1- How much turnover is too much? 2- What is causing the turnover at Columbus Custom Carpentry? 3- Did pay cause the interdepartmental issues or did interdepartmental issues cause the pay problems?
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Monday, 10:30 a.m. Mike Cooney, Chief Financial Officer (CFO)
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“We operate in a narrow niche market. We have to maintain a price advantage over the true custom manufacturers, or our customers will have no reason not to take advantage of the wider choices and individualized solutions. This means that efficiency of operations is our primary competitive advantage. If we lose that operating cost advantage, our business plan collapses like a house of cards. “We cannot produce at the incredibly low-cost level maintained by the mass market manufacturers. We would not get costs that low even if we mimicked their limited product lines and quality levels. We compete with them by creating styles and options that they don’t offer. Finding the balance between production costs and proliferation of models is a continuing struggle.
“We need to cut out the current levels of overtime to maintain our cost structure. It is not clear why we need this overtime. Our labor hours per unit made have stopped going down and are even up somewhat. Adding overtime to that increases our labor cost per hour as well. Turnover has been useful in the past, allowing us to replace higher-paid workers with more lower-paid new hires, but the pattern seems to be changing, and now it is our new hires who are leaving. The warehouse manager wants to increase wages in his area, but that raises our costs per labor hour without explaining how it will help us get our total costs down.”
Monday, 11:30 a.m. (lunch meeting) Derwin Boyer, manufacturing manager
“A variety of people issues are hindering our productivity. We have bottlenecks in the warehouse areas. These bottlenecks spill into our manufacturing area because we have to pull people off assembly work to get their own raw materials or to move finished product out of the production area. This also means that we are doing with more expensive manufacturing labor what should be done with less expensive warehouse labor. To operate at our needed levels of efficiency, employees need to be doing the jobs they are trained for. Driving around on a forklift just to find materials or to find a place to put finished units is not efficient. “We operate under the concept of mass customization. Using modular parts, we can produce designs with features that appear to the end user as custom work but have the manufacturing advantages of mass production.
“The assembly jigs we have developed are the heart of our system. You can think of them as big clamps. They hold the material in just the right arrangement. If the assembler puts in the wrong part, the jig will not close, preventing the assembler from wasting materials. Once the materials are in place, the jig closes and a single lever pull will drill any needed holes in the right place, in the right size and to the proper depth. It is fast, mistake-free and simple for the operator. Much of our assembly is gluing. Here is where the big clamp analogy is the closest. Once the jig is locked with just a couple of levers, proper clamping pressure is applied at exactly the right places. Assemblers no longer spend time placing individual clamps. Once closed, the jigs are tilted upright and rolled on their own rollers to a drying area. If they are to get painted, the paint hanger goes on before the jig is released and no one even has to touch the door unit until it is crated. Zero damage and zero waste in this part of the process.”
Monday, 1:30 p.m.John Brown, manufacturing supervisor
“It is hard to keep the guys working efficiently. We are always running out of raw materials, or the finished product builds up and I have to pull guys off the production floor to deal with it. The warehouse manager doesn’t do his job, but if I have my guys take loads over, he complains that they did not get stacked right and that the damage is our fault.”
Monday, 2:00 p.m. Cary Dobbins, warehouse manager
We are treated like stepchildren; the manufacturing department pays more and has the best equipment. If I do get a good employee, this person transfers to manufacturing at the first opportunity.
1- How much turnover is too much?
2- What is causing the turnover at Columbus Custom Carpentry?
3- Did pay cause the interdepartmental issues or did interdepartmental issues cause the pay problems?
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According to this scenario, what can we add to the previous answers?
Cary Dobbins, warehouse manager
“We are treated like stepchildren; the manufacturing department pays more and has the best equipment. If I do get a good employee, this person transfers to manufacturing at the first opportunity. I tried blocking a transfer once, but the employee got mad and quit. If we get behind, manufacturing just drops product anywhere, and when it gets damaged, they blame it on us. They think anybody can do our job, but they can’t seem to put a blue crate into a blue bin without hitting something.
“I waste time interviewing and training when I should be working on the crating jig project that is supposed to reduce our damage ratio and make packing easier. My best guys can pack better than the jig right now, but I have to train new people all the time, and some just don’t seem to get it. Crating may not be rocket science, but putting nails in crooked damages the doors. Miss a corner—and the whole thing will fall apart the first time we try to move it. People get the idea that because it is manual labor rather than an automated machine, it is simpler. The opposite is closer to the truth. My forklift drivers don’t want to do crating because it has so much bending over and lifting that it is much harder physically than their regular work. The crating jig should make it possible for less-skilled people to do the crating job. This will eventually allow us to save money both on labor costs and the cost of replacing damaged goods.”
Brandon Swift, marketing manager
“It is critical that we are seen by our customers as top quality because we charge more than the prices they see at the big-box stores. Damaged goods and shipping problems reflect poorly on our product, even if it is good quality. How many end users can truly judge the quality of our product? Not many; it’s all perception. “We work directly with the homeowners in the design process, but the builders are the ones who refer the homeowners, do the sizing, place the orders and install the product. They are the ones who take the heat for shipping delays or damage. When they need service, parts or replacements, they want them now, not tomorrow or the day after. Time is money to contractors. We have to win on design but deliver at a price that makes our products a better value.”
Thank you
by Bartleby Expert
