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Small Shop office management

Shane39

Plastic
Joined
Jan 1, 2023
Sorry in advance but this could get a bit long winded.

I am a younger guy and have a small job shop with 4-5 guys on the floor including myself. We specialize in precision low volume automation components. I myself run all the operations (office and shop) as well as try to keep our 5 axis going as much as possible. For a small shop with a great team we pump out a lot of work and work a lot of hours. We have great quality and are never late on orders but it is for sure organized chaos and I find we are always just getting by.

As we have grown and gotten busier, I am finding it difficult to stay organized from the office and business side of things while also trying to be on the machine. Hiring another body would help but as we all know its impossible to find good help and to be honest, I would hate to be off the machine and at my desk full time.

I was hoping for some feedback into how some small shop owners wearing multiple belts manage their office end in the way of quoting, scheduling, billing and what a day to day looks like for them and how they keep everything organized.

I believe we are too small for ERP and from what I can see it’s a lot of data entry which I am trying to help cut down on although I am open to software that might help keep jobs organized.

When I do get around to quoting my desk becomes an explosion of marked up prints(mostly converting to imperial what a waste of time)that I thrash through. Some customers want pricing on letterhead, some want their spreadsheets filled out and others are Ok just with a quick email response. When I do get the PO which could be days or weeks later I usually simply confirm over my phone since I am on the machine and make a mental note or schedule it into my google calendar. Once the job is up I dump the files onto the sever and re print all the prints and we go to town. After that its making tags by hand, inputting everything into QuickBooks and so on. The redundancies drive me nuts of quoting on a spreadsheet which you can’t copy into QuickBooks and QuickBooks not being able to make tags. I feel like I am doing everything 3 times.

I know if I spent some time daily making more job folders with purchase orders models drawings and scheduled every order into a calender it would tidy my day to day up but I just struggle to find that time while I which the spindle not run from my office.

Thanks in advance for any feedback.
 
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I believe we are too small for ERP and from what I can see it’s a lot of data entry which I am trying to help cut down on although I am open to software that might help keep jobs organized.
You are never too small for ERP. The problem is finding an ERP with low overhead(time/$$$). If you are relatively savey you can make an in-house "ERP" to meet your needs. This can grow as you grow. Think simple as possible but functional. Who knows maybe a mildly complicated excel spreadsheet can do what you need.
 
It sounds to me that you feel the best way to drive and ensure success for your business is to be out on the shop floor.

Everywhere is hurting for good help these days, but I think you might have better luck looking for a clerical/administrative assistant type rather than another machinist.

In my experience, it is much more difficult to find the mechanical aptitude required to be successful on the machines, than someone who is good with converting measurements, data entry, making phone calls and emails, etc.

Being fairly young myself, I can say that a large portion (but not all) of the kids my age were educated in preparation for careers in what I would consider "white collar" fields. So there is a very large pool of folks that might not be able to turn a wrench, but are smart enough to do the stuff that is taking time from you doing your thing on the shop floor. Might not be the best solution or the only one, but just my 2 cents.
 
Create a list of the tasks you are juggling. Put it on "paper" (Word or Excel) and make sure that list is complete.
Sort those tasks into categories and group those (e.g. accounting, quoting, blueprints, etc.)

This List represents / illustrates your problem and can be used for your two options below.

1) As DouglasRizzo pointed out: Organize blocks of time to deal with certain items. As an addendum to that, what I've done where I work is to create tracking/alerting tools that look out for me using Excel, and in some cases MS-Access. We'll stick with Excel for this post.

As one of several examples: There are about 25 miscellaneous "inspections", or maintenance tasks that have to occur throughout the year. I wrote a spreadsheet that lets me list these on a summary page, with their intervals, combined with a check on when the last check was done. If something comes due, it highlights the next due date in red.

This helps me when I hit one of my "blocked out" times to check on that stuff, because all I have to do is open the spreadsheet and look for red flags.

Don't underestimate how much you can help yourself with smart spreadsheet use, if an ERP isn't an option. Once you have an ERP someday you can drop some of the individual tools you've built if the ERP centralizes that.

2) Hire someone to do the "front office" or other work. I don't know your shop, so I'm not qualified to go into this at any depth. The obvious is: Hire someone proficient with computers, Excel, accounting, whatever, and who has a desire to think outside the box and learn something new.

Your List would help in this scenario also, giving you a roadmap of the duties and responsibilities to discuss with someone you are interviewing or have hired.

Best of luck to you.
 
When I was your size I had some one come in and set up some kind of file sharing thing in Microsoft Office. We had a couple of computers networked together.
Every morning I would see what orders came in the previous day, enter them into someplace in Office and send it to the other computer.

I had 1 guy who did my programming, set-up and run CNC's. So it would go to his computer. If it was a repeat job he would print out the job router, set-up sheets, program and check for tooling. All this would go in a clear plastic folder and back to my desk. If it was a new job, he would write up a quick order of operations, program the job and make out a tool list. This wouldn't be formalized in the system until it was a repeat job. Saved a lot of time that way.

I did the quoting, scheduling, dealt with customers, billing, payables and payroll and ran a machine. He did the programming, tooling inventory and ran machines.

At some point you're going to grow into not being able to do everything, so you might as well get some systems in place for others to help out. Naturally this will slow down the processing of jobs but it is the nature of the beast.

my .02
 
There are 1 man shops running ERP - remember to think not just of the cost, but of the cost savings - that is, if a good ERP systems means you don't have to hire an office manager, that means it's saving you $$$/month. However, you need to find the right one for (machine shop oriented rather than run GE oriented).

There are other kinds of automated tools, both web based and built up on apps that we've used on PCs forever.
 
