Category Archives: recruiting

Management By Walking Around

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Wage pressure is here.

Every site I go to the number one issue is “How can we get the people we need to produce at the level we need to produce?”

A facility struggles to find and keep qualified people and then a competitor opens the doors across the street.

What to do.

The short, and expensive answer is to raise wages.  Not just any wages; you need to raise entry level wages if you are looking to attract more employees.  You need to raise all wages if you want to keep employees.

This is Wage Economics 101.

We can get caught up in the “wages solve everything” train of thought but then we lose track of the fact that wages are not the only reason people come to work for you.

This brings me to the subject of this post: Management by walking around.

I was recently at a manufacturing facility where they were struggling with getting people in the door.  There was a lot of local competition for the same level of worker within a 20 mile radius.

This particular site was paying wages slightly below the median level.  This understandably made it hard to compete for new employees.  However, this company was having very little trouble retaining existing employees; employees that knew they could make more money for similar work just a mile down the road.

I was curious about this and went about interviewing people as to why they liked working there.  Overwhelmingly the answer was: “I like the people I work with.”  Nine out of ten gave this as their primary reason for working there.

Now, add to this equation, the plant manager; a young, very bright and energetic man.  He took me on a tour and introduced me to everyone we met.  He knew their first names.  He knew how many children they each had.  He knew who was in school.  In short, he knew everything about the 200 employees there as if they were his friends.

And that’s how he treated them.

It was clear that he was in charge.  If he saw a leak, he’d point it out to maintenance and they got after it.  If a machine was having a problem, he’d ask the operator what he, the Plant Manager, could do to help.

There was mutual respect across the board.

This manager spent a lot of time on the floor.  Mostly, I think, so that his people would see him seeing them.  His presence never had the feel of an inspection.  Rather, he was there to help them do their jobs.  The employees were working hard, but not for some unseen boss behind a closed door.  They were working for the man in the smile that knew them as if they were family.

This was a great place to work and I’m enjoying my time there.

It all started with the Plant Manager.  His positive attitude moved down through the ranks until the newest hire felt like he was an important part of what was going on around him.

Yes, wages are the big player when it comes to attracting and retaining quality employees.  But remember, its not the only game in town.

Jim

 

5 things H.R. needs to know about shiftwork

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Let’s start with this – My intent with this post is NOT to tell H.R. how to do their job. Rather, I want to round up many of the issues surrounding shiftwork in an effort to put the spotlight on those I have found to be most important to H.R. professionals.

So, let’s get to the list…

#1: No one is going to come to H.R. to tell you how much they like the schedule they are currently working.  When people are unhappy, they complain. When they are happy, they are quiet.  This means that people coming to your office to complain about the schedule will ALWAYS out number those that come by to tell you they love it.  Just be aware that listening to those that come to you is not a representative sampling of your workforce.

#2:  What the average shiftwork wants or what a nearby plant is doing has little bearing on what you should be doing with your schedule.  After nearly 30 years in the business, I can tell you exactly what the average shiftworker likes and doesn’t like; and yet…I have never met an average shiftworker.  Everyone is unique.  In the same way, your business is unique from the company down the street.  What works for one company is not necessarily what will work best for you; even if you are in the same industry.

#3: As a service organization, H.R. works for several different interests including: planning, production, maintenance, quality, administration and leadership.  All of these have different functions and thus often require different shiftwork structures and outcomes.  Serving several masters is no easy task.  All need to be heard.  All need to be tended to.  Remember, if H.R. was easy, no one would need you.

#4: Recruiting and retention of skilled employees is always affected by the shift schedule being used.  Supervision, absenteeism, vacancy coverage and overtime will also be impacted.

#5: Process is everything when it comes to changing a shift schedule.  How you communicate plans and ideas as well as how you solicit input from affected parties will determine the ultimate level of success you experience with your change.

Jim Dillingham, Partner

(415) 265-1621

Jim@shift-work.com

5 Signs that you may need a new shift schedule

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Shift schedules rarely fail overnight.  Typically, there are plenty of warning signs; signs that tell you to take action before it’s too late.  Here are the 5 biggest warning signs.

#1: You have idle equipment while still not producing enough to meet customer demands.  There can be a lot of reasons for this; nearly all of which point to a schedule that does not have the right people in the right place at the right time.  Product flow, staffing, maintenance and production order variability can all be addressed with the right shiftwork structure.

#2: Maintenance is blaming equipment availability for a downward trend in equipment up-time.  You can’t fix something while it’s running.  The result is often and solution like “We’ll wait until the weekend to fix it.”  This is fine until you find that leaving too much to the weekend ends up with an overly fatigued maintenance group with not enough hours on the weekend to fix everything.  Scheduling equipment, like scheduling people, can improve maintenance accomplishment while still getting the production hours you need.

