What is a Labor Standard?

by | Apr 19, 2017

Google the term labor standard, and you get more than 6.3 million hits.  The first is a link to a Marxist journal followed by websites dominated by references to labor laws like the Fair Labor Standards Act.

Narrow your search to engineered labor standard – a term often used interchangeably with labor standard – and the list shrinks to a mere 1.1 million hits.  Many focus on ways to measure work but it is hard to find a good definition for the term!

So, let me give you one:

A labor standard is the average amount of time it takes the average worker to perform a task correctly.

The definition is simple but it has a few key elements.  First, a labor standard is a measure of time: how long it takes to do a piece of work.

Second, it assumes the task is performed correctly.  Meaning, the worker follows your company’s standard operating procedures for the task.  Any deviation will cause the worker to perform the task faster or slower than the labor standard.

Finally, labor standards deal with averages. As with flipping coins, it means that your workers will work to the standard over a lot of iterations.  If you watch a worker perform a task once, chances are he or she will meet the standard, and instead, complete the task either faster or slower than the standard. However, if you watch many workers perform the task many times, they will work to the standard.

This concept of volume is important.  It is important when building labor standards and applying labor standards.  It also is one of the most understood aspects of labor modeling.  But, I will cover that in a future blog post.

For now, focus on the definition provided above.  Do the labor standards you use fit that definition?

For more information about the case for labor standards, check out our new eBook “The Case for In-Store Labor Standards.” 

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