Racal Acoustics
Racal gains greater business insight with Kronos solution
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About Racal Acoustics
Racal Acoustics is a world-recognised authority in the design and manufacture of audio communications equipment for both the military and commercial market.
The company, based in Harrow, London, occupies a 50,000 sq ft factory complex and has a turnover in excess of £25 million.
Business challenge
With the increased drive for improved performance and the desire for optimal control of the workforce, Racal Acoustics identified the need to invest in a more up-to-date system for shop floor data collection, time and attendance and payroll administration.
The existing system for job costing involved operators filling in timesheets detailing the works order; time spent on the order; quantity produced; scrap produced; machine downtime etc. Added to this, the system for managing employee time and attendance involved the production of manual spreadsheets which were corrected by hand before being manually keyed into the payroll system. Nick Moore, IT Manager at Racal Acoustics, commented, “We were spending too much time and effort manually checking and inputting figures into various systems. The systems were simply too labour intensive, slow and inaccurate to be cost effective. It was time to find a more efficient way of working.”
“Kronos has done an excellent job for us in enabling us to accurately record our working time against Works Orders. This gives us the most accurate summary of the exact costs of every job, and the productivity of every production line, including our lean lines.”
Nick Moore, IT Manager, Racal Acoustics
The solution
Following a thorough evaluation of a number of vendors' systems, Racal selected Kronos. Commenting on the decision, Nick Moore said, "Of all the systems we saw, Kronos was the only one that inspired real confidence. The breadth of product functionality, the technical ability of the Kronos team, their grasp of the way we work and their sheer professionalism, all combined to present an overwhelming case for selecting Kronos."
"The system has helped us, for example, to identify that operator experience and the regularity in which an order is produced have each had a direct bearing on how achievable our standard times can be. This type of critical information was impossible to retrieve with any degree of accuracy before Kronos."
Nick Moore, IT Manager, Racal Acoustics
Kronos at Racal Acoustics
Time and Attendance booking
All staff at Racal use Kronos to record their working hours. Shop floor staff clock into Kronos each morning when they start their shift and the system automatically clocks them out at 4.30pm – this avoids unnecessary queues forming at the clocks. All other project bookers are required to submit their working hours weekly and overhead staff – HR, accounts etc. – are required to log their monthly time into Kronos and are asked to record absence, sickness and holidays.
Shop floor data collection
Shop floor staff are required to log their time against each Works Order they are working on during the day, to ensure that an accurate time is allocated to each production job. Time is allocated to four main areas – job set-up, building the job, re-working and non-productive time (waiting for a supervisor for example).
Project booking staff, such as engineers, are required to log their time every Friday into Kronos against each of the projects they have worked on in the previous week. Their time, alongside shop floor time will be gathered up to provide an accurate picture of the cost of each job.
Business benefits
Immediate access to all shop floor data
The real-time nature of the Kronos system ensures that each Works Order can be analysed the minute a job is completed. Supervisors can see immediately how the production line has performed against the standard time the job was expected to take and any variance above the expected standard time can be addressed by the Racal team.
Nick Moore explained, "Before Kronos Activities was in place shop floor staff would allocate their time on a weekly basis. We typically had to wait a month or so for this information to be analysed before we could take any remedial action. Not only was the data inaccurate, but a month was too long to wait to make the necessary adjustments to improve productivity. The same information is now available from Kronos the minute a job is closed and the data is made available to all staff via the company intranet."
Analysis improvements
Standard times for production are created by the project engineers based on historical data and standard engineering methodology. Kronos Workforce Activities® provides detailed information on which to base future standard times. Nick Moore explained, "If Kronos reports that we are consistently missing our standard times, we need to find an explanation for it in order to rectify the situation. The system has helped us, for example, to identify that operator experience and the regularity in which an order is produced have each had a direct bearing on how achievable our standard times can be. This type of critical information was impossible to retrieve with any degree of accuracy before Kronos."
Complete visibility of all project costs
All project bookers – engineers for example – are also required to enter into Kronos all the time they spend on individual projects. Kronos automatically totals the number of entered hours to ensure that all an engineer’s working time can be accounted for.
Kronos calculates the total hours as a monetary amount and reduces the project budget accordingly. Engineers are now only able to book time to open projects, whereas pre-Kronos an engineer might accidentally book time to a project that had closed, creating more admin to correct the error.
Efficient system for monitoring off-bookings
Not all time spent during the day can be attributed directly to a Works Order and pre-Kronos it was difficult to see how much time was spent by staff on non job-related activities such as meetings, clearing up or waiting for supervision. Staff would regularly log all time against the Works Orders which gave an inaccurate picture of the total cost of a job. Now, once a Works Order is complete, Kronos books the time automatically to a non-productive cost code, allowing the operator to tell the system which particular non-productive task he is working on and ensuring that only productive time can be logged against each job.
Significant reduction in admin workload
The reduction in the level of manual administration required since the introduction of Kronos has enabled Racal to move two employees away from administrative tasks, such as timesheet preparation and payroll input, and re-train them to take on higher-level roles.
Exception only reporting
Shop floor employees are contracted to work a set shift pattern with a 4.30pm finish each day. Employees are required to record their start time each morning and the Kronos system automatically clocks employees out at 4.30pm to ensure that staff can leave promptly without having to queue at clocks. Supervisors are then required to sign off any pre-agreed overtime where staff have worked beyond their standard hours.
Commenting on the success of the Kronos project to date, Nick Moore explained, “Kronos has done an excellent job for us in enabling us to accurately record our working time against Works Orders. This gives us the most accurate summary of the exact costs of every job, and the productivity of every production line, including our lean lines. In a manufacturing environment, understanding your cost of sales is business critical information and ensures that we can be confident in the prices we quote for future jobs.”
The next stage of the project will be to fully interface Kronos with the manufacturing management system to ensure that Works Orders can be passed directly into Kronos and 'hours worked' data can be automatically transferred back to the manufacturing system.