Improving Labor Productivity On The Shop Floor

In the manufacturing sector, accurate, real-time visibility into plant operations is key for effective operational and strategic decision-making. Labor can amount to as much as 60% of a manufacturer's expenses and is an area into which there is the least visibility and control. Shop floor data collection processes, coupled with effective labor management applications, can help manufacturers better control labor expenses and streamline information flow to improve productivity and operations.

An Emerging Trend: Tools For Frontline Labor Management
Today, new applications are helping manufacturers provide frontline workers with the information they need to increase productivity and efficiency throughout the enterprise. Traditionally, manufacturers have implemented "back office" or enterprise resource planning (ERP) applications to manage corporate information such as sales order processing, financial and production planning aspects of the manufacturing environment. While these systems are critical to the success of the company, they do not provide frontline employees with real-time information about jobs in process, labor costs, productivity and inventory levels. This type of information is valuable and can provide a competitive edge for manufacturers because it allows employees to meet customer demand for shorter delivery cycles and less expensive products. However, data collection by itself is not sufficient to drive effective problem resolution. Accurate information must be coupled with effective tools to increase productivity.

Improving The Accuracy Of Operational Data
Many manufacturers still use manual time and attendance methods, like the time sheet, to manage their labor. While this method provides valuable feedback on the status of jobs in production, manual data entry is highly prone to errors, and only produces an historical view of labor on the shop floor rather than real-time information. To streamline the payroll process and increase accurate timekeeping while reducing costs, manufacturers have adopted automated data entry processes such as wand readers and electronic "time clocks." These new processes move data collection closer to the source of the information — the frontline employee, enabling users to record and manage their own time, while dramatically increasing accuracy.

Each data collection technology and process has been developed to provide a specific business solution. For example, once an employee has clocked in, he or she reports to the shop floor and records time spent and production quantities completed toward job-specific work orders throughout the day. This requires a much greater degree of real-time interaction between the employee, data collection device and shop floor application. As a result, manufacturers must implement an infrastructure and application suite that provides the appropriate integration and interaction between data collection devices and the application(s).

By coupling the two applications, a common database can be used. This simplifies data entry and produces operational benefits. For example, as an employee reports on a work order at the start of production, a validation report can be performed to assure that he has clocked in for the day. As the employee continues reporting labor throughout the day, a comprehensive record can be built as to how the time was spent.

Real-Time Information Enables Proactive Decision-Making
Frontline labor management applications offer manufacturers immediate access to real-time information such as production schedules made with certain staffing assumptions. Real-time attendance information can be used to identify problems and help managers reassign employees to offset unexpected absences that can cause costly production delays. Another benefit is that as actual production results are reported throughout the day, managers can compare real-time data to expected standards. This enables frontline supervisors to take any corrective action that might be needed to improve productivity while the job is still in process rather than after-the-fact.

Increased Customer Responsiveness
Visibility into production also facilitates greater flexibility and customer responsiveness. With real-time job status information, manufacturers can offer customers accurate completion estimates and better accommodate changing priorities.

Improved Operational Efficiency
An integrated labor management system must simultaneously provide several views of the shop floor and operations to help manufacturers realize productivity improvements. With access to real-time information that reflects a current status of the shop floor, manufacturers can measure productivity and operational improvements over time. Increased productivity and operational efficiency comes not from the implementation of a technology or a product, but from a solution that combines accurate data, decision support information, and a cultural drive to consistently improve.

Paul A. Hoy, v.p. manufacturing systems, Kronos