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Commercial Motor ~ 20/08/09

 Surviving the Recession

 It appears that nearly all companies in the transport and logistics sector (not to mention most other industries!) are suffering from the current recession.

 Sales are down, profits on those reduced sales are also down and, therefore, profits are suffering from a double blow. So we are sure that every wise company is reviewing costs to see how they can be reduced effectively without the business as a whole, or the reputation of the company, suffering.

 The Continuous Improvement Process is designed to assist companies to overcome these very problems. It closely monitors the efficiency of a business to see where savings can be made. Experience has shown it to be most effective in service (workshop) or manufacturing operations and is also most easily quantifiable in those Departments.

 The Team

 The Process uses a team of the company’s own employees (we have found 6 to be the ideal team size but this can vary depending on the size of the operation) who, under the guidance of the Team Leader, closely analyse the operations performed by each employee in a specific Department or area and, with the guidance of the Team Leader, assesses where time or material savings can be made. By using a team of employees, it ensures that the staff ‘own’ the recommended solutions so changes are more readily accepted by the workforce.

 For best results we suggest the team itself should not comprise purely staff from the shop floor. Typically in a vehicle service department, for instance, we would recommend that, as well as including one or two technicians as team members, one should also include someone from each of the Parts Department, Sales Department, Reception, Admin Department (all of whom do have on influence on the operations in Service). Where feasible, at least one member should be female as we have found that women usually see things from a different perspective and often come up with excellent, innovative ideas.

 We generally discourage having a member of management on the team as the tendency then is for the other team members to agree’ with the manager’s comments and they are less likely to come up with so many good, innovative,  ideas for improvement.

 Outside Eyes

This brings us to the Team Leader. We have found it is essential for him to be from outside the business (or maybe from another branch, but even that is unlikely to give the best results) as those from within the company have become ‘accustomed’ to the present way of doing things and usually see far fewer opportunities for improvement than an outsider.

 One good example where we witnessed this was when we carried out the Process for a client who had a particular concern in one area of the business. A senior QC Manager joined us with a view to assisting with follow up after we left. The Process itself was so successful that further ‘bottle necks’ were created further along the process so it was decided that the QC Manager would repeat the Process on this other section of the operation. When we returned a few days later to review his progress we immediately noticed a number of potential areas of improvement which had been missed due to his over-familiarity with the existing operations. He had not guided the Team to consider and analyse these points but had, in most cases, just considered the status quo to be ‘acceptable’.

 An ‘outside pair of eyes’ (trained to visualise potential alternatives) is DEFINITELY the key to a successful outcome.

 International Solution

 CIP Development Services have carried out this exercise in over 100 companies worldwide – apart from in the UK, we have introduced it into many companies in Africa, Australasia, Middle East, Russia, etc. In every single instance the costs of the exercise have been proved to be capable of being recovered within about 3 or 4 months and after that profits increase accordingly, as well as customer satisfaction and overall efficiencies. We are so confident in the success rate that we now guarantee an increase in profits if CIP personnel are involved (as Team Leader) in the initial 5-day exercise (i.e. a refund of the CIP consultancy fee if such potential savings are not proved by the team involved).

 This international aspect also means that excellent ideas are ‘discovered’ in a variety of countries and can be adapted to be suitable in the next country / company as relevant.

 In one large operation with two vehicle workshops it was proved that profits (before tax), including profits on the additional parts sold through the two service departments as a result of the increased throughput from the same number of technicians, due to increased efficiencies, would increase by a little over £3.5 million over the first 12 month period following completion of the exercise!

The programme itself is usually completed in 5 working days in the UK (overseas it may be slightly longer if translation is required) and the afternoon of the fifth day is set aside for the presentation of findings to Senior management so that suggestions and recommendations can be approved at the appropriate levels. Once this initial analysis has been completed, the programme is left with the company for ongoing review by the Team so that “Continuous Improvement” can be exercised, particularly as key parameters change. Follow-up reviews by the “outside pair of eyes”, taking one or two days every few months, are also recommended to ensure that implementation is ongoing. It is also often found that an improvement in one area can result in exposing an unforeseen shortcoming in a related activity which, in turn, will need fresh analysis during the follow process.


 Every minute saved by improving the efficiency of a technician, or ensuring he does the job he is employed and trained to do, rather than performing tasks that do not use his skills to the full, (so should be performed but others or would not be necessary if policies or procedures were modified, or maybe are not really necessary anyway!) is a bonus. The aggregate time saved will often enable one more vehicle per day to be serviced by that technician – a significant saving!

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