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The Berkshire Company Blog

Managing Multiple Sites

Posted by Mark Fallon on Jul 30, 2014 9:43:47 AM

“Congratulations! Since you’ve done such a good job with the Boston operation, we’re now putting you in charge of the New York and New Jersey operations as well.”

Despite the positive tone in my boss’s voice, I wasn’t sure that was good news. Yes, we’d been able to make some positive changes in the Boston mail and distribution center. But could I effectively manage three operations in three different cities? Soon, I was going to find out. And the lessons I learned would come in handy when a similar opportunity arose at another company five years later.

Whether managing one site or five sites, continue to use the basic management techniques that have made you successful. Developing a solid business plan; communicating that plan to all involved; knowing your customers; and motivating employees remain the foundations upon which to build. The only change is the method you use to execute those practices.

Although you’ll probably modify it before everyone’s had a chance to read it, you need to develop a business plan for the short- and long-term. This is your opportunity to share your vision for the unit with management and employees. Use the plan to explain where you want the unit to be in six months, a year, even five years. Circumstances will dictate changes (some drastic) to your plan. But as the saying goes, failure to plan is a plan for failure.

The plan should represent your unit as a whole and not each site individually. Though the sites may serve different clients and have completely different functions, they must see themselves as part of a larger team. The business plan is the place to start building that sense of team. Everyone needs to know how they can contribute to the big picture.

How you communicate that plan is essential to its success. You can’t deliver every message personally, and you can’t be in two cities at the same time. Even with cities in relative proximity, you can’t be on the road all the time and remain effective. You must choose one site as your base of operations, spending most of your time there.

However, don’t let that base become an isolation booth. Make sure that you reach out to the remote sites at least once a day. Send a short email update. Make a quick phone call. Or hold a virtual meeting, using Web conferencing. Whatever the method, use these opportunities to disseminate important information and provide support. Don’t turn your communication into a daily “big brother” surveillance tool.

Plan onsite visits on a regular basis, at least once a month. Schedule one-on-one time with the site manager. Introduce yourself to new employees and welcome them to the team. Make sure you spend some time on the shop floor with the employees. Shake hands, ask how things are going, and take the pulse of the unit. Remember: there’s no such thing as a typical day. But if things don’t feel right, schedule a return visit soon.

Use these visits to meet with your major clients at that site. If possible, form a user group with open forums. Have your site manager sit next to you at these forums, reinforcing the concept of one team. Take notes on compliments and complaints. When you return to your office, prepare written minutes and responses to any questions and concerns. After reviewing this document with your site manager, distribute the information to the whole group.

Also, when onsite, schedule “face time” with the highest ranking manager of the business unit or their deputy. Don’t worry if you only get 10 or 15 minutes of their time. This is just another way to emphasize that you care about your internal customers and that you’re aware of what’s going on. Again, follow up on any concerns with an email or phone call as soon as possible.

When you’re back at your home office, be sure to respond quickly to any phone calls or emails from remote customers. In fact, you need to respond to these requests faster than those from people at the home office. Because these customers aren’t located close to you, they may feel isolated and less important. Go the extra mile to reassure that distance has no impact on service, and that your onsite manager is more than capable of meeting their needs.

Keeping your employees motivated from a distance will probably be your greatest challenge. You need to be proactive in this area to counter the perception of “out of sight - out of mind”. When an employee anywhere in your organization does something commendable, call them immediately and thank them. Don’t substitute an email for a phone call, and don’t just leave a voicemail. Take a minute to have a conversation with this person and reinforce how important their actions were.

Keep a list of these events, and make sure you recognize people in front of the entire group during your next onsite visit. And any team successes should be recognized at all locations. If your New York unit set a record on getting the monthly shipments out early, don’t just celebrate in New York. Have celebrations in every location, strengthening the concept of team.

The key to success in each of these areas is the site manager. They must be an independent person, and a strong supporter of the team concept. Your site manager needs to keep the lines of communication open; sharing ideas, news and events. Most importantly, they must be confident enough to get any bad news to you as soon as possible, especially if it involves customer service.

Similarly, you must trust that manager to make the right decision. With the exception of hiring and firing employees, you must empower the site managers to do what they think is best. Often important decisions will have to be made without consulting you first. Make sure they inform you of these decisions as soon as possible. When people make errors in judgment, be careful with your critique. You want your managers to make a better decision the next time; you don’t want them to freeze and take no action without your prior approval.

Managing operations in multiple locations is a challenge for any manager. Time and travel will force you to be a better planner, communicator, motivator and delegator. Stretching these basic skills will shorten the distance to success.

