Pat Boutier has kindly agreed to share a simple method he uses for communicating return on investment (ROI) to his customer when he delivers Job Methods (JM) and Problem Solving (PS). Can you share any methods you use? You may do so in the form of a comment below or an email to me to be posted here.
In my role as a Business Specialist at the Texas Manufacturing Assistance Center (TMAC) I often assist companies by providing TWI training. Each time I find the classes, whether, Job Relations (JR), Job Instruction (JI), Job Methods (JM), Job Safety (JS) or Problem Solving (PS), to be of immediate and measurable benefit to my customers.
Generally, though not always, I am teaching these classes to individuals who are not at the ‘top’ of the organizational pyramid, such as it might be. Those who have participated are always providing me with feedback that talks about how their participation has opened their eyes to many new possibilities and have already begun to create and / or implement change that is beneficial to the company.
So what can I do to insure that my “customer”, those individuals who make decisions, learn about the impact that my work with their teams has made?
One item, of course, is the evaluation form that I use with all of the TWI classes. But just using that form and providing copies to a manager is simply asking for a lack of involvement. What manager is going to take the time to read that many comments? So I take those evaluations and summarize them into a simple excel sheet, which provides the numbers and all the comments. All of this in a one page form. That generally allows the manager to at least glance at it and see the general input from his own people.
I’ve found this effective in getting the opportunity to discuss more opportunities to effect further change. But this still leaves me with the problem that my customer would relish a more quantified input that the work we did actually resulted in quantifiable ROI at least in the short term.
JM and PS provide that opportunity. These programs require that the participants create a ‘proposal’ sheet. Within this sheet we have the participants briefly describe the current state and the future state. We then suggest how to apply monetary values to this work.
So, right before our eyes, is the answer to supplying a decision maker with the estimated impact their TWI trained employees can have. I simply require each individual to fill out that proposal form and hand it to me before the end of the last session. (In some cases I allow them to email it to me).
With this information I now can create a brief memo listing the ideas for improvement, and the dollar impact each is likely to have on the business over a one year period. Immediately, I can have a discussion on impact, the value of which is rarely refuted because their people provided the information. What better way to discuss ROI with a customer?
Of course, the manager might talk about some ideas being impractical, or even say that the financial advantage is overstated, I don’t care, because the goal is to talk about potential impact and positive changes that can be attributed directly to TWI.
Here is a sample of a chart in the memo that follows a JM Class:
|Job Methods at XYZ Inc.||January 25th -29th, 2010|
|Projects that were identified in the10 hour JM training.|
|Yearly Savings||Project Owner||Improvement|
|$ 9,500||Joe Bidden||Create a Jig for plate welding|
|$ 5,600||Moriah Carey||Move inventory to point of use in Cell C5|
|$ 7,500||Tom Jones||Eliminate Step 3 in electroplating process|
|$ 12,000||George Washington||Simplify wiring harness on model A123EF|
|$ 13,500||Donna Karan||Hang air guns at each workstation|
|$ 12,500||George Lopez||etc.|
|$ 8,500||Sarah Palin||etc.|
|$ 16,300||Edward Deming||etc.|
|$ 18,000||Albert Einstein||etc.|
|$ 4,700||Manny Ramirez||etc.|
|$ 108,100||Total savings year one|
Pat Boutier, Business Specialist at TEXAS MANUFACTURING ASSISTANCE CENTER (TMAC) at The University of Texas at Arlington, has 30 years of technical and business experience. He works with companies in implementing and increasing their deployment of Lean Enterprise techniques working with processes that cover a wide variety of equipment and services and is also a Shingo Prize Examiner. Pat has been certified by the TWI-Institute (Training Within Industry) as a trainer for Job Relations, Job Instructions, Job Methods, Job Safety and Job Problem Solving and has completed the Black Belt in Lean Six Sigma with the George Group. In addition he has the Bronze Certificate in Lean, and is a certified RFID implementer along with being a National MEPU RFID trainer.
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