For years, I have promoted the idea of using reliable estimated work minutes (R.E., S.U., Man-Minutes) for scheduling, pricing, and understanding true labor efficiencies. The most important aspect of properly developed work minutes is that you can create a short-scheduling time standards system. In essence, you show the workers, such as a workstation assembly crew, how much time it should take for them to complete their task, like a batch run. Then periodically, their progress of actual versus estimated can be checked.

And, it’s not only me who firmly believes in this method. Retired component manufacturer, and former WTCA President, Scott Arquilla is not shy about sharing his thoughts on the matter. In fact, he was co-author on an article almost twenty years ago on the subject: Houlihan: Recipe for Production Success by Libby Walters with Scott Arquilla, SBC Magazine, December 2004.

Scott took the time to speak with me at the 2023 Building Components Manufacturers Conference (BCMC) to show gratitude for my efforts to help component manufacturers (CMs) and to express his encouragement that I keep preaching the benefits of the Houlihan methodology. Here, I’m pleased to share this testimonial from Scott on how effective this scheduling process is in the very real world of wood truss component manufacturing:

My family started Best Homes, Inc. (roof and floor trusses and wall panels) in 1957 as a supplier to our family homebuilding business, which was a much larger operation. I left the banking business in 1989 and joined the business. Given my background in Finance, I always looked at the numbers. Throughout my early years, it was difficult to put a handle on the differences between actual vs. bid labor costs and why they often varied monthly and annually. Being located in the Chicago suburbs, we were a Union shop. It seemed we underestimated the labor in difficult jobs and overestimated the labor on easy jobs. In the late 1990s, I started hearing about the Houlihan System (short scheduled time standards work scheduling popularized by John Houlihan, an Industrial Engineer) at WTCA Board meeting ‘social’ events. All I heard were their successes. I was sold, and we took the first steps to fully manage our shop labor.

While John Houlihan was basically retired, we employed his co-worker and successor, Don Ullmer, who spent a week at our plant. Don provided a preview of potential labor savings if we adopted Realistic Expectations (R.E.) labor estimation. Don suggested that we could recoup our initial $75,000 investment by the end of year 2 if we went forward. A few months later, Don and his assistant, Frank Zientarski, were in our plant for about twelve weeks, six weeks each, for analysis and then system implementation of every movement of personnel and lumber. It was a tough adoption as the men didn’t really like someone looking over their shoulders, and the Carpenters Union had strong questions.

But, after the initial three months and another month of working out the kinks, the system was fully in place. Most importantly, hourly reporting of work completed was submitted, and daily meetings of foremen were held to analyze daily work ‘produced’ or finished and labor hours expended. Scheduling of work was far easier because we knew what we could produce given the personnel we had. By reviewing hourly and daily production, bottlenecks were addressed and resolved quickly. Our estimating system incorporated this method, and job R.E.’s were a part of the cutting and build sheets. Certain jobs were priced higher because of the number of setup changes. Easier jobs were priced lower because of less difficulty. All in all, it made our plant run much smoother.

I strongly endorse the use of the Houlihan Method for any component plant. It saved our company well over 10% in ‘pre-Houlihan’ annual labor costs for years.

-Scott Arquilla, former vice president of Best Homes and 2003 WTCA—now Structural Building Components Association—president

For over twenty years, I have developed proper time standards (work minutes, R.E., S.U., Man-Minutes.) using proper industrial engineering motion and time studies practices. This process is not easy, requires a great deal of time, and constantly needs updating. I can tell you emphatically that board foot units and piece count do not work as an alternative to properly developed work minutes for wood roof truss manufacturing.

This past BCMC show, I presented a seminar that covered this topic and other issues so common in our industry.

  • Component manufacturers (CMs) are in the business of creating manufactured products, not simply reselling lumber units. This approach is based on proven methods from PhD. Industrial Engineers.
  • It's crucial to explore the significance of using work minutes as a much more accurate measure for pricing, scheduling, and assessing productivity.
  • Typical gains that can be achieved when employing proper work minutes based on Industrial Engineer practices can be captured by any plant.

You can download the complete 20-page educational presentation, which contains easily comprehensible information, here: Component Manufacturing Should Not Be Operated as an LBM Supplier by TDC.