So, my doofus side popped out at the end of the last episode…not an ANAGRAM, an ACRONYM…
That Chris was forced back into the deep recesses of dumb that he came from, and the other, more common and sensible Chris emerged to speak about lean thinking in small business. Jerry Isenhour started the discussion last episode, and this week I expand on this waste-elimination bandwagon.
Interview – Chris Wetzel – Home Contractors HQ
Key points from the interview:
- Lean culture in your business doesn’t occur unless you set a precedent of hearing about ideas to eliminate waste from all levels of your business. What are inefficiencies that your employees – who do the job every day – have found ways around?
- A review of TIMWOOD:
- Transportation: When your trucks are rolling around town, you are not getting paid for those hours. Time is wasted, gas is wasted, tires are wasted…what can you do to schedule your appointments in a more efficient way?
- Inventory: Both lack of inventory (see “Waiting”) and bonus inventory cause opportunities to reduce waste. Do you know how many of each product and/or materials you use on a daily, weekly, or monthly basis?
- Movement (or Motion): How can you make the process more perfect for each service you provide to make each step as efficient as possible? Are you taking several trips to the truck or to the closest hardware store (hello, also opportunities to improve your Inventory and Transportation!)? When you standardize how your employees do their jobs, these inefficiencies disappear, as well as the variation from job to job.
- Waiting: Being prepared for a majority of top-selling add-on sales (services, products, etc.) to do the job the same day you are there does two things: increases revenue NOW and frees up a time slot LATER that would have been taken up for a return trip for the add-on. Instead, you can now use that time slot for a new customer!
- Overproduction: Are you still doing free estimates, your schedule is busy, and you have customers waiting for weeks or months because you don’t have the labor capacity to do them sooner? You are a victim of overproduction…you have produced too many estimates, and have no quick way to service those customers! Your “inventory” issue is now with jobs…you have too many sitting on the shelf! Right-size your capacity by either hiring and training more workers, or stop the free estimates!
- Overprocessing: “With every purchase, you get a free spatula!” Did your customer ask for a spatula? Definitely not! OK, silly example, let’s get more real…if you are doing a 21-point inspection, and some of those points don’t contribute to add-on sales or help flag a serious concern, why do them? Just to have more points? Cutting that time out can add value in the long run.
- Defects: Every mistake is an opportunity. EVERY TIME a customer complains, listen to what they say. Make the customer happy, then…figure out WHY the problem occurred. Build your process (and document it!) to prevent it from happening again.
- “You are spending dollars you don’t need to spend to solve problems you should not have.”
Mailbag Question – We want to hear from you! Send us your questions!
Hope you enjoyed this episode…see you next time!
— Chris —