Compounding Costs of Employee Breaks1/23/2013 12:00:00 AM
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|By Dave Grubb |
In the last article, I wrote about the use of video recordings to help find waste and aid in training shop floor management to separate non-productive and wasteful activity from productive activity. This month we look at a common occurrence that creates waste and often comes with a multiplier attached: The personal break.
Again this was observed on video. The video was monitoring the operation of a semi-automatic feed through hot press line with three operators producing full size veneer panels. Nominal cycle time was ninety seconds which was established by the press cycle.
At one hour into the video the lead operator disappeared. He didn’t appear to say anything to anyone, he simply walked away. Six minutes later he returned and production resumed. During the period he was absent the other two operators simply stood around and waited, despite the fact they could have run the line themselves at a partial decrease in throughput. The six minutes of lost time equated to four lost press cycles and four lost parts.
For our discussion, assume a $50/hour fully burdened labor cost. The labor cost of that six minute walk was $5.00 for the walker and $10.00 for the waiters. Adding operating cost for the line of $90/hour or $1.50/min adds another $9.00. Total costs for the six minute walk: $24.00.
That might not seem excessive if you look at it as a singular event, but these are not singular events. There are three operators on that line and if each takes a similar walk in the morning and again in the afternoon the cumulative costs now jump to $144.00/day. Extend that to five days a week and 50 weeks a year and the cost balloons to $36,000 on an annualized basis.
This can and often does compound even more. If those lost press cycles, totaling 24 by the end of the day, require overtime to maintain production demands, the final cost based on the overtime premium jumps to $171.00/day.
I am enough of a realist to know that stopping people from taking personal breaks is not going to happen, but we can and must manage the disruption and costs associated with these breaks.
In this particular case, the two remaining operators could have continued to run and lost only two cycles not four cycles during the six minute disruption. That option at the end of the day would have nominally reduced costs by 50 percent.
Another management tool is what I call tag teaming. Before anyone can leave a production line they have to be relieved. In this case there would be no loss of production on that line. Assuming the back-up is close by and not working in a production bottle neck the disruption is neutralized.
Tag teaming can also be used to effectively eliminate the lost production caused by breaks and lunch periods to maximize output without the cost of premium time.
Obviously these alternatives require planning, cross training and discipline in following the plan. They are not procedures that will happen without your intervention and control.
Often I have chased lost time in increments of seconds because of high repetition rates. At the end of the year they can total many hundreds of hours and thousands of dollars.
In today’s market of reduced margins, can you afford to give away money simply due to a lack of planning and control?
Pay close attention to the details; they add up quickly.