Increasing Productivity via Technology What it is - How to measure – Technology - Case study

Terry Rachwalski, MBA CMC

@consultingmania #CEMC terry@theconsultinglife.ca

1. Automation applied to an efficient operation will magnify the efficiency.

2. Automation applied to an inefficient operation will magnify the

inefficiency.

Bill Gates

Where is the value? Strategy

• Business model

• Customer value

• Uniqueness

Operation

• Perform activities better

• Cost, quality, time

• Execution

Decision making framework

• Strategic objectives 3 – 5 years? Performance?

• 5 best opportunities for growth?

• Pain points? What keeps you from growth? SWOT

• 5 biggest opportunities for productivity?

• Barriers to increasing productivity?

• How will we measure?

COST vs FLOW

COST - re-work, reducing waste & non-value add

FLOW increase includes

COST items + Increased output Improved quality

Decreased lead time

Why flow? Increase sales and

productivity

Cold facts: Value Added per Employee + ROI = Productivity

Earnings Salaries VAPE

FTEs

Value? +

What to do more of ? Less of?

+ Compare VAPE and ROI

+ Does the technology add

a strategic value? =

Make it so!

Barcode 12 digits

Standardized

Need line of site Close proximity

Quick response code Sends to a web site

Need smart phone + app

Close proximity

2D tag code Sends to a web site

Need smart phone + app

Close proximity Design! Retail !

Magnetic stripe Access control

Mag stripe less secure

Access Control

125kHz

Close proximity

Smart cards

More secure

Finance, border control, security

Passive RFID Poly tag

Standardized More data

1-3 m read range

Need reader + antenna Retail/inventory

Warehousing

Active RFID & RTLS Transmits

Needs battery Longer range

Indoor alt: WiFi

Need reader + antenna

Warehouse High value assets

GPS/cell Needs antenna

Outdoor Fleet management

Tracking Time

Value added features

Handheld Devices Versus

Smart Phones

Ruggedized Barcode/passive readers

Retail/inventory

Warehousing

Mobile Forms

Lone worker safety

Smart Phones

Mobile Work Force management

Visibility Needs

Combinations of technology &

business intelligence

Case Study: real time locating inventory

• Before RTLS (Monthly) – Labour – 4 people per shift $16,000

– Rush shipments & late charges $ 5,000

– Halted or slowed production lines $12,000

– Total $33,000

• Cost with RTLS (Monthly) – Labour – 1 person per shift $ 16,000

– Labour re-assigned to high value work

– Rush shipments & late charges $ 2,000

– Halted or slowed production lines $ 5,000

– Total $23,000

– Monthly Savings $10,000

ROI & VAPE

• Technology saved $10,000 per month

• Capital cost of $100,000 ROI = 10 months

• Re-assigned labour increased profit

• VAPE: increased 10% per employee

• Improved client relations = differentiator

Where’s the sweet spot?

Technology doesn’t solve bad process

Stick to value & profit

Productivity is in flow not just cost reduction

Value added per employee + ROI + strategic value

Combine business intelligence & technology

Questions? Terry Rachwalski, MBA CMC terry@theconsultinglife.ca

@consultingmania

Next up: Eric Anderson - Business Intelligence