Communication Among Manufacturing Departments

Feb 05, 2016

Today, I visited a client who has concerns about their costs and whether or not they are driving decision making more than should be allowed. More importantly, the client is even more concerned about the accuracy of their costs. Management has assumed because they had outdated information, their costs were automatically inaccurate. After careful review, we determined this is not the case.

While meeting with the scheduling manager, we learned there is a substantial amount of valuable information available. The manager is tracking the efficiency and average run times of all machines, people, and parts. He knows, in real time, if a standard is inaccurate and updates the information accordingly.

To be honest, the information available is some of the best I’ve seen. Unfortunately, the controller was not aware this information being noted and was easily accessible. Since our firm is now engaged in the process, we will make certain the two communicate.

Clearly, the scheduling department did not realize the data they collected could worthwhile for the accounting department. In any manufacturing business, it is critical to understand what each department does and what information they have on hand to help make the business run more efficiently. It is the job of a controller to be knowledgeable about the financial data in each department. If you are a controller, make it a point to engage each department on a regular basis. Monthly, or even quarterly reviews or meetings can make a significant impact and make you job that much easier. Communicating effectively and sharing information can ultimately make or break a business.

Categories: Cost Accounting