Optimizing processes has the potential to double a manufacturer's profitability. But it’s no small feat.
Manufacturing is many things. Naturally agile isn’t one of them. Change and optimization take mammoth efforts and a plethora of finely tuned collaboration to see results.
iMpact Utah has made transformations and quantifiable improvements in hundreds of manufacturing companies. Every company has its own challenges, but after assessing manufacturers in Utah, the data shows a few areas where most manufacturers struggle.
We narrowed the list down to the 3 areas where manufacturers are the least optimized across the board:
- Strategy and communication
- Process
- Accountability (Specifically, the time required to complete tasks.)
While these are common issues, they're not minor ones. Unaddressed, weak strategy, flimsy processes, and poor accountability can cost businesses millions. Not to mention the fact that scoring low in these areas is a consistent predictor of low employee morale and high turnover.
So why are these the hurdles that trip up manufacturers? And how’s it affecting their business?
Here’s what we found in our assessments of Utah manufacturers.
Numbers Don’t Lie—the iMpact Assessment
How does iMpact Utah get these results?
The Utah-MEP Alliance, facilitated through iMpact Utah, offers a complimentary business optimization assessment to companies statewide. The assessment measures performance in each element of business operations–strategy, structure, people systems, methods and tools, lateral communication, metrics, and supply chain–and compares it to optimal performance—yielding a percentage score.
The iMpact Utah team has surveyed hundreds of manufacturing companies, gathering insights from employees across diverse functional areas. The results begin to reveal a comprehensive understanding of organizational needs across manufacturing in Utah.
The Top 3 Challenges for Manufacturers in Utah
Let’s get into the top 3 hurdles facing industry in Utah, what causes them, and how they can impact business. Strategy (either lack thereof, or strategy poorly communicated) comes in at number one.
1. Unclear Strategy
Business strategy is bedrock. But on average, Utah manufacturers only achieve 22.6% optimization.
Why is strategy such a stumbling block?
The usual culprits won’t shock you. But they are formidable. In our experience transforming companies, we see the following factors undercut effective strategy:
- Lack of clear vision
- Misaligned goals
- Poor communication across departments
How weak business strategy is hurting manufacturers
Unclear objectives kill morale: Buy-in has everything to do with clarity and communication. If employees don’t understand the big picture behind initiatives, it can be next to impossible to get meaningful engagement.
Market strategy mishaps: A manufacturer unclear on strategic goals may invest in product features customers don’t care about, leading to wasted budget and missed market opportunities.
Departments working at cross purposes: Without a clear strategic direction, you run the risk that departments might pursue conflicting goals, wasting time and resources. For example, the marketing team might focus on promoting a product that the engineering team is struggling to produce efficiently.
Once addressed, these optimization opportunities will help your business clear the next highest hurdle: inefficient processes.
2. Inefficient Processes
Manufacturers in Utah are 29.3% optimized when it comes to their processes.
Inefficient workflows, outdated technology, and lack of standardization invite production bottlenecks, rework, and delays, impacting both employee and customer satisfaction.
Let’s look at some real examples of how spotty processes can bleed businesses of their potential.
What’s missing in most Utah Manufacturing processes?
It takes coordinated effort across multiple departments, moving in sync, to move the needle on manufacturing processes.
However, there are some key elements that we see missing in the companies we help optimize:
- Agility and adaptability
- Updated technology
- Limited data collection and analysis
- Information silos between departments
- Lack of standard operating procedures (SOPs)
How inefficient processes affect businesses
Production delays: Production lines with outdated equipment tend to break down. That can impact on-time delivery to customers. Bottlenecks, rework due to unclear processes, and inaccurate inventory management can also impact deliveries and drive up costs.
Reduced profitability: Material scrap, inefficient tasks, and missed cost-saving opportunities due to lack of data analysis can significantly eat into profits and weaken your competitive edge.
Poor customer satisfaction: Inconsistent quality control is a fast way to slash your customer ratings. Delivery delays and communication breakdowns between departments can also lead to frustrated customers and lost business.
3. No Accountability for Production Time
Forecasting the time required to complete tasks is a major hurdle for manufacturers. On average, manufacturers in Utah sit at about 36.5% optimization.
Absent expectations about the time it takes to complete a task can create unforeseen issues.
What’s missing from the picture that makes accountability and timing a nightmare for manufacturers?
- Real-time data
- Cross-functional collaboration (When siloed, teams struggle to track dependencies and hold each other accountable for timely completion.)
- Automated workflows (Manual tasks and communication create bottlenecks and delays.)
- Transparency (Lack of visibility into team performance erodes accountability and trust.)
How poor accountability affects manufacturers
Unclear Task Expectations: When employees are unsure of what’s expected (including time they should allot to a task), it can corrode everything: processes, production schedules, safety.
Inconsistent Performance Measurement: When performance isn’t measured accurately or consistently, it creates confusion and demotivation. It’s the old saying by Peter Drucker: “What is measured improves.” And the opposite holds just as true: Forget to measure and watch performance worsen.
Ineffective Feedback Systems: We often see misaligned metrics and rewards in the manufacturing space. They are usually misaligned either with real company goals or with truly motivating incentives.
But these 3 hurdles aren’t the only ones Utah manufacturers deal with. iMpact Utah measures 7 business components in every assessment. Here is the full picture from last year’s results.
The Big Picture on Utah’s Manufacturing Pain Points
2023 assessment data serves as a crucial starting point for manufacturers seeking to enhance their operations and unlock new levels of success.
By identifying areas for improvement and leveraging the expertise of organizations like iMpact Utah, manufacturers can gain a competitive edge and contribute even more significantly to the state's economic strength.
Clear the Hurdles Tripping Up Most Utah Manufacturers
If a weak link in your organization goes unaddressed, it’s usually because leaders haven’t found a reliable process to fix it or optimize it. At least, not one that wouldn’t grind operations to a halt or feel like a waste of time and resources.
Our nearly 30 years of experience helping Utah manufacturers gives us an expert eye for where manufacturing leaders should focus their energy next and how to strengthen “weak links” to achieve their top priorities.
iMpact Utah helps manufacturers address these pain points with the Straight 6 Optimization Model. While iMpact focuses on supporting manufacturing business in Utah, we have the resources to assess companies in other industries, additional company locations outside of Utah, and individual departments within a company. The latter two capabilities are helpful in creating comparisons that can improve the greater organization.
We come in (boots on the ground) and partner with your leaders to implement whatever pieces are missing from your operation and improve performance.
Discover your business’s operational gaps by taking iMpact Utah’s Business Excellence Assessment with your team.
