Today I want to give you the tool to explain what went wrong. Let’s use Metallic White Inc, my imaginary company as an example. Metallic White has a production line with ten employees each are handling on average 50 tasks per day. A normal day would look like this:
This means that on a normal day Metallic White Inc can handle 415 tasks, giving the managers a number to include in their budgets. So you run your production line for a month and ending up 20 % below budget, and the company board is furious asking for an explanation.
Then you give them an excel sheet day by day with your personal notes having each and every single day covered with something like this:
On this very day you even had one more in staff, because you hired a new worker, still you handle 74 % of the average capacity. And since the board denied you the use of overtime this is the result, or it could explain why the overtime budget is exceeded. All the comments in example 2 could be an average day at work. There is always something else going on.
Create budgets according to life.
The Metallic White Inc. board created a budget based on the number of employees and on average number of handled tasks. A lot of companies make this faulty calculation, creating an environment where it is never possible to reach the goals. And the line managers or team leaders need to explain. Well now you have a tool that can explain.
Predicting the future.
You can use this exercise to look into the future as well. If you know that you get people going on holidays, or if someone quits or there for any reason is something coming up to disturb your efficiency. You can even use it to calculate the effect on overtime and much more. Maybe John breaks an arm, but can still perform at a 75 % rate over the next five weeks? Well with this exercise you’ll be able to beat the board to the explanations.
I work at a call centre. I know the approximated amount of incoming calls and other tasks. I know the average amount handled on my department, and on almost each person. Let’s say an average Tuesday has 1000 incoming tasks. To handle this I would need 20 people averaging on 50 handled tasks each unless I would get longer handling times. To handle an average of 1000 tasks I need to take into consideration the current efficiency of the department. Do I have a lot of new ones? Do I have de-motivated staff? How many is sick on average? I can use this tool to calculate how well the day will go, if I see that we can handle 700 tasks during the day, I might call in the extra help needed?
If the board decide to cut back on staff, they usually do calculate that they need x number of people that can handle x number of tasks. Giving me in my case 20 people to handle 1000 tasks, because I said an average worker can handle 50 tasks. Since they do not do this calculation, I need to provide it for them saying that on average a worker handle 40 tasks! And it results in them giving me 25 people, and suddenly I manage to produce the results they want. You are the one that knows what is going on, so you should do these calculations. You can even say it to the board: On average a worker produce 50 tasks if he is never sick, reduced, replaced, fired, late or for any reason experience something in life that make them produce less. On average with all these factors, and since two people are being replaced in November, the average on total will be 40 tasks. Then they have both numbers. If they give me 25 workers I won because they considered my calculations, and if they don’t I still win, as I warned the board about reality.
Other costs you can calculate.
If your efficiency drops below the amount of necessary task to be handled you’ll might end up with longer handling time, in my case queue on the phone and longer handling time on e-mails. This will again result in customer turnover and bad reputation. So understaffing might have a high price, by doing this calculation you’ll end up being the company fortune teller.
If you like this article please sign up here for e-mail notifications when I update my blog.