Disconnect between management and engineering often fosters an environment in which added value fails to be achieved. Management often wants more from the employees than they are paying for. Engineers often want more from management than they feel is represented in the pay that management provides. The result: employees "get even" by not really doing more than is absolutely necessary, and management fails to realize that employees are assets that add value to what the business does. As entities, neither management nor engineering can be called lazy or inert. Nonetheless, there sometimes seems to be a NIMJD attitude among both groups.

Yet even this falls short in really explaining the precariously high percentage of activities that add little value within businesses.

More than half of engineers at build-to-order and engineer-to-order manufacturers spend most of their time on activities that add no real value to the customer, according to a research report recently published by software maker Cincom Systems.

The report, entitled Best Practices: Mass Customization and Built-to-Order Manufacturing, was based on a survey of senior engineering managers at 900 manufacturers of industrial, electrical and transportation equipment and systems between January and February 2007 and discusses the findings from an engineering perspective on the state of mass customization and built-to-order practices.

A non-value added activity, of course, is one that provides a business process with no competitive advantage because it performs neither cheaper nor better than the competition. To be a value-added action, according to iSixSigma, the action must meet (all of) the following three criteria:

1) The customer is willing to pay for this activity;

2) It must be done right the first time; and

3) The action must somehow change the product or service in some manner.

The Cincom report notes that while engineers spend 32 percent of their time creating new product drawings for customers, the week is often consumed by numerous administrative tasks:

• Creating bills of material (14 percent) and change orders (13 percent);
• Performing product selection and configuration (10 percent);
• Quote/order review and approvals (9 percent);
• Manufacturing changes in line (5 percent);
• Creating cost estimates (4 percent);
• Pricing orders (4 percent); and
• Making post-order revisions (4 percent).

Sales support activities such as general sales consultation and post-sales support of installation only consume 5 percent of engineers' time, according to engineers' responses. "While this appears to be a significant amount of time spent on sales support, one could argue that because engineering is uniquely positioned to optimize the fit between a customer's needs and manufacturing, this is time very well spent," notes the report.

"Unfortunately," writes Cincom Program Director Jim Wilson in an announcement of the findings, "much of the time spent is low-value activity."

The survey, authored by Wilson, indicates that engineering management has mixed perceptions on how sales and service activities affect new product development. Of the respondents, 48 percent indicated that sales and service activities delay while 31 percent indicated that it actually improves new product development.

"[Engineering] management would benefit from reducing the amount of low-value tactical support activity but increasing engineering's influence on sales processes and solutions that are proposed to customers," Wilson continues.

The executive summary goes on to say:

Keeping up with the unique and growing requirements of customers, broadening product offerings and competitive pressures to reduce time and cost for the delivery of customized products is a growing challenge for manufacturers. An enterprise's ability to succeed will depend on how effective [engineering] is at balancing short-term revenue objectives with strategic organizational and market-driven factors required to remain competitive.

Many companies, particularly in the United States, are finding it both cheaper and more efficient to outsource the raw manufacturing of goods to other nations. As so many industrial professionals, particularly in the U.S., continue to worry about the loss of manufacturing jobs — not to mention increasing attention being paid to poor-quality products made overseas — a study that finds inefficient use of engineering time within manufacturing and mass-customization companies in the U.S. does not strike an optimistic note for industry nationwide.

Engineers, do you think your time spent on sales support is time well spent? Let us know below.

Resources

Best Practices: Mass Customization and Built-to-Order Manufacturing (complete report)
by Jim Wilson
Cincom Systems, July 12, 2007

Engineers Spend More Than Half Their Time on Low-Value Activity
Cincom, July 12, 2007

iSixSigma.com