Factory Floor Management System Bridging the Executive Pay Gap

When the Investment Director of Money Morning/The Money Map Report recently published an article titled “U.S. CEOs Could Learn From Their Asian Counterparts,” he took a major stab at executive salaries: “The pay gap between the boardroom and the factory floor – already a longtime topic of controversy here in the United States – has widened to the point that it’s become absolutely staggering.”

According to statistics cited in the report, “CEOs of large [U.S.] corporations made an average of $10.5 million in 2007, which is 344 times the wages of the average U.S. worker.” Compare that to the wage gap in Japan and the rest of Asia, where “CEOs more commonly [are] making only 10 times to 15 times more than their base level employees.”

Indeed, in the wake of the firmly entrenched recession, during which auto industry sales figures plummeted to the point that the government had to step in for a bailout yet the industry’s CEO salaries continued to climb, Japanese executives were giving themselves self-induced pay cuts. “Making the effort to relate to what employees and customers are feeling during such a difficult stretch is very important: It fosters pride in the work force, loyalty from customers and in the long run, will also win over investors,” Money Morning’s Investment Director concluded.

But overseeing a massive factory floor is a complicated and time-consuming job that warrants multi-million dollar salaries, many of the guilty would argue. Perhaps then, it’s time for those executives to reassess their factory floor management approaches. If managing the factory floor has become such a chore that it’s interfering with a CEO’s ability to attend to other job duties, a top-notch real-time factory floor data collection system might be just what the bailout-weary doctor ordered.

A factory floor management system and its associated software can aid executives in better scheduling, WIP tracking, data collection, and time & attendance labor management. When coupled with touch screen capabilities and an MES (Manufacturing Execution System), it also provides CEOs with a visual factory that is easy to use and see and, therefore, easy to control.

What executives really need is better visibility of their factory floor activities, and a shop floor management system equips them with the oversight and control capabilities they require. Factory floor management software helps executives make sense of all factory floor data being collected. That way, they can see how effectively they’re using labor time and machine resources. As a result, they can also identify areas for making process improvements.

In a nutshell, a factory floor management system can take executives beyond data collection into improved information control. By functioning as a process improvement tool, it allows them to create quality data capture “templates” in a drag-and-drop environment to record measurements and identify nonconformance conditions.

With so many managerial capabilities at their fingertips, CEOs can no longer cry wolf that their jobs are difficult and time-consuming. As a result, the wide discrepancy between U.S. factory floor and boardroom salaries should be able to fall better in line with those in Asia.