In this task your work center supervisors and workers will update job labor in real time as sequences are finished.
Education:
Shop Control Guide - Updating Labor as Sequences Are Finished
Video - Shop Control Guideline Job Labor
Video Segments to View:
•Standard Hours Entry
•Actual Hours Entry
•Transaction Reversal
•Labor Reporting
Training Tasks:
•Enter labor progressively throughout the Work Center Schedule screen until all job sequences are closed. Enter fictitious hours if actual labor hours sequences are encountered.
•Experiment with reversing a transaction and making a corrective entry.
Job Labor Guidelines
Enter labor as job sequences are finished
Shop control depends on timely labor updating so that work center queues reflect current conditions for worker assignments. It is therefore essential that job labor be updated through the Work Center Schedule screen as job sequences are finished.
Standard hours are recommended for improved throughput and costing
When the Standard hours type is used against job sequences, labor can be quickly updated in just a few clicks because standard setup and labor hours are applied instead of actual hours. Using standard hours eliminates all the mechanical processes that are required to collect and report actual labor hours. Our recommendation is to use Standard hour sequences and commit to reporting completions when sequences are finished.
Special Warning Regarding Actual Hours
Our experience has shown that it is very difficult to perform actual hours in most manufacturing environments. The reality of most shops are that once an item is finished it is shipped out as soon as possible regardless of whether all of the costing information has been submitted. It is very easy to make errors or omissions in labor entry that can have a very consequential effect on your cost of sales accounts and make your income statement a challenge to interpret. Since the product is likely already out the door, there is not an opportunity to fix the costs after the fact. We strongly recommend Standard hours completions for most companies
Actual Hours Require 100% participation among shop personnel
Shop control is a system that is totally dependent on “just in time” process updating to have any meaningful use. Like any complex system, it is only as good as its weakest link. Therefore, shop control requires 100% participation among all workers and supervisors in entering their own material issues, labor hours, subcontract POs, job receipts, and job releases on a just in time basis with no tolerance for delay. Total participation will dramatically improve your efficiency and shop throughput.
Common Questions
Is using the Work Center Schedule mandatory?
DBA is designed for timely updating of material and labor through the Work Center Schedule screen.
It is time consuming and inefficient to manage work areas through manual planning. Constant investigation is required to track jobs and determine what job sequences are to be worked on next. Without software guidance, it is easy to work on the wrong job sequences or to ignore obvious bottlenecks that cause late shipments and generate excessive expediting.
The Schedule tab within the Work Center Schedule screen is a big time saver because it lists the active job sequences in each work center in job priority order. Job priority is determined by each job’s production time remaining relative to its required date. Assigning job sequences to workers in the suggested order throughout all work centers optimizes shop workflow and eliminates the need for manual expediting.
Work center scheduling is an activity that cannot be avoided because it must be performed regardless whether it is driven by software or done manually. A shop is a complex system with many participants and resources. It is a lot easier and far more efficient to manage work centers using software than doing so by instinct, manual tracking, and expediting.
Is real time updating practical?
Real time material and labor updating through the Work Center Schedule screen is not only practical, it saves a great deal of time and dramatically improves shop throughput.
It saves time because the alternative, which is updating at the end of the day, means that you are relegated to operating the shop in the dark without any current information.
Real time updating is highly practical because the entries are easy to make and can be done by the workers themselves or their supervisors. It only takes a few clicks to update any job sequence for material issues or labor. Furthermore, these entries cannot be avoided and they are easier to make as they occur compared to the tediousness of batch entry. Any worker or supervisor, even with no computer experience, can be taught to make these simple and highly repetitive entries.
Are payroll hours and costs to be linked or reconciled with job hours?
Payroll is an independent application that has no direct link or reconciliation requirement with job hours in DBA. Job hours are entered in DBA and can be a mix of standard hours, actual hours, and multi-job hours, all of which are costed at work center hourly rates. Payroll hours are entered strictly for time and attendance purposes and are costed at employee wage rates. Payroll hours are not to be reconciled in any way with job hours.
The only information DBA uses from payroll is your total cost for direct labor – including wages, taxes, and benefits – which is used by the Shop Rates screen to generate a calculated shop rate for direct labor. If you do not already isolate direct labor costs from those of non-labor employees or contractors, you must restructure the account assignments within your payroll system to post direct labor costs to their own accounts. See chapter 4 for details.
