In manufacturing and warehousing, when we set out to make improvements, we tend to aim for operational improvements. We look at materials movement, machine up times and worker efficiency. Yet often problems come from poor information handling. Incomplete, late and incorrect information causes delays, quality issues and a host of other woes.
In short – it is important to take a hard look at the administrative side of business.
Examples I have seen over the years:
1) Inaccurate customer data: The delivery person mixed up the billing address with the shipping address. The delivery truck is driving down Fifth Ave in Manhattan – wondering why they can’t find an industrial warehouse!!! That promised one-day delivery? Late.
2) Manual error part I: A salesperson quickly jotted down the quantity the customer ordered on the phone. He wrote 52 items instead of 62. The delivered order was short. A second rush delivery had to be made. Late again.
3) Manual error part II: The reverse can happen too – the customer ordered 52 items, but 62 were delivered. The driver has to return to pick up the extra 10 units.
4) Billing errors: By definition, billing errors follow a delivery error. How long will it take to bill the customer correctly for what they ordered, not for what was delivered?
Billing errors are the worst. Customers just love being over-billed. They also love having their accounting dept talking to your accounting dept for days on end to sort things out. It always takes more than a few iterations to get it right.
will it take to bill the customer correctly for what they ordered, not for what was delivered?
5) Billing errors are the worst. Customers just love being over-billed. They also love having their accounting dept talking to your accounting dept for days on end to sort things out. It always takes more than a few iterations to get it right.
6) Accurate Inventory: A salesguy writes down a phone order – but doesn’t input the order into the system for an hour. Another salesguy gets a call and sells his customer the same material. Uh oh!! Stock out. Neither salesperson has any visibility as to what was ordered and how much inventory remains. The promised one-day delivery suddenly turns into a 2-week nightmare as there is a mad scramble to get the material via rush order (an expensive solution). Customers really enjoy this kind of service!
7) Emails: – Everyone’s inbox is absolutely crammed with company emails. It is easy to miss an important email as it’s buried in CCed emails, company updates, etc.
8) Purchasing: Purchasing requires sign offs and approvals. Something needed right now can take weeks as the paperwork wends its way from inbox to inbox.
We are human. We will all make mistakes. Yet, we can create an administrative environment that is much less error prone. Meaning, it is time to ask:
What are our most common administrative mistakes?
What do those mistakes cost us? Extra work? Pissed off customers? Lost sales? Lost customers?
GEMBA BY JOAN ADAMS
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