Canadian Plastics

Investments in technology, people key to productivity gains

By Tom Venetis, editor   

A study by economists Melvyn Fuss, University of Toronto, and Leonard Waverman, London School of Business, argues that much -- but certainly not all -- of Canada's productivity lag behind the U.S. and...

A study by economists Melvyn Fuss, University of Toronto, and Leonard Waverman, London School of Business, argues that much — but certainly not all — of Canada’s productivity lag behind the U.S. and other wealthy countries can be blamed on our reluctance to invest in information and communications technologies.

This study confirms what I have long suspected: Canadian businesses — plastics processors included — are technology-deficient, and as a result, are missing out on the competitive edge these technologies can provide. And when the benefits can include improving production times, eliminating costs associated with inefficient manufacturing processes, and faster communication between customers and suppliers, it just doesn’t seem to make sense.

So why is this important for Canadian plastics processors? I predict the difference between plastics processors that will survive and those that will perish during the next few years will come down to which ones invested in such solutions and those who gave the technologies a pass.

Plastics processors that take the initiative will be better able to control costs, be more efficient in production processes and gain productivity enhancements that are crucial for surviving in today’s global environment.


Solutions like enterprise resource planning (ERP), manufacturing resource planning (MRP), customer relationship management (CRM), and supply chain management (SCM) will let plastics processors improve communicate with customers and even tie directly into the just-in-time manufacturing mechanism OEMs are demanding.

However, before you make any investments, talk to the people who will be using the technology. Ask them what they do and don’t like about the current way they do their jobs, and what they need to be more efficient. Spending money on technology no one uses surely won’t improve productivity.

But along with investments in communications and computer technology, I suggest plastics processors also take this New Year to re-invest in their employees. In order to control costs, many in the industry cut back, or eliminated, training programs for workers. While this provides savings in the short-term, the long-term costs are much more problematic. If companies want to gain productivity and competitive advantages, a well-educated and well-trained workforce is critical.

Workers need to be kept abreast of the latest advances in processing technologies and materials for companies to gain the maximum return on investment made in new equipment or resins and additives. Hoping workers will pick up this knowledge along the way will often result in missed opportunities for productivity improvements.

For example, a new injection molding machine may offer productivity improvements, but if workers are not trained to manage the quirks of the new machine and the new control system, then bad production runs and machine downtime will drive up costs instead.

It the world of high-tech, it was not uncommon for companies to spend huge amounts on the latest productivity solutions only to watch the supposed savings disappear because they didn’t take the time to train its workers. Instead of improving the bottom line, workers would spend weeks or even months fumbling with the program or just trying to get the solution to start up correctly. Now imagine that happening with workers on a costly injection molding machine.

If training and upgrading of skills can’t be done internally, consider taking advantage of the training and educational programs offered by the machinery manufacturers and materials suppliers. In fact, even schedule time for workers to attend these programs. Think of workers and their training and education as an investment in your long-term business health. When your employees feel invested in, they will invest back in you.



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