Studies from the U.S. Geological Survey show that a typical dripping faucet will yield 43,200 drips (3 gallons) of water per day. It may seem like only a drip, but that translates into 21 gallons per week, 1,092 gallons per year. Every day, we squander minutes of working time (“it’s only a few seconds per operation”), a few ounces of material (“its part of the process to drop stuff”) or remake a crown because we didn’t read a script (“it’s only 3% remake rate). As an individual occurrence or event, it is no big deal. But it is the number of events or occurrences that quickly add up.
Reach in your pocket. Pull out the change that you find. Put it in a jar. Do that every day for the next three months. At the end of three months, put it in a strong envelope and mail it to me. No, you say? You are not going to give me your money? Why not? It’s just a few pennies, right?
You don’t take the trash from under the kitchen sink at home every day because “its only a little bit”. Yet, somehow there are two full trash barrels on the curb every week. There are all sorts of examples within the laboratory. Overtime is a prime example. An hour here, another there; next thing you know we have thousands of scarce dollars being paid out, degrading the profitability.
Studies show that the typical technician is only utilized (performs value-added work) about 55%. That’s because that typical technician spends valuable production time performing non-value added tasks such as looking for cases, moving cases around the lab, doing remakes, waiting for QC, looking for missing information on lab slips, and fussing with bad impressions.
Another example is the zirconium pucks used in the milling machines, where the yield is multiple units per puck. If remilling is a common occurrence, the material waste associated with “one or two crowns” may well add up to the lab using an extra puck or two per week. How about that drawer under the technician’s bench with enough cutting burrs to supply the lab for a month? Look at the loss of precious minutes lost on our expensive digital equipment; it will quickly add up to dollars in terms of a lower Return on Investment, as the machines will be producing at less than designed capacities. Poor material control practices result in over-ordering, paying too much for materials, getting materials that are just not needed and overall increasing the dental lab expenses. These are but a few examples, but I’m sure you can see them in you lab if you look with a critical eye.
Laboratories that have learned to “stop the drip” have watched their technician productivity increase, remake rates reduce by 50%, saved thousands of dollars in labor costs, and dramatically cut material costs, all of which means bigger margins for the lab.
The “small change” loss is very real and can profoundly affect the business profitability in a very stealthy manner. According to NADL, the typical lab is earning somewhere around a 5-10% profit margin. The reader should be wondering just how much the margin could be increased if the trickle of expenses were to be identified and eliminated (or at least reduced). The key here is to acknowledge a problem, look for root cause solutions, set a budget, and get control of the “dripping faucet”.
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