The true cost of an hour of labor must include all benefits and peripherals in order to be used as a benchmark. In a similar manner, the true cost of a square foot of storage must include all direct and indirect storage components. If a company cannot determine these values using the same criteria, then accurate comparisons cannot be made. Often, these are motivated by a desire to convert storage and distribution functions back into production capabilities. Individual performance measurements should only be used for the overall account activity study not for evaluating the individual.
Employees can benefit by seeing overall workgroup progress.
This gives them feedback on the results of the program as well as a justification for their efforts to improve the company. The objectives are to measure the business processes in order to evaluate their performance. The information gathered will permit the company to focus on weaknesses and make corrective changes. Again, the purpose of the program is not to set work standards or discipline workers. It is a broader set of tools.