#3: Absenteeism is going up as overtime starts to wear down your workforce.  As overtime goes up, two things will happen.  First of all, your workforce will start to get tired.  Secondly, they will notice that they are now making a lot of money and can afford to take time off.  This is a “death spiral”  situation in that it is self-perpetuating and will only get worse.  Staffing will impact overtime but to do so effectively, you must have a shiftwork structure to support the newly resized workforce.

#4: Local competition for labor is causing problems with recruitment and retention.  I can’t tell you how many times I’ve heard something like “Amazon just opened a mega-facility down the street and is hiring all of our employees away from us.”  The right schedule, one that is a good fit for your workforce as well as your business can help with this.  If wages are a concern, look for ways to get overtime to that 20% of your workforce that wants all they can get.  Overtime costs your company about the same as fully loaded straight time.  This means when you pay overtime, your employees make 50% more but your cost per hour is virtually unaffected.  Don’t lose your workforce because of wage pressures or quality of life issues.  The right shiftwork structure can help.

#5: Productivity metrics are dropping as equipment runtime-hours are on the rise.  If you are running more an more hours with the same old schedule, then you are probably seeing an increase in overtime.  While overtime is not a bad idea in many instances, it can eventually lead to worker fatigue.  This is especially true if you spread it evenly across all shifts.  Remember, not all employees want the same amount of overtime.  As fatigue goes up, so will accidents, quality issues and absenteeism.  You make find, for example, that running 6 days a week yields more output than running 5 days.  However, if you didn’t change schedules, a 20% increase in runtime will yield significantly less than a 20% increase in output.

In summary, don’t underestimate the impact of having the right shiftwork structure.  Fixing this issue is often the most expeditious and cost effective way of improving your overall operations.

For more information, call me, Jim Dillingham, at (415) 265-1621 or drop me a line at Jim@shift-work.com

The next generation of shift work schedules

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As unemployment drops and wage pressures rise, companies are scrambling to find ways to attract people.  This is an especially challenging task for companies that work around the clock.  How can they be expected to attract people to jobs that require work on nights and weekends?

Here is an example of two schedules that work in tandem.

Let’s start with the situation.  This company had a very popular shift schedule (12-hour, 2-3-2 pattern) and yet, they were having trouble recruiting people to the night shift.  They were doing some things right: (1) Used fixed shifts and (2) paid a 12% shift premium for nights.  Still, they were having trouble.  Since people were not sticking around, training was a problem as well as staffing.  How could they attract quality people to nights, get them trained by senior people on days all the while giving them a Night Shift schedule that many would prefer to work over the existing Day Shift pattern.

We recommended the following:

Keep the 12-hour day shift pattern as it is

Replace the night shift pattern with one that has fewer short breaks, some day shift exposure and more weekend off.  Below is a copy of the schedule.A few notes about the features:

Slide1A few notes about the features:

  1. The Day shift is staffed by 2 crews.  Their schedule’s pay week starts on Sunday.
  2. The Night shift is staffed by 5 half-crews.  Their schedule’s pay week starts on Monday.
  3. Day shift people can take 24 hours of vacation on either Monday/Tuesday of week 1 or Wednesday/Thursday of week 2.  This 24 hour vacation nets them 7 days off in a row and thus represents prime vacation time for the Day Shift.
  4. Since the Night Shift is broken up into half-crews, two crews will show up every day to make up a full crew.
  5. Nights have a 7-day break every 5 weeks.  They also have two 3-day weekends off (in addition to the long break) every 5 weeks.
  6. Nights can get a 14 day vacation break using 32 hours of vacation time if they take off during week 2.
  7. Once, every five weeks, each crew rotates into week 2 where they go to days.  While on Day Shift they can be trained, relieve others for training or cover the expected high vacation rates on these days.

This is an example of a schedule working for the company instead of the other way around.  All too often, companies see their schedule as a static situation; one they must change their operation to conform to.  The reality is that a schedule can be used to enhance product flow, increase employee morale, lower costs, control overtime, flex the workforce, match the workload and much much more.

If you have any questions, here is my contact information:

  • Jim Dillingham, Partner at Shiftwork Solutions
  • Cell: (415) 265-1621
  • Email: Jim@shift-work.com

 

What is the Worst Shift to Work? Night Shift? Afternoon Shift?

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In my last post I talked about shift workers’ preferred shift, which is day shift, and the implications of that preference on worker satisfaction levels.  An obvious follow-on question to the preferred shift assignment is to understand shiftworkers’ least-preferred shift.
Over the last 23 years working with shift work operations, I have observed that there is often one least preferred shift at a site, and it is either the night shift (also known as 3rd, graveyard, or sometimes the hoot-owl or hoot shift) or the afternoon shift (2nd or swing shift).  Which shift is least preferred at a particular site is typically driven by the demographics of the work group and the work environment.

Here are the overall results from our database of survey responses to the question “What is your least-preferred 8-hour shift?” : Least preferred 8-hour shift.