 

 

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Operations Management

Postal Reform: No Hope in Sight

Posted by Mark Fallon on Jul 23, 2014 5:00:00 AM

For several years, the leadership of the United States Postal Service (USPS), the postal employee unions, and the mailing industry have clamored for postal reform. Under the Postal Accountability and Enhancement Act (PAEA) of 2006, the USPS has had to pre-fund future retiree health benefits, creating a $5 billion annual liability. Adding to the problem, the USPS has overpaid billions into the Federal Employee Retirement System. And mail volumes have declined (but not as much as many people think).

Congress has responded quickly – by doing nothing. There are over 30 bills in the House and Senate dealing with different aspects of postal reform. Only two bills – H.2748 and S.1486 – have been approved by the respective oversight committees. That was months ago, and neither have been brought to the floor for a vote. Probably because there are competing bills in each chamber that have more supporters, including a lot of bipartisan agreement.

The USPS Board of Governors is the equivalent of a board of directors of a private corporation. The Board is composed of the Postmaster General and 9 members who are appointed by the President with Senate approval. Since President Obama has taken office, the terms of 5 Governors have ended, and he has submitted the names of Republicans and Democrats as nominees. And waited. And waited.

Last week, the Senate held a confirmation hearing for 4 of the nominees. The committee chairman, Senator Carper, began the hearing with a statement on the importance of the USPS to the nation’s economy and the millions of people who work in the print and mail industry. He was the only member of the committee present. His Republican co-chair’s plane was delayed, but there was no explanation for the absence of the rest of the committee. Nor has a date been set for a vote on the Senate floor to finalize their confirmation.

The passage of a postal reform bill will be a contentious issue. While everyone agrees change is needed, there’s little agreement on what those changes should look like. It will take tremendous effort and compromise by all parties to create a solution that will resolve at least some of the issues impacting the USPS. It will be hard work.

However, the Congress has allowed the USPS Board of Governors to dwindle to less than half of its required appointees. The confirmation process wasn’t held up by the filibuster or other procedural delays. It’s just that nothing happened. Two more Governors’ terms expire in December.

If the routine procedural confirmation of these nominees can’t be completed in a timely manner, if committee members can’t make the time for these hearings, is there any hope for comprehensive postal reform in the near future?

 

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United States Postal Service

First-Class Mail Volumes: Facts and Fiction

Posted by Mark Fallon on Jul 9, 2014 5:00:00 AM

News stories about the United States Postal Service (“USPS”) usually include a statement about declining mail volumes. Often prefaced with, “due to diversion to the electronic communication” or “because of the internet”, the reporter or columnist will paint a dreadful picture of the state of the USPS. Hard copy bills and statements are derided as “snail mail”.

If posted on a news website, the readers' comments that follow are even more derisive. “I receive and pay all of my bills online.” “Who needs mail delivered to their house?” “The USPS is like buggy-whip factories in the age of the automobile.” Of course, these commenters have an active online presence, so their view is slightly skewed.

Mail volumes have declined considerably over the last decade. First-Class Mail – bills, statements, letters and payments – has been significantly impacted by online options. The USPS delivered 35% less First-Class Mail in 2013 than they did in 2004. However, the types of mail that have declined, and the rate of decline tell an interesting story.

The largest components of First-Class Mail are “Single Piece”, “Workshare” and “Post Cards”. Single Piece mail is composed of mail being deposited with the USPS at the full postage rate, with either a stamp or meter imprint. Much of this mail are payments being sent from consumers to companies and banks. Workshare mail is when companies presort their mail by ZIP Codes, and then receive a discount from the USPS. This is mail sent by companies to their customers. Post Cards can be sent at full rate or at a discounted rate.

The biggest drop in mail volumes has been with Single Piece mail. In 2013, the USPS processed 23.6 billion fewer pieces of Single Piece mail than in 2004. This makes up more than 73% of the total decline in First-Class Mail volumes. Much of this decline is caused by more people paying bills either online or through automatic withdrawal from their bank accounts.

Workshare mail has also declined significantly, but not as much – only 18% over the last 10 years. Some people have elected to have their bills and statements delivered electronically, just not as many as reporters seem to think. And not as many customers as most companies would prefer.

But electronic diversion is only part of the reason for the decline in hard copy mail. The most significant drop in mail volumes occurred during the Great Recession (2009-2011). The USPS saw a loss of over 19 billion pieces of First-Class Mail during this time period, representing 60% of the decline for the entire decade.

As the chart below shows, mail volumes continue to fall. However, the rate of decline has slowed considerably. In 2012 and 2013, there was only a 5% and 4% drop in First-Class Mail volumes respectively. The first 2 quarters of 2014 shows the trend continuing, with only a 4% reduction in volume. Significantly, Workshare mail is down only 3%, with the 2nd quarter of 2014 having almost the same number of pieces as 2013.


What does this all mean for the USPS and its customers? The drop in First-Class Mail volume is significant, but the rate of decline has slowed considerably. People are paying more bills online, but prefer to receive paper copies of their bills and statements. Mail volumes being delivered to businesses and banks will fall quicker than mail being delivered to households.

