“How does nGROUP produce results? How does my company know our investment is actually paying off?”
These are two of the most common questions we answer during initial conversations with a prospective partner. That’s not surprising, given they are two of the most important questions in any nGROUP partnership, and not only for our client.
For nGROUP, accurately defining and measuring success is the best way to achieve success.
Still, how does nGROUP define and measure success?
The answer is P.U.M.P.
What is P.U.M.P.?
P.U.M.P. stands for Pace, Utilization, Methods, and Performance. But more than a catchy mnemonic device, P.U.M.P. is actually a formula for success. Literally.
ΔP x ΔU x ΔM = ΔP
That is, the product of the change in Pace, Utilization, and Methods is equal to the change in overall Performance.
Let’s explore how nGROUP thinks about each of these 4 factors and how we leverage opportunities in each to drive improvements in productivity — alongside significant cost savings.
Pace is the speed at which an operation or action is performed. Specifically, nGROUP is concerned with the pace at which one of our team members performs a job, or a particular task within that job.
A normal pace is 100%. That is, the team member is performing their job at exactly the same speed as a standardized definition. If their pace is at 90%, they are performing slower than would be considered normal; at 110%, faster.
When a production line’s overall pace is lagging, or otherwise needs to be improved, nGROUP uses incentive structures, training, and instructive feedback to bring the whole team up to speed.
Simply put, utilization is a measurement that shows how much of a worker’s time is actually spent performing value-added tasks. In other words, it tells us how much time each worker is actually creating more value for your customers — and more value for you.
When utilization is measured in typical manual processes, 60% is considered a “good” number. Higher-achieving workforces will push that number up to about 70%.
For nGROUP, we consider successful utilization to be closer to 80-85%.
How can we get our teams to reach those levels? These are some of the areas we observe closely:
- Shift Start-up: How much time does it take for folks to go from clocking in to actually performing value-added tasks?
- Return from Break: Can this time window, the return from break to work, be reduced?
- Change Over: What are the biggest slowdowns that cause lost time during shift change? How can we address those areas?
- Defects: Are there too many, and is that being caused by hurrying or fatiguing our laborers?
How is work performed? How best is work performed? Measuring methods gives us the answers to these questions.
In an nGROUP engagement, our engineering experts study more than just the pace of workers, and the time they spend adding value to your company. We also study how the job is performed, and how those work methods can be improved.
We use two basic approaches: technology and observation. The first relies on our LMS (Labor Management System) nSITE, in conjunction with our video-based analysis tool, nVISION. We break down processes to find bottlenecks and identify opportunities for improvement.
The other approach we follow for improving methods is to play “follow the leader.” Here, nGROUP does the work of identifying individuals or teams that are more productive than their peers. We carefully monitor those individuals or teams, observing and cataloguing how they work — and why they are more productive.
With these improvements defined, the more productive workers can be recorded and shown to their colleagues.
And now for the big one. When the changes in Pace, Utilization, and Methods are multiplied together — and it is a multiplicative effect — the change in Performance can be profound.
For e-commerce operations, performance might mean not only cost savings, but a complete re-imagining of their labor structure.
- Carparts.com: labor savings of 8%, complete restructuring of shifts, and switched to CPU pricing model
Performance means different things to different organizations. For direct-to-consumer retail operations, performance might be defined as UPH, Units Per Hour.
- Macy’s pop-up operation: baseline UPH increased by 91%
For a logistics company, performance might be defined by various production metrics, as well as cost savings on their very labor-intensive operations.
- Optoro: increased performance metrics as much as 56%, saved $1,000,000+ per year on labor
All the work nGROUP and our partners did together was designed to improve Pace, Utilization, and Methods among the workforce. By doing that, we knew increased Performance would follow.
The Secret to P.U.M.P.
The secret to P.U.M.P., nGROUP’s special formula for success, is that there is no secret.
We are labor experts, and we put that knowledge to use every day. Our engineers know how to analyze everything about a labor-intensive operation, create standard measurements, and then track those measurements.
Our on-site managers and leaders understand the people we hire. The incentives we offer encourage everyone to stay at the top of their game, delivering incredible value to our partners and their customers.
The technological tools at our disposal also set us apart in the performance game. By making it easier to identify bottlenecks, analyze productive behaviors, and communicate needed improvements to the whole production line, our tech helps nGROUP improve our partners’ performance — however that performance is measured.
If your operation could benefit from a P.U.M.P. to production (and a cost savings on your direct labor), schedule a call with us today. nGROUP makes it easier to find the success you’re looking for.