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How much work is it and how long does it take to implement Labor Performance?
The implementation process takes between 1 and 3 months depending upon the resources allocated. The implementation process requires about 1-2 hours a week of phone meetings to communicate with the key management team on the incentive program setup and data collection. We recommend scheduling dedicated meetings twice per week with your assigned POC(s) in order to optimize the implementation process.
What are the technical requirements?
Labor Performance is a web based application and only requires an internet browser to operate. All reports are created in Adobe PDF format or .csv if you want to import them. If you currently scan some or all of your processes this data can be automatically uploaded into Labor Performance using a simple csv download from your WMS system. For companies that would like to run the application internally, API's can be created to interface with most WMS and ERP systems.
How soon will productivity increase?
It depends on how well the program is communicated to your employees and the training of supervisors on the program. If everything is communicated clearly before going live and the program embraced by upper management, you will see results very quickly. Most companies will see a complete ROI on the system within 2-3 months of going live and are able to achieve their peak estimated productivity gains in about a year.
Why are daily bonuses better than monthly?
From our experience, daily bonuses keep the highest level of motivation and performance in an operation. With weekly and longer performance periods, a bad productivity day can be a de-motivator for the remainder of the bonus period, or many employees may procrastinate their performance to the end of the period. One client that had a monthly bonus program experienced a 25% jump in productivity the first month by switching to a daily bonus program. The downside is that daily bonus management and reporting is more complex and generally cannot be run on spreadsheets due to its administrative requirements. That is why IMS includes all data processing as part of its service fee.
How does Labor Performance actually increase productivity?
There are three key reasons why the Labor Performance system drives productivity higher:
1. Employees now have visibility and daily accountability on their performance and how they compare to everyone else. When employees know they are being measured and the results acted upon, human nature naturally drives up their production level.
2. The system empowers management with granular visibility on who is performing and who is not performing and gives them the information to make the right decisions.
3. Employees are directly compensated for the value they are able to create through their increased effort. Often marginal performers can become your top performers with a simple financial incentive.
What are the risks of implementing Labor Performance?
Adjustments to employee compensation have to be handled correctly. When a pay for performance system is setup, it needs to incorporate employees and all key personnel in its development to ensure proper buy in. Additionally, once implemented, future adjustments to bonuses have to be handled delicately. There are many published case studies where the performance gains were so great, upper management decided to cut bonuses which resulted in the program collapsing. It is easy to give more, but very difficult to take away.
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