What does General Electric, Ford Motor Co., Westinghouse and Bosch have in common with us in our shops? They have exactly the same challenges and issues we do, only a lot more of them and likely many more years to learn.
No doubt that many of you are all familiar with terms like Kaizen, ISO certification and a host of other programs all meant to improve how businesses function and provide others with proof of following established practices and procedures. While there is an ISO level for service businesses, you may not wish to dive that deeply now. But there is no reason we can’t emulate proven practices and concepts that have been shown to improve profits and processes.
We’ll only scratch the surface of what ideas and concepts exist for the taking. Assuming you agree that making more money and becoming more profitable with happier people is a good thing, the time to read this will hopefully be a great start towards your own plan of attack.
Once upon a time I launched my own program of business improvement. I have a confession. Instead of taking my time and methodically working through one issue at a time, I tried to “eat the whole elephant” all at once. The result was overwhelming everyone involved, myself included. Not exactly productive. From this practical experience, take one issue at a time, starting with your biggest current challenge. The exception is safety, where time is of the essence.
“I don’t look to jump over 7-foot bars — I look for 1-foot bars that I can step over.” – Warren Buffett, chairman and CEO, Berkshire Hathaway Inventory control – JIT: If you pull out your last balance sheet and review the inventory category, and include everything you keep in your shop for both today and “just in case” along with things like shelves full of filters and more, it is typically a lot of money tied up. JIT, or Just in Time, is the concept of keeping no more inventory than what’s needed to support work in progress. For our shops that means just what we need now for the vehicles in the shop.
This is easier said than done. Often, shops will buy inventory on terms or hold things in consignment. The term periods tend to come and go with you paying for whatever isn’t sold. And consignment isn’t really free since you will pay for lost or damaged inventory, and the loss of shelf or cabinet space.
The answer is to work with your part supplier(s) to have them hold the inventory. They are in the business of distribution and are experts at managing part inventory. You are not. To be sure you get what you need, when you need it, it is critical to partner with as few part suppliers as is practical, communicate regularly and help them to know the vehicles you typically work on any given day.
Process control: This is the heart of quality control, increasing throughput and controlling both human-resource needs and inventory. In our shops it means having some type of formal process document that shows (generally in a flow chart form) what happens when someone calls, what happens when a customer/car arrive, what takes place in terms of process of working the vehicle into and out of the shop, then delivery to the customer, ordering parts, whatever. There are any number of advantages to be gained in return for the time spent creating these flow charts.
It makes training immensely easier since you train from a documented process, and that the document is readily available to any employee as needed. Without this understanding, a new technician or employee is left to guess or rely on what may well be bad information from another person.
Result measurement: If you want to know where you make money, who makes the most for you and whether all of the other improvements you are making are working, you must measure the results. Keep the number of measurements focused with no more than four or five metrics to watch. These might include average repair-order dollars, average job flow through, days without injury, inventory levels, comebacks or whatever is important to you.
Encourage participation & empowerment: An involved team is a more satisfied and productive team. One of the greatest accolades you can give a person is to let them know you value their opinion and input. And, if you have someone who you want to begin grooming for management, let them lead one of the teams and watch what happens. People will almost always participate better in a group. But, as a small business, you don’t have unlimited wages to pay for team time, nor the ability to have too many employee hours tied up. So, taking the lead from larger companies, identify the most critical issue to tackle that will improve productivity and margin. Could be a task force regarding scheduling and work allocation.
As time goes on and challenges are met, move on to the next most important priority.
The production cell concept: The idea is to keep like jobs and common equipment together to improve efficiency, reduce steps, improve communication between people and allow for inventory to be centralized as needed. You may ask yourself, “What has this to do with me?” Well, for purposes of this article, let’s assume you have a five-bay shop. And, brakes are an important part of your business. Using this concept, it is best to centralize brake work in adjacent work bays. You will be amazed at how much this improves your shop flow through.
Safety: We have a lot to learn here. To keep this short, I’ll summarize some ideas we could put to good use.
1. To be sure the crew keeps their safety glasses nearby and not just somewhere on the bench, put an elastic strap around the back. Keeps them in place while bending over and allows them to be lifted for short periods, but kept on the forehead. Ditto the torch glasses.
2. Use “lock-out, tag-out” tags on equipment or other shop items that are awaiting adjustment, are requiring repair or are otherwise out of service. Even though you may make some kind of announcement, no one will remember and this helps to avoid someone getting injured. You can buy these through any industrial supply house for pennies each.
3. Have two people in your shop (or yourself if you are a lone act) trained in both basic first aid and CPR. Both of these classes can be completed in just a few hours through the Red Cross. This is just good practice to protect both your team and your customers. A number of great shops have added AED, or automatic defibrillators, to their first-aid kits. The units start at about $1,100, and are wall mounted. Use either printed manuals that come with the units or better yet, classes through organizations like the Red Cross.
4. Regular safety training. Over the years I have looked inside many a dilapidated, near-empty first-aid kit that takes someone forever to even find. In my humble opinion you are way ahead by engaging the very affordable services of a safety supplier. They will drop by the shop occasionally, restock the first aid kit, check your AED, provide training and ideas and, if they offer the service, check the condition of your fire extinguishers. Incidentally, everything we just covered is an excellent way to build morale since your crew gets the feeling you care a great deal about them and their safety.
5. Use hearing protection. This may be a set of expandable ear plugs for under a buck, or a simple plastic band with the plugs mounted to both ends. Before you go further, I have used and been around plenty of impact hammers for exhaust, stuck bolts, etc. According to doctors, occupations exposure should be limited to no more than 85 decibels for no more than 8 hours. In your shop there are all kinds of things that will exceed this limit. These include impact wrenches, air hammers, drills (yes, that simple electric drill), car horns, compressors, loud radios and much, much more. Not wearing ear protection may well lead to deafness, need for hearing aids, tinnitus, and more. For pennies, it seems silly to take the risk.
6. Steel-toe boots. Lots of things fall in a shop.
7. Protective gloves for fluids and general work.
8. An eye-wash station. Very few days will go buy before someone splashes something into their eyes, it drips, they get a sliver, whatever. It’s just a few bucks to convert a regular sink to an eye wash station.
More: I am not even beginning to scratch the surface. There is a lot more we are able to learn.
Finally, take some personal time and read books and articles about what other companies have done to improve their businesses. The fancy consulting term for this is benchmarking. Whatever. I call it smart. As my grandfather always said, “Hard-working people learn from their own mistakes and lessons, smart people learn from other’s mistakes.” I would rather be smart than tired.