The keywords are: customer value process. What is a customer value process? This is a process that is capable of delivering customer value in terms of quality, cycle time and competitive pricing. Today’s digital customer is more informed, empowered and they are also more impatient. They have little time to invest in poorly managed businesses full of disconnects and interruptions during the interaction. James Womack and Daniel Jones in Lean Solutions echo the voice of today’s consumer: “Don’t waste my time. Minimize my total consumption, which is the price I pay plus my time and hassle.”
With this said, processes that deliver customer value in short order are paramount. Unfortunately, most shops’ processes are still riddled with errors, mistakes and delays. Yes, the collision repair industry has lots of variables and that’s all the more reason to have tightly controlled processes in place in order to minimize and control the amount of variation.
The optimum, well-defined process will enable your organization to get it right the first time and every time. The right processes will be tied to measurements, which enable them to be monitored closely and the processes improved upon. Measurements such as supplement reduction and decreasing the percentage of parts being returned to suppliers clearly indicate the stability of your damage analysis and estimating process.
Solutions – controlled environment
A shop I visited had achieved very impressive results in the area of damage analysis and estimating. Their process was yielding one parts order at 100 percent accuracy for each repair order. How was this possible, especially on high-line vehicles? They had implemented a bulletproof process of disassembling each vehicle to the last bolt and retainer clip that would be necessary in order to repair all the damage. Their effort was laser-focused on discovering everything upfront that they needed to rebuild the customer’s vehicle prior to ordering the parts. They had become the best performer in their market when ranked by insurance company’s metrics.
This same shop a few years earlier had a large parts room filled with part returns, but during this visit it was quite surprising to see that their parts room for handling the returns had been reduced to only a small plastic storage bin, holding a few labels and emblems. No large parts of significance were being returned any longer. This equated to full optimization of their damage analysis and estimating process.
Think about the time this shop was able to save by no longer needing to produce two or three supplements, order additional parts and track parts that had to be returned on every repair order. Additionally, the shop benefited from these time-saving efficiencies by avoiding customer dissatisfaction that would have been caused by not being able to deliver vehicles on the scheduled dates. After months of continuous improvement, the tasks and activities associated with damage analysis and estimating were streamlined into this one consistent and reliable process.
People – empower through knowledge
Why do 70 percent of all major transformation efforts geared toward process improvement fail? The reason is most organizations do not engage their workforce effectively. Management generally dictates to the people doing the work what specific changes they want to make. A shop in Chicago that I visited demonstrated a new management philosophy by allowing the employees to participate in solving the production problems. The people doing the work were the architects of the new process.
By capturing the creativity of your people who are doing the work, it enables you to build a more robust business model solely on your own shop’s efforts. All employees need to feel that it is part of their job to constantly come up with better ways of doing things, so that process innovation becomes just a way of doing business. And with the employees’ ownership tied to the processes, there is ongoing motivation to continually improve the processes and systems.
The right processes will always deliver the right results! Business transformation is a radical re-think of what the conventional processes are and how they should be, to improve operational performance.
Profitable process
Several years ago, while I was touring some shops in the U.K., I found a number of them were obsessing over production processes at the time. Many of them had made substantial equipment and information technology upgrades at their facilities, but their real focus was now concentrated on the workshop process. This isn’t to say that they had neglected to improve their front-end administrative processes as well. Actually, they had worked on these processes first, and now were resolved to improve the actual repair processes.
The U.K. shops that embraced the power of process improvements stayed their course through the dramatic decline in collision repair facilities over the last 12 years. Only the most process-driven shops were the repairers who were able to meet the new detailed service requirements. The forward-thinking repairers in the U.K. have re-engineered their processes to deliver completed vehicles in average cycle times as low as 3 days. They have also tracked results of 6-hour average touch times and 10 vehicles painted in a single booth per day.
Building the most efficient and effective business processes in the U.K. was no longer optional; it was absolutely mandatory for future survival. The industrialization of collision repair in the U.K. drove the shops away from the old “craft” style technique of repair to the new world of deliberate, well-defined processes for repairing vehicles.
The investment shops are making in training, equipment and information technology is always considered to be a smart investment. But now is the time to consider investing resources in building process solutions to address present workshop inadequacies. This must be accomplished in order to meet advancing vehicle technologies, customer demands and insurance company requirements.
At some point, insurance companies and customers will no longer tolerate businesses operating with broken processes. Simply because they have a choice: there are many shops in the U.S. and Canada that are re-engineering their processes to meet the customers’ needs and expectations, while doing so in an efficient and cost-effective manner.
Getting started
You don’t have to attempt beginning this journey alone; your shop can get help from various industry consultants and many paint companies offer help as well. Make sure you secure advice from someone who has knowledge of lean production principles and the ability to assist with implementing new processes at your facility. A great starting point is to commission someone to perform a complete impact assessment of your facility and current processes; this outside perspective is an invaluable resource for getting your organization geared up for the transformation necessary to drive customer value in the 21st century.
Things To Do
- Work closely with a consultant (lean production expert)
- Read The Toyota Way, Jeffery Liker
- Attend lean management training classes
- Value stream map your current processes to identify areas that need improvement
- Take study tours of facilities that have implemented lean processes
Subscribe to ABRN and receive articles like this every month…absolutely free! Click here to subscribe.
