Obtaining the Cost of Lost Productivity

To help us get a decent estimate of costs associated with lost productivity, due to use of company systems that are not optimally integrated, we’ll need to collect certain data. This can be done easily in our Evaluate app, that is available online, in a secure, dedicated URL on request. The data items listed can be entered at your leisure. As pertinent information is entered, the system provides updated calculations – similar to spreadsheet behavior.

Here are the steps required:

  • List the Departments in your company;
  • List the Roles within each Department;
  • Identify the people (Team Members) involved with each Role;
  • List the Activities that people spend time working on, including deliverables-prep and production, time spent on communication, collaboration and following of procedures and processes;
  • List the System Tasks types that people spend time working in the task system, and the relative productivity factor (1 is totally productive, 0 is non-productive) of data-related management functions in each task;
  • Estimate the time spent daily by each Role in each of these Activities while performing the Tasks;
  • Use the Company tab to view a Company-based evaluation of Cost and Cost of Lost Productivity, of people by Day (based on an 8 hour work day) and by Month (based on a 21 day work Month);
  • Use the Department tab to view a Department-based evaluation of Cost and Cost of Lost Productivity, of people by Day (based on an 8 hour work day) and by Month (based on a 21 day work Month)
  • Use the Role tab to view a Role-based evaluation of Cost and Cost of Lost Productivity, of people by Day (based on an 8 hour work day) and by Month (based on a 21 day work Month).

Using this exercise as a baseline, your cost benefits for improved productivity based on integrated technology should be pretty clear. Repeat this exercise as needed to help make your case for changes and improvements to the experience that your Team Members have. People want to feel that they are not wasting their time doing ‘make-work’ or repetitive data entry at work. This approach help you to ensure that you are taking tangible steps towards actually making a positive difference to each of your company objectives, such as:

  • Improved Safety performance due to fewer dropped communication balls;
  • Improved Quality and fewer re-dos, due to improved collaboration;
  • Improved Environmental performance – less paper, and improved communications;
  • Improved Plans and Schedules – due to integration between all parties, including contractors;
  • Improved Cost performance – due to more efficient, one-time, handling of your mission-critical data;
  • Improved Job satisfaction is each Team Member as that can see that their suggestions, concerns and needs are addressed quickly and effectively.

Repeat this Evaluation process periodically to gauge your progress and discover additional opportunities to improve.

Most companies, plants, sites, etc. have an organizational structure that starts at Department (ex. Engineering, Maintenance, Human Resources, Safety, Quality, Inspection, Supply Chain, etc.).

Each Department has people with certain Roles (ex. HR Admin, Engineer, Buyer, Cost Analyst, etc.).

Steps are:

  • In Evaluation app Drill into Department tab to Add Department
  • Drill down to Role tab to Add Roles to each Department
  • Drill down to Team Member tab to Add Team Member to each Role in the Department
  • Define each Business Activity in the Activity tab of the Evaluation app.
  • Define each Task Environment and the productivity factor associated with each in the Task tab of the Evaluation app.
  • In the Evaluation app, drill down to the Department, then Role then Daily Activity and Task to Add Daily Activity and Task for Role. Account for all work hours in a day.
  • When the hours in each Role’s day has been apportioned in this way, you can view the Daily and Monthly cost and the Daily and Monthly Cost of Lost Productivity on the Company tab, or on the Department tab, for each Department.

These numbers help to focus management’s attention on the relative benefits of improved data integration and can serve as a counterpoint to concerns about the cost of obtaining such gains.

Comment or email cpmonteiro@teamworkgroup.com to request access to your company-dedicated site for Productivity Analysis leading to the determination of Cost of Lost Productivity.