Month: October 2020

6 Shocking workplace stats and a single solution

Rarely real, scientifically proven data could be found about situation in companies, article of David Sturt and Todd Norstrom published in Forbes *is an exception. Reading them you see the answer on the emerging question: why top managers of good name multinational companies are burned out and loosing motivation to do their each day job.

  1. Employee Engagement is in constant decreasing. The Gallup institute proves that nearly 70% of employees are actively disengaged!

(Disengaged employees are characterized by lost enthusiasm for their day-by-day work, dramatically decreasing achievements of company.)

2. A recent study by CareerBuilder.com shows that 58% of managers said they didn’t received any manager training.

So the most of the managers never learned how to motivate people, how to lead them to accomplish their task, achieve personal and company targets and it’s normal, because most probably they become managers being  good at what they did.

3. Leigh Branham, author of “The 7 Hidden Reasons Employees Leave” revealed that 89% of bosses believe employees quit because they want more money.

However any boss would love this data, it’s not true: only 12% of employees actually leave for more money.

4. A Harvard Business Review survey reveals 58% of people say they trust strangers more than their own boss.  This level of distrust in leadership should make us worry, and put on road to examine: how to change it?

5. Global studies reveal that 79% of people who quit their jobs cite “lack of appreciation” as their reason for leaving. It means: people don’t leave companies. They leave bosses.

6. American workers forfeited nearly 50% of their paid vacation in 2017. And, nearly 10% take no vacation at all. According to Glassdoor, the fear of falling behind is the number one reason people aren’t using their vacation time.

Above shocking figures should put us to think! Might be is a moment to take action in our own company: measure and analyze our figures, look for ways to promote changes, and if it is a case, build practices, policies and procedures that inspire change! As leaders, this is our job – to inspire “the best” in people!

*The full article in Forbes could be found at link: https://www.forbes.com/sites/davidsturt/2018/03/08/10-shocking-workplace-stats-you-need-to-know/

**Source of the image: pexels.com

QCD – The Iron Triangle

The concept of Quality, Cost, Delivery is a management approach developed to help manufacturers within British Car industry around 1950. Later this method become a tool for effective project management, but for me is important the clear message what it is unchanged until today!

In a wood processing workshop 20 people is working at different machines producing elements for chairs which are packed together in a carton box to become the final product. In 8 hours shift using available machines operators are supposed to produce 600 sets of chairs. The customer prescribed precise quality requirements (no nodes, wood color, smoothness of surface), and offered a price for a product.

Above business represents a QCD System:

Quality of final product is described by Customer, quality of raw material (wood) by a manufacturer. Cost of production, raw material and profit are covered by the price of finished product.

Delivery is specified by pieces made in 8 hour shift in specified workshop by given machines assuring daily income what is covering items from “Cost”.

Until above QCD balance is untouched, business is functioning well!

But… What is nowadays untouchable?!

Challenge 1

World around us is changing, and prices of resources are increasing. (Cost of 1m3 of wood, cost of 1kWh, salary (minimum) increases, auxiliary materials (paint, enamel) etc. as well.) Exist lucky cases when proven cost increase is acknowledged by customer and the price is renegotiated. Even in this rare situation where regular price adjustment happens, there is a time delay between cost increase and price correction, where profitability suffers.

Challenge 2

Working with remarkable companies, general experience is customers demand after permanent quality increase. New desire for no nodes, less color tone variation, smoother surface are examples what makes life of manufacturer from above example hard. There are to ways to respond to new demand: better quality of raw material (what is more expensive) or additional operations in production process – as well resulting cost increase.

Challenge 3

In a time the niche on market of products becomes narrower (market saturation, more producers), and in order to maintain sales volume, manufacturers offers the same product in more variations (color, size, version). What this mean for production? More changes in production process, more type of raw materials, shorter production series, more changeovers, more down time, more cost!

Solution

There is an obvious solution to all 3 challenges: the price increase! Cases when product cost can be increased (to cover raw material price and production cost increase) in reality exists, however are rare! In majority of situations market does not allow price increase not even for a penny, because there are other factories, who applied a better solution: constant improvement of product and production process! This possibility is always on disposal and doesn’t depend nor on providers, nor on the market, but only of our own organization. The development process at each company is different, while follows the same steps:

  1. Define – describe the process
  2. Implement possibilities to measure output and efficiency
  3. Improve process at the bottleneck position
  4. Redefine the process
  5. Repeat steps 1 – 4!

Above 5 steps approach could be called KAIZEN (the tool from LEAN Methodology to develop product and process), but the name is irrelevant, matters the improvement and profitability what brings! Only what you need is a decision to do it, and a good production team under guidance of a productivity specialist! Good luck!