City of Kitchener targeted a 70% reduction in aggregate write-offs
Lean review of Kitchener's aggregate and weigh scale process: projected 70% cut in $51,000 annual write-offs and 310 staff hours released a year.
The challenge
The City generates over 50,000 metric tons of surplus material each year, yet aggregates were not being ascribed precisely to work activities, which led to considerable write-offs and discrepancies at the annual physical inventory. Recording relied on handwritten work orders passed through several hands, and the report estimated that the gap in recording aggregate use was as high as 50%.
The approach
Leading Edge interviewed six functional areas between May and June 2021, from Procurement and Stores to Finance and Infrastructure Services, and analyzed historical purchasing data. Because of pandemic restrictions, value stream mapping was carried out virtually with subject matter experts, and a cross-functional working group documented 18 issues with proposed solutions. Options for upgrading or enforcing the weigh scale were assessed and set aside on cost and practicality, in favour of standard load estimates, mobile data entry and a simpler inventory model.
The result
The report projects a 70% reduction in the City's $51,000 average annual write-offs, which equals $35,700 better allocated to the correct cost centres. It also projects 310 staff hours a year released from manual data entry and paperwork handoffs, worth $15,500, and 140 hours or $19,040 a year in cost avoided compared with making use of the weigh scale mandatory.
How it holds
The report recommends a table of standard load weights, colour-coded cards and signage at the aggregate bins, supervisor oversight of recording, and a staged move from paper work orders to digital worksheets so that the people who use the material record it once.
Results
What changed
| Measure | Before | After | Change |
|---|---|---|---|
| Annual inventory write-offs | $51,000 average a year | 70% reduction projected, $35,700 better allocated to the correct cost centres | |
| Staff time on manual data entry and paperwork | 1,860 aggregate transactions a year | 310 hours a year projected to be released ($15,500) | |
| Cost avoided versus making the weigh scale mandatory | 140 hours and $19,040 a year projected |
FAQ
Common questions
No. The figures come from the benefit calculations in the City-published report of September 2021 and are projections for the recommended future state. They include a 70% reduction in $51,000 of average annual write-offs and 310 staff hours a year released from manual data entry.
The working group looked at moving, retrofitting or replacing the existing scale. It decided against these options because they were either prohibitive in cost or seen as counterproductive for front-line staff, and chose standard load estimates and mobile data entry to improve compliance and accuracy instead.
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