Physical mail remains a critical link between businesses and their customers. Companies need to remain flexible, offering their customers the ability to receive communication in their preferred format – electronic and paper. The USPS must remain committed to accepting and delivering physical mail in a cost-effective, customer-centric and timely manner.

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United States Postal Service

Effective Material Handling: Part Two – Storage

Posted by Mark Fallon on Jun 25, 2014 5:00:00 AM

In our last blog post, we reviewed the 7 characteristics of paper that have a direct impact on the efficiency of your equipment. Quality materials will conform to vendor specifications and US Postal Service publications. Testing is an integral function to ensure that your materials meet industry standards.

Your quality paper and forms also need to be stored properly. If you use an offsite warehouse, ensure the warehouse has some type of climate control. If your operation is located in an area with extreme weather conditions (e.g., very cold or very hot), climate control is especially important.

Keep the storage area's climate consistent. The temperature should stay between 64 and 80 degrees Fahrenheit. Relative humidity should be maintained between 40 and 60 percent. Invest in a wall monitor that displays and records temperature and humidity readings. Report any significant fluctuations to facilities management, and schedule quarterly meetings to discuss any improvements.

Materials should be stored in their original packaging for as long as possible. The cardboard and shrink-wrap provide added protection from climate changes. Also, the covering will minimize any damage when moving paper from storage to the production area. You should also store material up and away from concrete floors and walls. Install shelving with at least a four-inch clearance from the walls. If shelving is not an option, use the pallets on which the papers and forms were delivered.

You'll need to recondition material after moving it from storage to the operations area, allowing the paper to sit in the same environment as the equipment to adjust to the climate change. The greater the temperature change, the more time the material will need for reconditioning. Vendors recommend at least four hours for every 10 degrees in temperature change. However, whenever possible, allow 24 hours of reconditioning for optimum performance.

Monitoring and metrics

It's important to establish a method of continuous monitoring of material quality. Set up a quality control station to test all new applications and forms. Train the receiving area to spot and report any damage as shipments arrive. Work with the U.S. Postal Service, consultants, paper suppliers and equipment vendors to set standards and testing procedures. Track and report the effects that poor quality materials have on production time.

And remember that paper suppliers use different mills and factories to produce your forms. While the bulk of the forms may come from one facility, the vendor may need to redirect work due to time constraints, capacity issues or disaster recovery. Require that testing be done at each mill/factory, using the same standards. Ensure the paper source is identified on all packaging and bills of lading.

Printer and inserter manufacturers are "pushing the envelope" on how fast their machines can process a piece of paper. New inks, glues and finishing elements create new opportunities for how companies can produce creative hardcopy messages. But that technology is dependent on using quality paper and forms.

For the immediate future, paper will retain its importance as the preferred method for receiving bills and statements. Physical mail is an essential component in integrated marketing campaigns. Start a quality program now for your paper and forms, and take advantage of new technology to produce superior documents for your customers and prospects.

 

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Operations Management

Effective Material Handling: Part One – Paper Characteristics

Posted by Mark Fallon on Jun 18, 2014 5:30:00 AM

To be successful in production mail, an operation needs quality in three areas—people, equipment and materials. Quality people who are aware of industry guidelines and USPS regulations. Quality equipment that ensures high integrity at high speeds. And quality materials that conform to industry specifications and USPS publications.

To ensure that your materials meet industry specifications, you'll need to test certain characteristics. Some testing is easy, and can be performed in your shop. However, some of the testing requires sophisticated equipment, and should be performed by an external provider. Potential sources include your paper supplier, your printer manufacturer, and your inserter vendor.

The precise definitions and measurements for some of these characteristics are quite technical. You may have worked in the print and mail industry for years, unaware of these technical terms. However, as a true professional, you should learn more about this essential topic.

7 characteristics of paper

There are 7 characteristics of your paper and forms that will have a direct impact on the efficiency of your equipment:

1. Grain direction
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Operations Management

Did You Listen?

Posted by Mark Fallon on Jun 4, 2014 5:00:00 AM

Years ago, I was working at a financial services company. One of the departments was responsible for producing fund pricing reports. The company’s computer system would receive information from the stock exchange mainframe computer at the end of trading. Using the stock prices, the company could calculate the values of all the managed funds. Reports were printed and shipped overnight to customers.

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Operations Management

Motivation in a Production Environment

Posted by Mark Fallon on May 28, 2014 5:30:00 AM

It’s difficult for managers in a production area, like print, mail or shipping, to keep their employees motivated. There are several factors that lead to this, including relatively low pay, working in what is often considered a low-status department, and the high turnover of personnel. You’re now faced with another phenomenon that works against you – the rapid rate of change in the technologies used to do your job.

