Excess Labor After Lean Improvements – Two points of view on what to do with labor that has been freed up by efficiency or work flow improvements.  The first, short sighted, is to reduce the headcount.  The second is to do something CONSTRUCTIVE with that headcount.  Here are some options and we need you to add your comments and ideas in the conversation.  It all starts with eliminating the workflow interruptions like motion & waiting waste which probably exceed what the leaders have realized can be achieved.  This can be done with our “Observe Analyze Improve” process for a steady flow of improvements.  Here are the preferred options:

1. Redeploy the freed-up labor to where they are needed more. This may include cross training to fill current vacancies elsewhere in the operation. They may displace temporary workers.
2. Identify positions that are no longer needed so that when the site incurs “natural attrition” you redeploy those folks to the vacated position. Yes, hold on to them and provide cross training.  It’s not costing you anything extra to maintain credibility & loyalty with the workers while waiting for opportunities.
3. Use the excess labor to take on more work if the demand is there. An example is to bring in-house work that you are purchasing outside.  That could be raw material prep, labeling, pre-assembly, quality checks, packaging, machining. Consider this “vertical integration,” which gives you greater control of the process.
4. Consider having the freed-up labor do services work that you are purchasing such as cleaning, sanitizing, maintenance, housekeeping, yard maintenance. I have seen a large biotech company displace their contract sanitizing crew with employees to avoid a layoff. 
5. Industrial Engineers and lean practitioners can manage this realignment of staffing plans. Take care that HR is read in to the plan and expected to help implement it.

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