Top Office Wastes
To begin moving to a "Lean" office environment a collision repair business must first identify waste in the offices. Let me begin with Frank's Top Office Wastes……
Fragmented Processes: Fragmented processes create delays that negatively affect all aspects of the repair process and leads to poor internal and external communications, missed delivery dates, longer cycle times, lower profit margins, and lower CSI. As I outlined in my March newsletter there are many benefits to developing and coordinating processes in your office. Below is a list….
• Improved work flow
• Reduced stress
• Improved cash flow
• Reductions in cycle time
• Improved CSI
• Reductions in employee turnover
• Improved efficiencies and productivity
• Reductions in operating cost and non-value added expenses
Searching: Searching involves everything from trying to determine what to do next, to finding a file, an invoice, a repair authorization, part, etc… The typical office worker wastes more than 8 hours per week due to information delivery inefficiencies. By organizing the layout of your office, defining "Lean" processes and procedures, and implementing a Digital Documentation system you can dramatically reduce the amount of "searching" time your office employees spend daily!
Roadblocks: A Roadblock is anything that gets in the way of speeding up the process while reducing the accuracy of the process! Many office roadblocks are a result of existing company policies, procedures, and processes. For example, a shop may require their CSR's to manually fill out forms with customer, insurance, vehicle and repair information when they could be using software that would automatically create and fill out the forms for them!
Sacred Cows: A Sacred Cow is an obsolete process, task, or operation that once made sense but is no longer pertinent or required. The easiest way to determine if your office has Sacred Cows is to ask an employee why they are performing a process and they respond with "We have always done it this way!"
Duplication of Effort: This is self-explanatory. Any time a process, activity, task, or operation is done more than once, it is waste!
Improper Personnel Utilization: Improper Utilization of Personnel occurs when a shop has too many or not enough personnel to handle the workload as well as the loss of personnel because of too much or too little workload. I have been in many shops that have way too many office personnel because they are stuck in a manual, paper based operating model. Because the shop needs to process so much paper and manual communications they need more people to get the work done.
On the other hand, I have been in many shops that cannot get their administrative work done in time because they a) have a ton of manual, paper based processes and b) not enough people in the office. Many dealership body shops are victims if this and have a terrible time closing RO files in a timely basis.
Whack-A-Mole Management: If you have ever played the Whack-A-Mole game, you know what I mean by Whack-A-Mole Management. Every day you or your office manager walk into the office and tell your employees to "whack the moles" that have "popped up" today! You can also call it call it "putting out fires".
This type of management philosophy creates a tremendous amount of waste due to the fact that the office personnel are always interrupted and asked to perform or complete other tasks other than the one they are working on at the moment. This style of management also causes high levels of stress, which leads to high turnover and improper personnel utilization that we covered earlier.
Manual or Paper Based Processes: I devoted my entire February newsletter to this subject. Based on my research manual or paper based processes "cost" a shop approximately $50.00 per RO!
Old, Obsolete Computer Software and Hardware: This is a real pet peeve of mine. Most shops use hardware and software that require them to operate in a VERY wasteful environment. Today a majority of shop owners presently use a shop management system that is more than 7 years old. Those systems require their users to perform certain tasks and operations that do not support a Lean Office Environment. For example, many shop management systems require their users to manually change RO line items to properly categorize these items for payroll and their financial statements. Our research indicates that this process adds 2-5 minutes to every Repair Order. If this shop produces $2.0 million per year in sales they are wasting as much as 72 hours per year inline item changes!
Fragmented Processes: Fragmented processes create delays that negatively affect all aspects of the repair process and leads to poor internal and external communications, missed delivery dates, longer cycle times, lower profit margins, and lower CSI. As I outlined in my March newsletter there are many benefits to developing and coordinating processes in your office. Below is a list….
• Improved work flow
• Reduced stress
• Improved cash flow
• Reductions in cycle time
• Improved CSI
• Reductions in employee turnover
• Improved efficiencies and productivity
• Reductions in operating cost and non-value added expenses
Searching: Searching involves everything from trying to determine what to do next, to finding a file, an invoice, a repair authorization, part, etc… The typical office worker wastes more than 8 hours per week due to information delivery inefficiencies. By organizing the layout of your office, defining "Lean" processes and procedures, and implementing a Digital Documentation system you can dramatically reduce the amount of "searching" time your office employees spend daily!
Roadblocks: A Roadblock is anything that gets in the way of speeding up the process while reducing the accuracy of the process! Many office roadblocks are a result of existing company policies, procedures, and processes. For example, a shop may require their CSR's to manually fill out forms with customer, insurance, vehicle and repair information when they could be using software that would automatically create and fill out the forms for them!
Sacred Cows: A Sacred Cow is an obsolete process, task, or operation that once made sense but is no longer pertinent or required. The easiest way to determine if your office has Sacred Cows is to ask an employee why they are performing a process and they respond with "We have always done it this way!"
Duplication of Effort: This is self-explanatory. Any time a process, activity, task, or operation is done more than once, it is waste!
Improper Personnel Utilization: Improper Utilization of Personnel occurs when a shop has too many or not enough personnel to handle the workload as well as the loss of personnel because of too much or too little workload. I have been in many shops that have way too many office personnel because they are stuck in a manual, paper based operating model. Because the shop needs to process so much paper and manual communications they need more people to get the work done.
On the other hand, I have been in many shops that cannot get their administrative work done in time because they a) have a ton of manual, paper based processes and b) not enough people in the office. Many dealership body shops are victims if this and have a terrible time closing RO files in a timely basis.
Whack-A-Mole Management: If you have ever played the Whack-A-Mole game, you know what I mean by Whack-A-Mole Management. Every day you or your office manager walk into the office and tell your employees to "whack the moles" that have "popped up" today! You can also call it call it "putting out fires".
This type of management philosophy creates a tremendous amount of waste due to the fact that the office personnel are always interrupted and asked to perform or complete other tasks other than the one they are working on at the moment. This style of management also causes high levels of stress, which leads to high turnover and improper personnel utilization that we covered earlier.
Manual or Paper Based Processes: I devoted my entire February newsletter to this subject. Based on my research manual or paper based processes "cost" a shop approximately $50.00 per RO!
Old, Obsolete Computer Software and Hardware: This is a real pet peeve of mine. Most shops use hardware and software that require them to operate in a VERY wasteful environment. Today a majority of shop owners presently use a shop management system that is more than 7 years old. Those systems require their users to perform certain tasks and operations that do not support a Lean Office Environment. For example, many shop management systems require their users to manually change RO line items to properly categorize these items for payroll and their financial statements. Our research indicates that this process adds 2-5 minutes to every Repair Order. If this shop produces $2.0 million per year in sales they are wasting as much as 72 hours per year inline item changes!
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