Are you losing money because production can’t meet the volume of requests? There may be a bottleneck in your production process that, if not addressed, can cause serious issues in your business. In this article we’ll talk about:
Have you ever had an unexpected increase in demand for your product or service? It’s an exciting feeling! You finally have hit that spike in sales that is needed to take your business to the next level.
But as sales increase, does production bog down? It seems like you can’t keep up with the volume of requests. As a result, you’re taking longer to put products out and there are delays in shipping. Customers are asking for refunds and are leaving critical reviews and what should’ve been a blessing is another stress added to your already full plate.
If you’re experiencing any of this, odds are you have a bottleneck in your system. We can describe a bottleneck as a point of congestion in production (such as an assembly line or a computer network) that occurs when workloads arrive too quickly for the production process to handle.
It’s hard to know for sure how much you should produce. If you produce too much, then you have a surplus and your product can go to waste or be outdated. If you produce too little, then you have to work even harder and faster to meet the demand. It’s a hard thing to balance which is why we create a production plan to help give us a ballpark of what to expect.
But sometimes unpredictable situations happen that can throw off our plans. But we need to pivot.
The first way to pivot from a bottleneck is to have transparency in the process. With this, we mean having a clear picture of every part of the process from order to shipping. Knowing every part of the system allows us to pinpoint where the bottleneck occurs.
72% of suppliers who have dealt with supply chain breakdowns have lacked the visibility needed to come up with a fast and simple solution (Business Continuity Institute).
Gaining visibility into the process, product and equipment will give us valuable data that we can use to identify problems. Additionally, doing this early on allows us to plan ahead and create a contingency plan in case there are breakdowns.
Once we’ve added the transparency needed to see the problem, we can now start to solve it.
Here are 5 of the most common issues and how to solve it.
Change the schedule of production - If you currently have a production time of 8 hours, meaning it takes 8 hours to make your product, then maybe you need to extend the time to 12 hours. This doesn’t mean that you make employees work longer, but schedule them strategically so that one works half the time and another group works the remaining time. The goal is to keep the operation running so that the bottleneck continues to produce, even when all other operations stop.
We may be hesitant to purchase new equipment when there’s already so much going on in the business. But if you are losing money at the expense of keeping this equipment, then is it worth it?
This can increase your capacity to produce by strategically adding people to address the bottleneck. A lot of business owners worry about having the money or means to hire new people. But if putting your funds towards hiring a new person can increase your profits by twice the amount you invested, isn’t it worth it?
Automation is a system of procedures that makes sure we do the job correctly and efficiently every time. We can do this by implementing new technology that we can program to do specific tasks. This can free up the time of our employees to delegate them to more important tasks.
If you look at the bottleneck and see there are too many tasks within the bottleneck, you may need to reassign work within the bottleneck to other resources.
Communication is a must in business, not only between the owner and their team, but between the business and the customer. In the production process, ensure there are open lines of communication so that someone can report immediately any issues. Also, make sure you’re able to receive feedback directly from customers so that any issues with your product are reported and resolved before it affects your business.
There are a lot more problems that lead to bottlenecks than the ones on this list and not every solution will apply to your business. If you want to look more into specific issues that may be present in your business, talk to a professional. Our certified business coaches offer complimentary coaching sessions to discuss your business needs. Contact us today!
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