Continuous improvement plans
How to make your estimating department work smart, not harder
Over the past few years, many formal “Continuous Improvement” programs have been promoted, such as ISO 9000 and TQM. Continuous improvement, or quality improvement, is defined by ISO A8402-1994 as: the actions taken by an organization to increase the effectiveness and efficiency of activities and processes in order to provide added benefits to both the organization and its customers. The goal is to work smarter, not harder. Companies that adopt either ISO or TQM already have formal systems. But what can the rest of us do?
An effective continuous improvement program is usually triggered by an event that forces a company to review its current situation, change or correct its processes and communicate the changes to all employees. Don’t wait for the trigger event to be a customer complaint. Make the event a scheduled meeting, or even a call from a prospective supplier.
An accurate estimate requires accurate, detailed specifications. Usually it’s the sales reps who meet customers, obtain the job requirements and document them. Begin your continuous improvement program by training new sales reps on the request for estimate process. Encourage them to provide feedback. Is information lacking? Should the request for estimate require samples, for instance?
Another process could see your estimator taking 10 minutes out of scheduled sales meetings to present general feedback, announce new suppliers, materials and processes, or cover interesting and creative solutions that were applied to complex jobs during the planning stages.
Accurate standards are critical, but seldom do we have the time for formal reviews or updates. Ask a summer student or intern to review dockets and analyze your standards based on current equipment and performance.
Continuous improvement begins with a list of questions for new or prospective trade suppliers. The list should review key measurements such as turnaround of quotes, competitive pricing, service, quality, on-time delivery, complaint resolution, and references. Develop this list and keep a record of interviews to help you pre-qualify new suppliers. Also conduct periodic supplier reviews and have these reviews managed by the customer service department or accounting department.
A printer’s primary material is paper. Merchants and mills are continually changing and improving product lines to be competitive. Why not have your main merchant do a presentation on new products and updates annually or more frequently? Don’t forget to include ink and coating suppliers; request periodic updates from them, too.
The old saying “a good workman never blames his tools” might still be valid in some areas, but not all. You can’t compare the efficiency of a power-saw to a hand-saw. The same can be said for estimating software. A top-notch estimator can only do so much with an outdated estimating system. Continuous improvements ensure that your company is using the most current version of the software, and that updates have been loaded. Many companies let their software maintenance and service contracts lapse, which limits access to the latest tools. This applies to your current pricelists and defined processes: keep them current.
Estimating training is the basis for a successful career, however, it’s only the beginning. There is no substitute for experience. Every company should have formal employee performance reviews, and the feedback process should include a review of training requirements.
Service level agreements
Service agreements outline service levels and what’s expected from both parties. Monitoring turnaround times for quotes indicates how successful your company was in achieving them. Of course, companies need to be realistic. Mandating a reduction in quote turnaround times won’t be effective unless estimators have the tools and resources to improve this service.
The key element throughout this discussion of continuous improvement is measurement. If you don’t know what level you’re at now, there’s no way to know if changes are improvements. Measurements should be easy to track and understand, and statistically sound.
Some jobs have built-in measurements to gauge effectiveness. For instance, sales reps are compensated on sales results. Measuring estimating activity should be used as a management tool to recognize those who put in extra effort, peak volumes of activity, and when estimators and other departments require added support.
You may not be able to put all of these ideas into action, but if you can find something that will improve your organization, we have succeeded.
Bob Dale is the president of Pilot Graphic Management Services Inc., a company providing management consulting and custom training for organizations. He is also on the executive of the Toronto Club of Printing House Craftsmen. Bob can be reached at (416) 410-4096, or via e-mail at firstname.lastname@example.org.