For the last decade, concrete producers have been balancing production requirements with employee headcounts. Fortunately for an industry with a less-than-stellar reputation, the balancing act was focused on retaining just enough key workers to match the drastic loss of production demands. At many locations, the cuts were deep, often displacing long-term employees, friends, and family members. And along with the cuts, producers were hesitant to hire any new employees.
But as the economy rebounds with production on a slow but steady increase, producers now face a different balancing act. Older, experienced workers are retiring at an accelerated rate. Lower unemployment has reduced the number of job applicants, and producers are finding it almost impossible to find employees with any practical experience.
As producers consider plans for growth, they’re paying closer attention to plant operating costs. One trend is to adopt technology to become more efficient. For many, this option could include remote batching operations. And in doing so, the industry’s may be fostering a new class of employee - the lone worker.
Economic challenges
There is very limited published data on how remote operations affect a producer’s profitability. When producers batch remotely, the economic benefits are often buried in their overall cost performances. But evidence shows that more profitable producers have lower production costs.
Production costs for an average ready-mixed concrete producer has been relatively static compared to the total percentage of sales, according to Andy Kulback, vice president at Allen-Villere Partners, a mergers and acquisition advisory firm to the construction industry.
In the 2016 NRMCA Data Survey, which reflects 2015 data, plant operating costs for the average NRMCA member was 6.4% of the total percentage of sales. But this figure is about 24% higher when compared to the plant operating costs as a percent of sales of ready-mix producers who had profitability in the highest quartile of responding companies. These more profitable producers reported production costs to be about 4.9 % of the total percentage of sales. “In rough terms, producers with greater efficiencies tend to have a $1.30 per cubic yard advantage on plant operating costs,” says Kulback.
Kulback suggests that the cost benefit of greater plant efficiency may be underreported. In 2015, many plants were operating at reduced percentage of capacities. “As production levels increase, more efficient producers tend to be more profitable,” says Kulback.
Plant efficiency is a very important component of profitability. Production costs for the lowest quartile (the least efficient) was 8.3% of the percent of sales. “This data suggests that, on average, their production costs are about $2.75 higher than the top producers,” says Kulback.
The concept of increasing productivity by operating remote plants from a central location is not new. "Many producers began managing remote operations in the 1990s," says Bob Capasso, of Concrete Financial Insights. Capasso, a 40-year veteran in the concrete industry, advises producers on operational efficiency. Producers who apply continuous improvement analysis to their cost reviews may find situations where remote operations may increase their profitability. "Remote batching may offer producers a chance to operate in growing fringe markets when combing GPS truck tracking to dispatching software,” he says.
But Capasso cautions that paying for plant upgrades for remote batching must be thoroughly studied. Producers should develop internal financial measures and benchmarking procedures to monitor efficiencies. Managers should also consider other questions, including do the additional volumes, customer service considerations or delivery savings justify the ongoing additional fixed costs and capital employed in these "satellite" locations? Does the plant speed match the production requirements? And has the producer established standardized operating procedures for remote operations to ensure safety and cost efficiency?
The Lone Worker
Safety experts define this employee classification as an individual working without close or direct supervision, and does not have visual or audible contact with another who can provide or call for assistance in an emergency, injury, or illness. To properly protect these solitary workers, producers may consider adopting new safety procedures and plant modifications to provide protection.
There's little formal guidance on how to establish lone worker safety procedures. While there may be specific situations that require two workers, there is no general OSHA standard that prohibits an employee from working alone. OHSA Standard 1915.84 does provide some guidance:
“Except as provided in § 1915.51(c)(3) of this part, whenever an employee is working alone, such as in a confined space or isolated location, the employer shall account for each employee:
- 1915.84(a)(1):Throughout each workshift at regular intervals appropriate to the job assignment to ensure the employee's safety and health; and
- 1915.84(a)(2): At the end of the job assignment or at the end of the workshift, whichever occurs first.
- 1915.84(b): The employer shall account for each employee by sight or verbal communication.”
Producers can comply with these standards by equipping lone workers and their work areas with devices connected to a centralized alert management service. Roadpost, a Toronto-based provider of mobile satellite equipment and data services, introduced its GeoPro service about eight years ago. The GeoPro app enables easy, centralized management of more than just emergency alerts, effectively monitoring the wellbeing of employees.
Producers can customize their lone worker monitoring service to meet their own procedures. These services offer settings that include check-in and check-out procedures, overdue check-in notifications when a scheduled check-in is missed, no-motion notification based on the producer’s parameters when a there is a man down, supervisory notification when an SOS alert is triggered, and notification when a geo-fence is crossed.
Using Technology to Improve Productivity for Lone Employees
To ensure that lone worker operations are efficient and reduce expenses, producers may consider adopting software technology to help track employee costs, enhance preventative maintenance procedures, and control expendable item purchases. At 2017 World of Concrete, several new web-based services were unveiled.
