If you have read other blog posts on this site you may have come across me writing about the hockey stick effect. This is the term often used to describe the uneven output many factory based businesses experience towards the end of the month.
Recently I have witnessed a couple of businesses who have a double hockey stick effect in their business. The order book is front loaded in the month (i.e. their planning doesn’t go much past the first week and a half of the month) and the output is back loaded in terms of what really happens.
There are two main things going on here. There is a lack of realism in the planning (let alone thoroughness) and there is a lack of control regarding throughput within the production side of the business.
A good way to prevent this situation from occurring is to implement a formal sign off process to the production schedule. Every business has some kind of ‘rule of thumb’ that can inform you whether your plan is achievable. It is very rare that a business can handle twice the volume of work without investing in equipment or undertaking some form of radical process improvement work.
This approach doesn’t have to be rocket science, but it does have to make sense and leave us with a workable plan.
Giles Johnston
Author, Consultant and Chartered Engineer