How to Calculate the ROI of a Connected Worker Support App

Since the Toyota Way philosophy made its debut on the world stage, manufacturers have eagerly embraced the idea of engaging their front-line workers to drive continuous improvement (CI) in their daily operations.

This strategy emphasizes the critical role of the workforce in enhancing operational efficiency and productivity. However, despite the willingness to implement these strategies, the return on continuous improvement investments has often been lackluster. This shortfall is largely due to a failure to provide frontline workers with the essential knowledge and tools needed to communicate effectively, collaborate, and contribute to continuous improvement while seamlessly integrating their efforts into their daily workflows.

The good news is that effective digital transformation solutions exist, and many manufacturers have successfully transformed their operations by digitally connecting their factory workers. By using connected worker applications, organizations have seen significant improvements in productivity, waste reduction, and product quality. For example, Duvaltex, the largest textile manufacturer in North America, achieved a remarkable 50% reduction in non-quality rates, while dairy giant Danone decreased the time and cost of training and onboarding new workers by an impressive 40%. These statistics illustrate the critical importance of investing in a worker performance support app to drive operational success.

This article reveals the measurable impact that investing in a worker performance support app can have on your organization. We will explore how to calculate your anticipated return on investment (ROI) and the key performance indicators (KPIs) that can help you justify this investment.

Building the Case for Change and Prioritizing Your KPIs

For some proactive plant managers, the value of investing in worker performance support was self-evident. As one plant manager at an electrical installation company noted, "To me, Poka is like a smartphone for the factory floor. It empowers workers to engage effectively and make significant improvements." However, most manufacturers find that relying solely on instinctive confidence in the value of digital transformation is insufficient to persuade senior executives to make the leap.

Competing priorities and budget constraints require most manufacturers to justify any new technology investment. Therefore, focusing on key performance indicators (KPIs) that matter most to your operations is essential in building a convincing business case.

For instance, some Poka customers sought a solution due to challenges related to waste, while others were primarily concerned with equipment downtime during product changeovers. By calculating the anticipated savings in just one or two critical areas, you can often justify the project effectively.

Key Performance Indicators (KPIs) for Digital Transformation Success

Determining the right KPIs is vital for assessing the effectiveness of your digital transformation investment. Here are some of the top KPIs that organizations can use to justify their investment in Poka and measure the success of their digital transformation efforts:

Productivity Metrics

Investing in new equipment is an obvious method to drive improvements in productivity. However, true potential can only be achieved when operators work to standard and contribute to continuous improvement. By equipping operators with the right tools and knowledge, you can improve:

Production start time: The time it takes to start the production process can be significantly reduced.
Product changeover time: Effectively managing the transition between different production tasks can enhance efficiency.
Overall Equipment Effectiveness (OEE): This metric combines availability, performance, and quality to provide a comprehensive view of productivity.
Unplanned stoppage: Minimizing unexpected breakdowns contributes to greater overall efficiency.
Mean time to repair (MTTR): Reducing the time taken for repairs directly impacts overall productivity.

The Ultimate Guide to Connected Worker Solutions

Labor Effectiveness

In the current smart factory era, measuring Overall Equipment Effectiveness (OEE) is critical. However, it is equally important to assess the effectiveness of operators, engineers, supervisors, and management. Antiquated tools like whiteboards and spreadsheets still dominate many factories, resulting in inefficient and disconnected processes. By digitally connecting all employees, including frontline workers, improvements can be unlocked in:

Time spent shadowing: Reducing the need for shadowing can free up valuable resources.
Time to competency: Accelerating training processes leads to faster onboarding and productivity.
Time to create training content: Streamlined content creation can significantly enhance training efficiency.
Time to approve work instructions: Quicker approvals facilitate smoother operations.
Knowledge retention: Ensuring that knowledge is preserved and shared across the organization can enhance operational continuity.

Safety Improvements

According to Training Magazine, manufacturers spend more on training employees than any other industry, averaging $1,217 per learner. However, traditional training methods often fall short in promoting workplace safety. By creating a continuous learning environment where workers consult short micro-lessons in the flow of work, you can drive improvements in these safety KPIs:

Recordable accidents: Reducing accidents benefits both employees and the organization.
Near misses: Tracking and addressing near misses can prevent future incidents.
Safety observations: Encouraging proactive safety observations can enhance workplace safety culture.

Quality and Waste Reduction

In an ideal factory, frontline workers perform tasks to standard, minimizing variability in quality between shifts and operators. Empowering workers to identify opportunities for improvement and troubleshoot quality issues is essential. To support this vision, consistent and effective training must be provided, enabling workers to solve problems independently. Results can be tracked in areas such as:

Product reworks: Minimizing rework enhances efficiency and quality.
Scrap and waste: Identifying wasteful practices can lead to significant cost savings.
Customer returns: Reducing returns improves customer satisfaction and lowers costs.
Non-quality rates: Ensuring products meet quality standards is essential for operational success.

Benchmark Your KPIs Against Your Peers

When calculating anticipated ROI, having real-world examples from manufacturers serves as an invaluable benchmark. Here are some KPI improvements reported by Poka customers that illustrate potential outcomes:

34% decrease in near misses (Masonite)
50% reduction in non-quality rates (Duvaltex)
10% reduction in production line setup time (Leclerc)
9% reduction in waste (Riviera)
4% improvement in OEE (Barry Callebaut)
40% reduction in training costs and onboarding time (Danone)
50% reduction in time to create new work instructions (WestRock)

Calculate Your Potential Savings with Poka

To jumpstart your business case, we've developed a free online calculator to help you quickly estimate your potential savings with Poka in areas such as:

Downtime Reduction: Reduce downtime by giving workers instant access to troubleshooting solutions and accelerating problem resolution.
Waste Reduction: Enable workers to identify and share best practices and new opportunities for improvement more quickly.
Training: Accelerate time to productivity and reduce training costs by enabling workers to quickly learn new skills directly at their workstations.
Content Creation: Reduce the time and cost of creating effective training guides and work instructions by empowering subject matter experts with the right tools.

Contact Us for Help

Our team of performance experts is ready to help you create a personalized business case for your organization. Contact us today to explore how we can support your digital transformation journey on the factory floor.

The Role of the Connected Worker in Total Productive Maintenance

This article was updated in November 2024 for accuracy.

Building the Business Case for Digital Transformation on the Factory Floor