 

From a sleep management perspective, most shiftworkers have more trouble getting enough good-quality sleep on the night shift.  This makes it less desirable for facilitating high alertness.  On the other hand, it allows the people on night shift to meet other obligations in their lives like managing child care, going to school, working a second job, and spending time with their families.

Afternoon shift allows many shift workers to manage their sleep patterns better (second shift workers get more sleep than either day shift or afternoon shift) so they often feel better on this schedule than on a night shift schedule.  The main downside to the second shift is that it requires work during the “prime-time” evening hours when family and friends are available.  For parents, this can be a deal-breaker since it may mean that they almost never see their families during the workweek.

This difference of opinion on the least desired shift is an opportunity when it comes to staffing your shift schedule.  On an 8-hour schedule, it is often possible to give an overwhelming majority of folks either their first or second choice of shift assignments and avoid the least desirable shift.  All it takes is some flexibility in the shift-bid system and sufficient cross-training of the workforce to meet the skill requirements on all shifts.

If you have questions about shift-workers’ shift schedule preferences or shift staffing issues, please call us at (415) 763-5005.  Or you can email me, Dan Capshaw, directly at dan@shift-work.com.

How many people does it take to staff your schedule? (Part 2)

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There is a short answer and a long answer to this question.  Here is a link to the short answer.

Now for the long answer:

Take a look at the “short answer” in the previous blog post.  That is a good place to start.

The following should be considered to refine the number you get using the “short answer”:

  1. The cost of full time labor matters.  How much does it cost you to pay someone for an hour of straight time?  How much does it cost you to pay for an hour of overtime?  I am not talking about “how much an employee receives.”  I’m talking about cost-to-the-company.  If you do the analysis correctly, you should find that the two costs (overtime and straight time) are within 10% of each other.  This is important because the amount of overtime you use will play a big factor in staffing levels.  For a fixed workload, the higher the overtime, the lower the staffing level you need.

  2. How much training does it take to qualify an employee for a position.  It is likely that there is a wide variance on this with regards to different positions.  Do Not use and “average”.  If you need an astrophysicist and a box stacker, an average will give you a bad number (4 years of post-graduate study for the physicist and 5 minutes for the stacker = about 2 years, on average, to train an employee).  Long training times lead to an increased use of overtime and less reliance on other labor options such as temporary help.  If your workforce is staffed with highly  skilled people, whose skills are easily transferable to another nearby company, then you will have to bend a more towards compensation scheduling and employee preferences for overtime so as to not lose these people.

  3. How variable is your workload?  If your workload level is flat, you will still have some fluctuations in staffing as people are on vacation or FMLA etc.  When staffing fluctuates, you have have extra staffing available or you can use overtime or you can reduce production.  Cost, degree of variability, employee preference and the nature of your operations will all play a role in determining how you staff for variability.   Its worth noting here that the most expensive option is to over-staff or staff for peak production as this leads to frequent over-staffing which is costly. A highly variable workload tends to mean lower staffing and higher overtime.

  4. How available are alternative sources of labor?  It your workforce pro-overtime or overtime-adverse?  Is temporary or part time labor available? If you are in Memphis and need temporary, highly skill forklift drivers, there are temp. agencies that can give you all this type of labor that you want.  However, if you need those same temporary skill in San Francisco, you may need to “grow your own.”  Can you scale back with seasonality by using shorter work weeks or voluntary layoffs?  Note: If the answer is no, the staff to the lower end and use overtime when things get busy.

  5. What about support activities?  Things like maintenance, engineering, quality shipping/receiving and administration all need to be staffed appropriately as you grow (or shrink).  There is no simple formula for how to staff these as there is often not a “straight line” relationship between staffing numbers in operations and staffing numbers for support areas.  For example, a 30% increase in operation staffing does not mean you need 30% more CFO’s.  In some areas, you may actually find that you need fewer support staff.  For example, maintenance struggles to fix everything on the weekend but if you go to a 24/7 schedule, maintenance can now take place any time in the week; including weekdays where it can be performed more efficiently.

  6. Are you LEAN?  It’s “old school” to think you should stockpile between cells in a value stream ensure you never run out of product either upstream or downstream.  Instead, just-in-time is what modern operations strive for.  Many companies can maximize or throttle production using staffing alone.   This may mean you staff an area below its maximum capacity to enure it does not outrun its value stream neighbors.

  7. What is the opportunity cost of lost time?  This must be a consideration if you are going to staff with as few people as possible.  You may save a lot of money by having fewer maintenance specialists but then you might lose even more money if you suffer downtime because you are understaffed.

Staffing is at least as important as that next piece of equipment you are considering.  The right number of the right people will impact your cost structure at several different levels.  It will impact labor costs.  It will impact quality.  It will impact volume.  It will impact turnover and absenteeism.  It will impact your ability to respond quickly to your customers.

If you have any questions, please give me a call.

Jim Dillingham, Partner

(415) 265-1621 or Jim@shift-work.com