To counter these obstacles, you must motivate your employees by instilling pride in their jobs. How do you instill pride? By using PRIDE:+ Read More

Operations Management

These Are a Few of My Favorite Sites

Posted by Mark Fallon on May 22, 2014 1:19:36 PM

For professionals in the mailing industry, some of the best information about print and mail will never be printed and mailed. Instead, it resides on the World Wide Web. Through our browsers, we’re able to keep up to date on changes in postal regulations, announcements by vendors and other industry news.

In addition to the websites of customers and vendors, here are some of the sites I've bookmarked:+ Read More

Operations Management

Implementing Process Improvements

Posted by Mark Fallon on May 14, 2014 6:00:00 AM

In the last two posts, we reviewed documenting your processes and identifying areas for improvement. Now it’s time to introduce positive change.

When implementing any process improvement, you must plan. The most important part of that plan is testing. Whenever possible, conduct testing in a non-production environment. For systems, this means using a domain or server specifically designed for testing purposes. For new equipment, you'll want to conduct testing at the factory and after installation at your site.

When testing, use a written checklist of all steps impacted. Follow the order used in actual production and don't skip any steps. If minor problems arise, make a notation for follow-up and continue on. Stop the tests if any major issue surfaces and don't proceed until the problem is resolved. Extra time in testing will prevent issues in production.

After the changes have been thoroughly tested, you're ready for implementation. Whenever possible, schedule implementation during a slow, non-critical time for your operation. Closely monitor the work as it moves through the new process.

Have a plan in place to back out any new software or programs if a critical error occurs. When replacing printers or finishing equipment, keep the old equipment nearby. Introducing changes requires leadership boldness. Implementing those changes requires caution and patience.

Evaluation and documentation

After successfully implementing changes to a process, review your work. This review should cover two points: did the process improvements meet the objectives? And, was the method used to implement the changes effective?

When evaluating the impact of the improvements, you should compare the new process to both the stated goals and the baseline metrics. Explain why there's any deviation from the objective – both positive and negative. Include any added benefits not known before implementation. For example, new equipment decreased processing times, and it also helped improve morale and reduced absenteeism.

Review the methodology for implementing the process improvements. Report on what was done well, and on any extra efforts made by team members. Determine what could have been done better during the project. Don't hide anything; examine every step.

At the beginning of this exercise, you mapped out the existing lifecycle of the document. Update that map to include the improvements implemented. Document any new processes with step-by-step instructions. Include the names of team members as a reference for future improvements.

And future improvements will be needed. One truth about improving processes is that your work is never done. New technologies, changes in business plans, a better understanding of your customers - these all will lead to the need to adjust your processes to remain efficient and effective.

Be proud of your team achievements, but never remain satisfied. Continue your journey in process improvements.+ Read More

Operations Management

Identifying Opportunities for Improvement

Posted by Mark Fallon on May 7, 2014 9:02:34 AM

There are numerous management theories and fads about quality production – Total Quality Management (TQM), Management by Objective (MBO), and Six Sigma, just to name a few. They all have one common element – improvement of processes. Whether you're overhauling an operation or introducing incremental improvements, managing the process is the key to success.

After you've documented the existing process, you can begin the work of targeting areas to be improved. Are there too many opportunities for errors? Is there a chance to implement automation? What are the bottlenecks that impede productivity? Are the right people working on the right parts of the process? Does the existing process support the company's overall strategy?

To ensure success, don't undertake this stage alone. Build a team that includes people from the original group that mapped out the existing process. Also, recruit staff from different levels of management to get different points of view. When appropriate, bring in vendors and outside consultants.

The team should question every step, however mundane. Investigate if new technology can add integrity or increase speed. Eliminate steps that don't add value. Nothing can be considered off-limits during this discussion phase.

When proposing changes, document the business reasons for doing so. Don't make changes for change sake. It's easier to support implementing modifications when you understand the reasons behind them. Also, this step provides a road map for future reviews and improvements.

Clearly state the goals of the process improvements. Establish objectives that can be accurately measured. Use the metrics determined earlier as a statement of the existing condition, or baseline. Set up a reporting format to review your progress. Be prepared to explain your successes and failures.

The power of "What if?"

Use the "What if?" methodology to uncover more improvements. For example, there are several "What if?" questions that could lead to improving a statement processing system. A short list would include:
  • What if statements weren't printed, but offered in a digital format?
  • What if print quality could be measured automatically during the process?
  • What if printer/inserter speed could be increased by 10%? By 20%? By 30%?
  • What if every piece could be tracked during production?
  • What if color print was introduced to highlight important information?
Also use "What if?" when considering proposed solutions. Evaluate the impact on technological and business factors. For example, with changes to the statement process, you should consider:
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Operations Management

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About the Company

The Berkshire Company improves business processes in your print & mail operations, helping you solve real problems.

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