Mitigating Business Risks by working on your software and work flow processes
Spending most your time working in, rather than on your business? With plenty of pressures to meet demand and keep customers happy, you’ve got your head down, spread so thin that it’s hard to even find the time to hire the additional people you need. Keeping track of orders is time-consuming, managing the supply chain is a real challenge and the prospect of a mistake which could cost thousands is an ever-present worry. Putting out fires isn’t fun.
However, this situation is fraught with risk…
In the absence of appropriate processes and systems, you’re at the mercy of tribal knowledge contained in the heads of key people. A single mis-handled order can wipe out a month or more’s worth of profits (one manufacturer shared with me a simple mistake costing over $100,000 – and that was just the aluminum cost, not the lost productivity or impact on other orders).
At the same time, fenestration knowledge is hard to come by. Tenured employees with knowledge of the business are retiring. The ‘next generation’, who should be stepping into their shoes, left the construction industry never to return in the wake of the Global Financial Crisis. Scalability is no longer achievable by adding bodies. The talent pool is just not there.
Further to that, manual cutting is hugely inefficient; an experienced operator might achieve 15% waste, versus an optimized cutting plan can easily achieve 5% waste. Assuming you are buying around $1.2-million of aluminum a month, that’s a saving of $120,000, every month.
The solution lies partly in software, which allows information to be housed in a single silo. No spreadsheets, handwritten notes or tribal knowledge. Software which provides instant visibility of process flows (and processes which are clearly defined not just on the factory floor, but also in the manager’s office). Software boosts control, efficiency and equips your factory for the automation necessary to meet current demand cost effectively, and provide scope for future scalability.
You want information to flow unimpeded from the estimate to manufacturing, to your ERP. Most of the folks I discuss this with agree that it is time to move into the future. But here’s the thing. Good software, properly implemented, will cost some money. But, so does your current way of doing business. Just go back to my client who lost $100,000 on a single order…
By working on your business, investing in your software and work flow processes, you will reduce your business risks, better utilize your internal talent and achieve better financial results.