Darren Rovell is on assignment and unable to post today - but Sports Bizlives on. Today's special Sports Biz Guest Blogis from Chad Walters, the Continuous Improvement Engineer for Thomson Plastics in Thomson, GA. He is a former marketing consultant for the Atlanta Braves.
Sports Teams Can Make Money By Eliminating Waste by Chad Walters
Just because the economy is on the upswing doesn’t mean sports organizations can afford to be wasteful in their operations. The recession forced significant belt-tightening in front offices, but teams can be even more profitable by applying the recession’s lessons and being mindful of eliminating wasteful activities. Major corporations employ experts to aid in becoming more efficient and profitable – sports organizations are no different.
But what is “waste?”
It’s more than just trash and junk. It’s in processes and procedures that the customer doesn’t want to pay for. The first step in reducing waste is being able to identify the eight types of waste.
1. Excess Motion: This is the collection of unnecessary movements operators currently perform to complete a process. Let’s say a ticket window cashier takes an order, fills out a form, walks over to another desk, stamps it, and takes it to a boss for approval. What if the stamp was placed at the window, thereby eliminating some walking? The order is processed faster and the customer is done quicker.
2. Transportation: This related to excess motion. The more time that is spent moving items around, the less time is devoted to customer service. If a stadium refrigerator serving four concourse concession stands is located on the far end of the stadium, a lot of time is spent moving food items from one end of the stadium to the other. What if the refrigerators were centrally located so that less time can be spent carting burgers and buns?
3. Scrap/Rework: How many times have you ordered a diet soda, only to have been given the sugar-filled version? Not only does it take time to remake the soda correctly, but you’re taking time away from serving new customers and you’re taking up the time of the customer you improperly served. Finding ways to make orders right the first time is critical, and training your workers on how to do it correctly will save lots of money and headaches on the back end.
4. Overproduction: I worked for a minor league team a few years back that cooked a slew of hot dogs well in advance of a big event. The event was rained out. The hot dogs were thrown away. That’s an extreme case, but how often is already-prepared food thrown away after ballgames because it went unsold and couldn’t be reused? That’s not only food being trashed, but also cold cash being wasted. If there are ways to make items for customers when they ask for them, the amount of food thrown away will be greatly reduced.
5. Excess Inventory: Some teams think that by buying in large quantities from distributors they will save money through price breaks. While true, it’s also true that the excess food takes up a larger stadium footprint, requires extra refrigerators that use more energy, and food not used right away can and will spoil. Companies like to build up inventory because it makes them feel safe from stockouts and prepared for any emergency situation, but the costs can be burdensome. At the end of the day, it’s entirely possible that buying only what you require when you require it will actually turn in a cost savings.
6. Waiting: If you have workers standing around because there are no customers or you’ve stocked out of an item, then you’re not making money. What if there are three cashiers but only one operational cash register? What if you have hungry customers but are out of buns and can’t sell any burgers as a result? The customers will be forced to wait, and perhaps your staff will be forced to wait for buns to be delivered. Waiting comes in the form of operators standing around as well as unhappy customers being serviced by an insufficient amount of team representatives.
7. Overprocessing: This is a unique waste opportunity to spot from a sports perspective, as there are typically few steps in any particular process for concessions or front offices, however they do exist. What if a soda customer doesn’t require a lid for her cup, yet one is snapped in place by a worker anyway? The employee could either ask the customer if she wants a lid, or have the lids waiting on the side of the concession stand and allow the customer to take one if she so chooses. What if a ticket taker at a gate bends the perforation four times when two is sufficient for tearing? On a busy day with a long line of patrons, how much time would be saved and waiting reduced by eliminating half of the bends? Small changes in processes can have a very big impact!
8. Unused Creativity: The most overlooked of the wastes is not adequately applying ideas and concepts from the employees who utilize the processes every day! A ticket window operator might have a good idea on where to place the credit card swipe to improve service time. A post-game cleaning crew member might recommend a new location for an outlet so less time is spent plugging and unplugging heavy duty blowers. A concession stand attendant might realize her stand is almost exclusively used for drinks – what if her stand was converted to a drinks-only stand and the cooking/food employees were moved to where food is ordered more often, thereby eliminating food spoilage and excess space consumed?
There are so many ways to make sports organizations more efficient from a business standpoint, but the first thing organizations must do is recognize and identify those wasteful activities. Next time you’re at a ballpark, you’ll see these little things that can be fixed or tweaked to improve your game experience, and isn’t the experience what it’s all about?
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Chad Walters is the Continuous Improvement Engineer for Thomson Plastics in Thomson, GA. He is a former marketing consultant for the Atlanta Braves, an MBA graduate from Indiana University’s Kelley School of Business and a certified Six Sigma Black Belt. He can be reached at chawalte@gmail.com.