Hire an office manager ... if you look at how much time you waste and how many opportunities you miss you soon understand how getting a good office manager makes your more than enough to cover their wages and lets you do what you do as you are usually your best employee and didn't start a business because you were good at office shit.
ERP's are great, But only as good as those using them and those driven to using them. An ERP does nothing more than Excel apart from make it easy, introduce process you didn't know you were missing and stops you doing stuff you probably knew you shouldn't do in the first place.
 
I feel your pain with hiring. Here are some options for you to consider and I am happy to share an experience I fell into for a new hire.

I have a small shop and most of the effort and heavy lifting (Engineering / Machining) was my domain. Of course I wanted the work and role which was why I started the company. We are growing and expanding and without help we would not succeed. I struggled with how to find talent. One of the guys I know in our building runs a game store where where one of his customers had a home shop and some machining experience. He was also an Engineering school fall out due to Covid. This kid is great. He adapted to my Prototrak and is now running my Kitamura and doing G code edits at the machine. This was someone who was able to show me some great work samples but had a really messy and lousy resume. The takeaway on this is to put some feelers out for people in places you would not consider. Maker spaces, hobby stores, or such are good options. Absent that here is my thoughts on how to move the needed absent my luck in finding someone.

1. As noted hire an office admin to organize your email traffic and details. You can get someone part-time to do this and just having your urgent email, quotes, and nonsense organized will save you time. You could even hire someone remote to do this.

2. Move your current team up. It sounds like you are the 5 axis guy. Train your lead guy to be the new 5 axis guy, and move your other guys up to learn new skills / machines. Then you can hire a new guy to train to do your more "less skilled" work. This is a good effort even though it may be painful at first but you can redo this to bring in new people and put them into least risky jobs to see how works and who does not. It also can help you with job satisfaction and retention of your current team.

3. Partner with a trade school and get one or two coop kids. No guarantee but the people you get will have machining experience. They can be started in the least risky jobs.

I am not a pure machine shop but I can say hiring people to do machining work is a unique frustration. As an example I was considering buying a shop and the owner was in business for 20 years and had one employee. I said how good is your employee as buying machines is easy but where we are talent is what you really want. The owner said I would not want to keep the other guy as he typically called out sick multiple times per week, was basically a machine tender.

I also know shops who employ the tiered skill effort. They hire good CNC programmers and pay them well. They employ CNC setup and debug guys (may be the CNC programmers) and pay them well. Hire monkeys to put parts in place, change inserts, monitor the parts, push the green button, and pay them crap. The first two tiers save the money, the others pay the bills. This arrangment was in an aerospace shop so I know it is tennable. The challenge with this is you will get the reputation of not being a good place to work as talent will not hang around waiting for oppertunites to move into setup or programming.

I personally want to work with talent and people who want to learn and grow, but you have to play the hand you are dealt. You can weed out a lot of issues if you just request or mention drug testing at hire. The good people will be upfront, the people who will be using in your parking lot will not apply or will leave. Your insurance company will test anyone who gets hurt so asking about a drug test is not dishonest during an interview.

Generally I suggest consulting a lawyer on how to structure your hiring and use that time to stress test your new hire. I would also suggest a 30, 60, 90 review and use his resume or application to evaluate his stated abilities on his resume / application in the 30 day period, give him new skills but using equipment he knows in the 60 day period, and push him on new techniques / equipment in the 90 day period.

Also at the 60 day review, ask your team how it is going. They will have more insight into his skills, work ethic, desire to do a good job etc. Do a full team meeting and tell them that the company will sink or swim based on who we hire. If you pay Christmas bonuses, profit sharing or other benefits that are discretionary, put that out there. If people think their money is in jeopardy they will speak up. Personality issues may come up but I think team chemistry is important and you want your core team to be happy. To bypass this you may want to have some of your current guys spend 20 or 30 minutes in the initial interview. Pick one of your more relaxed open guys and one of your more crusty disgruntled guys to get a pro / con perspective.

Sorry this is so long, but overall I don't know any magic location you can find engineering school drop outs. You have to use your network and don't discount places not related to machining but that have a social or off hour draw for people with diverse backgrounds.

Good luck in growing your organization.
 
When does a small shop financially benefit from an office manager?

When annual gross income reaches $1 million?
When employee shop support exceeds 4 people?

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How can you be 100% sure that you will have enough work to keep an office manager busy for 40 hrs each week?

If you are currently the person who; replies to emails, quotes work, answers technical questions over the phone, orders consumables and material, schedule's jobs, chooses vendors, sends RFQ's, writes P.O.'s, meets with the accountant ect...

How much of that work can a "small shop" owner pass onto a generic office manager and trust that it will be carried out exactly how you would do it?

In a small shop were the owner wants to be on the shop floor, actively engaged in manufacturing, what is the difference between hiring an office manager and hiring a business manager?

What differentiates a small shop from a regular size shop?
 
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Yes, you need an office manager/bookkeepper/ AR/AP/HR/PA/receptionist/secretary. All one person. Once trained they will be a huge asset. We started with someone who knew bookeeping (Quickbooks) and trianed them on the rest. We opted for a payroll service. 10 man shop, she works 35 hrs /week. She is busy most of the time, and it lets me quote work, meet customers, run my business. Well worth what we pay her, which isn't cheap.
 
I know if I spent some time daily making more job folders with purchase orders models drawings and scheduled every order into a calender it would tidy my day to day up but I just struggle to find that time while I which the spindle not run from my office.

I have this exact same problem, keeping focused on -and improving upon a system to deal with things I do not like doing. You also mentioned making mental notes, don't do that. It makes the "organized chaos" feel much worse than it is.

Check out the book "getting things done" by David Allen. There is an audiobook version as well. I have found it helpful lately.

Here is a summary of the theory.
 








 
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