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The Pathway to Productivity: Are Your Standards Driving the Right Hours?

In the last edition of the Pathway to Productivity we discussed the value engineered standards can have to an organization. Throughout my career I’ve worked with companies across many industries that have some form of standards in place.  Some are more sophisticated than others, and different companies may use their standards for different purposes, but all labor managers face a common question…

Are my standards actually driving the right hours?

There can be many symptoms that may point to your standards becoming outdated…

Best in class labor managers are able to stay out in front of these problems by regularly auditing that their standards are up to date and driving the right labor hours to achieve the desired outcome. There are several basic concepts that anyone in any industry can follow to improve the accuracy of their standards over time.  A great way to begin is by asking the following questions about your labor management department:

  1. Do we have a formal routine in place so that when process changes occur, or are planned to occur, the standards can be modified to reflect the change in process?
  2. How often do we audit our standards? Have the most significant standards been identified for more frequent auditing?
  3. Do we frequently measure productivity factors such as utilization, methods, and performance?
  4. How do we follow up a change to a standard to inform the business of the impact to operations?

Are there any tools available to help me with standards maintenance?

Pareto analysis can be a powerful approach to aid standard maintenance.  A Pareto analysis identifies the standards that make up the top 80% of hours…i.e. the most significant tasks.

Standards that fall within the Pareto should be audited more frequently, typically at least on an annual basis.  Determining how frequently you will audit each standard is referred to as creating a maintenance cycle. The maintenance cycle must be both target at keeping the most important operations to the business accurate while also being realistic to the limitations of your labor management group.

Tools such as Logile’s Standards Analyzer make it easy to identify the most significant standards. During the maintenance cycle proposed changes to the standard can be simulated and business impact analyzed.

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