Where does Missing Time come from?

Posted On : Dec 12, 2017

Missing Time is the difference between the time recorded by the time clocks (what you pay your employees) and the employee time tracked on your work flow system (WMS, CRM, MRP, Job Coding, etc). When we initially start working with customers, if they have never managed their missing time before, they will often show 1-2 hours or more of missing time per day per employee. If the company does not have a job coding system, then up to 50% of hours worked are unaccounted for. Even the best WMS systems, without job coding, only track about 60% of the time an employee has worked. Many direct labor processes like cross docking and receiving are usually not tracked by the WMS. Additionally, there are many indirect processes such as battery changes, cleanup, startup meetings, etc that are not accounted for. Not all missing time is truly missing or wasted time, it is just improperly accounted for.

Easy Metrics puts employee time into 3 buckets: direct labor, indirect labor and missing time. Without a job coding system, the customer will have 2 buckets: direct labor and missing time. The first step then with a new customer is to setup job coding. This can be done through the current time clock system, through a job coding system like Easy Metrics Job Trak, or manually tracked on spreadsheets. Once job coding is in place, you will see missing time decrease and the indirect and direct labor time increase as missing time is properly allocated.

Once job coding is in place, you will still experience a lot of missing time initially. It requires proactive management by supervisors to make sure employees are properly logging their work flow in both the WMS and job coding system. However, even if the employee is actively tracking their time, there will still be some missing time. The best quartile of our customers average under 5% missing time per employee per day, or about 20 minutes.

So where does this time come from? It usually is not large blocks to time by an employee but instead 5 minutes coming back late from break or lunch or stopping for a few minutes to chat with a co-worker. This little bits of time add up very quickly and turn into real cost. When first starting, customers will have about 2 hours of missing time a day (25%). Of that, half is real missing time and the other half is untracked time. Then with proactive management and coaching, they are able to get missing time under control and under 5% usually within 1-2 months. To put the potential cost savings in perspective, just reducing missing time by 15 minutes per day per employee and having the time shifted into productive activities, for a 100 person operation, this is $500 a day in savings, or $120,000 a year. Very real money and very worth making the effort to manage it.

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