A Standard is a Line in the Sand
Organizations identify value they can unlock in their businesses by establishing standards. Once established, a standard becomes a measure for what actually happens. Improvement comes from understanding and closing the gap.
But … how can we improve if the expectation or standard is wrong?
Drawing a line in the sand
Direct observation creates the best standards for processes requiring manual labor. Multiple observations, with close attention to the details of what is and is not value added, leads to a strong understanding of the time the task requires.
However, most standard times for labor content are established from a history of demonstrated performance or an educated guess from an engineer. And most standard times for labor content are wrong.
The good news, however, is that the improvement cycle still works.
The improvement cycle still works
Suppose the task of sewing a t-shirt takes 10 minutes, but the standard time established by the company is 5 minutes. The cause may be that the standard time was calculated observing a faster stitching pattern and this t-shirt’s patterns takes longer. The immediate reaction when a person sewing the t-shirt is asked to improve is: “Well, the standard is all wrong.”
The standard is clearly wrong, and by a large margin, but for the purposes of improvement, it is still a line in the sand. The trick is to measure performance based on the line in the sand.
Suppose a team member makes 6 t-shirts in an hour at roughly 10 minutes each. The efficiency for the hour, based on the standard of 5 minutes per t-shirt, is 50%.
6 t-shirts at 5 min each per standard (30 min)
divided by
6 t-shirts at 10 min each actual time (60 min)
= 50 %
Now suppose an observation of the sewing process recognizes that unfolding the material and lining up for the first stitch takes one minute, but by using a template and fixture, it can be reduced to zero. Now the time to sew the t-shirt is nine minutes. If we measure our efficiency again we find it is 55%, a 5% improvement in efficiency and a 10% reduction in the overall time.
6 t-shirts at 5 min each per standard (30 min)
divided by
6 t-shirts at 9 min each actual time (54 min)
= 55 %
The real danger in a wrong standard
The real danger in thinking it takes five minutes to sew a shirt when it really takes nine is in how we cost the t-shirt. If the sales team believes the t-shirt only requires 5 minutes or .50 cents worth of labor, but in reality it requires 9 minutes or 95% worth of labor, the risk is lower than expected profit. The other risk is using the standard to schedule the day and apply resources.
For the operation, however, the line in the sand still allows for improvement. The standard should be changed to reflect what is real, but it is not an excuse for not measuring performance and driving improvement.
Learn more in Patrick’s book, “Facilitating Effective Change,” available online through Amazon and Barnes & Noble.
Patrick Putorti
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