Understanding the impact of labour on manufacturing operations – where to start?

Posted in Blog on October 27th, 2020

Cimlogic is dedicated to understanding and exploring the challenges faced by the manufacturing industry. We focus on recognising and analysing our clients’ business issues, whilst aligning with the best-integrated technology solutions to meet their goals and deliver maximum value.

So, here are the key takeaways from our recent labour efficiency blog series, along with some suggested next steps to understanding the impact of labour on manufacturing operations…

  • Evaluate the factors that are impacting your labour costs the most

In the first blog, we set the scene by discussing the external factors that are having a huge impact on manufacturing labour costs, including the COVID pandemic, Brexit uncertainty and the national minimum wage rise. We also emphasised the integral role that digital technology will play in reducing labour costs and mitigating the risk to profitability.

Read the full blog ‘What external conditions are impacting labour costs in manufacturing’

  • Consider what effect high OEE has on other areas of production such as labour

The importance of measuring OEE in the context of other KPI metrics including labour efficiency variance, maintenance optimisation, and overall productivity was highlighted in the second blog. It was established that a clear understanding of both labour and OEE metrics is key to ensuring that manufacturers optimise the performance of their workforce to achieve production targets.

Read the full blog ‘What is high OEE costing you?’ 

  • OEE data needs to drive actionable improvement

In the third blog we examined the pros and cons of OEE, and how effective it is at providing a complete view of factory performance. It was established that viewing single machine performance in isolation will not help identify bottlenecks and explains why manufacturers should address wider challenges when building a business case for an OEE system.

Read the full blog ‘Going beyond OEE: real-time visibility of manufacturing performance to gain competitive advantage’ 

Do you have the systems and tools to answer these questions accurately?

Labour issues are driving manufacturers to look at new ways to monitor and control labour costs, such as automating processes and implementing digital technologies.

  • What impact are rising labour costs having on production costs?
  • What effect is labour uncertainty having on efficiency & production KPIs?
  • Do you understand how profitably your jobs are running?
  • What is your labour cost per unit and labour cost per production run?
  • How many packs do you produce per operator hour?
  • How accurate is your labour cost/efficiency data?
  • What are your true labour costs?

The next step to improving labour efficiency

Would you like to learn how to increase labour efficiency in the production process and understand how the workforce affects production costs and profitability? Register to our upcoming webinar ‘Labour Variance in Manufacturing’ on Fri 6th Nov 2020 at 11am.

Cimlogic’s industry experts, Fraser Thomson (Business Development Director) and Oliver Stone (Head of Operational Excellence) will be joined by a guest client for this discussion on labour variance in manufacturing.  They will offer their collective experience and insight into the key labour challenges currently facing manufacturers, such as workforce shortages, skills gaps and rising labour costs.

Learning Outcomes:

  • What is causing a rise in manufacturing labour costs?
  • The impact of workforce uncertainty on output & productivity
  • Real-time labour efficiency data to measure true labour costs
  • Example client stories & the benefits gained from an integrated labour solution
  • What digital technology tools are available to manage labour efficiency, highlight cost savings & improvement opportunities?