Current Issue

Back to ARA Magazine

Turn the tide on Your Poor Processes


Turn the Tide on Your Poor Processes

By Ryan Falco

The worst words you can hear in any organization, especially for those of us working in salvage yard are, “that’s just how we have always done things.” In a fast-changing industry like ours, those words should be considered poison to the ears. It means an organization has become blind to inefficiencies, justifying the status quo because we are too busy to care or because of a prevailing if-it-ain’t-broke mentality.

Poorly designed processes create vast amounts of waste. But if we take time to rework our processes and reduce wasted time and energy, the outcome is simple: you can drive bottom line revenue.

Often times people fail to recognize the symptoms of bad processes. If any of the following sound familiar, you probably have some poor processes that need to be examined:
• Customer’s complaining about poor product quality and/or bad service
• Other colleagues getting frustrated
• Work is duplicated
• Costs are increasing
• Resources are wasted; and
• Bottlenecks develop such that you miss deadlines.

Immediately evaluating your processes should resolve most of the headaches above. It seems like a big task, but the first step is actually simple: take some time out of your day to watch each department’s workflow. It will become obvious to you which department is in need of dire help. Maybe it’s the department that tells you there is “not enough time in the day to get our work done” or the one where you can cut tension with a knife because the stress of the job is unbearable.

For us, it became clear that our shipping department needed new processes. Employees were not happy with the stress on the dock. It turned out it was a ten-year-old process that was making work impossible.

Wasted steps led to missed deadlines which led to poor customer service. Having identified that our process and workflow was broken, we rolled up our sleeves, knowing that the hard work of fixing the process would pay dividends in the future.

We implemented a 6-step process to improve our situation.

Step 1   We engaged the stakeholders to fix the process. This is the most important step, if we do not have buy-in from the people that are working the process day in and day out, our solutions will fail. This is very much a bottom-up approach instead of a top-down management approach. Take time to have open and honest communication, emphasize what is in it for them (it may lower stress or enhance their ability to get more work done). Besides that, they are the ones working on the shop floor, so they will offer fresh perspectives to the issue in front of you.

Step 2   We mapped our current process. Take the pen and paper out in order to document the current flow that you are working with. This will allow you to visualize what’s happening. This is another opportunity to involve your employees. I was surprised how little I knew about daily tasks until I did this myself.

Step 3   We analyzed our current workflow. Try to answer these simple questions:
• Where do team members or customers get
• Where do costs go up and/or quality go down?
• Which of these steps requires the most time,
or causes the most delays?
• Which of these steps creates a bottleneck?

Now that you have answered these questions, find five different reasons “why” you answered the way you did. This is a remarkably simple process. By taking the time to ask “why” five times, it forces you to get to the root of the problem.

I try to be as relentless as my 3-year-old son Jack – no matter the answer, he always asks why! This forces you to dive deeper until you arrive at the root problem and pinpoint where a break down has occurred. The questions why are not a time to place blame on individuals, but to take incremental steps to become a better and more efficient team.

Step 4   We redesigned the process. This is the step where you need to work with your team to eliminate the problems identified in step three. Again, involve everyone from your team. You may design the new process, but it’s the staff that will have to care enough to execute the vision.

When redesigning the process it is important to ask these questions
•  What impact does this new process have downstream?
•  What risk do we have by doing it a new way?
•  Where are potential failures that may arise after this process is put in place?
•  What are the full consequences of each proposed ideas?

It is essential to acquire the resources needed to make the new process happen as efficiently as possible. Don’t bother with any new processes if you aren’t willing to invest the resources to execute it. It may be something as cheap as a new tape gun or as expensive as a new forklift.

If a cost analysis justifies the purchase, don’t hesitate. Other salvage yards have taken it to the level of completely rebuilding and dismantling facilities to accommodate their new plan. Here’s a general rule of thumb: if the new process lowers stress and streamlines production … invest in it!

Step 5   Implement the Change. This is where all of your pre-planning and strategy meetings pay off. If you have included stakeholders in the process, this should be pretty seamless. Consider starting small, a pilot or test of the program will help work out any kinks. This will give you ample time to make any tweaks to minimize pain for departments or, more importantly, customers. Undoing decades of bad processes is rarely a pain-free undertaking, but it’s vital to stand strong.

It’s not so different than my annual January diet. After the holidays, I plan the steps I am going to take in the new year: exercise, diet, counting calories. Within a week, after I have yet to see the full benefits of the changes, I throw in the towel, telling myself “it’s too hard.” If I had resisted the urge to go back to old habits, I imagine February would have rolled around and I would have been amazed by the results. Forge on and don’t give up. Plus, if you cut corners, you will end up right where you started. Don’t bother unless you invest resources to implement the change!

Step 6   Review the Process. This is the last and final step in our journey. Any time you implement a new process you need to closely monitor to make sure that it has not been derailed and is working how you planned. You should also expect issues to arise – this is part of the game. Be prepared to look at these issues with your staff and reevaluate the process when needed.

Processes are evolving entities – you should never be complacent. As Socrates said “the Secret of Change is to focus all of your energy, not on fighting the old, but on building the new.” I have only been in this industry for a short eight years (though that is 28 in salvage yard years). In that time, the changes have been mind-boggling. I learned quickly from the owners of my business that, in order to build a lasting business, we have to be open to change and committed to implementing processes that respond accordingly.

Ryan Falco is General Manager of Midway Auto Parts in Kansas City, Missouri, that includes a full-service salvage yard processing over two hundred vehicle monthly, two self-service locations, an aftermarket parts store and a car lot selling new and used vehicles. He began in the industry 8 years ago as an outside sales rep/driver for Midway’s Aftermarket division and quickly rose through the ranks, first managing the aftermarket division and the auto sales division, then as a sales manager for the full-service yard until he assumed his current position in 2014.