Lean

In my last blog, I wrote about Toyota and how their principles focus on eliminating waste or “Muda”. When I first set up DrivenByQ, I wanted it to be lean – for there to be no waste. In order to do this it was important to understand how a conventional company operated and to analyse its procedures. For example a conventional private hire company has a phone line and a member of staff to answer it.

A member of staff is typically operating a radio 'base' station or data system. That system needs an aerial to communicate with the vehicles. The radio system needs tall premises to mount a large aerial on top. The building needs electricity and it incurs other costs like rent, rates, insurance, furniture, stationery and even things like fire extinguishers. There is also a cost for cover during staff holidays or sickness.

Most offices these days have computerised despatch so there are IT costs to add and hardware eventually needs replacing too. The data heads, or radio equipment in the cars are costs which must also be included too! The office has only one way of recovering the costs in relation to fare paying passengers and that is by charging their drivers a rental fee for a radio (known in the industry as settle - typically between £100 and £120 per week). The driver then works a number of shifts and what they earn in fares is what they keep (minus their fuel, insurance, servicing costs, etc).

An office typically needs 17 cars just to break even each week. With all these factors in mind, I set about analysing the work flow related to receiving a booking - right the way through to despatching a car. I questioned each stage of the process and asked if it could be reduced? I also asked if there was a newer technology that could assist in the process. It took no time at all to realise that using an online booking system would instantly negate the need for a member of staff as the customer could input their details directly in to a web page.

Without a member of staff, there was no need for a fixed phone line or the associated costs. A booking page enhanced the quality of information received too as web forms would not submit until all the key information was acquired. The submitted booking from our web site sent an email notification directly to my smart phone - eliminating the need for radio equipment. Without the need for a member of staff, a phone line or radio, the premises themselves become obsolete and so did all the associated costs. This was just the start of process improvement and elimination of Muda in our organisation and the beginning of lean.