Optimizing Your Manufacturing Job Shop - You Can’t Manage What You Don’t Measure

Topics: manufacturing skills gap, shop management software, cost of doing business

Posted on Aug 21, 2013 10:30:00 AM by Dave Lechleitner

If you are an owner or a manager of a job shop or contract manufacturing facility, the old management adage of “you can’t manage what you don’t measure” is more true today than ever before. With the economic uncertainty that still abounds, the demands placed on you by customers for high quality parts at lower and lower prices, and the skills gap between those employees that you might be losing and those available in the workforce, it is critically important to understand the current state of your business through the use of real time key performance indicators or KPIs. The challenge for many job shop owners is understanding first WHAT to measure, then setting a goal or standard METRIC by which your current state is measured against also known as benchmarking, and then putting corrective actions into place to help you achieve or surpass these goals in a regular, sustainable fashion.


Key performance indicators should be uniquely personal for your shop.  However, for most small and mid-sized manufacturers there are the obvious indicators which EVERY shop should consistently measure at least on a monthly (or even weekly) basis.  These indicators should represent a cross-section of your business focusing on the key elements of customers, productivity, vendors/suppliers, and financial. 

For example, when a business establishes their customer indicators, these indicators should focus on quote backlog, quote win rate, order backlog in weeks or dollars, new orders placed this week/month, on-time performance, etc.  When the shop establishes productivity metrics, these indicators should focus on utilization by work center or department, efficiency by work center or department, throughput in days both from a production standpoint (lead days from first time entry to first shipment) and administrative throughput (lead days from order date to first shipment), overbook or underbooked work centers, rework hours, scrap cost,  and direct vs. indirect hours. 

For vendor metrics, the shop should establish metrics for a vendor on time performance, average lead time by vendor, acceptance rate by vendor, and valuation of stock and WIP inventory.  Finally, key financial indicators should focus on customer and vendor aging, past due invoices, average days to pay (customers and vendors), and current cash position.

read more

Accurate Job Costing for Job Shops — Easy as A-B-C (Part 2)

Topics: shop management software, cost of doing business, accurate costing, job costing

Posted on Apr 18, 2013 2:35:00 PM by JobBOSS Team

In Part 1 of our article on accurate job costing, we discussed the importance of regularly reviewing the actual costs of your jobs when you are a job shop or contract manufacturer and what to look for in job shop software solutions to help you do so.  In this week’s article, we will discuss one element specifically, and that is how to determine the appropriate labor and overhead rates to charge to your jobs. 

read more

10 Steps to Successful Job Shop Management Software Implementation

Topics: manufacturing skills gap, shop management software

Posted on Apr 5, 2013 9:55:00 AM by Star Bazella

Job shops and contract manufacturers decide to select shop management software for a variety of reasons. Business growth may lead to the need for an automated solution, manual processes have become demanding, or legacy systems may be regarded as old fashioned and lacking in up to date functionality.The following 10 steps outlines the process required to successfully implement a shop management system and if followed will ensure you have made the correct software choice for long term business and user benefit, and safeguard that the new system is implemented efficiently, on time and to budget. 
read more

Growing Your Job Shop with an Integrated Solution Quote to Cash

Topics: shop management software, cost of doing business, quote to cash

Posted on Feb 27, 2013 12:57:00 PM by Dave Lechleitner

For small and mid-sized job shops, the task of consistently managing sustainable growth can be quite challenging. Granted, when times are good, it is often easy to gain repeat business and sustain growth. For many customers, as long as you ship on time with reasonable consistency and offer a good price, they will continue to place orders. In harder economic times, however, this may not always be enough to keep customers around.

read more

5 Common and Costly Manufacturing Mistakes Made by Job Shops

Topics: shop management software, cost of doing business

Posted on Feb 5, 2013 3:44:00 PM by Dave Lechleitner

As a job shop owner, you face a unique set of challenges in today’s business world. Owning and managing a job shop may never have been particularly easy, but the modern manufacturing situation in the U.S. has only worsened. This has many job shop owners questioning whether they can even remain in business, much less thrive.

read more
Manufacturing Dream Shop. 5 Steps to yours.

5 Steps to Your Dream Shop

Five tried and true fundamentals to building your dream job shop. Download your ERP business guide!

Job Shop Software Overview Demo of JobBOSS

The Right Solution for You

On-premise or hosted software; job-based shop management system for custom, mixed-mode and service manufacturers focused in metal fabrication, rubber/plastics and machine building industries.

Watch Now

Subscribe to the JobBOSS blog

Recent Posts