Saturday Morning Labor Standards Lessons

by | Dec 19, 2011

Last week my oldest daughter and I were doing what most families do on a weekend: fold laundry.  In this case, we were folding napkins. Being only 8 years old, my daughter was anxious to finish this chore and get back to playing with her sister when she asked, “How much longer is this going to take?” As a father and being one that works in the workforce management industry, I viewed this as a “learning moment” to teach my daughter what her father does for a living.

“Let’s see how long it takes to fold a napkin,” I said. “By measuring a how long it takes to fold one napkin, we can calculate how long it will take to fold many napkins.  The time it takes to fold one napkin is called a labor standard.”

In response, I got an unenthusiastic, “Cool.”  But, darn it, this was a learning moment and I was going to take advantage of it.

Before we started measuring, I asked her to guess how long it was going to take to fold all the napkins.  In dramatic fashion, she sighed and said, “Forever, Dad!”  After suggesting that was unrealistic, she thought it might take 15 minutes to fold the pile of napkins that sat in front of us. 

After pulling up the stopwatch on my trusty iPhone, she quickly folded a napkin that was in her hand.  It took her 1.5 seconds, but I pointed out that folding the napkin was the task but the process actually involved several steps.  The process involved (1) picking up the napkin from the pile, (2) folding it and (3) putting it on a stack.  If we just measured the folding part, we would end up with the wrong labor standard.

So, I asked her to fold it a second time.  This time it took her 2.8 seconds to complete every step in the process, but she wanted to show how fast she could get it done, it looked like she has simply wadded the napkin up in a ball. 

I asked her to try again and fold more neatly.  This time she was very careful and ensured that corners met and the creases were crisp.  It took her 7.4 seconds to fold that perfect napkin.  I asked her if she would fold napkins that perfectly every time.  “No, Daddy,” she admitted honestly. 

We decided to try one more time (and at this point, my learning moment began to feel like a learning lifetime).  This time I asked her to fold it “like a normal person” (a common phrase in my household when my girls start to get crazy).  This time, it took her 4.8 seconds.  The results were not perfect but they were not a wad of cloth either.  In short, it looked like the thousands of other napkins she’s folded in her life.

Finally, we had what felt like a decent labor standard.  And, when we averaged the second, third and fourth measurements (I threw out the first because it was an incomplete process), we ended up with 5 seconds.  This was pretty close to 4.8 seconds that she got with her normal-person fold.  So, we decided to use 5 seconds as our labor standard.

Now, I asked her to count how many napkins we had left.  It turns out we had 73 napkins left to fold.  I asked her to multiply the 73 napkins with the 5 second labor standard to calculate how long it would take to fold our napkins.  The answer was that we could fold the rest of the napkins in 365 second or 6 minutes and 5 seconds.  With two people folding, it would take us a little over 3 minutes.  I had to point out that her estimate was pretty far off: she guessed it would take 15 minutes but it was only going to take us 3 minutes. 

She was skeptical but it was time to test our labor standard.  Would it really take us 3 minutes and 3 seconds to fold these napkins.  It turned out that it took us 3 minutes and 7 seconds.  She was impressed, and that was when the light bulb went off for her.

“Daddy,” she said, “Could I borrow your iPhone?  I want to measure how long it takes to do other chores so that I can figure out how much work I need to do this weekend and how much time I have to play.”  

As I basked in the glow of teaching my daughter about labor standards, I realized how much of what we just went through retailers still struggle with:

  1. At the outset, my daughter guessed it would take 15 minutes to do the job.  It really took us just over 3 minutes to get the job done.  This is the problem with letting store managers guess how much labor they need and when they need it on a weekly basis:  they guess wrong and often overestimate what they need.  Of course, this is why finance provides the stores a budget.  The problem with the budget is that it often doesn’t reflect the work that needs to be done.  It just reflects the amount that they want to spend on labor.  Labor standards help provide a realistic budget.
  2. The first time we measured the work, we measured the wrong thing.  Instead of measuring the end-to-end process of folding a napkin, we just focused on one step.  This resulted in an inaccurate labor standard.  It wasn’t until we defined the correct process did we get a good measurement.
  3. We ended up measuring the process four times, and while I didn’t tell my daughter this, it was still not a valid work study sample.  The problem with a traditional time-motion study is that you need to measure a task many, many times to get a statistically valid measurement (the specific number of the result of a complex formula that industrial engineers can tell you all about).  This represents a huge investment of time.  Today, most retailers turn to a Predetermined Motion Time System (PMTS) in which the times of individual parts or motions of a task (i.e., pick up the napkin with your left hand, move it 12 inches to the right, put it down, etc.) are recorded in a database.  The PMTS allows individual motions to be strung together to help establish the standard.  This means that you only need to observe one person doing the process correctly to calculate an accurate labor standard.  It doesn’t matter if they rush through the task or lollygag, as long as the task was correctly observed and recorded, an accurate labor standard can be produced.

Labor standards are not hard – heck, my 8-year-old daughter can create them now – but labor standards are necessary.  Without them, you cannot accurately predict how much labor your stores need to operate.  Without labor standards, you have to operate your business on “gut instinct” or go with what you’ve done in the past.  You end up in emotional debates about labor spend rather than base decisions on facts.  And, in today’s economy, that approach just doesn’t cut it. 


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