The elephant in the room (Or why labour productivity is now more important than ever)

The elephant in the room (Or why labour productivity is now more important than ever)

No, this isn’t just another blog exploring ways to improve manufacturing productivity. Well actually it is, but not along the usual lines. It doesn’t serve up generic pronunciations on the importance of lean manufacturing methods, followed by the standard list of must-haves and nice-to-haves with an emphasis on:

  • The critical role of automation, AI, AR, and ‘software defined manufacturing’
  • The introduction of robots/cobots to factory and warehouse settings
  • The rise of 3D/additive manufacturing processes

Not that these topics aren’t important. In fact they all have a big role to play in addressing the wider productivity puzzle (and not a moment too soon, with aggregate productivity performance in the UK since the 2007/8 financial crash at its worse since 1860).

Yet talk of embracing IoT, Industry 4.0., and enhancing automation capabilities etc. can have little impact on those manufacturers running processes that still require significant manual intervention (for example, it’s estimated that the UK has just 74 industrial robots per 10,000 employees, compared to 710 in South Korea).

So what can be done to improve productivity in these scenarios?

Getting your people working

The answer of course is quite a lot, particularly if you focus on the key metric of labour productivity which measures the output per worker across a period of time (and again, since 2008/9 this has tanked in the UK, with the ONS estimating a 20% drop).

The challenge here is that most commentators consider low output to be the result of slow working. This can of course be a root cause of poor productivity, but experience teaches that the bigger cause is operators being prevented from performing due to factors outside their immediate control (waiting on parts etc.).

At MESTEC we would argue (based on direct evidence from countless client engagements) that removing these factors is the quickest way to improve workforce productivity, and therefore the ideal place to start any new initiative. Let us explain:

  • Manufacturers typically know that for various reasons, both known and unknown, utilisation levels are often below the ideal
  • The reasons behind each issue/problem are usually numerous, unique, and require a detailed understanding of what’s going on at the shop floor level to really appreciate root causes
  • Only by gaining this level of visibility can companies plan and schedule work with any degree of confidence to make the most of their most expensive resources: humans

All of which can lead to many subtle nods of the head in agreement from manufacturers, before the inevitable question: how?

Delivering practical outcomes

Exploring the how means going beyond the top line measures used to track output. It means utilising simple data collection at the point of activity allied with analysis and planning tools to help you make more informed decisions around productivity. And it means using the available insight to gain a real-time understanding of cause and effect when allocating human resources.

Get this right however, and the benefits are immediate:

Avoid delays

Detailed productivity insights help uncover all the causes of non-value add activity and highlight opportunities for eliminating delays.

Identify your best operatives and best practices

Data doesn’t lie and can quickly identify your best people, as well as highlighting what they’re doing different to the rest – letting you embed these findings across the board.

Address waiting times

Armed with real-time notifications of delays and waiting times, supervisors can see what’s holding back production and immediately address the causes– rather than analysing them ‘after the event’ when it’s too late to rectify.

Plan with realistic precision

With live visibility of schedule adherence, you’ll have early warnings of any potential issues and the ability to address them before they blow up – while also being in a far better position to model all existing constraints in the manufacturing process to your supply chain.

Summing it all up

Labour productivity really should get more press. The challenge it faces is competing with more glamorous topics beloved by consultants and thought leaders. Speak to any manufacturing leader though and they get it – how labour is their most precious (and costly) resource, and any ability to maximise their output leads to a measurable impact over the long-term.

If you’d like the quick overview on how MESTEC can support you in this endeavour, including our credentials, and capabilities – then feel free to get in touch.