A common mistake companies make when implementing labor management is overlooking the ongoing cost to maintain labor standards for their operations. Companies will spend large sums of money implementing and engineering their labor management system, but if they do not maintain their standards, they will often become inaccurate within a year or two, rendering the labor management system ineffective.
We have met with many companies that have implemented labor management but no longer use their system because the standards are no longer accurate. This impacts morale, productivity, and your management team’s ability to manage.
It is critically important when setting up a labor management system to take into consideration the time and investment required for maintenance. How you decide to calibrate your standards will determine the ongoing cost for maintenance.
Easy Metrics supports two standards models – engineered standards and data driven standards. While both have their advantages and disadvantages, the data driven standards model is a very cost-effective way to maintain your standards.
With data driven standards, the standards are only as good as the underlying data. During an implementation using data driven standards, industrial engineers may often be used if standards have insufficient data. They identify what additional metrics are needed in order to have an accurate and fair standard.
Once the standards are implemented, the data driven standards model becomes very powerful. Easy Metrics’ data model uses a multi-variant linear regression model that tells you both the variance in the standards and, with a click of the mouse, what the optimal metric configuration is for the best standard. Recalibration is extremely cost-effective.
Using data driven standards for the maintenance of labor standards substantially reduces the cost and time required to maintain your labor management system, thus driving a strong ROI from your system.