Houston, Texas (PRWEB) May 20, 2014
Even as energy and chemical manufacturers scramble to meet the increased demands for their products, they must not forget that one of the key drivers of profitability is workforce efficiency, stated Barjor M. Dastur, President and CEO of Phillip Townsend and Associates, a leader in global benchmarking solutions.
Speaking at a forum for senior process industry executives, Dastur outlines several reasons why companies that fail to make workforce efficiency a priority also underperform when it comes to profitability.
“The general assumptions our industry has been making have changed dramatically,” asserted Dastur. “What was considered acceptable performance yesterday is no longer acceptable today. Companies must truly understand how margins for their various product lines differ across regions and they need to be optimized globally.”
“Performance paradigms are established at the top of an organization, but care must be taken to ensure that the assumptions being made are supported by data,” he explained. His insights include the following regional observations:
Low labor costs in the Middle East along with lower raw material costs have allowed companies to invest in projects and be very competitive without regard to staffing levels. Focus was on getting the plants started up and operating without much regard for staff levels. Wage inflation and government pressure to increase use of more expensive local labor is changing this.
Even in places like Asia & India where feedstock costs are not advantaged, low labor rates have allowed investments to occur, but wage rate inflation, low labor efficiency is becoming a threat to performance.
Impact on Global Operations
Capacity investment in other areas such as LNG in Australia, shale developments in NA as well as the increased use of local labor have made proper staffing levels much more important.
Dastur presented a chart showing how labor costs and personal efficiency vary by region. He addressed regional concerns: “our analysts have been meeting with the planners and operations managers of the world's leading petrochemical companies and of special concern is the situation in both the Middle East and Asia with rising costs and the lower levels of staffing efficiency.”
One solution lies in analyzing local and global performance across process industries. According to Dastur, companies must ask the following questions to improve their competitive position:
“The value of our Site Performance Index solution becomes obvious very quickly for our clients,” added Dastur. Here’s why:
Phillip Townsend Associates is the leader in global benchmarking solutions, headquartered in Houston, Texas. Established in 1972 as a plastics industry information source, we expanded our business focus to encompass a full spectrum of benchmarking services. We have worked in over 35 countries in over 50 industries. All of our benchmarking programs are custom designed for specific clients with the constant objective of delivering validated, comparative information that can be easily used to make decisions and take actions to improve performance across the enterprise.
Over the years, PTAI has earned a reputation for trusted advice and counsel from our clients - through our uncompromised commitment to value and performance.
Learn more at http://www.ptai.com.