Elaborating on the Respect for People principle and challenge from Bob Emiliani, in this article I want to show how Respect for People relates to Takt Time. I’ll do so by showing how Respect for People looks like to Employees, Suppliers, Customers, Investors, and Communities. I’ll attempt to show examples also.
Let me briefly explain Takt Time.
I’ve written about Takt Time many times before. For example, I show how Takt Time can be used in a tax return filing operation; also, how I learned Takt Time from a Toyota Warehouse Worker, which humbled me greatly; I also provide a Takt Time Calculator Download for Free. So, I won’t go into detail here, but here’s the gist of what Takt Time means.
Consider the following equation:
Where,
T = Takt Time, or the work time between two consecutive units
Ta = Net Available Time to work
D = Demand, or units required per period
Imagine a horizontal line that represents customer demand. Now, it takes a certain amount of time to produce an item or perform a service. Working within Takt Time means we are working below that horizontal line that represents customer demand.
| Respect for People | ||
| Takt Time | Example | |
| Employees | Takt Time is building or performing in accordance to customer demand. If we adhere to this, then Takt Time should allow for (a) adequate pacing, so employees aren’t scrambling (b) and prevent overproduction – which means that employees don’t have to work harder than is needed. | When we don’t know Takt and are building based on a forecast, there could be situations where we need to build more. This leads to overtime and could lead managers to hold employees to a production schedule that is not reasonable. |
| Suppliers | Like the manufacturer or service operation, upstream suppliers also rely on their best known knowledge of demand. If a downstream customer didn’t build to Takt, then there could be a sudden demand, creating stress and burden to the upstream supplier. This means the employees at the supplier location could be burdened by the downstream company. | Not building to Takt is, at best, making a bad guess as to what customer demand will be. And, guessing may lead to sudden demand, creating stress and burden to the employees of an upstream supplier. |
| Customers | Building to Takt Time means that we are building based on the customer’s need relative to quantity and also to the time in which the product or service is needed. | In a service operation, when we perform to Takt that means the customer’s demand is being met. |
| Investors | When a company is building to Takt Time or performing a service to Takt, then the expected outcome is that the customers are happy. And, when we happy customers, we believe they will gain loyalty and perhaps buy from the company again. This increases overall value of the firm and creates greater shareholder value. | When companies fulfill their customer’s need, customers love them and will buy again. |
| Communities | When a company builds or performs a service to Takt, then the company gains greater customer loyalty. And, in business, loyalty means that the customer will buy more. This helps the company to thrive and allows the company to grow. This means the company will have a need to hire more employees, allowing the community in which the company resides to thrive. | Suppose a local manufacturer builds to Takt and delights their customers. Demand is great and business is booming. The plant hires more people in order to meet crazy customer demand. More people in the community are employed and are able to live a richer life. |
I’d love to hear from you. It’s likely my attempt here is not perfect, so I’d love to hear from you on where I might have missed something or even gotten something completely wrong.
Let me know in the comment section below.
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