Loosen Bottlenecks with Continuous Scheduling
Many shop owners are discovering the wonders of continuous scheduling. Bringing cars in all week long rather than piling them up on a Monday cuts way back on the need for weekend car rentals, makes more money, and creates happier customers because cars are completed when promised.
David McCreight, president of Collision Resources Inc., a Kansas City consulting firm that specializes in the collision repair industry, studied shops in the six months before and after they adopted continuous scheduling. Those that vacated the start-on-Monday system cut their cycle time by an average of two days and boosted the amount of time a day that technicians work on cars by 31 percent.
McCreight’s data punches holes in the argument that scheduling cars to start on Monday helps shops avoid weekend rentals. “We looked at $1 million, $1.5 million and $2 million stores, and in the six months after they evened out their workflow, we saw the number of vehicles tied up over the weekend go down by 33 percent,” he says.
Putting that stat into action, McCreight says that a shop doing $2 million a year and roughly 17 cars a week can save $8,000 annually in weekend rentals by switching to scheduling throughout the week. “And that’s a conservative estimate—if they eliminated only three rental cars each week,” he says.
Speed and Efficiency
Continuous scheduling nails a core principal of lean operations: avoid batching. Before Bob Sanford switched to continuous scheduling, vehicles would back way up at the paint booth.Sanford’s workload—and stress—built all week long, as he thought about how he and his technicians would finish cars in time for Friday pickups.
Four years ago, Sanford shifted M&B Autobody in Schaumburg, Ill., to continuous scheduling. And it has made a big difference. He’s no longer fighting to keep from falling behind, and his shop cut two to four days from its cycle time. That made for happier customers and a more profitable shop.
Two other perks to weeklong scheduling: Sanford has customers lined up for two weeks—giving him a great sense of security. And he and his employees work so steadily throughout the week that he often closes up shop at 4 p.m. on Fridays.
$80,000 Cash Crunch
It’s just not realistic for a shop to work on all 25 or 30 cars scheduled for Monday morning; inevitably, many cars sit in the parking lot until Wednesday or Thursday, emphasizes McCreight. And then they get carried over the weekend because the repairs weren’t done by Friday.
John Sweigart, CEO of The Body Shop@, believes that’s akin to lying to customers. For more than 10 years he has scheduled cars to come in throughout the week at his four locations in the Pittsburgh and Philadelphia areas.
With continuous scheduling, Sweigart found that technicians not only repaired cars much faster, his shops also spent less money doing the work. How so? To keep techs busy, The Body Shop@ would typically have 100 cars waiting in the lot for repair, each requiring that the shop put up about $800 for parts.
“That’s an incredible expense to have to pay for parts for cars just sitting there. You get in a big cash-flow crunch,” says Sweigart. “That excess inventory is oil for a really bad machine. Really finely tuned machines don’t need that much oil.”
Through precise scheduling, lack of inventory and speedier repairs, The Body Shop@ quadrupled profitability. Its cycle time for 2009, Sweigart reports, was 5.2 days—well below the industry average of 14 days.
Even with those results, Sweigart’s shop faces pressure from insurance companies to start cars on Mondays. “I tell them, ‘I know there might be a penalty and rental expense, so bill me,’” he says. “But we pay almost no rental expense because our cycle time is half the industry. I’ll take that bet all day long.”