So, What's In It For Me?ByRaymond D. Matkowsky
Several years back, I was in charge of quality control for a small chemical manufacturer. In the course of that responsibility, We looked for and discovered many ways to lower costs without sacrificing "quality." Often, these were hidden or at least not obvious. Many of these savings were small, but added up significantly by the year's end. They were of the "100 pennies equals a dollar" variety. At times the savings would be quite dramatic and had the side benefit of actually improving operations.
Many chemical plant functions revolves around the batch blending and the mixing of raw materials, a very labor intensive procedure. The batches are generally 1000 to 5000 pounds (125 gallons to 675 gallons) in size. Raw material assembly, blending and mixing, and cleanup procedures may take two men 3.5 to 4 hours per batch. At most, two batches can be completed per shift.
Since over 90% of the products consisted of materials that would be shipped in and out of the plant in 40,000 pound (~4820 gallon) tank trucks, it occurred to us that the mixing could possibly be done within the delivery tanker itself while enroute to the client. This, in itself, would save us many man hours per week in unloading and loading times. It was soon discovered that we did not need a mixing procedure for many products. The movement within the tanker during transit was more than sufficient to obtain a thorough mixing. In an hour and a half, one man could accomplish what two men previously accomplished in as much as a week. At the very worse, this was a 467% increase in productivity. Needless to say that this had a tremendous effect on the reduction of production costs.
You may also have a half dozen products that may lend itself to this technique. Imagine your potential savings and the effect on your bottom line if you could implement this procedure across the entire list. You owe it to yourself to find out if you can.
The example works best with large quantity bulk orders. However, even the production of your smaller orders may benefit from this technique. Tank trucks are available in capacities as low as 225 gallons. At the opposite end, railroad tank car capacities begin at 11,000 gallons. You can probably find a truck to fit your needs exactly. Take a look at your order book and your standard manufacturing procedures. Is there anything that looks like it might be adaptable? If so, try it! Ship a small order to one of your other locations or even to yourself. You may be able to entice a loyal customer to help you evaluate the procedure by offering a large one time discount and assuring the immediate replacement or reprocessing of an unsatisfactory shipment.
Don't give in to negative attitudes
For every great idea that you can come up with, someone will give a reason why "it can't be done". Don't let negativity stop you. History is replete with successful inspirations that "couldn't be done". Besides, if everyone thought your idea was so great and easy to implement it probably would have been done already.
Guard against the reasons good ideas never get implemented. Be on the lookout for and able to respond to the following:
Keep negativity away and remember great ideas can come from anyone, anywhere, anytime.
What's in it for me?
So, you ask: What's in it for me? Well, for one, there are possibilities of tremendously increasing your profitability without further monetary investment. There is the potential of becoming the lowest cost supplier in your market and the benefits that it would bring. Developing a product or service that is clearly superior to your competition's. Discovering a greater potential or market for your product. The list can go on and on. The possibilities may only be limited by the boundaries of your thinking.
I've given you one idea that has worked well for us. You know your business better than anyone else. It's up to you to come up with more. It is certainly in your interest to look closely at every thing you do and ask yourself if you could do it better, cheaper or easier. If the answer is yes to any of these questions, what are you waiting for? The sooner you start investigating these possibilities, the sooner you will reap their benefits. Every penny you save is a penny more in earnings! Savings go directly to your company's bottomline!
If you have any questions, comments or suggestions drop me a line at rdm@datastats.com.
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