Investing in the future - Part 4: Methods - Procedures and Processes
We almost always think of investment only in terms of the actual money we invest. The old saying time is money is still true and the procedures and processes (of all types) that we use take up time and therefore use money. This is a hidden investment that we need to monitor.
A company may well be doing many things efficiently but if it doesn't need to do these things then there is little benefit in being efficient about them. A long time ago I took up a new job and found that my secretary was keeping records of capital expenditure for the whole company, she was very efficient in doing this and could locate any record immediately. The only problem was that the company had introduced a computer system some years previously and this automatically tracked the expenditure. All the records were already being kept in the finance department and it involved considerable effort to send the copies to her for filing and recording, all of which duplicated the records already kept. After asking Why are we keeping these records we decided that there was no need to keep them at all: at a stroke my secretary's workload was reduced by 30% - she was certainly being efficient but not effective. We need to be effective in what we do rather than simply concentrating on the efficiency of the process.
Workers are paid to do things right, managers are paid to do the right things - there is a world of difference!
We need to be ruthless in what we do and concentrate on only doing those things that add value to the business or process.
Investing time and effort in deciding what are the right things will be one of the best investments you can make. We can work smarter and not harder.
The easiest and most productive investment that you will ever make is to invest in not doing things!
People are pattern seeking animals and we use patterns to simplify things and to make them work. This is how any system develops - we seek patterns and then develop systems to deal with them. All information is time based and we develop systems and methods to fit the information that we have had in the past. Systems are rarely optimised for the current situation and needs - they were fixed or developed in the past and we force the current needs into the system rather than adapt the system to meet the current needs.
Systems grow in this manner until they no longer function and become a liability to the company. This is the essence of business process re-engineering (BPR) - you look at what the systems are currently required to deliver and re-design them to meet these needs.
An enormously productive investment is to map the current system and to carry out a paperchase of all your documents. This will give an overview of where the system is performing, where it is failing and where any redundant work is being carried out. This is an opportunity to combine forms and information and to eliminate any overlap. A good rule to follow is Record information only once and do this at the point of origin. A good quality system based on BS EN ISO 9000 should be doing this already - the quality standard should be seen as a way to reduce documentation rather than as an excuse to increase it.
Investment in systems analysis should bear the following points in mind:
- Processes should be simple - easy to understand and carry out.
- Processes should be self checking - mistake proofing should be built in to all systems.
- Humans are not rational creatures, they are rationalising creatures - they will invent all types of reasons for doing something when it is not required.
Productivity should not be just measured in the factory. Often the worst bottlenecks are in the office where it can sometimes take longer to complete the paperwork than it does to make the actual product.
Investment in manufacturing processes is vital and is easily made but before investing you need to monitor and measure the existing activities to know where you are starting from.
Invest in jigs and fixtures to guide the workers and make the job simple and easy for them. Investment in fixtures will improve quality and throughput almost every time.
Invest in process development (with the help of the systems supplier) to remove or reduce processing at all stages. Outer frame corners will be hidden when the product is installed, if you are finishing them in some way then ask both why and how you are doing this.
As with any system the most productive investment is in stopping doing something that is not effective. Investment in waste reduction is critical to success in the future. Waste is an investment of resources which do not add value to the product at least equal to the cost of the resources expended. Reducing wastes gives more effective production and a better factory environment. The table below gives some of the typical manufacturing activities and their classification in terms of adding value or wasting value.
In many firms the material in the manufacturing system is having real value added to it for less than 1% of the total time it spends in the system. The rest of the time it is work in progress (WIP) or inventory and it is effectively a liability rather than an asset.
As a final point no procedure or process will ever function properly if you cannot find it. Clean and tidy office areas, factories and yards will enable you to see where you are and what needs to be done. Be ruthless with junk and invest in a big rubbish bin. Everything needs a place and should be in it - even if it is the rubbish bin!
Invest wisely in procedures and processes, small investments here can have excellent returns.
Investing for the future is designed to challenge your concepts and ideas on investment for the future. Various aspects of investment are considered and discussed. The series is:
Part 1: Introduction
Part 2: Machinery - Plant & Equipment
Part 3: Materials - Products
Part 4: Methods - Procedures and Processes (This section)
Part 5: Manpower - People
Part 6: Measures - Performance
Last edited: 11/03/10
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