Small Manufacturer Uses Unique Staffing

Anyone who has ever worked in a manufacturing operation knows that keeping machines running is key to success. A problem that many small manufacturers face is how best to staff their operation to maximize machine run time.

Leelanau Industries of Traverse City, Michigan, is a job shop manufacturer that was faced with the same staffing problem. (They make parts for firefighting equipment as well as their own product line of hose couplings and adapters.) Keith Scott, president of Leelanau, had just invested a great deal of money in new machine tools and needed to keep them running, and running efficiently. Mr. Scott looked at traditional staffing options, such as two- and three-shift operations, but thought there was a better way. What Mr. Scott did was to develop a round-the-clock operation to maximize the total hours of operation, but with the workers putting in fewer hours for the same pay. On the surface this sounds like a fast way to the poorhouse, but Mr. Scott thought things out very carefully and came up with the following work schedule for his 19 employees.

The machinists are divided into four teams. Only one team works at a time. Each team works four consecutive 91/2-hour days, either on the day or night shift. A 90-minute interval separates the day shift from the night shift, during which time the machines run unattended. The teams constantly rotate so they all work the same number of weekends.

In this arrangement, the operators work 20 percent fewer hours, but at the same pay because they are paid a time-and-a-half premium for the weekend hours.

I asked Mr. Scott some questions regarding the program he has implemented:

Why did you adopt this program?
"The equipment we use is very expensive and so we need to use it to its fullest capabilities. To do this, we needed to develop a schedule that allowed us to run all hours in a year, thus spreading the cost of our capital investment over this period. At the same time, we also needed to have our people on an enjoyable schedule that would give them ample time off to keep them vibrant during the days they work."

Economically speaking, how were you able to justify having workers put in fewer hours for the same pay?
"Our real expense was having our investment [plant and equipment] sitting idle, not making money and costing us money at the same time. Amazingly enough, if you were to work four days on and then take four days off and get compensated at the 11/2-times rate for weekends, you would end up with the same pay as a normal five-day week, but work 414 hours less. We are able to use fewer people and utilize all assets of the company every hour."

How did the workers initially react to the change? How do they feel about it now?
"Initial reaction was mixed and probably more negative than positive. However, the more that people thought about it, the more they liked the idea. We also had a trial period of 90 days for which we stated that we would go back if the consensus was against the new schedule. Today, I don't believe anyone would like to go back to the old schedule."

What benefits have the workers realized?
"Some workers have second jobs. Vacations become three weeks on a two-week schedule, and people are not burned out and are eager to work."

What benefits have you been able to attribute directly to your staffing system?
"We have full production capabilities seven days a week. We also have unman-ned production between shifts, during breaks, lunches, and company meetings. A full crew is available for backup and fill-ins. We have greater production per worker due to workers being rested. Fewer skilled workers are doing the same work as more used to."

Have there been any downsides?
"I can't think of a single downside."

What are your projections for the future? 
"In the future, we will continue to perfect our current system and develop new ones. If anyone thinks they are done improving, or have the ultimate system, they should think again. We are never done and there is always something greater. Never stop looking and thinking."