Leading Companies Use Ideas to Boost Productivity and Cut Costs

The best ideas to cut costs and improve productivity are not found in corporate board rooms. The best ideas are found with those who are closest to the work. They know what keeps them from doing their best. All they need is a system to get those ideas identified and implemented.

Does anyone have a good idea? I recently returned from speaking at the National Conference of the Society of Human Resource Managers. Because of the slow down in the economy HR executives are looking for new ways to improve productivity and keep costs down. The sad dilemma facing them is many companies who have laid off workers now realize they are less productive than ever before. Employees that got to stay now face doing the work of 2-3 people. Those “survivors” are putting in longer hours now feel alienated and even more mistrustful of management. This is giving them grist of finding jobs elsewhere as soon as the economy improves.

Instead of firing their employees, many leading companies use more innovative ways to boost productivity and cut costs. My experience has shown me that the best ideas to cut costs and improve productivity are not found in corporate board rooms. The best ideas are found with those who are closest to the work. People on the front line already know what keeps them from doing their best. They know which procedures and processes keep them from providing good service. All they need is a system to get those ideas identified and implemented.

Peter E. Drucker said, “One has to assume, first, that the individual human being at work knows better than anyone else what makes him or her more productive . . . even in routine work the only true expert is the person who does the job.” One Yamaha employee I knew of came up with one remarkable idea that saved the company close to a million dollars. Wainwright manufacturing averages 66 suggestions per employee per year.

In my seminars and training programs I talk about a concept known as total employee involvement which means involving everyone in the organization from the bottom-up. In one study conducted by Development Dimensions International showed that organizations using high involvement practices experienced a 70% improvement in the quality of their products, 70 % improvement in customer service, a 65% improvement in overall productivity and finally worker satisfaction also grew by 45%.

One aspect of total employee involvement is a little known program called idea campaigns. An idea campaign is a high-intensity suggestion program designed to get hundreds of ideas in a short time period. Idea campaigns are as different to the old suggestion box as Madonna is to Mother Theresa. Idea campaigns are over and done within 3-4 weeks. One organization we worked with generated 500 ideas from 140 employees. At Eglin Air Force Base, the campaign ran for two weeks. They asked civilian and military personnel to submit ideas that could reduce waste and inefficiency or increase productivity. Eglin received a tremendous bonus when workers generated $400,000 worth of cost savings ideas and new ways to generate revenue. Holly Farms got over 15,000 ideas and subsequently found over $1millon dollars in savings. Gold Kist generated 1280 ideas and was able to implement 66% of them.

The goal of the program is to get at least one idea from everyone in the organization. After the first week, the idea campaign turns into a motivational program. People see their ideas implemented which in turn motivates them to contribute more ideas. Furthermore, people gain a positive feeling because they know management is taking their ideas seriously and listening to their suggestions.

Getting employees’ ideas and getting their involvement is not an option anymore. If your workforce is going to be competitive, it’s mandatory to involve the minds, hands, and ideas from everyone in your organization. This is particularly true with the college grads of today who want to take the reins now and are not concerned about waiting around for a retirement check. They want to contribute their ideas or they will take them somewhere else pronto.