AboutTime Technologies launched its WorkMax TIME software that automates time collection and management across a business’s workforce. The cWorkMax TIME has the flexibility to handle multiple workflows for time entry and allocation. Producers can stagger start times of lone employees at the same operation. For example, on an early morning start, the manger may call out the plant maintenance team to check on hot water, then call out the plant operator and, finally, the QC technician.
This new product can be combined with AboutTime’s FormsXpress’s option, which allows producers to create customized electronic forms to collect important field information rather than paper checklists. Employees working remotely track equipment time, production units, mobile notes (digital text or audio) and photos (automatically organized by site/location/job). When combined with truck tracking and batching software, this reporting software completes the picture of what is happening in a remote operation.
Producers can use the data to create productivity versus budget accruals for time and production on lone worker activities. The system also includes GPS location stamps and geo-fence alerts that can be incorporated into a procedure for monitoring lone workers.
Producers who opt to operate remote plants must also develop strong preventative maintenance procedures. One exhibitor unveiled an app to organize their preventative maintenance for decentralized mechanics and service technicians. ClockShark was developed by a contractor who used his experience of scheduling his crews. Plant managers can not only track hours and costs, but also schedule tasks that can be on second shift or during plant non-use time. Employees download the app to their phones.
Controlling costs for tool and key parts at remote operations can also be handled through Share my Toolbox. The app uses a web interface to connect a producer’s central storeroom, service personal, and plant managers. Software allows field personnel to easily find and borrow tools from each other and see what’s available at the warehouse or remote locations. The producer’s maintenance manager imports tools and key parts from an Excel spreadsheet into the database. The manager then identifies approved users who will have access to the tool tracking software. The users use the e-mail addresses for checking tools in and out as well as in the field.
An important capability of ShareMyToolbox for producers considering remote batching is the ability to transfer tools. This enables the tool management system to track tools while they move in the field. By providing personnel the ability to transfer tools directly, the manager no longer wastes time calling to locate tools or updating internal systems as items move. Field personnel can use the tool tracking app with their phones.
Sidebar:
When Ghosts Rule
With millions of dollars of investment residing at remote operations, producers are relooking at the opportunities they can employ to protect equipment from theft and vandalism.
At World of Concrete 2017, ECAMSECURE displayed its security technology suitable for remote plants and construction sites. One of their latest innovations is its Virtual Guard services designed to enhance or replace the need for onsite personnel.
The service combines the benefits of traditional video surveillance technology with a physical security guard through the two-way audio. Should an incident happen, the system provides instantaneous video verification to law enforcement and clients, reducing false alarms and response times, and providing easy access to recorded footage in the event of litigation.
The Virtual Guard System has several producer-friendly options. The system provides a security protocol, including performing video tours on a preset schedule determined by the customer’s needs. These checks can be performed any time of the day or night and identify suspicious behavior.
A producer’s lone worker operating procedure can be included. Virtual Guards can both check-in at predetermined times and be made available at the press of a panic button. Upon actuation, the Virtual Guard immediately responds via cameras and two-way audio, ensuring that appropriate help is dispatched to assist the employee.
The Virtual Doorman feature may be used to check visitors onto the plant site and can check, validate, and record the person’s information using audio and video. If they meet the pre-determined requirements of the customer, the gate or door will be opened to allow access. If that person has not been approved, the system will not allow access and can contact the owner to verify whether they'd like to allow the person inside. The virtual doorman can also keep a log of all employee and guest’s activity at the entrance.
Sidebar:
Ten Things to Consider When Adopting a Lone Worker Operating Procedure
- Conduct thorough risk assessments in the areas where lone worker will be. Determine what tasks may be safely accomplished by lone workers. If you opt to use a personal monitoring system, consider geo-fencing areas of known dangers such as silos, bins, and even high voltage electrical areas so an
alarm sounds when the employee enters. - Establish a company-wide standard operating procedure for lone-employee operations that include operations for non-traditional hours such as early starts, night repairs, and stockpiling.
- Establish a clear action plan in the event of an emergency that is consistent for all operations at which lone workers may be assigned.
- Establish a training program for lone workers and their immediate supervisors on emergency response.
- Require supervisors to make periodic visits to observe lone workers.
- Ensure regular contact between lone workers and supervisors via phone or radio. Consider providing other lines of communications in areas where cellular service is inconsistent.
- Establish a system that verify lone workers have returned to fixed base or home after completing a task.
- Consider installing automatic warning devices that alert others if signals are not received periodically from a lone worker.
- stablish a review process includes the physical fitness of the lone worker. Employees with heart conditions, or taking certain medications should not be assigned as lone workers.
- Review the site access procedures. Entrance to the site should be restricted to authorized employee and contractors. Visitors should have preauthorized permission and should log in.
