Labor standards, which prescribe the exact number of employees needed to perform a specific job, are integral to any manufacturing business strategy.  Collectively, these standards represent a facility’s optimum balance of operational efficiency and worker productivity.  Despite all of the engineering and investment behind the creation of labor standards, many manufacturers are simply unable to apply them to their operations.  Can your facility?

Labor scheduling software and strategies that do not directly integrate data from production plans and published labor standards leave manufacturers with limited options for systematically improving their labor effectiveness.  By the time effectiveness is measured, and poor results are shown, a facility can do little to proactively fix its problems.  If a facility enacts changes to improve its labor effectiveness, it can only determine the success of those changes after weeks or months of collecting additional data.  Many manufacturers and software providers have come to accept these labor challenges as simply the “cost of doing business.”  If it were possible to directly apply business strategy to labor deployment, it would have already been done, right?

This pessimism is easy to understand.  To illustrate the challenge of implementing labor standards on the shop floor, let us consider a sample facility that produces three products: A, B, & C.  Research has determined that it takes one person to produce A, two people to produce B, and three people to produce C.  Labor scheduling would be rather easy if the facility only produced a single product during each shift.  The reality is that market demand and a zero-inventory model forces the facility to produce multiple products during each shift.  Labor schedulers need to consider the dynamic mix of products running on each shift to determine the requisite number of employees to staff.  Considering a shift where all three products will be produced, the scheduler would likely bring in three employees to account for the needs of product C.  If only A and B are produced, there remains a chance that product C will be a late addition to the production plan.  Should that happen, a schedule that strictly adheres to the labor standards for A and B will prevent the facility from meeting its customer orders.

Since manufacturing operations are largely measured by how well they can meet output goals, a common strategy is to provide a “cushion” of labor on each shift.  For the sample facility above, this may mean a general policy of staffing each shift with three workers, regardless of the production plan.  This ensures that they have the flexibility to manufacture any of the three products at any given time.  Unfortunately, that flexibility comes at the very high price of under-utilized labor.  Measuring the sample facility’s labor deployment against labor standards may produce the following results:

Sample Facility labor effectiveness (based on 3 employees scheduled per shift):
Average excess labor per shift: 1 person
Average excess labor per product:  A = 2, B = 1, C = 0

Not only does this data highlight inefficiencies in the facility, the extra costs ultimately get passed along to the product.

Faced with these problems, what kind of effectiveness changes can the sample facility reasonably make?  Should it attempt to schedule fewer workers on certain shifts at the risk of not meeting critical production goals?  Should it discontinue product A because it requires too much labor and cost to produce?  Should it adjust the labor standards to more closely reflect reality?  These options only indirectly, at best, address the problems.  Unfortunately, many real manufacturing facilities find themselves in these same situations, asking the same questions, and implementing the same changes.

It does not have to be this way.  Manufacturers need to carefully select labor scheduling software that can directly leverage production plans and labor standards into the workforce schedule.  Software that integrates with the production schedule allows operations staff to see precisely when specific products need to be made.  At the same time, the software should apply the published labor standards to each product run to create an optimized staffing plan.  This ability and sophistication is what differentiates ScheduleSoft in a crowded scheduling software market.  Should a facility choose to maintain a labor “cushion”, ScheduleSoft’s design allows for operations management to see exactly where and when the discrepancies exist between labor deployment and the optimum plan.  This kind of visibility allows management to increase labor productivity in a meaningful way by assigning excess workers to other tasks during those times.  By automating this capability across many production lines and products, a manufacturer can optimize its resource deployment facility-wide, regardless how the production plan may change. Labor standards maintain their integrity, employee productivity increases, and extra labor costs do not get attributed unnecessarily to specific products.

In this competitive global market, success or failure rest upon the thinnest of margins.  If a process manufacturer removes operational constraints from its overall supply chain strategy, it goes a long way to ensuring its long term viability.  ScheduleSoft’s labor scheduling software can effectively and smoothly integrate shop floor operations into a facility’s larger business process and goals.

To find out who some of our customers are or to see a demonstration of the ScheduleSoft solution, contact us at 1-800-416-9006.