Rave blog Post

Smarter Year-End Budgeting Solutions in Manufacturing

It has been a challenging year for businesses in the manufacturing industry due to the COVID-19 pandemic. Many businesses have experienced falls in demand, delays in the supply chain, and changes to operating processes and working practices. Some have even had to change what they manufacture in order to remain profitable.

At the start of the year, the forecast for the manufacturing industry was one of modest growth with businesses streamlining operations and investing in digital muscle in order to keep up to speed with the Fourth Industrial Revolution (or “Industry 4.0”). However, before the end of the first quarter, everything changed for many businesses in the manufacturing industry due to the COVID-19 pandemic.

Some affected businesses adjusted better than others to the disruption; and while optimism is growing the manufacturing industry will return to pre-pandemic levels of production by the middle of next year, the level of recovery for some sectors will depend on a safe vaccine being developed (i.e. aviation) and consumer confidence returning (for suppliers to the hospitality and leisure sectors).

Related Blog: How (some) Manufacturing Plants have Updated Procedures amid the  COVID-19 Pandemic

The Impact of COVID-19 on Operational Budgets

approaching_COVID.5f6bf29b96ec8One of the consequences of the disruption was that many businesses put spending on hold. For some this resulted in operational budgets being reduced; but - according to a survey of CFOs - the reductions most commonly occurred in sales and marketing, facilities and utilities, HR, IT, and R&D. For remaining departments, budget cuts were minimal - if they happened at all.

In cases where spending was put on hold and budgets were either kept intact or minimally reduced, substantial budget surpluses exist. In businesses with a “use it or lose it” mindset, those surpluses will have to be spent by the end of the financial year in order to prevent next year's budget being reduced. How budget surpluses are spent can contribute towards operational efficiency - or not.

Related Blog: Why Pen and Paper is Not Enough for Tracking Manufacturing  Employee Health Checks

Lessons to Learn from the Public Sector

The public sector definitely has a “use it or lose it” mindset. In September each year - as the federal year end approaches - departments with budget surpluses go on spending sprees to ensure budgets remain intact the following year. According to the American Economic Association, spending in the last week of the federal financial year is 4.9 times higher than the weekly average for the rest of the year.

Furthermore, it doesn't appear as if surpluses are spent on smarter year-end budgeting solutions. In 2018, vast sums were spent on crab meat, trombones, and golf carts; while the shopping list for last year's budget surpluses included donuts, sofas, and a water slide. 

What are Smarter Year-End Budgeting Solutions?

Smarter year-end budgeting solutions are those on which surpluses are spent that contribute value to the business. In the context of manufacturing, really smart solutions include anything that can contribute to more efficient operational efficiency, employee health and safety, or - particularly relevant while the COVID-19 pandemic is ongoing - shift management.

Spending surpluses on technological solutions that achieve these objectives also reconciles with streamlining operations and investing in digital muscle - processes that have to continue if businesses want to come out of the pandemic in a stronger position than before and not lose ground against competitors. But what technological solutions exist to contribute value in these ways?

Related Blog: How a Mass Notification Solution Can Help Streamline Operations  in Manufacturing

Technology Solutions for Manufacturing

Manufacturers should consider looking into a suite of customizable communication technology solutions. This can be used together or separately to enhance operational efficiency, better protect employees against workplace risks, and resolve time-consuming issues with shift management. Each element of the suite has its own features and capabilities:

iStock-641830698Reduce Problem Resolution Times

According to a recent report, a factor that extends Mean Time to Resolve (MTTR) is the time taken to contact personnel responsible for diagnosing and repairing machine failures. Using a mass notification system's database segmentation capability, engineers can be contacted and informed of the nature and location of the failure within minutes - potentially reducing MTTR by hours.

Anonymous Safety Tip Texting

There are scenarios in which employees may be reluctant to report faults or hazards to a supervisor - for example if a fault is attributable to the negligence of employees themselves. In these cases it is safer for the workplace in general for there to be a safety tip texting service available for reporting faults and hazards, with the option to report faults and hazards anonymously if desired.

Shift Management Issues Resolved

Many businesses are currently experience shift management issues due to employees with symptoms of COVID-19 calling in sick and other employees self-isolating after being in contact with an infectious person. A mass notification solution's automated geo-polling capability can save businesses time and money by eliminating the slow, manual process of finding replacements for vacant shifts.

Universal - Corporate Manufacturing Solution

Tara Gibson
Tara Gibson

Tara is a Marketing Coordinator on the Rave Mobile Safety marketing team. She loves writing about all things K-12, State & Local, Higher Ed, Corporate, and Healthcare, and manages the Rave social media channels. When she's not working, she's taking care of her smiley, shoe eating, Instagram-famous fur baby, Enzo!

Coronavirus Recovery Solutions for Manufacturing

Discover how you can strengthen recovery with targeted communications, automated wellness checks, and more.

Get the Info Sheet 

Schedule a Free Consultation

Talk With An Expert

Discover our pre-packaged solutions or configure a package that's right for your business. Learn how you can be up and running in days, take advantage of unlimited usage, and benefit from unbeatable performance and customer satisfaction.