By Malcolm Campbell
All revenue stage businesses should come to understand their underlying factors of productivity. The information aids business planning and employee motivation. Both factors can be leveraged toward increasing business performance.
At Midwest Mosaic, Inc. my tile installation services company, the need could not be more vital. In 2012 we went from one employee, me, to four (still including me). When there is but one employee analysis is a rather simple metal exercise. When there are many the mental approach does not scale. Nor is a mental understanding nearly as rewarding to employees as it is to the main risk taker. Finally productivity outcomes differ from one to many. These outcomes, also known as experience factors, inform forward pricing. Pricing with inappropriate experience factors can harm business performance.
So I have formed a project group tasked with analyzing the productivity on the various tile jobs MWM performed in 2012. While I could do this myself, I believe it is more important to award the opportunity to interns, so that they may distinguish themselves in the marketplace. Also, it is important that I experience the executive factors: delegation, leadership, collaboration.
Joining the project team are: Ms. Emily Young and Ms. Chelsea French both of whom are senior business economics majors at Bowling Green State University expected to graduate this May 2013.
The high points:
- Young and French will digitize analog field data from daily project logs, and combine that with digital data from other sources.
- They have chosen to use MS Access as their data crunching tool. I told them I was impressed, and you should be too!
Tile productivity is all about square feet (floors and walls) and lineal feet (various trims; base corners, etc.). Hence they will be seeking to understand the number of square feet per workday of turn key goods on a given project or scope of work (experience factors). Followed by an understanding of the cost of labor per square foot. Finally they will compare actual costs to estimated costs to understand the economic value add attributable to labor. The value should be returned to labor as soon as possible.
- Update the historical estimating database with 2012 experience factors.
- Make recommendations for bonus distribution to 2012 employees.
Follow on Project:
Consult on how to integrate the above process into the current IT configuration so that the data can be leveraged in real time with better accuracy. Receiving better