Identifying and Managing Labor Bottlenecks in Manufacturing

3/1/21 12:00 PM

In a production system, a bottleneck can be defined as a step or operation that has limited capacity and reduce the capacity of the entire production chain. Bottlenecks can cause delays in production and can be costly for the company if they are not resolved.No matter how well your manufacturing operations are running, you can usually identify bottlenecks that are reducing the overall production capacity. 

Capacity constraints are often a result of machine breakdowns or due to the misallocation of human resources. There may also be several bottlenecks within your production facility that are affecting the overall throughput.

Bottlenecks limit the throughput of the manufacturing organization

As bottlenecks limit the capacity and hold back inventory through the production system, it is important to identify the areas where bottlenecks are present. One of the costliest bottlenecks found in manufacturing facilities is labor bottlenecks. This is due to the increasing costs associated with labor and the variability of efficiency in production. Major performance improvements will result from the identification and elimination of bottlenecks that continuously slow down the manufacturing flow.

Identifying Labor Bottlenecks With Advanced Planning and Scheduling (APS) Software

Advanced Planning and Scheduling (APS) software can capture and analyze a wealth of data to identify where labor bottlenecks occur. PlanetTogether’s Advanced Planning and Scheduling software has a multitude of features that allow manufacturers to first identify bottlenecks and then eliminate them so that your production can be efficient and optimized.

  • Performance Tracking: In PlanetTogether, you are able to monitor the performance of your resources by comparing actual with expected values. The software allows users to track the quantities of items performed and the number of hours worked on those items to generate a performance score. An ideal situation would be to have a performance score of 100% or less as this would indicate that the resource is meeting the expected hours and quantities of work or is performing faster than expected. Resource bottlenecks can be identified when the performance score is above 100%, which means that the resource (whether a machine or labor resource) is performing at a slower rate than is expected. 
  • Capacity Plan: Capacity Planning is one of the main functions of PlanetTogether. Finite capacity planning is of great concern to manufacturers as there is a limited number of hours in a day and a limited number of days in a week available for production. The capacity plan is a great tool to identify potential bottlenecks as the software will show the scheduled capacity usage for each machine, tool, and labor resource. You are likely running into a bottleneck when resources have a scheduled capacity usage that is consistently above 100%. This situation will create a lot of trouble in the long run as it will cause delays in production and increase production costs. 

The PlanetTogether APS software dashboard presents results clearly so that managers can assess and correct bottleneck situations proactively, rather than after production costs have increased.

With PlanetTogether APS, we can see if our paint department will be swamped next Tuesday, and bring in more staff to meet the need.


Once labor bottlenecks have been identified within your production facility, it is time to eliminate or reduce their impact. Typical improvements to throughput include identifying cross-training opportunities, improving communication throughout the production plant, and analyzing production capacity.


Managing Labor Bottlenecks in Manufacturing

1) Identify Cross Training Opportunities

When employees are not performing as they should, it is important to consider the reason. Is it that they are overall poor performers that will cost your company money or that they do not have the skills to tackle their tasks? After having identified the areas where certain employees have reduced efficiency, you can decide whether additional training would be beneficial.

Poorly-managed employee skill-sets can result in bottlenecks and reduce the throughput of the company. This is especially important in manufacturing operations that require workers that are highly skilled. Additional training

An Advanced Planning and Scheduling system can assist in identifying areas where additional training would be beneficial as well as who should receive more training. PlanetTogether APS can also support the creation of multiple scenarios (with its “What-If” scenario functionality) to determine the effect of training on the bottlenecks.

2) Improve Communication

Let's address the following manufacturing scenario: the machines are primed, workers are in place, but the correct materials are not in inventory or were not delivered to the job site. Unfortunately, the materials plan was not synchronized with the production schedule. This results in time wasted by line workers as well as supervisors while they sort out the delay. Management and sales teams sometimes waste several hours each day determining if production and delivery schedules are able to meet customer demand. Even worse, workers could spend valuable time away from machines checking with supervisors on what they should do next.

With an Advanced Planning and Scheduling system, every department in the organization is looking at the same, real-time information in an effort to avoid these problem situations. Management has a realistic overview of the production floor status as well as the supply chain, planners can adjust schedules to address reality and changing demands, and workers can be as productive as possible by being notified of these schedule changes in real-time.

3) Identify Capacity Constraints

Bottlenecks are usually identified by the resources that are either slower than they should or have an accumulation of work that they cannot process. In addition to the performance level and skill-sets of the labor resources, it is important to consider whether the accumulation of work is due to the workers or caused by the production scheduling system.

If your scheduling system does not account for varying production rates and capabilities of your workers, it is likely that your schedulers are over-estimating the actual available capacity. For example, a manufacturer may have ten machines that are able to produce a product, but only five employees that are skilled enough to operate those machines. If the scheduler assumes that the production output should be equal to the maximum capacity of all ten machines, you will have issues down the line. 

It is essential for manufacturers to realize that theoretical capacity is not always the same as the actual capacity you possess. An Advanced Planning and Scheduling system is a powerful tool for planners and schedulers as it automatically takes into account a variety of constraints (including run rates, required skills, etc.) to generate the most accurate and realistic schedule possible.

Labor resources can be bottlenecks in production

A manufacturing bottleneck constrains the entire organization and lowers the production capacity of the facility. Identifying and eliminating bottlenecks within your manufacturing operation can be a challenging feat for any manufacturer. However, PlanetTogether’s Advanced Planning and Scheduling system has a multitude of features that can make this process easier. This will result in the creation of production schedules that are realistic and account for production limitations as well as the available labor to handle production. Your company’s performance will be optimized so that you can maximize your profits. 

PlanetTogether’s Advanced Planning and Scheduling (APS) Software

Advanced Planning and Scheduling Softwares have become a must for modern-day manufacturing operations as customer demand for increased product assortment, fast delivery, and downward cost pressures become prevalent. These systems help planners save time while providing greater agility in updating ever-changing priorities, production schedules, and inventory plans. APS Systems can be quickly integrated with an ERP/MRP software to fill the gaps where these systems lack planning and scheduling flexibility, accuracy, and efficiency.

With PlanetTogether APS you can:

  • Create optimized schedules that balance production efficiency and delivery performance
  • Maximize throughput on bottleneck resources to increase revenue
  • Synchronize supply with demand to reduce inventories
  • Provide company-wide visibility to resource capacity
  • Enable scenario data-driven decision making

The implementation of an Advanced Planning and Scheduling (APS) Software will take your manufacturing operations to the next level of production efficiency by taking advantage of the operational data you already possess in your ERP system. APS is a step in the right direction of efficiency and lean manufacturing production enhancement. Try out a free trial or demo!

Related Lean Manufacturing Video

 APS Resources

Topics: Advanced Planning and Scheduling, Lean Manufacturing, PlanetTogether, Implementation, APS, APS, bottlenecks, bottleneck visibility, ERP System, manufacturing technology, APS benefits


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