatisfaction and retention issues if the result is under-delivered.
- Are you utilizing your labor properly? Are you reporting labor hours, as they relate to particular processes or number of pieces that can be completed in a given amount of time? Do you know the costs associated with these operations? All these data points need to be properly tracked in order to construct accurate and cost-effective schedules.
Did you know it’s generally accepted that inventory is worth only 20 percent of its actual value until used. Therefore, excess inventory that is accumulated due to inefficient scheduling will eat at an enterprise’s cash flow and profitability.
Technology makes it much easier to create and view schedules that drive a customer-focused shop floor. By tracking all your data points, companies can better see and understand the business restrictions impacting delivery. This, in turn, helps manufacturers develop realistic commitments and create attainable schedules, both of which lead to satisfied customers and repeat buyers.
So, think about your business and how it can best meet customer expectations through great scheduling and delivering on promises.
Danna Nelson works for Aptean and can be reached at [email protected]. Learn more at www.aptean.com.