Ever wonder how productive your organization is?
We have consulted with many businesses and found that on the average, businesses are less than 50% productive. This usually comes as a surprise to the business owner. After the surprise is digested, the usual follow up question is: How did you come up with that number. Here’s how I did it.
I have found when taking all the ‘support’ items into consideration a comfortable number for most small business was in the neighborhood of 70% to 80% productivity. What the owner also realized that perhaps they were not pricing profitably; or organizing their schedules accordingly. Here’s an example.
One client received most of their work orders on Friday afternoon, Monday and Tuesdays for delivery later in the week. We determined that working 5 days at 7.5 hours each day was not as productive as 3 days at 12 hours each. Overtime was reduced as well since the extra hours normally worked on Wednesday and Thursday nights was not required. Also, repeat trips to site were reduced as more work was done at each site during the day thereby reducing (but not necessarily eliminating) the number of returns to finish the job the next day. The client also introduced travel time charges that were more in line with their labour rates in addition to their fuel and maintenance costs.
Do the simple 6 steps outlined above to see where you are on the productivity.
RK Fischer & Associates