The Recession Helped Productivity. Now What?
- Published: Tuesday, 20 March 2012 14:51
Look At How Your Managers and Supervisors Run Their Operations for More Productivity Gains.
By Steve Schumacher
The 2012 U.S. Construction Industry FMI Productivity Report says:
“The early effect of the recession on the nonresidential construction sector included significant productivity improvement. Downsizing has resulted in retaining the most experienced and best-trained personnel who are the most capable of working more efficiently and harder. However, this initial productivity spike has begun to wear off over time. While productivity does continue to improve, the rate of improvement is slowing. More than half of the survey respondents did report improvement. However, for the majority it is only a slight change. Interestingly, 80 percent of respondents believe they can save at least five percent of their annual field labor cost through better management.”
What the report is telling us is that when the recession first hit, most companies made cutbacks in the workforce, many for the first time. Those first rounds of cuts eliminated a lot of the deadwood employees: the ones who probably should have been let go sooner. Now, a couple years after those cuts, the hardest working and most talented employees have reached their peak performance given the tools, resources and management practices they have become accustomed to.
Yes, you could invest a lot of money in consultants who will help you implement Lean Processes, Six Sigma techniques, or other comprehensive improvement initiatives. These will all take a lot of time and, in many cases, require an entire shift in the culture of the company. Before you take that drastic step, take a hard look at something you can control and work on tomorrow.
It is now time to take a look at going to the next step in productivity improvement: how you do your business at the manager/supervisor level.
Three things that impact productivity every day should be looked at right away: Project managers, work planning and communication.
Project Managers. Too often, project managers live in a world of their own. They communicate primarily with the plant manager and contractors. They get the specifications they need, submit a budget, design a plan, and then hand it off to operations to execute. They are skilled at putting the foundation together, but need to get better at working closely with operations in the initial concept, planning, and execution of their projects.
In order to improve productivity in this area, have your project managers collaborate with operations and maintenance people in the concept stage to gather their input on feasibility and potential obstacles. This will aid the project manager in making sure all items necessary are included in the budget. When contractors have their designs completed, go over them with operations and maintenance so they can get a visualization of what the project looks like on paper. At that point, they can add vital information for the contractor to add prior to any fabrication and/or testing.
Understand that your project managers may be limited in their desire to collaborate, as well as their ability to facilitate meetings, ask questions, and listen. Additional training may be necessary in those areas.
Work Planning. The FMI survey found that “a full 70 percent of respondents who experienced significant productivity gains plan and communicate resource needs more than five days in advance compared to only 40 percent of companies who experienced declines in productivity.”
In my experience, plant personnel spend a great deal of their time running around trying to find parts every day, which is a huge drain on productivity. Operations complains that maintenance does not fix equipment right the first time, and maintenance complains that operations needs to do more preventative maintenance on their own. In the meantime, parts get ordered and re-ordered to put out the immediate fires. One company I work with created a full-time position to inventory all spare parts, tag them, watch order quantities and work with vendors closely to monitor costs. He found an amazing amount of usable parts laying around or in the bone yard. The position easily paid for itself in just the cost of duplication.
Give your supervisors some basic planning skills that will help them get ahead of the curve. Bring your employees together daily in groups to review what happened the previous day, or previous shift, and actually plan what they are to accomplish that day, along with the parts and equipment needed. At least monthly, bring key employees together for a day-long session that looks at all the projects going on and line out what needs to be done. Everyone is busy, but when it comes to productivity, a little advance planning can work wonders.
Communication. As is so often the case, poor communication is the root cause of productivity problems. Project managers do not communicate well with operations, maintenance does not communicate well with operations and vice versa, shifts do not communicate well with each other, etc.
Set the expectation with all of your employees that communication, at all levels, must improve. That includes vertically and cross-functionally. Give them some basic tools that will help them communicate better like active listening, presentation skills, and meeting skills. Put a calendar together that includes daily tailgate-type meetings, weekly planning meetings, shift handoff meetings, monthly planning update meetings, etc. Yes, people will complain about too many meetings. If you keep the meetings short, have set agendas and give people feedback on key metrics, productivity will improve more than you can imagine.
In summary, if your productivity has flattened out lately, look for things you can control to jumpstart it again. Instead of looking for the latest and greatest process-improvement techniques, focus on what you can control, it’s cheap and will work right away. Simple planning tools, project manager involvement and communication skills will take your productivity to the next level.